Attached files
| file | filename |
|---|---|
| EX-99.2 - PREPARED REMARKS - PTC INC. | remarks.htm |
| 8-K - FORM 8-K - PTC INC. | form8-kq12018earnings_sig.htm |
PTC Announces First Quarter Fiscal Year 2018 Results
First Quarter Bookings and Revenue Exceed High End of Guidance
Range
NEEDHAM, MA, January 17, 2018 -PTC
(NASDAQ: PTC) today reported financial
results for its fiscal first quarter ended December 30,
2017.
●
First
quarter FY’18 total revenue was $307 million
●
First
quarter GAAP net income was $14 million or $0.12 per diluted share;
non-GAAP net income was $36 million or $0.31 per diluted
share
●
First
quarter license and subscription bookings were $104 million and
subscription mix was 67%
●
Total
deferred revenue, billed and unbilled, was $1.17 billion, an
increase of 42% from the same period last year
●
First
quarter subscription Annualized Recurring Revenue (ARR) was $402
million, an increase of $183 million or 84% from the same period
last year
“We are very pleased with our first quarter fiscal 2018
results and the continuing momentum we see in our business,”
said James Heppelmann, President and CEO, PTC. “Bookings of
$104 million exceeded the high end of our guidance range by $12
million, powered by large strategic wins in our Solutions business
with marquee customers like BMW, momentum in our IoT business where
we had five deals with bookings of over $1 million, and strength in
the channel.”
Heppelmann added, “This is a strong start to fiscal year 2018
with broad-based strength both geographically and across our
product portfolio. CAD, PLM, and IoT performed above our
expectations, while the demand environment, particularly for our
subscription offerings, remains strong around the globe. Given the
strong start, we are raising our FY’18
guidance.”
Additional first quarter operating and financial highlights are set
forth below. Information about our bookings and other reporting
measures is provided beginning on page four.
For additional details, please refer
to the prepared remarks and financial data tables that have been
posted to the Investor Relations section of our website at
investor.ptc.com.
●
Q1’18
license and subscription bookings were $104 million, up 16%
year-over-year.
●
Total
bookings in the first quarter exceeded the high end of our guidance
by $12 million and subscription bookings comprised 67% of total
bookings. We believe that the announced discontinuation of new
perpetual license sales in the Americas and Western Europe led to
an increase in perpetual license purchases of approximately $4
million in the quarter, which impacted the subscription mix by
about 3% percentage points.
●
Total deferred revenue – billed and unbilled
- increased $344 million or 42% year-over-year and increased $77
million or 7% sequentially to $1.17 billion.
Billed deferred revenue increased 15%
year-over year and declined 6% sequentially, as expected, to $431
million, due to the timing of support billings during the year.
Billed deferred revenue can fluctuate quarterly based upon the
contractual billings dates in our recurring revenue
contracts,
as well as the timing of our fiscal
reporting periods.
●
GAAP and non-GAAP software revenue in the first
quarter were both approximately $265 million, an increase of 10%
year-over-year,
despite a higher mix of subscription
bookings than the same period last year.
●
Approximately
87% of first quarter GAAP and non-GAAP software revenue came from
recurring revenue streams.
●
Annualized
Recurring Revenue (ARR) was approximately $928 million, an increase
of 13% year-over-year and the fourth consecutive quarter of
double-digit growth.
●
GAAP
operating expenses in the first quarter were approximately $206
million, compared to $200 million in the same period last year;
non-GAAP operating expenses were approximately $183 million,
compared to $170 million in the same period last year.
●
GAAP
operating margin in the first quarter was 6%, compared to 2% in the
same period last year; non-GAAP operating margin was 17%, compared
to 15% in the same period last year.
●
Operating
cash flows in the first quarter were $25 million, and free cash
flow was $19 million, ahead of our expectations, and both include
cash payments related to our October 2015 restructuring plan of
approximately $1 million.
●
Total
cash, cash equivalents, and marketable securities as of the end of
the first quarter was $342 million and total debt, net of deferred
issuance costs, was $743 million.
●
On
December 22, 2017, the United States enacted tax reform legislation
through the Tax Cuts and Jobs Act, which significantly changed the
existing U.S. tax laws, including a reduction in the corporate tax
rate from 35% to 21%, and a move from a worldwide tax system to a
territorial system. We have recorded the impact of this legislation
in our Q1 GAAP earnings, resulting in a non-cash tax benefit of
approximately $7 million. In addition, we recorded a non-cash tax
benefit of approximately $0.5 million related to the new
stock-based compensation accounting guidance. We have adjusted our
balance sheet accounts accordingly and excluded these benefits from
our non-GAAP results.
