7/29/2005 - Cadence Design Systems, Inc. (NYSE: CDN) (Nasdaq: CDN) reported second quarter, 2005 revenue of $321 million, an increase of 12 percent over the $287 million reported for the same period last year. On a GAAP basis, Cadence® recognized net income of $0.5 million, or $0.00 per share in the second quarter of 2005, compared to $4 million, or $0.01 per share, in the same period last year.
In addition to using GAAP results in evaluating Cadence's business, management believes it is useful to measure results using a non-GAAP measure of net income (loss), which excludes, as applicable, amortization of intangible assets and deferred compensation, in-process research and development charges, integration and other acquisition-related expenses, non-recurring executive severance payments, restructuring charges and equity in losses (income) from investments. Non-GAAP net income is adjusted by the amount of additional taxes or tax benefit that the company would accrue if it used non-GAAP results instead of GAAP results to calculate the company's tax liability. See "GAAP to non-GAAP Reconciliation" below for further information on our non-GAAP measure.
Using this non-GAAP measure, net income in the second quarter 2005 was $53 million, or $0.17 per share on a fully diluted basis as compared to $42 million, or $0.14 per share on a fully diluted basis, in the same period last year.
“We saw good growth in both our global accounts and geographic regions during the second quarter, confirming for us that both our technologies and our strategies are well positioned to help all types of customers meet their market demands,” said Mike Fister, president and CEO of Cadence Design Systems, Inc. “We are looking forward to CDNLive!, our new expanded user group meeting in September, where we will share more about our new technology and products with our customers.”
Added Bill Porter, senior vice president and chief financial officer: “Once again in the second quarter, we saw good results across our product portfolio with particular strength in custom IC as well as digital and verification. Our diversified portfolio is a significant driver of our consistent results.”
The following statements are based on current expectations. These statements are forward looking, and actual results may differ materially. These statements do not include the impact of any mergers, acquisitions or other business combinations that may be completed after July 27, 2005.
For the third quarter of 2005, the company expects total revenue in the range of $320 million to $330 million. Third quarter GAAP earnings per fully diluted share are expected to be in the range of $0.05 to $0.07. Diluted earnings per share using the non-GAAP measure defined below are expected to be in the range of $0.18 to $0.20.
For the full year 2005, the company expects total revenue in the range of $1.275 billion to $1.315 billion. On a GAAP basis, net income per fully diluted share for fiscal 2005 is expected in the range of $0.21 to $0.27. Using the non-GAAP measure defined below, fully diluted earnings per share for fiscal 2005 are expected to be in the range of $0.75 to $0.81.
A schedule showing a reconciliation of the business outlook from GAAP net income and diluted net income per share to the non-GAAP net income and diluted net income per share is included with this release.
Audio Webcast Scheduled
Cadence Design Systems, Inc.’s Mike Fister, president and chief executive officer, and Bill Porter, chief financial officer, will host a second quarter 2005 financial results audio webcast today, July 27, 2005, at 2 p.m. (Pacific) / 5 p.m. (Eastern). Attendees are asked to register at the Web site at least 10 minutes prior to the scheduled webcast. An archive of the webcast will be available starting July 27, 2005 at 5 p.m. Pacific time and ending at 5 p.m. Pacific time on August 3, 2005. Webcast access is available at www.cadence.com/company/investor_relations.
Cadence (NYSE and Nasdaq:CDN) enables global electronic design innovation and plays an essential role in the creation of today's integrated circuits and electronics. Customers use Cadence software and hardware, methodologies, and services to design and verify advanced semiconductors, consumer electronics, networking and telecommunications equipment, and computer systems. Cadence reported 2004 revenues of approximately $1.2 billion, and has approximately 5,000 employees. The company is headquartered in San Jose, Calif., with sales offices, design centres, and research facilities around the world to serve the global electronics industry. More information about the company, its products, and services is available at www.cadence.com.
Cadence and the Cadence logo are registered trademarks of Cadence Design Systems, Inc.
The statements contained above regarding the company's second quarter 2005 results, those contained in the Business Outlook section above and the statements by Mike Fister and Bill Porter include forward looking statements based on current expectations or beliefs, as well as a number of preliminary assumptions about future events that are subject to factors and uncertainties that could cause actual results to differ materially from those described in the forward looking statements. Readers are cautioned not to put undue reliance on these forward looking statements, which are not a guarantee of future performance and are subject to a number of uncertainties and other factors, many of which are outside Cadence's control, including, among others: Cadence's ability to compete successfully in the design automation product and the commercial electronic design and methodology services industries; the mix of products and services sold and the timing of significant orders for its products; economic uncertainty; fluctuations in rates of exchange between the U.S. dollar and the currencies of other countries in which Cadence does business; and the acquisition of other companies or the failure to successfully integrate those it acquires.
For a detailed discussion of these and other cautionary statements, please refer to the company's filings with the Securities and Exchange Commission. These include the company's Annual Report on Form 10-K for the year ended January 1, 2005, and the quarterly report on Form 10-Q for the quarter ended April 2, 2005.
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