CIMdata PLM Industry Summary Online Archive

October 26, 2004

Financial News

Cadence Reports Q3 Revenue up 12% Over Q3 2004

Cadence Design Systems, Inc. reported third quarter 2005 revenue of $337 million, an increase of twelve percent over the $302 million reported for the same period last year. On a GAAP basis, Cadence® recognized net income of $21 million, or $0.07 per share, in the third quarter of 2005, compared to $20 million, or $0.07 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, which excludes, as applicable, amortization of intangible assets and deferred compensation, in-process research and development charges, integration and other acquisition-related expenses, 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 third quarter 2005 was $67 million, or $0.21 per share, on a fully diluted basis as compared to $52 million, or $0.17 per share, on a fully diluted basis in the same period last year.

"We had great response across the board in the third quarter, including a number of significant competitive wins," said Mike Fister, president and CEO of Cadence Design Systems, Inc. "Customers are buying from Cadence both for the depth and breadth of our technology, and our ability to deliver at an enterprise level."

Added Bill Porter, senior vice president and chief financial officer: "Once again, we had solid results in the third quarter across product lines and geographies. Both our verification and digital solutions continue to build momentum."

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 Oct. 26, 2005.

Business Outlook

For the fourth quarter of 2005, the company expects total revenue in the range of $360 million to $370 million. Fourth quarter GAAP earnings per fully diluted share are expected to be in the range of $0.17 to $0.19. Diluted earnings per share using the non-GAAP measure defined below are expected to be in the range of $0.27 to $0.29.

For the full year 2005, the company expects total revenue in the range of $1.31 billion to $1.32 billion. On a GAAP basis, net income per fully diluted share for fiscal 2005 is expected in the range of $0.25 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 $0.80 to $0.82.

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

Fister and Porter will host a third quarter 2005 financial results audio webcast today, Oct. 26, 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 Oct. 26, 2005, at 5 p.m. Pacific time and ending at 5 p.m. Pacific time on Nov. 3, 2005. Webcast access is available at www.cadence.com/company/investor_relations.

 

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