●
Continuing
the phased global rollout of our subscription licensing model, we
separately announced that new software licenses for our core
solutions and ThingWorx industrial innovation platform will be
available globally only by subscription, effective January 1, 2019,
with a few exceptions. Those exceptions apply to China, Korea,
Taiwan, Russia, Turkey and India where we have not announced the
end-of-life of perpetual licenses. Also, Kepware will continue to
be available under perpetual licensing. We previously announced the
transition to subscription-only licensing in the Americas and
Western Europe effective January 1, 2018. Customers globally will
be able to continue to use their existing perpetual licenses and
renew support on active licenses.
Fiscal 2018 Business Outlook
For the second quarter and fiscal year ending September 30, 2018,
the company expects:
|
In millions except per share amounts
|
|
|
|
|
|
|
|
|
|
Operating Measures(1)
|
|
Q2’18 Low
|
|
Q2’18
High
|
|
FY’18 Low
|
|
FY’18 High
|
|
|
|
|
|
|
|
|
|
|
|
Subscription ACV
|
|
$ 37
|
|
$ 41
|
|
$ 181
|
|
$ 189
|
|
License and Subscription Bookings
|
|
$ 94
|
|
$ 104
|
|
$ 455
|
|
$ 475
|
|
Subscription % of Bookings
|
|
79%
|
|
79%
|
|
80%
|
|
80%
|
|
(1) An explanation of the
metrics included in this table is provided
below.
|
||||||||
|
Financial Measures
|
|
Q2’18 Low
|
|
Q2’18 High
|
|
FY’18 Low
|
|
FY’18 High
|
|
Subscription Revenue
|
|
$ 111
|
|
$ 113
|
|
$ 460
|
|
$ 470
|
|
Support Revenue
|
|
126
|
|
126
|
|
510
|
|
510
|
|
Perpetual License Revenue
|
|
20
|
|
23
|
|
92
|
|
97
|
|
Total Software Revenue
|
|
257
|
|
262
|
|
1,062
|
|
1,077
|
|
Professional Services Revenue
|
|
43
|
|
43
|
|
173
|
|
173
|
|
Total Revenue
|
|
$ 300
|
|
$ 305
|
|
$ 1,235
|
|
$ 1,250
|
|
|
|
|
|
|
|
|
|
|
|
Operating Expense (GAAP)
|
|
$ 202
|
|
$ 205
|
|
$ 825
|
|
$ 836
|
|
Operating Expense (Non-GAAP)
|
|
176
|
|
179
|
|
727
|
|
737
|
|
Operating Margin (GAAP)
|
|
4%
|
|
6%
|
|
6%
|
|
7%
|
|
Operating Margin (Non-GAAP)
|
|
16%
|
|
17%
|
|
17%
|
|
18%
|
|
Tax Rate (GAAP)
|
|
15%
|
|
15%
|
|
(5%)
|
|
(5%)
|
|
Tax Rate (Non-GAAP)
|
|
11%
|
|
9%
|
|
11%
|
|
9%
|
|
Shares Outstanding (GAAP)
|
|
117
|
|
117
|
|
117
|
|
117
|
|
Shares Outstanding (Non-GAAP)
|
|
117
|
|
117
|
|
117
|
|
117
|
|
EPS (GAAP)
|
|
$ 0.01
|
|
$ 0.04
|
|
$ 0.28
|
|
$ 0.37
|
|
EPS (Non-GAAP)
|
|
$ 0.28
|
|
$ 0.32
|
|
$ 1.29
|
|
$ 1.39
|
|
Free Cash Flow
|
|
|
|
|
|
$ 195
|
|
$ 205
|
|
Adjusted Free Cash Flow
|
|
|
|
|
|
$ 199
|
|
$ 209
|
The
second quarter and fiscal 2018 non-GAAP operating margin and
non-GAAP EPS guidance exclude the estimated items outlined in the
table below, as well as any tax effects and discrete tax items
(which are not known nor reflected).
