EX-99.1 2 f05300exv99w1.htm EXHIBIT 99.1 exv99w1
 

Exhibit 99.1

Cadence Design Systems, Inc.
Consolidated Balance Sheets
January 1, 2005 and January 3, 2004
(In thousands)

                 
    January 1, 2005     January 3, 2004  
Current Assets:
                
Cash and cash equivalents
   $ 556,766     $ 384,525  
Short-term investments
     36,241       33,898  
Receivables, net of allowance for doubtful accounts of $8,151 and $10,967, respectively
     384,114       348,680  
Inventories
     20,481       16,926  
Prepaid expenses and other
     87,702       58,212  
 
            
Total current assets
     1,085,304       842,241  
Property, plant and equipment, net
     390,367       403,847  
Goodwill
     995,065       922,797  
Acquired intangibles, net
     195,655       237,508  
Installment contract receivables, net
     96,038       121,627  
Other assets
     242,799       289,882  
 
            
Total Assets
   $ 3,005,228     $ 2,817,902  
 
            
Current Liabilities:
                
Accounts payable and accrued liabilities
     277,992       243,450  
Current portion of deferred revenue
     270,966       238,478  
 
            
Total current liabilities
     548,958       481,928  
 
            
Long-term Liabilities:
                
Long-term portion of deferred revenue
     20,847       16,287  
Convertible notes
     420,000       420,000  
Other long-term liabilities
     313,043       327,406  
 
            
Total long-term liabilities
     753,890       763,693  
 
            
Stockholders’ Equity
     1,702,380       1,572,281  
 
            
Total Liabilities and Stockholders’ Equity
   $ 3,005,228     $ 2,817,902  
 
            

 

 

Cadence Design Systems, Inc.
Consolidated Statements of Operations
For the Quarters and Years Ended January 1, 2005 and January 3, 2004
(In thousands, except per share amounts)

                                 
    Quarters Ended     Years Ended  
    January 1,
2005		     January 3,
2004		     January 1,
2005		     January 3,
2004		  
    (Unaudited)                        
Revenue:
                                
Product
   $ 226,730     $ 202,319     $ 729,783     $ 663,513  
Services
     32,982       30,187       137,046       131,149  
Maintenance
     83,384       78,585       330,651       324,822  
 
                        
Total revenue
     343,096       311,091       1,197,480       1,119,484  
 
                        
Costs and Expenses:
                                
Cost of product
     23,421       17,373       82,011       67,036  
Cost of services
     21,467       21,624       90,993       93,153  
Cost of maintenance
     13,236       13,061       53,049       56,460  
Marketing and sales
     87,806       79,586       325,937       326,579  
Research and development
     87,713       82,444       351,254       340,121  
General and administrative
     20,524       16,968       83,414       82,566  
Amortization of acquired intangibles
     11,028       16,310       55,700       62,573  
Amortization of deferred stock compensation
     9,484       15,566       31,408       41,124  
Legal settlements
     —       —       —       (14,500 )
Restructuring and other charges
     4,142       2,610       13,542       66,836  
Write-off of acquired in-process technology
     —       —       9,000       7,500  
 
                        
Total costs and expenses
     278,821       265,542       1,096,308       1,129,448  
 
                        
Income (loss) from operations
     64,275       45,549       101,172       (9,964 )
Interest expense
     (1,378 )     (1,296 )     (6,198 )     (5,002 )
Other income (expense), net
     1,479       (5,400 )     (8,537 )     (15,599 )
 
                        
Income (loss) before provision (benefit) for income taxes
     64,376       38,853       86,437       (30,565 )
Provision (benefit) for income taxes
     4,581       23,621       11,963       (12,999 )
 
                        
Net income (loss)
   $ 59,795     $ 15,232     $ 74,474     $ (17,566 )
 
                        
Basic net income (loss) per share
   $ 0.22     $ 0.06     $ 0.27     $ (0.07 )
 
                        
Diluted net income (loss) per share
   $ 0.20     $ 0.05     $ 0.25     $ (0.07 )
 
                        
Weighted average common shares outstanding
     270,734       264,178       271,328       266,794  
 
                        
Weighted average common and potential common shares outstanding—assuming dilution
     303,858       301,203       305,774       266,794  
 
                        

 

 

Cadence Design Systems, Inc.
Consolidated Statements of Cash Flows
For the Years Ended January 1, 2005 and January 3, 2004
(In thousands)

                 
    Year Ended  
    January 1,     January 3,  
    2005     2004  
Cash and Cash Equivalents at Beginning of Year
   $ 384,525     $ 371,327  
 
            
Cash Flows from Operating Activities:
                
Net income (loss)
     74,474       (17,566 )
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
                
