Ansoft Corporation (NASDAQ:ANST) today announced financial results
for its third quarter of fiscal 2006 ended January 31, 2006.
Revenue for the third quarter totaled $19.7 million, an increase of
13% compared to $17.4 million reported in the previous fiscal
year's third quarter. On a non-GAAP basis, net income for the third
quarter was $4.5 million, or $0.35 per diluted share, representing
a 52% increase when compared to non-GAAP net income of $3.0
million, or $0.23 per diluted share in the previous fiscal year's
third quarter. On a generally accepted accounting principles (GAAP)
basis, net income for the third quarter was $4.3 million, or $0.33
per diluted share, compared to GAAP net income of $2.8 million, or
$0.21 per diluted share in the previous fiscal year's third
quarter. Non-GAAP financial measures exclude the impact of
acquisition-related amortization. A reconciliation of these amounts
to the appropriate GAAP amounts, for the three months ended January
31, 2006 and 2005 is included with this press release. "We had an
excellent quarter with more than 50% growth in earnings," said
Nicholas Csendes, Ansoft's President and CEO. "For the fourth
quarter, we expect record revenues and record earnings." Ansoft is
a leading developer of high-performance electronic design
automation (EDA) software. Engineers use Ansoft software to design
state-of-the-art electronic products, such as cellular phones,
internet access devices, broadband networking components and
systems, integrated circuits (ICs), printed circuit boards (PCBs),
automotive electronic systems and power electronics. Ansoft markets
its products worldwide through its own direct sales force and has
comprehensive customer-support and training offices throughout
North America, Asia and Europe. This press release contains
forward-looking statements including those related to revenue and
earnings growth for the current fiscal year that are made pursuant
to the safe harbor provisions of the Private Securities Litigation
Act of 1995. These forward-looking statements are based on current
expectations and assumptions that are subject to risks and
uncertainties that could cause actual results to differ materially,
including, but not necessarily limited to, management's ability to
forecast revenues and control expenses and the amount, timing and
structure of software licenses. For further information regarding
risks and uncertainties associated with Ansoft's business, please
refer to the "Management's Discussion and Analysis of Financial
Condition and Results of Operations" section of Ansoft's SEC
filings, including, but not limited to, its annual report on Form
10-K and quarterly reports on Form 10-Q, copies of which may be
obtained at Ansoft's website at
www.ansoft.com/about/investor/index.cfm. All information in this
release is as of February 14, 2006. Ansoft undertakes no duty to
update any forward-looking statement to conform the statement to
actual results or changes in the Company's expectations. -0- *T
ANSOFT CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts) (unaudited) Three months
ended Nine months ended January 31, January 31, 2006 2005 2006 2005
--------- --------- --------- --------- Revenue License $11,251
$10,182 $27,194 $25,012 Service and other 8,404 7,198 25,279 20,992
--------- --------- --------- --------- Total revenue 19,655 17,380
52,473 46,004 Costs of revenue License 135 141 368 363 Service and
other 368 355 1,019 1,015 --------- --------- --------- ---------
Total cost of revenue 503 496 1,387 1,378 Gross profit 19,152
16,884 51,086 44,626 Operating Expenses Sales and marketing 8,013
7,424 22,477 22,522 Research and development 4,188 4,204 12,377
12,230 General and administrative 1,122 1,199 3,692 3,592
Amortization 370 415 1,108 1,208 --------- --------- ---------
--------- Total operating expenses 13,693 13,242 39,654 39,552
--------- --------- --------- --------- Income from operations
5,459 3,642 11,432 5,074 Net realized gain (loss) on sale of
securities - - (2) 732 Other income, net 269 374 749 975 ---------
--------- --------- --------- Income before income taxes 5,728
4,016 12,179 6,781 Income tax expense 1,468 1,232 2,655 2,076
--------- --------- --------- --------- Net income $4,260 $2,784
$9,524 $4,705 ========= ========= ========= ========= Net income