|
In millions
|
|
Q2’18
|
|
FY’18
|
|
|
|
|
|
|
|
Effect of acquisition accounting on fair value of acquired deferred
revenue
|
|
$ 0
|
|
$ 2
|
|
Restructuring charges
|
|
-
|
|
0
|
|
Intangible asset amortization expense
|
|
15
|
|
58
|
|
Stock-based compensation expense
|
|
21
|
|
79
|
|
Total Estimated Pre-Tax GAAP adjustments
|
|
$ 36
|
|
$ 139
|
PTC’s Fiscal 2018 First Quarter Results Conference Call,
Prepared Remarks and Data Tables
Prepared remarks and financial data tables have been posted to the
Investor Relations section of our website at ptc.com. The Company
will host a management presentation to discuss results at 5:00 pm
ET on Wednesday, January 17, 2018. To access the live webcast,
please visit PTC’s Investor Relations website at
investor.ptc.com at least 15 minutes before the scheduled start
time to download any necessary audio or plug-in software. To participate in the live conference
call, dial 773-799-3757 or 800-857-5592 and provide the passcode
PTC. The call will be recorded and a replay will be available for
10 days following the call by dialing 866-376-2452 and entering the
pass code 0513. The archived webcast will also be available
on PTCs Investor
Relations website.
Bookings Metrics
We offer both perpetual and subscription licensing options to our
customers, as well as monthly software rentals for certain
products. Given the difference in revenue recognition between the
sale of a perpetual software license (revenue is recognized at the
time of sale) and a subscription (revenue is deferred and
recognized ratably over the subscription term), we use bookings for
internal planning, forecasting and reporting of new license and
cloud services transactions. In order to normalize between
perpetual and subscription licenses, we define subscription
bookings as the subscription annualized contract value
(subscription ACV) of new subscription bookings multiplied by a
conversion factor of 2. We arrived at the conversion factor of 2 by
considering a number of variables including pricing, support,
length of term, and renewal rates. We define subscription ACV as
the total value of a new subscription booking divided by the term
of the contract (in days) multiplied by 365. If the term of the
subscription contract is less than a year, the ACV is equal to the
total contract value.
License and subscription bookings equal subscription bookings (as
described above) plus perpetual license bookings plus any monthly
software rental bookings during the period. Total ACV equals
subscription ACV (as described above) plus the annualized value of
incremental monthly software rental bookings during the
period.
Because subscription bookings is a metric we use to approximate the
value of subscription sales if sold as perpetual licenses, it does
not represent the actual revenue that will be recognized with
respect to subscription sales or that would be recognized if the
sales were perpetual licenses, nor does the annualized value of
monthly software rental bookings represent the value of any such
booking.
Total Deferred Revenue
Total Deferred Revenue consists of Billed Deferred Revenue and
Unbilled Deferred Revenue. We define Unbilled Deferred Revenue as
contractually committed orders for license, subscription and
support with a customer for which the associated revenue has not
been recognized and the customer has not been invoiced. We do not
record Unbilled Deferred Revenue on our Consolidated Balance Sheet
until we invoice the customer. Billed Deferred Revenue primarily
relates to software agreements invoiced to customers for which the
revenue has not yet been recognized.
Software Revenue
Any reference to “total recurring software revenue” or
“recurring software revenue” means the sum of
subscription revenue and support revenue. Any reference to
“total software revenue” or “software
revenue” means the sum of subscription revenue, support
revenue and perpetual license revenue. “Subscription
revenue” includes cloud services revenue.
Annualized Recurring Revenue (ARR)
To help investors understand and assess the success of our
subscription transition, we provide an Annualized Recurring Revenue
operating measure. Annualized Recurring Revenue (ARR) for a given
quarter is calculated by dividing the portion of non-GAAP software
revenue attributable to subscription and support for the quarter by
the number of days in the quarter and multiplying by 365. (A
related metric is Subscription ARR, which is calculated by dividing
the portion of non-GAAP revenue attributable to subscription for
the quarter by the number of days in the quarter and multiplying by
365.) ARR should be viewed independently of revenue and deferred
revenue as it is an operating measure and is not intended to be
combined with or to replace either of those items. ARR is not a
forecast of future revenue, which can be impacted by contract
expiration and renewal rates, and does not include revenue reported
as perpetual license or professional services revenue in our
consolidated statement of income. Subscription and support revenue
and ARR disclosed in a quarter can be impacted by multiple factors,
including
but not limited to (1) the timing of the start of a contract or a
renewal, including the impact of on-time renewals, support
win-backs, and support conversions, which may vary by quarter, (2)
the ramping of committed monthly payments under a subscription
agreement over time, and (3) multiple other contractual factors
with the customer including other elements sold with the
subscription or support contract. These factors can result in
variability in disclosed ARR.
