Cadence Reports First Quarter 2013 Financial Results and Completes Acquisition of Tensilica
http://media.marketwire.com/attachments/200609/285023_CadenceLOGOcurrent.jpghttp://at.marketwire.com/accesstracking/AccessTrackingLogServlet?PrId=1010227&ProfileId=051205&sourceType=1SAN JOSE, CA -- (Marketwired) -- 04/24/13 -- Cadence Design Systems, Inc. (NASDAQ: CDNS) today announced results for the first quarter of fiscal year 2013.
Cadence reported first quarter 2013 revenue of $354 million, compared to revenue of $316 million reported for the same period in 2012. On a GAAP basis, Cadence recognized net income of $79 million, or $0.27 per share on a diluted basis, in the first quarter of 2013, compared to net income of $31 million, or $0.11 per share on a diluted basis, in the same period in 2012. GAAP net income for the first quarter of 2013 included a $34 million income tax benefit due to a reversal of an uncertain tax position.
Using Cadence's non-GAAP measure, net income in the first quarter of 2013 was $61 million, or $0.21 per share on a diluted basis, as compared to net income of $47 million, or $0.17 per share on a diluted basis, in the same period in 2012.
"In Q1 we accelerated our IP strategy through key acquisitions that will expand the scope of our IP business and demonstrate our capabilities and readiness for FinFET-based high performance design, and we also saw significant strength in repeat orders for Palladium XP," said Lip-Bu Tan, president and chief executive officer. "Looking ahead, I expect to see our focus and discipline in scaling our IP business start to show meaningful growth."
"Strong execution by the Cadence team continued in Q1 as results for all key operating metrics exceeded expectations," added Geoff Ribar, senior vice president and chief financial officer. "The Tensilica acquisition not only significantly expands the scope of our IP business, but also brings a growing royalty component to our revenue mix."
IP Acquisitions
Cadence this week completed its previously announced acquisition of Tensilica, Inc., a leader in dataplane processing IP. The cash outlay at closing, after taking into account adjustments for certain costs and an estimated $25 million of cash held by Tensilica at closing, was approximately $326 million. In addition, Cadence assumed certain unvested Tensilica options. Tensilica's configurable dataplane processing units complement industry-standard processor architectures and are optimized for embedded data and signal processing. Tensilica's target markets include mobile wireless, network infrastructure, auto infotainment and home applications. The Tensilica team, led by Jack Guedj, will report to Martin Lund, Cadence's senior vice president of research and development, SOC Realization Group.
During the first quarter 2013, Cadence also announced its intent to acquire Cosmic Circuits Private Limited, a developer of low-power connectivity and analog/mixed-signal IP. This transaction is expected to close soon. These acquisitions accelerate Cadence's strategy of growing its IP business by providing high quality differentiated IP for leading protocols at advanced process nodes. Cadence is pursuing this strategy through both targeted acquisitions and increased investment in internal IP development. In addition to expanding Cadence's IP portfolio focused on growing markets, these acquisitions, as they are integrated into Cadence, will enable optimization with Cadence's design tools and accelerate IP subsystem development and integration.
It is estimated that 2013 revenue on a standalone basis for Tensilica would be about $57 million prior to merger accounting, of which $13 million would be royalties, representing growth of about 30 percent over Tensilica's revenue in 2012. Cadence is assuming that Tensilica will contribute approximately $27 million of revenue in the remainder of 2013, after a deferred revenue adjustment of approximately $16 million due to merger accounting. The transaction is expected to be approximately eight cents dilutive to GAAP EPS and one cent dilutive to non-GAAP EPS for 2013.
The following statements are based on current expectations. These statements are forward-looking, and actual results may differ materially.
Business Outlook
For the second quarter of 2013, the company expects total revenue in the range of $355 million to $365 million. Second quarter GAAP net income per diluted share is expected to be in the range of $0.10 to $0.12. Net income per diluted share using the non-GAAP measure defined below is expected to be in the range of $0.19 to $0.21.
