Cadence reported fourth quarter 2013 revenue of $377 million, compared to revenue of $346 million reported for the same period in 2012. On a GAAP basis, Cadence recognized net income of $38 million, or $0.13 per share on a diluted basis, in the fourth quarter of 2013, compared to net income of $314 million, or $1.10 per share on a diluted basis, in the same period in 2012. Revenue for 2013 totaled $1.460 billion, compared to revenue of $1.326 billion for 2012. Net income for 2013 was $164 million, or $0.56 per share on a diluted basis, compared to net income of $440 million, or $1.57 per share on a diluted basis, for 2012. GAAP net income for the fourth quarter of 2012 included a $220 million income tax benefit from releasing a valuation allowance against Cadence's deferred tax assets and a $37 million income tax benefit related to the settlement of a State of California examination of Cadence's state income tax returns for the tax years 2001 through 2003.
Using the non-GAAP measure defined below, net income in the fourth quarter of 2013 was $67 million, or $0.23 per share on a diluted basis, as compared to net income of $58 million, or $0.20 per share on a diluted basis, in the same period in 2012. For 2013, non-GAAP net income was $252 million, or $0.86 per share on a diluted basis, compared to non-GAAP net income of $217 million, or $0.77 per share on a diluted basis, in 2012.
"In 2013, our talented development teams delivered six new innovative products, revenue grew 10 percent, and we completed three important acquisitions in the IP space," said Lip-Bu Tan, president and chief executive officer. "Our differentiated design IP portfolio led to wins at over ten top tier customers, including head-to-head wins at advanced FinFET nodes."
"Our continuing focus on execution with customers and ecosystem partners, as well as product development, M&A and financial performance, drove strong revenue, cash flow and operating profits in Q4 and throughout 2013," added Geoff Ribar, senior vice president and chief financial officer. "Even after the acquisition-related write-downs of deferred revenue, we still achieved our operating margin goal."
Cadence also announced today that its Board of Directors has approved the repurchase of up to $100 million of its common stock under its stock repurchase program, and Cadence expects to repurchase up to $50 million of its common stock during each of fiscal years 2014 and 2015. The actual timing and amount of the repurchases will be based on an evaluation of market conditions, share price and other factors. The stock repurchase program may be suspended, modified or discontinued at any time.
The following statements are based on current expectations. These statements are forward-looking, and actual results may differ materially.
Business Outlook
For the first quarter of 2014, the company expects total revenue in the range of $373 million to $383 million. First quarter GAAP net income per diluted share is expected to be in the range of $0.08 to $0.10. Net income per diluted share using the non-GAAP measure defined below is expected to be in the range of $0.18 to $0.20.
For 2014, the company expects total revenue in the range of $1.550 billion to $1.585 billion. On a GAAP basis, net income per diluted share for 2014 is expected to be in the range of $0.55 to $0.65. Using the non-GAAP measure defined below, net income per diluted share for 2014 is expected to be in the range of $0.92 to $1.02.
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, president and chief executive officer, and Geoff Ribar, senior vice president and chief financial officer, will host a fourth quarter and fiscal year 2013 financial results audio webcast today, January 29, 2014, 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 January 29, 2014 at 5 p.m. (Pacific) and ending March 14, 2014 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 and the Cadence logo 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 fourth quarter and fiscal year 2013 financial results and Cadence's intention to repurchase shares of its common stock under its share repurchase program, as well as the information in the Business Outlook section 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; (iv) change in customer demands, including those resulting from consolidation among Cadence's customers and the possibility that the restructurings and other efforts to improve operational efficiency of Cadence's customers could result in delays in 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 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; (x) 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 (xi) 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 generally accepted accounting principles, or 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 and sale 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 and retention expenses for employees added from our 2013 acquisitions, executive severance costs, 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 | ||||||
|
|
|
December 28, 2013 |
|
December 29, 2012 | ||||
|
|
|
(unaudited) | ||||||
|
(in thousands) |
|
|
|
| ||||
|
Net income on a GAAP basis |
|
$ |
37,705 |
|
|
$ |
313,874 |
|
|
Amortization of acquired intangibles |
|
12,422 |
|
|
7,649 |
| ||
|
Stock-based compensation expense |
|
18,798 |
|
|
13,276 |
| ||
|
Non-qualified deferred compensation expenses |
|
1,256 |
|