Navigate Allocation
Revenue and bookings for Navigate are allocated 50% to Solutions
and 50% to IoT.
Constant Currency Change Metric
Year-over-year changes in revenue and bookings on a constant
currency basis compare reported results excluding the effect of any
hedging converted into U.S. dollars based on the corresponding
prior year’s foreign currency exchange rates to reported
results for the comparable prior year period.
Important Information about Non-GAAP References
PTC provides non-GAAP supplemental information to its financial
results. We use these non-GAAP measures, and we believe that they
assist our investors, to make period-to-period comparisons of our
operational performance because they provide a view of our
operating results without items that are not, in our view,
indicative of our operating results. We believe that these non-GAAP
measures help illustrate underlying trends in our business, and we
use the measures to establish budgets and operational goals,
communicated internally and externally, for managing our business
and evaluating our performance. We believe that providing non-GAAP
measures affords investors a view of our operating results that may
be more easily compared to the results of peer companies. In
addition, compensation of our executives is based in part on the
performance of our business based on these non-GAAP measures.
However, non-GAAP information should not be construed as an
alternative to GAAP information as the items excluded from the
non-GAAP measures often have a material impact on PTC’s
financial results and such items often recur. Management uses, and
investors should consider, non-GAAP measures in conjunction with
our GAAP results.
Non-GAAP revenue, non-GAAP operating expense, non-GAAP operating
margin, non-GAAP gross profit, non-GAAP gross margin, non-GAAP net
income and non-GAAP EPS exclude the effect of the following items:
fair value of acquired deferred revenue, fair value adjustment to
deferred services cost, stock-based compensation, amortization of
acquired intangible assets, acquisition-related charges included in
general and administrative costs, restructuring charges, and income
tax adjustments. Additional information about the items we exclude
from our non-GAAP financial measures and the reasons we exclude
them can be found in “Non-GAAP Financial Measures”
beginning on page 33 of our Annual Report on Form 10-K for the
fiscal year ended September 30, 2017.
A reconciliation of non-GAAP measures to GAAP results is provided
within this press release.
PTC also provides information on “free cash flow” and
“adjusted free cash flow” to enable investors to assess
our ability to generate cash without incurring additional external
financings and to evaluate our performance against our announced
long term goal of returning approximately 40% of our free cash flow
to shareholders via stock repurchases. Free cash flow is net cash
provided by (used in) operating activities less capital
expenditures; adjusted free cash flow is free cash flow excluding
restructuring payments and certain identified non-ordinary course
payments. Free cash flow and adjusted free cash flow are not
measures of cash available for discretionary
expenditures.
Forward-Looking Statements
Statements in this press release that are not historic facts,
including statements about our second quarter and full fiscal 2018
targets, and other future financial and growth expectations and
targets, and anticipated tax rates, are forward-looking statements
that involve risks and uncertainties that could cause actual
results to differ materially from those projected. These risks
include: the macroeconomic and/or global manufacturing climates may
deteriorate; customers may not purchase our solutions when or at
the rates we expect; our businesses, including our Internet of
Things (IoT) business, may not expand and/or generate the revenue
we expect; foreign currency exchange rates may vary from our
expectations and thereby affect our reported revenue and expense;
the mix of revenue between license & subscription solutions,
support and professional services could be different than we
expect, which could impact our EPS results; our transition to
subscription-only licensing in the Americas and Western Europe
could adversely affect sales and revenue; sales of our solutions as
subscriptions may not have the longer-term effect on revenue and
earnings that we expect; we may be unable to expand our partner
ecosystem as we expect and our partners may not generate the
revenue we expect; we may be unable to improve performance in Japan
when or as we expect; we may be unable to generate sufficient
operating cash flow to return 40% of free cash flow to shareholders
and other uses of cash or our credit facility limits could preclude
share repurchases. In addition, our assumptions concerning our
future GAAP and non-GAAP effective income tax rates are based on
estimates and other factors that could change, including the
geographic mix of our revenue, expenses and profits. Other risks
and uncertainties that could cause actual results to differ
materially from those projected are detailed from time to time in
reports we file with the Securities and Exchange Commission,
including our most recent Annual Report on Form 10-K and Quarterly
Reports on Form 10-Q.