For 2013, the company expects total revenue in the range of $1.440 billion to $1.470 billion. On a GAAP basis, net income per diluted share for 2013 is expected to be in the range of $0.59 to $0.69. Using the non-GAAP measure defined below, net income per diluted share for 2013 is expected to be in the range of $0.81 to $0.91.
A schedule showing a reconciliation of the business outlook from GAAP net income and diluted net income per share to non-GAAP net income and diluted net income per share is included with this release.
Audio Webcast Scheduled
Lip-Bu Tan, Cadence's president and chief executive officer, and Geoff Ribar, Cadence's senior vice president and chief financial officer, will host a first quarter 2013 financial results audio webcast today, April 24, 2013, at 2 p.m. (Pacific) / 5 p.m. (Eastern). Attendees are asked to register at the website at least 10 minutes prior to the scheduled webcast. An archive of the webcast will be available starting April 24, 2013 at 5 p.m. (Pacific) and ending May 8, 2013 at 5 p.m. (Pacific). Webcast access is available at www.cadence.com/company/investor_relations.
About Cadence
Cadence enables global electronic design innovation and plays an essential role in the creation of today's integrated circuits and electronics. Customers use Cadence software, hardware, IP, and services to design and verify advanced semiconductors, consumer electronics, networking and telecommunications equipment, and computer systems. The company is headquartered in San Jose, California, with sales offices, design centers, and research facilities around the world to serve the global electronics industry. More information about the company and its products and services is available at www.cadence.com.
Cadence, the Cadence logo and Palladium are registered trademarks of Cadence Design Systems, Inc. All other trademarks are the property of their respective owners.
The statements contained above regarding Cadence's first quarter 2013 results, as well as the information in the IP Acquisitions and Business Outlook sections and the statements by Lip-Bu Tan and Geoff Ribar, include forward-looking statements based on current expectations or beliefs and 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. These forward-looking statements are subject to a number of risks, uncertainties and other factors, many of which are outside Cadence's control, including, among others: (i) Cadence's ability to compete successfully in the electronic design automation product and the commercial electronic design and methodology services industries; (ii) the success of Cadence's efforts to improve operational efficiency and growth; (iii) the mix of products and services sold and the timing of significant orders for Cadence's products, and its shift to a ratable license structure, which may result in changes in the mix of license types; (iv) change in customer demands, including those resulting from consolidation among Cadence's customers and the possibility that Cadence's customers' restructurings and other efforts to improve operational efficiency could result in delays in customers' purchases of Cadence's products and services; (v) economic and industry conditions in regions in which Cadence does business; (vi) fluctuations in rates of exchange between the U.S. dollar and the currencies of other countries in which Cadence does business; (vii) capital expenditure requirements, legislative or regulatory requirements, interest rates and Cadence's ability to access capital and debt markets; (viii) the acquisition of other companies or technologies or the failure to successfully integrate and operate these companies or technologies Cadence acquires, including the potential inability to retain customers, key employees or vendors; (ix) the failure or inability to consummate the previously announced acquisition, the effect of regulatory approval requirements and the effects of the acquisitions on Cadence's financial results; (x) the effects of Cadence's efforts to improve operational efficiency on Cadence's business, including strategic, customer and supplier relationships, and its ability to retain key employees; (xi) events that affect the reserves or settlement assumptions Cadence may take from time to time with respect to accounts receivable, taxes, litigation or other matters; and (xii) the effects of any litigation or other proceedings to which Cadence is or may become a party.
For a detailed discussion of these and other cautionary statements related to Cadence's business, please refer to Cadence's filings with the Securities and Exchange Commission. These include Cadence's most recent reports on Form 10-K and Form 10-Q, including Cadence's future filings.