|
1,216 |
| ||
|
Restructuring and other charges |
|
15,405 |
|
|
64 |
| ||
|
Integration and acquisition-related costs |
|
8,903 |
|
|
2,187 |
| ||
|
Executive severance costs |
|
216 |
|
|
— |
| ||
|
Amortization of debt discount |
|
5,515 |
|
|
5,354 |
| ||
|
Other income or expense related to investments and non-qualified deferred compensation plan assets* |
|
(1,553) |
|
|
(4,081) |
| ||
|
Income tax benefit of valuation allowance release |
|
— |
|
|
(219,601) |
| ||
|
Income tax benefit of State of California settlement |
|
— |
|
|
(36,564) |
| ||
|
Income tax effect of non-GAAP adjustments |
|
(31,775) |
|
|
(25,363) |
| ||
|
Net income on a non-GAAP basis |
|
$ |
66,892 |
|
|
$ |
58,011 |
|
|
|
|
|
* |
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. |
|
Net Income Reconciliation |
|
Years Ended | ||||||
|
|
|
December 28, 2013 |
|
December 29, 2012 | ||||
|
|
|
(unaudited) | ||||||
|
(in thousands) |
|
|
|
| ||||
|
Net income on a GAAP basis |
|
$ |
164,243 |
|
|
$ |
439,948 |
|
|
Amortization and sale of acquired intangibles |
|
44,134 |
|
|
28,618 |
| ||
|
Stock-based compensation expense |
|
66,285 |
|
|
47,561 |
| ||
|
Non-qualified deferred compensation expenses |
|
3,293 |
|
|
4,453 |
| ||
|
Restructuring and other charges |
|
17,999 |
|
|
113 |
| ||
|
Shareholder litigation costs |
|
— |
|
|
46 |
| ||
|
Integration and acquisition-related costs |
|
31,972 |
|
|
9,278 |
| ||
|
Executive severance costs |
|
961 |
|
|
— |
| ||
|
Amortization of debt discount |
|
22,315 |
|
|
20,846 |
| ||
|
Other income or expense related to investments and non-qualified deferred compensation plan assets* |
|
(5,280) |
|
|
(6,296) |
| ||
|
Income tax benefit of valuation allowance release |
|
— |
|
|
(219,601) |
| ||
|
Income tax benefit of State of California settlement |
|
— |
|
|
(36,564) |
| ||
|
Income tax benefit due to a release of an uncertain tax position |
|
(33,719) |
|
|
— |
| ||
|
Acquisition-related income tax benefit |
|
— |
|
|
(14,806) |
| ||
|
Income tax effect of non-GAAP adjustments |
|
(60,104) |
|
|
(56,857) |
| ||
|
Net income on a non-GAAP basis |
|
$ |
252,099 |
|
|
$ |
216,739 |
|
|
|
|
|
* |
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 | ||||||
|
|
|
December 28, 2013 |
|
December 29, 2012 | ||||
|
|
|
(unaudited) | ||||||
|
(in thousands, except per share data) |
|
|
|
| ||||
|
Diluted net income per share on a GAAP basis |
|
$ |
0.13 |
|
|
$ |
1.10 |
|
|
Amortization of acquired intangibles |
|
0.04 |
|
|
0.03 |
| ||
|
Stock-based compensation expense |
|
0.06 |
|
|
0.05 |
| ||
|
Non-qualified deferred compensation expenses |
|
0.01 |
|
|
— |
| ||
|
Restructuring and other charges |
|
0.05 |
|
|
— |
| ||
|
Integration and acquisition-related costs |
|
0.03 |
|
|
0.01 |
| ||
|
Executive severance costs |
|
— |
|
|
— |
| ||
|
Amortization of debt discount |
|
0.02 |
|
|
0.02 |
| ||
|
Other income or expense related to investments and non-qualified deferred compensation plan assets* |
|
— |
|
|
(0.02) |
| ||
|
Income tax benefit of valuation allowance release |
|
— |
|
|
(0.77) |
| ||
|
Income tax benefit of State of California settlement |
|
— |
|
|
(0.13) |
| ||
|
Income tax effect of non-GAAP adjustments |
|
(0.11) |
|
|
(0.09) |
| ||
|
Diluted net income per share on a non-GAAP basis |
|
$ |
0.23 |
|
|
$ |
0.20 |
|
|
Shares used in calculation of diluted net income per share — GAAP** |
|
294,663 |
|
|
286,289 |
| ||
|
Shares used in calculation of diluted net income per share — non-GAAP** |
|
294,663 |
|
|
286,289 |
| ||
|
|
|
|
* |
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. |
|
Diluted Net Income per Share Reconciliation |
|
Years Ended | ||||||
|
|
|
December 28, 2013 |
|
December 29, 2012 | ||||
|
|
|
(unaudited) | ||||||
|
(in thousands, except per share data) |
|
|
|
| ||||
|
Diluted net income per share on a GAAP basis |
|
$ |
0.56 |
|
|
$ |
1.57 |
|
|
Amortization and sale of acquired intangibles |
|
0.15 |
|
|
0.10 |
| ||
|
Stock-based compensation expense |
|
0.23 |
|
|
0.17 |
| ||
|
Non-qualified deferred compensation expenses |
|
0.01 |
|
|
0.02 |
| ||
|
Restructuring and other charges |
|
0.06 |
|
|
— |
| ||
|
Shareholder litigation costs |
|
— |
|
|
— |
| ||
|
Integration and acquisition-related costs |
|
0.11 |
|
|
0.03 |
| ||
|
Executive severance costs |
|
— |
|
|
— |
| ||
|
Amortization of debt discount |
|
0.08 |
|
|
0.07 |
| ||
|
Other income or expense related to investments and non-qualified deferred compensation plan assets* |
|
(0.02) |
|
|
(0.02) |
| ||
|
Income tax benefit of valuation allowance release |
|
— |
|
|
(0.78) |
| ||
|
Income tax benefit of State of California settlement |
|
— |
|
|
(0.13) |
| ||
|
Income tax benefit due to a release of an uncertain tax position |
|
(0.11) |
|
|
— |
| ||
|
Acquisition-related income tax benefit |
|
— |
|
|
(0.05) |
| ||
|
Income tax effect of non-GAAP adjustments |
|
(0.21) |
|
|
(0.21) |
| ||
|
Diluted net income per share on a non-GAAP basis |
|
$ |
0.86 |
|
|
$ |
0.77 |
|
|
Shares used in calculation of diluted net income per share — GAAP** |
|
294,564 |
|
|
280,667 |
| ||
|
Shares used in calculation of diluted net income per share — non-GAAP** |
|
294,564 |
|
|
280,667 |
| ||
|
|
|
|
* |
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 March 14, 2014, 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 first quarter 2014 earnings release is published, which is currently scheduled for April 21, 2014.