PTC and the PTC logo are trademarks or registered trademarks of PTC
Inc. or its subsidiaries in the United States and in other
countries.
About PTC (NASDAQ: PTC)
PTC has the most robust Internet of Things technology in the world.
In 1986 we revolutionized digital 3D design, and in 1998 were first
to market with Internet-based PLM. Now our leading IoT and AR
platform and field-proven solutions bring together the physical and
digital worlds to reinvent the way you create, operate, and service
products. With PTC, global manufacturers and an ecosystem of
partners and developers can capitalize on the promise of the IoT
today and drive the future of innovation.
PTC.com @PTC Blogs
PTC Investor Relations Contacts
Tim Fox, 781-370-5961
tifox@ptc.com
Jason Howard, 781-370-5087
jahoward@ptc.com
|
PTC
Inc.
|
||
|
UNAUDITED
CONSOLIDATED STATEMENTS OF INCOME
|
||
|
(in
thousands, except per share data)
|
|
|
Three Months Ended
|
|
|
|
December 30,
|
December 31,
|
|
|
2017
|
2016
|
|
|
|
|
|
Revenue:
|
|
|
|
Subscription
|
$100,008
|
$54,362
|
|
Support
|
131,197
|
151,478
|
|
Total
recurring revenue
|
231,205
|
205,840
|
|
Perpetual
license
|
33,985
|
34,379
|
|
Total
subscription, support and license revenue
|
265,190
|
240,219
|
|
Professional
services
|
41,454
|
46,108
|
|
Total
revenue
|
306,644
|
286,327
|
|
|
|
|
|
Cost
of revenue:
|
|
|
|
Cost of license and subscription
revenue (1)
(2)
|
24,376
|
20,130
|
|
Cost of support revenue
(1)
(2)
|
22,200
|
22,817
|
|
Total
cost of software revenue
|
46,576
|
42,947
|
|
Cost of professional services
revenue(1)
|
36,382
|
39,168
|
|
Total
cost of revenue
|
82,958
|
82,115
|
|
|
|
|
|
Gross
margin
|
223,686
|
204,212
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
Sales and marketing
(1)
|
99,315
|
90,690
|
|
Research and development
(1)
|
63,969
|
57,914
|
|
General and administrative
(1)
|
35,004
|
36,695
|
|
Amortization
of acquired intangible assets
|
7,821
|
8,067
|
|
Restructuring
charges, net
|
105
|
6,285
|
|
Total
operating expenses
|
206,214
|
199,651
|
|
|
|
|
|
Operating
income
|
17,472
|
4,561
|
|
Other
expense, net
|
(11,001)
|
(11,064)
|
|
Income
(loss) before income taxes
|
6,471
|
(6,503)
|
|
Provision (benefit) for income
taxes (3)
|
(7,406)
|
2,638
|
|
Net
income (loss)
|
$13,877
|
$(9,141)
|
|
|
|
|
|
Earnings
(loss) per share:
|
|
|
|
Basic
|
$0.12
|
$(0.08)
|
|
Weighted
average shares outstanding
|
115,731
|
115,290
|
|
|
|
|
|
Diluted
|
$0.12
|
$(0.08)
|
|
Weighted
average shares outstanding
|
117,656
|
115,290
|
|
|
|
|
|
|
(1)
|
The amounts in the tables above include stock-based compensation as
follows:
|
||||
|
|
Three Months Ended
|
|
|
|
December 30,
|
December 31,
|
|
|
2017
|
2016
|
|
Cost
of license and subscription revenue
|
$413
|
$293
|
|
Cost
of support
|
808
|
1,144
|
|
Cost
of professional services revenue
|
1,706
|
1,457
|
|
Sales
and marketing
|
4,879
|
3,621
|
|
Research
and development
|
2,960
|
2,997
|
|
General
and administrative
|
7,565
|
8,476
|
|
Total stock-based compensation
|
$18,331
|
$17,988
|
|
|
|
|
|
|
(2)
|
In the third quarter of 2017, PTC began reporting cost of support
revenue separate from cost of license and subscription revenue.