Depreciation and amortization
     179,205       191,608  
Amortization of deferred stock compensation
     31,407       41,124  
Equity in loss from investments, net
     16,944       10,875  
Gain on sale of investments
     (12,467 )     —  
Write-off of long-term investment securities
     4,236       4,785  
Write-off of acquired in-process technology
     9,000       7,500  
Non-cash restructuring and other charges
     4,142       18,438  
Tax benefits from employee stock transactions
     17,260       14,875  
Deferred income taxes
     (30,772 )     (60,048 )
Proceeds from the sale of receivables
     30,070       87,355  
Provisions for losses on trade accounts receivable and sales returns
     775       11,428  
Other non-cash items
     (1,070 )     3,678  
Changes in operating assets and liabilities, net of effect of acquired and disposed businesses:
                
Receivables
     (49,361 )     (1,326 )
Inventories
     (3,555 )     (7,312 )
Prepaid expenses and other
     (3,410 )     (6,820 )
Installment contract receivables
     20,556       (107,929 )
Other assets
     16,417       31,941  
Accounts payable and accrued liabilities
     193     (106,687 )
Deferred revenue
     34,878       14,642  
Other long-term liabilities
     31,791       40,440  
 
            
Net cash provided by operating activities
     370,713       171,001  
 
            
Cash Flows from Investing Activities:
                
Proceeds from sale and maturities of short-term investments—available-for-sale
     8,301       —  
Proceeds from the sale of long-term investments
     9,900       3,274  
Proceeds from sale of equipment
     3,625       9,147  
Purchases of property, plant and equipment
     (61,779 )     (82,881 )
Purchases of software licenses
     (4,157 )     (33,507 )
Investment in venture capital partnerships and equity investments
     (22,773 )     (39,761 )
Net cash paid in business combinations
     (115,170 )     (182,247 )
 
            
Net cash used for investing activities
     (182,053 )     (325,975 )
 
            
Cash Flows from Financing Activities:
                
Proceeds from credit facility
     —       45,000  
Principal payments on credit facility and capital leases
     (372 )     (98,856 )
Proceeds from issuance of convertible notes
     —       420,000  
Payment of convertible notes issuance costs
     (1,920 )     (11,463 )
Proceeds from sale of common stock warrants
     —       56,441  
Purchase of call options
     —       (134,637 )
Proceeds from issuance of common stock
     77,126       86,567  
Purchases of treasury stock
     (94,103 )     (213,832 )
 
            
Net cash provided by (used for) financing activities
     (19,269 )     149,220  
 
            
Effect of exchange rate changes on cash
     2,850       18,952  
 
            
Net increase in cash and cash equivalents
     172,241       13,198  
 
            
Cash and Cash Equivalents at End of Year
   $ 556,766     $ 384,525  
 
            

 

 

Cadence Design Systems, Inc.
(Unaudited)

Revenue Mix by Geography (% of Total Revenue)

                                                                                 
    2003     2004  
GEOGRAPHY   Q1     Q2     Q3     Q4     Year     Q1     Q2     Q3     Q4     Year  
         
 
                                                                                
North America
     55 %     54 %     59 %     64 %     58 %     53 %     57 %     56 %     45 %     52 %
Europe
     17 %     15 %     19 %     16 %     17 %     16 %     19 %     20 %     30 %     22 %
Japan
     20 %     22 %     13 %     13 %     17 %     22 %     14 %     15 %     14 %     16 %
Asia
     8 %     9 %     9 %     7 %     8 %     9 %     10 %     9 %     11 %     10 %
Total
     100 %     100 %     100 %     100 %     100 %     100 %     100 %     100 %     100 %     100 %

Revenue Mix by Product Group (% of Total Revenue)

                                                                                 
    2003     2004  
PRODUCT GROUP   Q1     Q2     Q3     Q4     Year     Q1     Q2     Q3     Q4     Year  
         
 
                                                                                
Functional Verification
     20 %     18 %     18 %     20 %     19 %     20 %     20 %     18 %     19 %     19 %
Digital IC Design
     24 %     22 %     27 %     20 %     23 %     25 %     21 %     24 %     27 %     24 %
Custom IC Design
     27 %     28 %     27 %     27 %     27 %     27 %     24 %     27 %     27 %     27 %
Design for Manufacturing
     9 %     10 %     7 %     13 %     10 %     6 %     9 %     12 %     8 %     9 %
System Interconnect
     8 %     9 %     8 %     10 %     9 %     10 %     9 %     8 %     9 %     9 %
Services & Other
     12 %     13 %     13 %     10 %     12 %     12 %     17 %     11 %     10 %     12 %
Total
     100 %     100 %     100 %     100 %     100 %     100 %     100 %     100 %     100 %     100 %

Note: Product Group total revenue includes Product + Maintenance