For more information, please contact:
Investors and Shareholders
Alan Lindstrom
Cadence Design Systems, Inc.
408-944-7100
Email Contact
Media and Industry Analysts
Anna del Rosario
Cadence Design Systems, Inc.
408-914-6884
Email Contact
|
Cadence Design Systems, Inc. | ||||||||||
|
Condensed Consolidated Balance Sheets | ||||||||||
|
December 28, 2013 and December 29, 2012 | ||||||||||
|
(In thousands) | ||||||||||
|
(Unaudited) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 28, 2013 |
|
December 29, 2012 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
| |||
|
|
Cash and cash equivalents |
|
|
|
$ 536,260 |
|
$ 726,357 | |||
|
|
Short-term investments |
|
|
|
96,788 |
|
100,704 | |||
|
|
Receivables, net of allowances of $0 and $85, respectively |
|
|
|
107,624 |
|
97,821 | |||
|
|
Inventories |
|
|
|
|
50,220 |
|
36,163 | ||
|
|
2015 notes hedges |
|
|
|
306,817 |
|
303,154 | |||
|
|
Prepaid expenses and other |
|
|
|
123,382 |
|
127,036 | |||
|
|
|
Total current assets |
|
|
|
1,221,091 |
|
1,391,235 | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
Property, plant and equipment, net of accumulated depreciation of $568,494 and $635,450, respectively |
|
238,715 |
|
244,439 | ||||||
|
Goodwill |
|
|
|
|
456,905 |
|
233,266 | |||
|
Acquired intangibles, net of accumulated amortization of $139,820 and $104,351, respectively |
|
|
311,693 |
|
184,938 | |||||
|
Long-term receivables |
|
|
|
3,672 |
|
7,559 | ||||
|
Other assets |
|
|
|
|
196,525 |
|
225,566 | |||
|
Total assets |
|
|
|
|
$ 2,428,601 |
|
$ 2,287,003 | |||
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
| |||
|
|
Convertible notes |
|
|
|
$ 324,826 |
|
$ 447,011 | |||
|
|
2015 notes embedded conversion derivative |
|
306,817 |
|
303,154 | |||||
|
|
Accounts payable and accrued liabilities |
|
|
216,594 |
|
171,318 | ||||
|
|
Current portion of deferred revenue |
|
|
299,973 |
|
295,787 | ||||
|
|
|
Total current liabilities |
|
|
|
1,148,210 |
|
1,217,270 | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term liabilities: |
|
|
|
|
|
|
| |||
|
|
Long-term portion of deferred revenue |
|
|
52,850 |
|
50,529 | ||||
|
|
Other long-term liabilities |
|
|
|
71,436 |
|
104,033 | |||
|
|
|
Total long-term liabilities |
|
|
|
124,286 |
|
154,562 | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' equity |
|
|
|
|
1,156,105 |
|
915,171 | |||
|
Total liabilities and stockholders' equity |
|
|
$ 2,428,601 |
|
$ 2,287,003 | |||||
|
Cadence Design Systems, Inc. | ||||||||||||
|
Condensed Consolidated Income Statements | ||||||||||||
|
For the Three Months and Years Ended December 28, 2013 and December 29, 2012 | ||||||||||||
|
(In thousands, except per share amounts) | ||||||||||||
|
(Unaudited) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Years Ended | ||||
|
|
|
|
|
|
|
December 28,
|
|
December 29,
|
|
December 28,
|
|
December 29,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue: |
|
|
|
|
|
|
|
|
| |||
|
|
Product and maintenance |
|
$ 350,079 |
|
$ 318,513 |
|
$ 1,357,934 |
|
$ 1,212,429 | |||
|
|
Services |
|
|
26,643 |
|
27,072 |
|
102,182 |
|
113,995 | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
|
|
376,722 |
|
345,585 |
|
1,460,116 |
|
1,326,424 | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
|
|
|
| |||
|
|
Cost of product and maintenance |
41,757 |
|
24,437 |
|
132,245 |
|
118,516 | ||||
|
|
Cost of services |
|
|
17,274 |
|
19,353 |
|
67,956 |
|
72,607 | ||
|
|
Marketing and sales |
|
94,384 |
|
95,604 |
|
378,157 |
|
342,278 | |||
|
|
Research and development |
|
135,465 |
|
118,382 |
|
534,022 |
|
454,085 | |||
|
|
General and administrative |
|
29,481 |
|
27,712 |
|
121,314 |
|
112,076 | |||
|
|
Amortization of acquired intangibles |
5,157 |
|
3,772 |
|
19,416 |
|
15,077 | ||||
|
|
Restructuring and other charges |
15,405 |
|
64 |
|
17,999 |
|
113 | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total costs and expenses |
|
338,923 |
|
289,324 |
|
1,271,109 |
|
1,114,752 | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations |
37,799 |
|
56,261 |
|
189,007 |
|