Costs for previous periods have also been separately reported to
conform to the current period presentation.
|
||||
|
|
(3)
|
In Q1’18 our effective tax rate was lower than the 24.5%
statutory federal income tax rate due, in large part, to our
corporate structure in which our foreign taxes are at an effective
tax rate lower than the U.S. Additionally, our rate includes a
benefit of $7.0M relating to the enactment of the Tax Cuts and Jobs
Act.
|
||||
|
PTC Inc.
|
|||
|
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS
(UNAUDITED)
|
|||
|
(in thousands, except per share
data)
|
|
|
Three Months Ended
|
|
|
|
December 30,
|
December 31,
|
|
|
2017
|
2016
|
|
|
|
|
|
GAAP
revenue
|
$306,644
|
$286,327
|
|
Fair
value adjustment of acquired deferred subscription
revenue
|
117
|
646
|
|
Fair
value adjustment of acquired deferred services revenue
|
246
|
268
|
|
Non-GAAP
revenue
|
$307,007
|
$287,241
|
|
|
|
|
|
GAAP
gross margin
|
$223,686
|
$204,212
|
|
Fair
value adjustment of acquired deferred revenue
|
363
|
914
|
|
Fair
value adjustment to deferred services cost
|
(104)
|
(113)
|
|
Stock-based
compensation
|
2,927
|
2,894
|
|
Amortization
of acquired intangible assets included in cost of
revenue
|
6,675
|
6,388
|
|
Non-GAAP
gross margin
|
$233,547
|
$214,295
|
|
|
|
|
|
GAAP
operating income
|
$17,472
|
$4,561
|
|
Fair
value adjustment of acquired deferred revenue
|
363
|
914
|
|
Fair
value adjustment to deferred services cost
|
(104)
|
(113)
|
|
Stock-based
compensation
|
18,331
|
17,988
|
|
Amortization
of acquired intangible assets included in cost of
revenue
|
6,675
|
6,388
|
|
Amortization
of acquired intangible assets
|
7,821
|
8,067
|
|
Acquisition-related
charges included in general and administrative costs
|
7
|
169
|
|
Restructuring
charges, net
|
105
|
6,285
|
|
Non-GAAP operating income (1)
|
$50,670
|
$44,259
|
|
|
|
|
|
GAAP
net income (loss)
|
$13,877
|
$(9,141)
|
|
Fair
value adjustment of acquired deferred revenue
|
363
|
914
|
|
Fair
value adjustment to deferred services cost
|
(104)
|
(113)
|
|
Stock-based
compensation
|
18,331
|
17,988
|
|
Amortization
of acquired intangible assets included in cost of
revenue
|
6,675
|
6,388
|
|
Amortization
of acquired intangible assets
|
7,821
|
8,067
|
|
Acquisition-related
charges included in general and administrative costs
|
7
|
169
|
|
Restructuring
charges, net
|
105
|
6,285
|
|
Income tax adjustments (2)
|
(11,000)
|
148
|
|
Non-GAAP
net income
|
$36,075
|
$30,705
|
|
|
|
|
|
GAAP
diluted earnings (loss) per share
|
$0.12
|
$(0.08)
|
|
Fair
value adjustment of acquired deferred revenue
|
-
|
0.01
|
|
Stock-based
compensation
|
0.16
|
0.15
|
|
Amortization
of acquired intangibles
|
0.12
|
0.12
|
|
Acquisition-related
charges
|
-
|
-
|
|
Restructuring
charges, net
|
-
|
0.05
|
|
Income
tax adjustments
|
(0.09)
|
-
|
|
Non-GAAP
diluted earnings per share
|
$0.31
|
$0.26
|
|
|
|
|
|
GAAP
diluted weighted average shares outstanding
|
117,656
|
115,290
|
|
Dilutive effect of
stock-based compensation plans
|
-
|
1,735
|
|
Non-GAAP
diluted weighted average shares outstanding
|
117,656
|
117,025
|
(1)
Operating margin impact of
non-GAAP adjustments:
|
|
|
Three Months Ended
|
|
|
|
|
December 30,
|
December 31,
|
|
|
|
2017
|
2016
|
|
GAAP operating margin
|
5.7%
|
1.6%
|
|
|
|
Fair
value of acquired deferred revenue
|
0.1%
|
0.3%
|
|
|
Fair
value adjustment to deferred services cost
|
0.0%
|
0.0%
|
|
|
Stock-based
compensation
|
6.0%
|
6.3%
|
|
|
Amortization
of acquired intangibles
|
4.7%
|
5.0%
|
|
|
Acquisition-related
charges
|
0.0%
|
0.1%
|
|
|
Restructuring
charges, net
|
0.0%
|
2.2%
|
|
Non-GAAP operating margin
|
16.5%
|
15.4%
|
|
|
|
|
|
|
(2)
We have recorded a full valuation allowance against our U.S. net
deferred tax assets and a valuation allowance against net deferred
tax assets in certain foreign jurisdictions. As we are profitable
on a non-GAAP basis, the 2018 and 2017 non-GAAP tax provisions are
being calculated assuming there is no valuation allowance. Income
tax adjustments reflect the tax effects of non-GAAP adjustments
which are calculated by applying the applicable tax rate by
jurisdiction to the non-GAAP adjustments listed above. We have
recorded the impact of the Tax Cuts and Jobs Act in our Q1'18 GAAP
earnings, resulting in a non-cash benefit of approximately $7
million. We have excluded this benefit from our non-GAAP
results.