GAAP to Non-GAAP Reconciliation
To supplement Cadence's financial results presented on a GAAP basis, Cadence management uses non-GAAP measures that it believes are helpful in understanding Cadence's performance. One such measure is non-GAAP net income, which is a financial measure not calculated under GAAP, and is calculated by taking GAAP net income and excluding, as applicable, amortization of intangible assets and debt discount related to our convertible notes, stock-based compensation expense, acquisition and integration-related costs including changes in fair value of contingent consideration, investment gains or losses, income or expenses related to Cadence's non-qualified deferred compensation plan, restructuring and other significant items not directly related to Cadence's core business operations, and the income tax effect of non-GAAP pre-tax adjustments.
Cadence's management uses non-GAAP net income because it excludes items that are generally not directly related to the performance of the company's core business operations and therefore provides useful supplemental information to Cadence's management and investors regarding the performance of the company's business operations, facilitates comparisons to the company's historical operating results and enhances investors' ability to review Cadence's business from the same perspective as Cadence's management. Cadence's management also uses non-GAAP net income internally for forecasting and budgeting. Non-GAAP financial measures should not be considered as a substitute for or superior to measures of financial performance prepared in accordance with GAAP. Investors and potential investors are encouraged to review the reconciliation of non-GAAP financial measures contained within this press release with their most directly comparable GAAP financial results. Investors are encouraged to look at the GAAP results as the best measure of financial performance.
The following tables reconcile the specific items excluded from GAAP net income and GAAP net income per diluted share in the calculation of non-GAAP net income and non-GAAP net income per diluted share for the periods shown below:
Net Income Reconciliation Three Months Ended
------------------------------
March 30, 2013 March 31, 2012
-------------- --------------
(unaudited)
(in thousands)
Net income on a GAAP basis $ 78,609 $ 31,104
Amortization of acquired intangibles 7,598 6,685
Stock-based compensation expense 13,810 11,525
Non-qualified deferred compensation
expenses 152 1,798
Restructuring and other charges (credits) (148) (51)
Shareholder litigation costs -- 46
Integration and acquisition-related costs 4,935 448
Amortization of debt discount 5,536 5,089
Other income or expense related to
investments and non-qualified deferred
compensation plan assets* (990) (1,949)
Income tax benefit due to a reversal of an
uncertain tax position (33,719) --
Income tax effect of non-GAAP adjustments (15,146) (8,195)
-------------- --------------
Net income on a non-GAAP basis $ 60,637 $ 46,500
============== ==============
* Includes, as applicable, equity in losses or income from investments,
write-down of investments, gains or losses on sale of investments and
gains or losses on non-qualified deferred compensation plan assets
recorded in other income or expense.
Diluted Net Income per Share Reconciliation Three Months Ended
------------------------------
March 30, 2013 March 31, 2012
-------------- --------------
(unaudited)
(in thousands, except per share data)
Diluted net income per share on a GAAP basis $ 0.27 $ 0.11
Amortization of acquired intangibles 0.03 0.03
Stock-based compensation expense 0.05 0.04
Non-qualified deferred compensation
expenses -- 0.01
Restructuring and other charges (credits) -- --
Shareholder litigation costs -- --
Integration and acquisition-related costs 0.02 --
Amortization of debt discount 0.02 0.02
Other income or expense related to
investments and non-qualified deferred
compensation plan assets* (0.01) (0.01)
Income tax benefit due to a reversal of an
uncertain tax position (0.12) --
Income tax effect of non-GAAP adjustments (0.05) (0.03)
-------------- --------------
Diluted net income per share on a non-GAAP
basis $ 0.21 $ 0.17
============== ==============
Shares used in calculation of diluted net
income per share -- GAAP** 292,151 277,733
Shares used in calculation of diluted net
income per share -- non-GAAP** 292,151 277,733
* Includes, as applicable, equity in losses or income from investments,
write-down of investments, gains or losses on sale of investments and
gains or losses on non-qualified deferred compensation plan assets
recorded in other income or expense.