211,672 | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
(9,208) |
|
(8,902) |
|
(37,581) |
|
(34,742) | ||
|
|
Other income, net |
|
842 |
|
5,369 |
|
7,570 |
|
11,341 | |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before benefit for income taxes |
29,433 |
|
52,728 |
|
158,996 |
|
188,271 | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Benefit for income taxes |
|
(8,272) |
|
(261,146) |
|
(5,247) |
|
(251,677) | |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
$ 37,705 |
|
$ 313,874 |
|
$ 164,243 |
|
$ 439,948 | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share - basic |
|
$ 0.13 |
|
$ 1.15 |
|
$ 0.59 |
|
$ 1.63 | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share - diluted |
|
$ 0.13 |
|
$ 1.10 |
|
$ 0.56 |
|
$ 1.57 | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding - basic |
280,083 |
|
272,884 |
|
277,796 |
|
270,479 | |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding - diluted |
294,663 |
|
286,289 |
|
294,564 |
|
280,667 | |||||
|
Cadence Design Systems, Inc. | ||||
|
Condensed Consolidated Statements of Cash Flows | ||||
|
For the Years Ended December 28, 2013 and December 29, 2012 | ||||
|
(In thousands) | ||||
|
(Unaudited) | ||||
|
| ||||
|
|
|
|
|
|
|
|
|
Years Ended | ||
|
|
|
December 28, |
|
December 29, |
|
|
|
2013 |
|
2012 |
|
|
|
|
|
|
|
Cash and cash equivalents at beginning of period |
|
$ 726,357 |
|
$ 601,602 |
|
Cash flows from operating activities: |
|
|
|
|
|
Net income |
|
164,243 |
|
439,948 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
Depreciation and amortization |
|
98,308 |
|
89,217 |
|
Amortization of debt discount and fees |
|
25,384 |
|
23,513 |
|
Stock-based compensation |
|
66,285 |
|
47,561 |
|
Gain on investments, net |
|
(5,311) |
|
(6,320) |
|
Deferred income taxes |
|
(2,366) |
|
(240,424) |
|
Provisions (recoveries) for losses (gains) on receivables, net |
|
(85) |
|
215 |
|
Other non-cash items |
|
4,017 |
|
3,315 |
|
Changes in operating assets and liabilities, net of effect of acquired businesses: |
|
|
|
|
|
Receivables |
|
(3,609) |
|
45,630 |
|
Inventories |
|
(14,594) |
|
5,245 |
|
Prepaid expenses and other |
|
30,368 |
|
(12,426) |
|
Other assets |
|
(2,530) |
|
(4,902) |
|
Accounts payable and accrued liabilities |
|
41,727 |
|
17,523 |
|
Deferred revenue |
|
2,506 |
|
(69,662) |
|
Other long-term liabilities |
|
(36,738) |
|
(22,439) |
|
Net cash provided by operating activities |
|
367,605 |
|
315,994 |
|
|
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
|
|
Purchases of available-for-sale securities |
|
(111,702) |
|
(121,154) |
|
Proceeds from the sale of available-for-sale securities |
|
77,621 |
|
18,338 |
|
Proceeds from the maturity of available-for-sale securities |
|
38,706 |
|
4,150 |
|
Proceeds from the sale of long-term investments |
|
6,234 |
|
74 |
|
Purchases of property, plant and equipment |
|
(44,929) |
|
(35,966) |
|
Investment in venture capital partnerships and equity investments |
|
- |
|
(250) |
|
Cash paid in business combinations and asset acquisitions, net of cash acquired |
|
(392,825) |
|
(66,432) |
|
Net cash used for investing activities |
|
(426,895) |
|
(201,240) |
|
|
|
|
|
|
|
Cash flows from financing activities: |
|
|
|
|
|
Proceeds from revolving credit facility |
|
100,000 |
|
- |
|
Payment on revolving credit facility |
|
(100,000) |
|
- |
|
Payment of convertible notes |
|
(144,639) |
|
- |
|
Principal payments on receivable financing |
|
(2,526) |
|
(5,776) |
|
Payment of debt issuance costs |
|
- |
|
(1,372) |
|
Payment of acquisition-related contingent consideration |
|
(677) |
|
(39) |
|
Tax effect related to employee stock transactions allocated to equity |
|
9,034 |
|
6,061 |
|
Proceeds from issuance of common stock |
|
42,657 |
|
32,687 |
|
Stock received for payment of employee taxes on vesting of restricted stock |
|
(20,140) |
|
(15,728) |
|
Net cash provided by (used for) financing activities |
|
(116,291) |
|
15,833 |
|
|
|
|
|
|
|
Effect of exchange rate changes on cash and cash equivalents |
|
(14,516) |
|
(5,832) |
|
|
|
|
|
|
|