|
PTC Inc.
|
|||
|
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
|
|||
|
(in thousands)
|
|
|
December 30,
|
September 30,
|
|
|
2017
|
2017
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
Cash
and cash equivalents
|
$291,679
|
$280,003
|
|
Marketable
securities
|
50,567
|
50,315
|
|
Accounts
receivable, net
|
131,059
|
152,299
|
|
Property
and equipment, net
|
61,219
|
63,600
|
|
Goodwill
and acquired intangible assets, net
|
1,427,988
|
1,440,680
|
|
Other
assets
|
343,430
|
373,487
|
|
|
|
|
|
Total
assets
|
$2,305,942
|
$2,360,384
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
Deferred
revenue
|
$431,494
|
$458,907
|
|
Debt,
net of deferred issuance costs
|
742,622
|
712,406
|
|
Other
liabilities
|
242,727
|
303,635
|
|
Stockholders'
equity
|
889,099
|
885,436
|
|
|
|
|
|
Total
liabilities and stockholders' equity
|
$2,305,942
|
$2,360,384
|
|
|
|
|
|
PTC Inc.
|
|||||
|
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS
|
|||||
|
(in thousands)
|
|
|
Three Months Ended
|
|
|
|
December 30,
|
December 31,
|
|
|
2017
|
2016
|
|
|
|
|
|
Cash
flows from operating activities:
|
|
|
|
Net
income (loss)
|
$13,877
|
$(9,141)
|
|
Stock-based
compensation
|
18,331
|
17,988
|
|
Depreciation
and amortization
|
21,046
|
21,454
|
|
Accounts
receivable
|
21,603
|
21,184
|
|
Accounts
payable and accruals
|
(53,057)
|
(53,608)
|
|
Deferred
revenue
|
22,055
|
(11,726)
|
|
Income
taxes
|
(14,272)
|
(6,096)
|
|
Other
|
(4,456)
|
(27,931)
|
|
Net
cash provided (used) by operating activities(1)
|
25,127
|
(47,876)
|
|
|
|
|
|
Capital
expenditures
|
(6,377)
|
(7,100)
|
|
Purchase
of intangible asset
|
(2,500)
|
-
|
|
Proceeds
(payments) on debt, net
|
30,000
|
(20,000)
|
|
Payments of withholding taxes in connection with
|
|
|
|
vesting
of stock-based awards
|
(33,488)
|
(18,623)
|
|
Proceeds
from investments
|
-
|
1,502
|
|
Contingent
consideration
|
(3,176)
|
(2,711)
|
|
Purchases
of marketable securities, net
|
(508)
|
-
|
|
Foreign
exchange impact on cash
|
2,598
|
(9,760)
|
|
|
|
|
|
Net
change in cash and cash equivalents
|
11,676
|
(104,568)
|
|
Cash
and cash equivalents, beginning of period
|
280,003
|
277,935
|
|
Cash
and cash equivalents, end of period
|
$291,679
|
$173,367
|
|
(1)
|
Effective the beginning of fiscal 2018, in accordance with the
adoption of ASU 2016-09, "Compensation - Stock Compensation (Topic
718): Improvements to Employee Share-Based Payment Accounting,"
excess tax benefits are now classified as an operating activity on
the statement of cash flows rather than as a financing activity.
The prior period excess tax benefits have been reclassified for
comparability.
|
|||