** Shares used in the calculation of GAAP net income per share are expected
to be the same as shares used in the calculation of non-GAAP net income
per share, except when the company reports a GAAP net loss and non-GAAP
net income, or GAAP net income and a non-GAAP net loss.
Cadence expects that its corporate representatives will meet privately during the quarter with investors, the media, investment analysts and others. At these meetings, Cadence may reiterate the business outlook published in this press release. At the same time, Cadence will keep this press release, including the business outlook, publicly available on its website.
Prior to the start of the Quiet Period (described below), the public may continue to rely on the business outlook contained herein as still being Cadence's current expectations on matters covered unless Cadence publishes a notice stating otherwise.
Beginning June 14, 2013, Cadence will observe a Quiet Period during which the business outlook as provided in this press release and the company's most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q no longer constitute the company's current expectations. During the Quiet Period, the business outlook in these documents should be considered to be historical, speaking as of prior to the Quiet Period only and not subject to any update by the company. During the Quiet Period, Cadence's representatives will not comment on Cadence's business outlook, financial results or expectations. The Quiet Period will extend until the day when Cadence's Second Quarter 2013 Earnings Release is published, which is currently scheduled for July 24, 2013.
Cadence Design Systems, Inc.
Condensed Consolidated Balance Sheets
March 30, 2013 and December 29, 2012
(In thousands)
(Unaudited)
March 30, 2013 December 29, 2012
----------------- -----------------
Current assets:
Cash and cash equivalents $ 810,152 $ 726,357
Short-term investments 100,992 100,704
Receivables, net of allowances of $0
and $85, respectively 75,253 97,821
Inventories 37,016 36,163
2015 notes hedges 315,895 303,154
Prepaid expenses and other 122,604 127,036
----------------- -----------------
Total current assets 1,461,912 1,391,235
Property, plant and equipment, net of
accumulated depreciation of $626,732
and $635,450, respectively 237,455 244,439
Goodwill 232,608 233,266
Acquired intangibles, net of accumulated
amortization of $104,822 and $104,351,
respectively 177,891 184,938
Long-term receivables 3,734 7,559
Other assets 209,663 225,566
----------------- -----------------
Total assets $ 2,323,263 $ 2,287,003
================= =================
Current liabilities:
Convertible notes $ 452,571 $ 447,011
2015 notes embedded conversion
derivative 315,895 303,154
Accounts payable and accrued
liabilities 156,606 171,318
Current portion of deferred revenue 285,553 295,787
----------------- -----------------
Total current liabilities 1,210,625 1,217,270
----------------- -----------------
Long-term liabilities:
Long-term portion of deferred revenue 41,432 50,529
Other long-term liabilities 51,533 104,033
----------------- -----------------
Total long-term liabilities 92,965 154,562
----------------- -----------------
Stockholders' equity 1,019,673 915,171
----------------- -----------------
Total liabilities and stockholders'
equity $ 2,323,263 $ 2,287,003
================= =================
Cadence Design Systems, Inc.
Condensed Consolidated Income Statements
For the Three Months Ended March 30, 2013 and March 31, 2012
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended
------------------------------
March 30, 2013 March 31, 2012
-------------- --------------
Revenue:
Product and maintenance $ 328,271 $ 286,288
Services 25,995 29,542
-------------- --------------
Total revenue 354,266 315,830
-------------- --------------
Costs and expenses:
Cost of product and maintenance 29,847 27,212
Cost of services 18,344 19,374
Marketing and sales 90,402 83,795
Research and development 124,084 108,594
General and administrative 29,810 27,770
Amortization of acquired intangibles 3,791 3,786
Restructuring and other charges (credits) (148) (51)
-------------- --------------
Total costs and expenses 296,130 270,480
-------------- --------------
Income from operations 58,136 45,350
Interest expense (9,262) (8,537)
Other income, net 2,175 2,434
-------------- --------------
Income before provision (benefit) for
income taxes 51,049 39,247
Provision (benefit) for income taxes (27,560) 8,143
-------------- --------------
Net income $ 78,609 $ 31,104
============== ==============
Net income per share - basic $ 0.29 $ 0.12
============== ==============
Net income per share - diluted $ 0.27 $ 0.11
============== ==============
Weighted average common shares outstanding -
basic 274,936 267,940
============== ==============
Weighted average common shares outstanding -
diluted 292,151 277,733
============== ==============
Cadence Design Systems, Inc.