Increase (decrease) in cash and cash equivalents |
|
(190,097) |
|
124,755 |
|
|
|
|
|
|
|
Cash and cash equivalents at end of period |
|
$ 536,260 |
|
$ 726,357 |
|
Cadence Design Systems, Inc. | ||||
|
As of January 29, 2014 | ||||
|
Impact of Non-GAAP Adjustments on Forward Looking Diluted Net Income Per Share | ||||
|
(Unaudited) | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ending |
|
Year Ending |
|
|
|
March 29, 2014 |
|
January 3, 2015 |
|
|
|
Forecast |
|
Forecast |
|
|
|
|
|
|
|
Diluted net income per share on a GAAP basis |
$0.08 to $0.10 |
|
$0.55 to $0.65 | |
|
|
|
|
|
|
|
|
Amortization of acquired intangibles |
0.04 |
|
0.16 |
|
|
Stock-based compensation expense |
0.07 |
|
0.28 |
|
|
Integration and acquisition-related costs |
0.02 |
|
0.05 |
|
|
Amortization of debt discount |
0.01 |
|
0.06 |
|
|
Income tax effect of non-GAAP adjustments |
(0.04) |
|
(0.18) |
|
|
|
|
|
|
|
Diluted net income per share on a non-GAAP basis |
$0.18 to $0.20 |
|
$0.92 to $1.02 | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cadence Design Systems, Inc. | ||||
|
As of January 29, 2014 | ||||
|
Impact of Non-GAAP Adjustments on Forward Looking Net Income | ||||
|
(Unaudited) | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ending |
|
Year Ending |
|
|
|
March 29, 2014 |
|
January 3, 2015 |
|
($ in millions) |
Forecast |
|
Forecast | |
|
|
|
|
|
|
|
Net income on a GAAP basis |
$25 to $31 |
|
$167 to $197 | |
|
|
|
|
|
|
|
|
Amortization of acquired intangibles |
12 |
|
50 |
|
|
Stock-based compensation expense |
19 |
|
83 |
|
|
Integration and acquisition-related costs |
6 |
|
15 |
|
|
Amortization of debt discount |
4 |
|
18 |
|
|
Income tax effect of non-GAAP adjustments |
(13) |
|
(56) |
|
|
|
|
|
|
|
Net income on a non-GAAP basis |
$53 to $59 |
|
$277 to $307 | |
|
Cadence Design Systems, Inc. | |||||||||||||||||||||||
|
(Unaudited) | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
|
Revenue Mix by Geography (% of Total Revenue) |
|
|
|
|
| ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
|
|
|
2012 |
|
2013 | |||||||||||||||||||
|
GEOGRAPHY |
|
Q1 |
Q2 |
Q3 |
Q4 |
Year |
|
Q1 |
Q2 |
Q3 |
Q4 |
Year | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
|
Americas |
|
44% |
46% |
43% |
45% |
45% |
|
44% |
45% |
48% |
47% |
46% | |||||||||||
|
Europe, Middle East and Africa |
|
19% |
20% |
20% |
21% |
20% |
|
22% |
21% |
20% |
20% |
21% | |||||||||||
|
Japan |
|
18% |
16% |
17% |
14% |
16% |
|
15% |
13% |
12% |
14% |
13% | |||||||||||
|
Asia |
|
19% |
18% |
20% |
20% |
19% |
|
19% |
21% |
20% |
19% |
20% | |||||||||||
|
Total |
|
100% |
100% |
100% |
100% |
100% |
|
100% |
100% |
100% |
100% |
100% | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
|
Revenue Mix by Product Group (% of Total Revenue) |
|
|
|
|
| ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
|
|
|
2012 |
|
2013 | |||||||||||||||||||
|
PRODUCT GROUP |
|
Q1 |
Q2 |
Q3 |
Q4 |
Year |
|
Q1 |
Q2 |
Q3 |
Q4 |
Year | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
|
Functional Verification, including Emulation Hardware and IP |
|
30% |
33% |
30% |
30% |
30% |
|
26% |
28% |
31% |
32% |
29% | |||||||||||
|
Custom IC Design |
|
23% |
22% |
24% |
24% |
23% |
|
25% |
25% |
25% |
24% |
25% | |||||||||||
|
Digital IC Design and Signoff |
|
23% |
22% |
23% |
23% |
23% |
|
25% |
23% |
21% |
21% |
23% | |||||||||||
|
System Interconnect Design |
|
8% |
8% |
9% |
9% |
9% |
|
10% |
11% |
10% |
10% |
10% | |||||||||||
|
Design for Manufacturing |
|
7% |
6% |
6% |
6% |
6% |
|
7% |
6% |
6% |
6% |
6% | |||||||||||
|
Services |
|
9% |
9% |
8% |
8% |
9% |
|
7% |
7% |
7% |
7% |
7% | |||||||||||
|
Total |
|
100% |
100% |
100% |
100% |
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 December 28, 2013 | ||||||||||||||
|
(In thousands) | ||||||||||||||
|
(Unaudited) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
| ||
|
|
|
|
|
|
|
|
|
December 28, 2013 |
|
|
|
| ||
|
|
|
|
|
|
|
GAAP |
|
Adjustments |
|
Non-GAAP |
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
Revenue: |
|
|
|
|
|
|
|
|
|
| ||||
|
|
Product and maintenance |