per share Basic $0.36 $0.24 $0.80 $0.41 ========= =========
========= ========= Diluted $0.33 $0.21 $0.73 $0.35 =========
========= ========= ========= Weighted average shares used in
calculation Basic 11,849 11,490 11,852 11,574 ========= =========
========= ========= Diluted 12,957 13,390 12,961 13,342 =========
========= ========= ========= ANSOFT CORPORATION CONSOLIDATED
BALANCE SHEETS (In thousands, except per share amounts) (unaudited)
January 31, April 30, 2006 2005 ------------ ---------- Assets
Current assets Cash and cash equivalents $10,498 $11,910 Accounts
receivable, net of allowance for doubtful accounts of $525 and
$425, respectively 12,660 17,388 Deferred income taxes 566 229
Prepaid expenses and other assets 1,780 1,148 ------------
---------- Total current assets 25,504 30,675 Equipment and
furniture, net of accumulated depreciation of $7,764 and $6,961,
respectively 2,696 2,811 Marketable securities 31,365 28,496 Other
assets 128 146 Deferred income taxes 5,733 6,177 Goodwill 1,239
1,239 Other intangible assets, net 2,800 3,877 ------------
---------- Total assets $69,465 $73,421 ============ ==========
Liabilities and stockholders' equity Current liabilities Accounts
payable $500 $231 Accrued payroll 1,429 2,290 Other accrued
expenses 2,522 3,076 Current portion of deferred revenue 15,114
17,500 ------------ ---------- Total current liabilities 19,565
23,097 Long-term portion of deferred revenue 1,189 1,039
------------ ---------- Total liabilities 20,754 24,136
Stockholders' equity Preferred stock, par value $0.01 per share;
1,000 shares authorized, no shares outstanding - - Common stock,
par value $0.01 per share; 25,000 shares authorized; issued 14,194
and 13,901 shares, respectively and outstanding 11,833 and 12,083,
respectively 142 140 Additional paid-in capital 75,596 70,410
Treasury stock, 2,361 and 1,818 shares, respectively (36,119)
(21,762) Accumulated other comprehensive loss, net (1,267) (338)
Retained earnings 10,359 835 ------------ ---------- Total
stockholders' equity 48,711 49,285 ------------ ---------- Total
liabilities and stockholders' equity $69,465 $73,421 ============
========== ANSOFT CORPORATION RECONCILIATION OF GAAP NET INCOME TO
NON-GAAP NET INCOME (In thousands, except per share amounts)
(unaudited) *T Pursuant to the requirement of Regulation G, the
Company has provided a reconciliation of the non-GAAP financial
measure to the most directly comparable GAAP financial measure.
These measures differ from GAAP in that they exclude
acquisition-related amortization. The Company has provided this
measurement in addition to GAAP financial results because it
believes the non-GAAP financial measure provides useful information
to investors in that it provides additional insight into our core
operations and a consistent basis for comparison between quarters
not influenced by certain non-cash items. The Company does not
acquire businesses on a predictable cycle. As a result, management
has difficulty comparing the Company's profitability as measured by
net income on a period to period basis unless it excludes
acquisition-related amortization because it may appear in one
period but not in the comparable period. Further, management finds
it useful to exclude non-cash charges in order to more readily
correlate the Company's operating activities with the Company's
ability to generate cash from operations and more accurately
predict liquidity requirements. Finally, this same financial
measure is used by management to track the Company's performance
relative to externally communicated financial targets and to
competitors' operating results. The additional non-GAAP financial
information presented should be considered in conjunction with, and
not as a substitute for, the financial information presented in
accordance with GAAP. -0- *T Three months ended January 31,
-------------------- 2006 2005 ---------- --------- GAAP net income
$4,260 $2,784 Amortization of intangibles (1) 229 257 ----------
--------- Non-GAAP net income $4,489 $3,041 ========== =========
Non-GAAP net income per diluted common share $0.35 $0.23 ==========
========= Weighted average diluted shares used in calculation
12,957 13,390 ========== ========= (1) Amortization expense net of
a 38% tax rate. *T
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