Condensed Consolidated Statements of Cash Flows
For the Three Months Ended March 30, 2013 and March 31, 2012
(In thousands)
(Unaudited)
Three Months Ended
----------------------
March 30, March 31,
2013 2012
---------- ----------
Cash and cash equivalents at beginning of period $ 726,357 $ 601,602
---------- ----------
Cash flows from operating activities:
Net income 78,609 31,104
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 21,682 21,939
Amortization of debt discount and fees 6,281 5,734
Stock-based compensation 13,810 11,525
Gain on investments, net (1,006) (1,949)
Deferred income taxes 8,695 223
Provisions (recoveries) for losses (gains) on
receivables, net (85) -
Other non-cash items (922) 746
Changes in operating assets and liabilities, net
of effect of acquired businesses:
Receivables 23,652 60,172
Inventories (979) (154)
Prepaid expenses and other (1,099) (5,545)
Other assets 4,148 (577)
Accounts payable and accrued liabilities (11,003) (19,582)
Deferred revenue (16,648) (39,315)
Other long-term liabilities (49,799) (3,612)
---------- ----------
Net cash provided by operating activities 75,336 60,709
---------- ----------
Cash flows from investing activities:
Purchases of available-for-sale securities (24,282) -
Proceeds from the sale of available-for-sale
securities 14,985 -
Proceeds from the maturity of available-for-sale
securities 8,700 -
Proceeds from the sale of long-term investments 6,102 44
Purchases of property, plant and equipment (6,569) (8,201)
Investment in venture capital partnerships and
equity investments - (250)
Cash paid in business combinations and asset
acquisitions, net of cash acquired (757) (1,041)
---------- ----------
Net cash used for investing activities (1,821) (9,448)
---------- ----------
Cash flows from financing activities:
Principal payments on receivable financing (2,526) -
Payment of acquisition-related contingent
consideration (582) (39)
Tax effect related to employee stock transactions
allocated to equity 5,276 2,842
Proceeds from issuance of common stock 21,801 12,761
Stock received for payment of employee taxes on
vesting of restricted stock (8,775) (6,173)
---------- ----------
Net cash provided by financing activities 15,194 9,391
---------- ----------
Effect of exchange rate changes on cash and cash
equivalents (4,914) (2,567)
---------- ----------
Increase in cash and cash equivalents 83,795 58,085
---------- ----------
Cash and cash equivalents at end of period $ 810,152 $ 659,687
========== ==========
Cadence Design Systems, Inc.
As of April 24, 2013
Impact of Non-GAAP Adjustments on Forward Looking Diluted Net Income Per
Share
(Unaudited)
Three Months Ending Year Ending
June 29, 2013 December 28, 2013
------------------- -------------------
Forecast Forecast
------------------- -------------------
Diluted net income per share on a
GAAP basis $0.10 to $0.12 $0.59 to $0.69
Amortization of acquired
intangibles 0.04 0.15
Stock-based compensation expense 0.05 0.21
Integration and acquisition-
related costs 0.03 0.09
Amortization of debt discount 0.02 0.08
Other income or expense related to
investments and non-qualified
deferred compensation plan
assets* - (0.01)
Income tax benefit due to a
reversal of an uncertain tax
position - (0.11)
Income tax effect of non-GAAP
adjustments (0.05) (0.19)
------------------- -------------------
Diluted net income per share on a
non-GAAP basis $0.19 to $0.21 $0.81 to $0.91
=================== ===================
* Includes, as applicable, equity in losses or income from investments,
write-down of investments, gains or losses on sale of investments and
gains or losses on non-qualified deferred compensation plan assets
recorded in other income or expense.