|
|
$ 350,079 |
|
$ - |
|
$ 350,079 |
|
| ||||
|
|
Services |
|
|
26,643 |
|
- |
|
26,643 |
|
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
Total revenue |
|
|
376,722 |
|
- |
|
376,722 |
|
| |||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
Costs and expenses: |
|
|
|
|
|
|
|
|
| |||||
|
|
Cost of product and maintenance |
|
41,757 |
|
(7,743) |
(A) |
34,014 |
|
| |||||
|
|
Cost of services |
|
|
17,274 |
|
(698) |
(A) |
16,576 |
|
| ||||
|
|
Marketing and sales |
|
|
94,384 |
|
(5,201) |
(A) |
89,183 |
|
| ||||
|
|
Research and development |
|
135,465 |
|
(15,666) |
(A) |
119,799 |
|
| |||||
|
|
General and administrative |
|
29,481 |
|
(7,130) |
(A) |
22,351 |
|
| |||||
|
|
Amortization of acquired intangibles |
|
5,157 |
|
(5,157) |
(A) |
- |
|
| |||||
|
|
Restructuring and other charges |
|
15,405 |
|
(15,405) |
|
- |
|
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
Total costs and expenses |
|
338,923 |
|
(57,000) |
|
281,923 |
|
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
Income from operations |
|
37,799 |
|
57,000 |
|
94,799 |
|
| |||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
Interest expense |
|
|
(9,208) |
|
5,515 |
(B) |
(3,693) |
|
| ||||
|
|
Other income (expense), net |
|
842 |
|
(1,553) |
(C) |
(711) |
|
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
Income before provision (benefit) for income taxes |
29,433 |
|
60,962 |
|
90,395 |
|
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
Provision (benefit) for income taxes |
|
(8,272) |
|
31,775 |
(D) |
23,503 |
|
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
Net income |
|
|
$ 37,705 |
|
$ 29,187 |
|
$ 66,892 |
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
Notes: |
|
|
|
|
|
|
|
|
|
|
|
| ||
|
(A) For the three months ended December 28, 2013 adjustments to GAAP are as follows for the line items specified: | ||||||||||||||
|
| ||||||||||||||
|
| ||||||||||||||
|
|
Amortization of acquired intangibles |
Stock-based compensation expense |
Non-qualified deferred compensation expenses |
Integration and acquisition- related costs |
Executive severance costs |
Total adjustments |
|
Cost of product and maintenance |
$ 7,265 |
$ 471 |
$ 7 |
$ - |
$ - |
$ 7,743 |
|
Cost of services |
- |
689 |
9 |
- |
- |
698 |
|
Marketing and sales |
- |
4,703 |
68 |
430 |
- |
5,201 |
|
Research and development |
- |
9,605 |
683 |
5,378 |
- |
15,666 |
|
General and administrative |
- |
3,330 |
489 |
3,095 |
216 |
7,130 |
|
Amortization of acquired intangibles |
5,157 |
- |
- |
- |
- |
5,157 |
|
Total |
$ 12,422 |
$ 18,798 |
$ 1,256 |
$ 8,903 |
$ 216 |
$ 41,595 |
|
| ||||||||||||||
|
(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 effect of non-GAAP adjustments | ||||||||||||||
|
Cadence Design Systems, Inc. | ||||||||||||
|
Supplemental Reconciliation of Certain GAAP to Non-GAAP Measures | ||||||||||||
|
For the Three Months Ended December 29, 2012 | ||||||||||||
|
(In thousands) | ||||||||||||
|
(Unaudited) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
|
|
|
|
|
|
|
|
|
|
December 29, 2012 |
|
|
|
|
|
|
|
|
|
|
|
GAAP |
|
Adjustments |
|
Non-GAAP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue: |
|
|
|
|
|
|
|
|
|
| ||
|
|
Product and maintenance |
|
|
$ 318,513 |
|
$ - |
|
$ 318,513 |
|
| ||
|
|
Services |
|
|
27,072 |
|
- |
|
27,072 |
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
|
|
345,585 |
|
- |
|
345,585 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
|
|
|
| |||
|
|
Cost of product and maintenance |
|
24,437 |
|
(4,263) |
(E) |
20,174 |
|
| |||
|
|
Cost of services |
|
|
19,353 |
|
(554) |
(E) |
18,799 |
|
| ||
|
|
Marketing and sales |
|
|
95,604 |
|
(3,082) |
(E) |
92,522 |
|
| ||
|
|
Research and development |
|
118,382 |
|
(8,725) |
(E) |
109,657 |
|
| |||
|
|
General and administrative |
|
27,712 |
|
(3,932) |
(E) |
23,780 |
|
| |||
|
|
Amortization of acquired intangibles |
|
3,772 |
|
(3,772) |
(E) |
- |
|
| |||
|
|
Restructuring and other charges |
|
64 |
|
(64) |
|
- |
|
| |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total costs and expenses |