Cadence Design Systems, Inc.
As of April 24, 2013
Impact of Non-GAAP Adjustments on Forward Looking Net Income
(Unaudited)
Three Months Ending Year Ending
June 29, 2013 December 28, 2013
------------------- -------------------
($ in millions) Forecast Forecast
------------------- -------------------
Net income on a GAAP basis $29 to $35 $172 to $202
Amortization of acquired
intangibles 12 46
Stock-based compensation expense 13 63
Integration and acquisition-
related costs 8 26
Amortization of debt discount 6 22
Other income or expense related to
investments and non-qualified
deferred compensation plan
assets* - (1)
Income tax benefit due to a
reversal of an uncertain tax
position - (34)
Income tax effect of non-GAAP
adjustments (13) (56)
------------------- -------------------
Net income on a non-GAAP basis $55 to $61 $238 to $268
=================== ===================
* Includes, as applicable, equity in losses or income from investments,
write-down of investments, gains or losses on sale of investments and
gains or losses on non-qualified deferred compensation plan assets
recorded in other income or expense.
Cadence Design Systems, Inc.
(Unaudited)
Revenue Mix by Geography (% of Total Revenue)
2012 2013
------------------------ ----
GEOGRAPHY Q1 Q2 Q3 Q4 Year Q1
------------------------ ----
Americas 44% 46% 43% 45% 45% 44%
EMEA 19% 20% 20% 21% 20% 22%
Japan 18% 16% 17% 14% 16% 15%
Asia 19% 18% 20% 20% 19% 19%
Total 100% 100% 100% 100% 100% 100%
Revenue Mix by Product Group (% of Total Revenue)
2012 2013
------------------------ ----
PRODUCT GROUP Q1 Q2 Q3 Q4 Year Q1
------------------------ ----
Functional Verification, Hardware and IP 30% 33% 30% 30% 30% 26%
Digital IC Design 23% 22% 23% 23% 23% 25%
Custom IC Design 23% 22% 24% 24% 23% 25%
Design for Manufacturing 7% 6% 6% 6% 6% 7%
System Interconnect 8% 8% 9% 9% 9% 10%
Services and other 9% 9% 8% 8% 9% 7%
Total 100% 100% 100% 100% 100% 100%
Note: Product Group total revenue includes product and maintenance revenue
Cadence Design Systems, Inc.
Supplemental Reconciliation of Certain GAAP to Non-GAAP Measures
For the Three Months Ended March 30, 2013
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended
March 30, 2013
-----------------------------------------
GAAP Adjustments Non-GAAP
Revenue:
Product and maintenance $ 328,271 $ - $ 328,271
Services 25,995 - 25,995
----------- ----------- -----------
Total revenue 354,266 - 354,266
----------- ----------- -----------
Costs and expenses:
Cost of product and maintenance 29,847 (4,175) (A) 25,672
Cost of services 18,344 (530) (A) 17,814
Marketing and sales 90,402 (3,104) (A) 87,298
Research and development 124,084 (7,928) (A) 116,156
General and administrative 29,810 (6,967) (A) 22,843
Amortization of acquired
intangibles 3,791 (3,791) (A) -
Restructuring and other charges
(credits) (148) 148 -
----------- ----------- -----------
Total costs and expenses 296,130 (26,347) 269,783
----------- ----------- -----------
Income from operations 58,136 26,347 84,483
Interest expense (9,262) 5,536 (B) (3,726)
Other income, net 2,175 (990) (C) 1,185
----------- ----------- -----------
Income before provision
(benefit) for income taxes 51,049 30,893 81,942
Provision (benefit) for income
taxes (27,560) 48,865 (D) 21,305
----------- ----------- -----------
Net income $ 78,609 $ (17,972) $ 60,637
=========== =========== ===========
Notes:
(A) For the three months ended March 30, 2013 adjustments to GAAP are as
follows for the line items specified:
Non- Integration
Amortization qualified and
of Stock-based deferred acquisition-
acquired compensation compensation related Total