|
289,324 |
|
(24,392) |
|
264,932 |
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations |
|
56,261 |
|
24,392 |
|
80,653 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
(8,902) |
|
5,354 |
(F) |
(3,548) |
|
| ||
|
|
Other income, net |
|
|
5,369 |
|
(4,081) |
(G) |
1,288 |
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before provision (benefit) for income taxes |
52,728 |
|
25,665 |
|
78,393 |
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit) for income taxes |
|
(261,146) |
|
281,528 |
(H) |
20,382 |
|
| |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
$ 313,874 |
|
$ (255,863) |
|
$ 58,011 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes: |
|
|
|
|
|
|
|
|
|
| ||
|
(E) For the three months ended December 29, 2012 adjustments to GAAP are as follows for the line items specified: | ||||||||||||
|
|
|
|
| |||||||||
|
|
|
|
| |||||||||
|
|
Amortization of acquired intangibles |
Stock-based compensation expense |
Non-qualified deferred compensation expenses |
Integration and acquisition- related costs |
Total adjustments |
|
Cost of product and maintenance |
$ 3,877 |
$ 375 |
$ 11 |
$ - |
$ 4,263 |
|
Cost of services |
- |
538 |
16 |
- |
554 |
|
Marketing and sales |
- |
2,907 |
110 |
65 |
3,082 |
|
Research and development |
- |
6,293 |
623 |
1,809 |
8,725 |
|
General and administrative |
- |
3,163 |
456 |
313 |
3,932 |
|
Amortization of acquired intangibles |
3,772 |
- |
- |
- |
3,772 |
|
Total |
$ 7,649 |
$ 13,276 |
$ 1,216 |
$ 2,187 |
$ 24,328 |
|
| ||||||||||||
|
(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 | ||||||||||||
|
Cadence Design Systems, Inc. | ||||||||||
|
Supplemental Reconciliation of Certain GAAP to Non-GAAP Measures | ||||||||||
|
For the Year Ended December 28, 2013 | ||||||||||
|
(In thousands) | ||||||||||
|
(Unaudited) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended |
|
|
|
|
|
|
|
|
|
|
|
December 28, 2013 |
|
|
|
|
|
|
|
|
|
GAAP |
|
Adjustments |
|
Non-GAAP |
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue: |
|
|
|
|
|
|
| |||
|
|
Product and maintenance |
|
$ 1,357,934 |
|
$ - |
|
$ 1,357,934 | |||
|
|
Services |
|
|
102,182 |
|
- |
|
102,182 | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
|
|
1,460,116 |
|
- |
|
1,460,116 | |
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
|
| |||
|
|
Cost of product and maintenance |
|
132,245 |
|
(26,352) |
(I) |
105,893 | |||
|
|
Cost of services |
|
|
67,956 |
|
(2,373) |
(I) |
65,583 | ||
|
|
Marketing and sales |
|
|
378,157 |
|
(17,828) |
(I) |
360,329 | ||
|
|
Research and development |
|
534,022 |
|
(53,403) |
(I) |
480,619 | |||
|
|
General and administrative |
|
121,314 |
|
(27,273) |
(I) |
94,041 | |||
|
|
Amortization of acquired intangibles |
|
19,416 |
|
(19,416) |
(I) |
- | |||
|
|
Restructuring and other charges |
|
17,999 |
|
(17,999) |
|
- | |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total costs and expenses |
|
1,271,109 |
|
(164,644) |
|
1,106,465 | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations |
|
189,007 |
|
164,644 |
|
353,651 | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
(37,581) |
|
22,315 |
(J) |
(15,266) | ||
|
|
Other income, net |
|
|
7,570 |
|
(5,280) |
(K) |
2,290 | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before provision (benefit) for income taxes |
158,996 |
|
181,679 |
|
340,675 | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit) for income taxes |
|
(5,247) |
|
93,823 |
(L) |
88,576 | |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
$ 164,243 |
|
$ 87,856 |
|
$ 252,099 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes: |
|
|
|
|
|
|
|
| ||
|
(I) For the year ended December 28, 2013 adjustments to GAAP are as follows for the line items specified: | ||||||||||
|
|
| |||||||||
|
|
| |||||||||
|
|
Amortization and sale of acquired intangibles |
Stock-based compensation expense |
Non-qualified deferred compensation expenses |
Integration and acquisition- related costs |
Executive severance costs |
Total adjustments | |
|
Cost of product and maintenance |
$ 24,718 |