intangibles expense expenses costs adjustments
------------------------------------------------------------
Cost of product
and
maintenance $ 3,807 $ 364 $ 4 $ - $ 4,175
Cost of
services - 525 5 - 530
Marketing and
sales - 3,018 22 64 3,104
Research and
development - 6,553 78 1,297 7,928
General and
administrative - 3,350 43 3,574 6,967
Amortization of
acquired
intangibles 3,791 - - - 3,791
------------------------------------------------------------
Total $ 7,598 $ 13,810 $ 152 $ 4,935 $ 26,495
============================================================
(B) Amortization of debt discount related to convertible notes
(C) Other income or expense related to investments and non-qualified
deferred compensation plan assets
(D) Income tax benefit due to reversal of an uncertain tax position $33,719
and income tax effect of non-GAAP adjustments $15,146
Cadence Design Systems, Inc.
Supplemental Reconciliation of Certain GAAP to Non-GAAP Measures
For the Three Months Ended March 31, 2012
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended
March 31, 2012
-----------------------------------------
GAAP Adjustments Non-GAAP
Revenue:
Product and maintenance $ 286,288 $ - $ 286,288
Services 29,542 - 29,542
----------- ----------- -----------
Total revenue 315,830 - 315,830
----------- ----------- -----------
Costs and expenses:
Cost of product and maintenance 27,212 (3,250) (E) 23,962
Cost of services 19,374 (503) (E) 18,871
Marketing and sales 83,795 (2,877) (E) 80,918
Research and development 108,594 (6,045) (E) 102,549
General and administrative 27,770 (4,041) (E) 23,729
Amortization of acquired
intangibles 3,786 (3,786) (E) -
Restructuring and other charges
(credits) (51) 51 -
----------- ----------- -----------
Total costs and expenses 270,480 (20,451) 250,029
----------- ----------- -----------
Income from operations 45,350 20,451 65,801
Interest expense (8,537) 5,089 (F) (3,448)
Other income, net 2,434 (1,949) (G) 485
----------- ----------- -----------
Income before provision for
income taxes 39,247 23,591 62,838
Provision for income taxes 8,143 8,195 (H) 16,338
----------- ----------- -----------
Net income $ 31,104 $ 15,396 $ 46,500
=========== =========== ===========
(E) For the three months ended March 31, 2012 adjustments to GAAP are as
follows for the line items specified:
Stock- Non- Integration Shareh
based qualified and older
Amortization compens deferred acquisition litiga Total
of acquired ation compensation -related tion adjustm
intangibles expense expenses costs costs ents
------------------------------------------------------------
Cost of product
and
maintenance $ 2,899 $ 331 $ 20 $ - $ - $ 3,250
Cost of
services - 474 29 - - 503
Marketing and
sales - 2,511 257 109 - 2,877
Research and
development - 5,008 807 230 - 6,045
General and
administrative - 3,201 685 109 46 4,041
Amortization of
acquired
intangibles 3,786 - - - - 3,786
------------------------------------------------------------
Total $ 6,685 $11,525 $ 1,798 $ 448 $ 46 $20,502
============================================================
(F) Amortization of debt discount related to convertible notes
(G) Other income or expense related to investments and non-qualified
deferred compensation plan assets
(H) Income tax effect of non-GAAP adjustments
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For more information, please contact:
Investors and Shareholders
Alan Lindstrom
Cadence Design Systems, Inc.
408-944-7100
investor_relations@cadence.com
Media and Industry Analysts
Anna del Rosario
Cadence Design Systems, Inc.
408-914-6884
publicrelations@cadence.com