$ 1,596 |
$ 38 |
$ - |
$ - |
$ 26,352 | |
|
Cost of services |
- |
2,321 |
52 |
- |
- |
2,373 | |
|
Marketing and sales |
- |
15,642 |
239 |
1,467 |
480 |
17,828 | |
|
Research and development |
- |
32,999 |
1,700 |
18,704 |
- |
53,403 | |
|
General and administrative |
- |
13,727 |
1,264 |
11,801 |
481 |
27,273 | |
|
Amortization of acquired intangibles |
19,416 |
- |
- |
- |
- |
19,416 | |
|
Total |
$ 44,134 |
$ 66,285 |
$ 3,293 |
$ 31,972 |
$ 961 |
$ 146,645 | |
|
| ||||||||||||||
|
(J) Amortization of debt discount related to convertible notes | ||||||||||||||
|
(K) Other income or expense related to investments and non-qualified deferred compensation plan assets | ||||||||||||||
|
(L) Income tax effect of non-GAAP adjustments | ||||||||||||||
|
Cadence Design Systems, Inc. | ||||||||||
|
Supplemental Reconciliation of Certain GAAP to Non-GAAP Measures | ||||||||||
|
For the Year Ended December 29, 2012 | ||||||||||
|
(In thousands) | ||||||||||
|
(Unaudited) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended |
|
|
|
|
|
|
|
|
|
|
|
December 29, 2012 |
|
|
|
|
|
|
|
|
|
GAAP |
|
Adjustments |
|
Non-GAAP |
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue: |
|
|
|
|
|
|
| |||
|
|
Product and maintenance |
|
$ 1,212,429 |
|
$ - |
|
$ 1,212,429 | |||
|
|
Services |
|
|
113,995 |
|
- |
|
113,995 | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
|
|
1,326,424 |
|
- |
|
1,326,424 | |
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
|
| |||
|
|
Cost of product and maintenance |
|
118,516 |
|
(14,905) |
(M) |
103,611 | |||
|
|
Cost of services |
|
|
72,607 |
|
(1,957) |
(M) |
70,650 | ||
|
|
Marketing and sales |
|
|
342,278 |
|
(11,247) |
(M) |
331,031 | ||
|
|
Research and development |
|
454,085 |
|
(29,860) |
(M) |
424,225 | |||
|
|
General and administrative |
|
112,076 |
|
(16,910) |
(M) |
95,166 | |||
|
|
Amortization of acquired intangibles |
|
15,077 |
|
(15,077) |
(M) |
- | |||
|
|
Restructuring and other charges |
|
113 |
|
(113) |
|
- | |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total costs and expenses |
|
1,114,752 |
|
(90,069) |
|
1,024,683 | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations |
|
211,672 |
|
90,069 |
|
301,741 | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
(34,742) |
|
20,846 |
(N) |
(13,896) | ||
|
|
Other income, net |
|
|
11,341 |
|
(6,296) |
(O) |
5,045 | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before provision (benefit) for income taxes |
188,271 |
|
104,619 |
|
292,890 | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit) for income taxes |
|
(251,677) |
|
327,828 |
(P) |
76,151 | |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
$ 439,948 |
|
$ (223,209) |
|
$ 216,739 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes: |
|
|
|
|
|
|
|
| ||
|
(M) For the year ended December 29, 2012 adjustments to GAAP are as follows for the line items specified: | ||||||||||
|
|
| |||||||||
|
|
| |||||||||
|
|
Amortization of acquired intangibles |
Stock-based compensation expense |
Non-qualified deferred compensation expenses |
Integration and acquisition- related costs |
Shareholder litigation costs |
Total adjustments | |
|
Cost of product and maintenance |
$ 13,541 |
$ 1,317 |
$ 47 |
$ - |
$ - |
$ 14,905 | |
|
Cost of services |
- |
1,889 |
68 |
- |
- |
1,957 | |
|
Marketing and sales |
- |
10,193 |
492 |
562 |
- |
11,247 | |
|
Research and development |
- |
21,516 |
2,144 |
6,200 |
- |
29,860 | |
|
General and administrative |
- |
12,646 |
1,702 |
2,516 |
46 |
16,910 | |
|
Amortization of acquired intangibles |
15,077 |
- |
- |
- |
- |
15,077 | |
|
Total |
$ 28,618 |
$ 47,561 |
$ 4,453 |
$ 9,278 |
$ 46 |
$ 89,956 | |
|
| ||||||||||||||
|
(N) Amortization of debt discount related to convertible notes | ||||||||||||||
|
(O) Other income or expense related to investments and non-qualified deferred compensation plan assets | ||||||||||||||
|
(P) Income tax effect of non-GAAP adjustments | ||||||||||||||
SOURCE Cadence Design Systems, Inc.
| Contact: |
| Cadence Design Systems, Inc.
Web: http://www.cadence.com |