UNITED STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM 8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF
THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported): April
27, 2011
CITRIX SYSTEMS, INC.
(Exact
name of Registrant as specified in its Charter)
Delaware |
0-27084 |
75-2275152 |
(State or other Jurisdiction of Incorporation or Organization) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
851 West Cypress Creek Road |
||
(Address of Principal Executive Offices) (Zip Code) |
Telephone: (954) 267-3000
(Registrant’s Telephone Number,
Including Area Code)
Not Applicable
(Former Name or
Former Address, If Changed Since Last Report)
Check the
appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any
of the following provisions:
⃞ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
⃞ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
⃞ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
⃞ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Section 2-Financial Information
Item 2.02. Results of Operations and Financial Condition
The information under this Item 2.02, including the Exhibit attached hereto, is intended to be furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such filing.
On April 27, 2011, Citrix Systems, Inc. issued a press release regarding its financial results for the quarter ended March 31, 2011. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated into this Item 2.02 by reference.
Section 9-Financial Statements and Exhibits
Item 9.01. Financial Statements and Exhibits.
(d) |
Exhibits. |
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Exhibit No. |
Description |
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99.1 |
Press release dated April 27, 2011 of Citrix Systems, Inc. |
SIGNATURES
Pursuant to
the requirements of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Citrix Systems, Inc. |
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|
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Dated: |
April 27, 2011 |
By: |
/s/ David J. Henshall |
Name: David J. Henshall |
|||
Title: Senior Vice President and Chief Financial Officer & Treasurer |
Exhibit Index
Exhibit No. |
Description |
|
99.1 |
Press release dated April 27, 2011 of Citrix Systems, Inc. |
Exhibit 99.1
Citrix Reports First Quarter Financial Results
Quarterly revenue of $491 million up 18% year-over-year
First quarter GAAP diluted Earnings per share of $0.38 up 53% year-over-year
First quarter non-GAAP diluted earnings per share of $0.50 up 27% year-over-year
Board of directors authorizes $500 million increase to share repurchase program
SANTA CLARA, Calif.--(BUSINESS WIRE)--April 27, 2011--Citrix Systems, Inc. (NASDAQ:CTXS) today reported financial results for the first quarter of fiscal 2011 ended March 31, 2011.
FINANCIAL RESULTS
In the first quarter of fiscal 2011, Citrix achieved revenue of $491 million, compared to $414 million in the first quarter of fiscal 2010, representing 18 percent revenue growth.
GAAP Results
Net income for the first quarter of fiscal 2011 was $74 million, or $0.38 per diluted share, compared to $47 million, or $0.25 per diluted share, for the first quarter of 2010.
Non-GAAP Results
Non-GAAP net income in the first quarter of fiscal 2011 was $97 million, or $0.50 per diluted share, compared to $75 million, or $0.40 per diluted share, in the comparable period last year. Non-GAAP net income for both periods excludes the effects of amortization of intangible assets primarily related to business combinations, stock-based compensation expenses, charges recorded in connection with the restructuring program that the company implemented in January 2009 and the tax effects related to those items.
“I’m pleased with our results for the first quarter,” said Mark Templeton, president and chief executive officer for Citrix. “Customer demand was solid across our core SaaS, desktop and networking markets, especially in the Americas and Pacific, supported by large, strategic technical services engagements.
“Clearly, the industry is rapidly moving from “PC era” to “cloud era,” where users are demanding -- and CIOs are embracing -- the consumerization of IT. We’re driving the transition with products that change how people collaborate, how desktops are delivered, and how delivery networks are built.
“This transformation is elevating our presence as a strategic vendor, increasing our engagement with C-level executives, and driving more interest in our virtual computing platform.”
In addition to quarterly financial results, Citrix also announced that its board of directors has authorized it to repurchase up to an additional $500 million of its common stock. As of March 31, 2011, approximately $11.5 million remained for repurchases from previous authorizations.
Q1 Financial Summary
In reviewing the first quarter results of 2011, compared to the first quarter of 2010:
Financial Outlook for Second Quarter 2011
Citrix management expects to achieve the following results during its second fiscal quarter of 2011 ending June 30, 2011:
The above statements are based on current expectations. These statements are forward-looking, and actual results may differ materially.
Financial Outlook for Fiscal Year 2011
Citrix management expects to achieve the following results during fiscal year 2011 ending December 31, 2011:
The above statements are based on current expectations. These statements are forward-looking, and actual results may differ materially.
Company, Product and Alliance Highlights
During the first quarter of 2011, Citrix announced:
Conference Call Information
Citrix will host a conference call today at 4:45 p.m. ET to discuss its financial results, quarterly highlights and business outlook. The call will include a slide presentation, and participants are encouraged to listen to and view the presentation via webcast at http://www.citrix.com/investors.
The conference call may also be accessed by dialing: (888) 799-0519 or (706) 634-0155, using passcode: CITRIX. A replay of the webcast can be viewed by visiting the Investor Relations section of the Citrix corporate website at http://www.citrix.com/investors for approximately 30 days. In addition, an audio replay of the conference call will be available for approximately 15 days by dialing (800) 642-1687 or (706) 645-9291 (passcode required: 58832886).
About Citrix
Citrix Systems, Inc. (NASDAQ:CTXS) is a leading provider of virtual computing solutions that help people work and play from anywhere on any device. More than 230,000 enterprises rely on Citrix to create better ways for people, IT and business to work through virtual meetings, desktops and datacenters. Citrix virtualization, networking and cloud solutions deliver over 100 million corporate desktops and touch 75 percent of Internet users each day. Citrix partners with over 10,000 companies in 100 countries. Annual revenue in 2010 was $1.87 billion.
For Citrix Investors
This release contains forward-looking statements which are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and of Section 21E of the Securities Exchange Act of 1934. The forward-looking statements in this release do not constitute guarantees of future performance. Investors are cautioned that statements in this press release, which are not strictly historical statements, including, without limitation, statements by Citrix's president and chief executive officer, statements contained in the Financial Outlook for Second Quarter 2011 and Financial Outlook for Fiscal Year 2011 sections, under the Non-GAAP Financial Measures Reconciliation section, and statements regarding management's plans, objectives and strategies, constitute forward-looking statements. Such forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated by the forward-looking statements, including, without limitation, the impact of the global economy and uncertainty in the IT spending environment, including Citrix's European markets; the success and growth of the company's product lines, including risks associated with successfully introducing new products into Citrix's distribution channels, including XenDesktop; the company's product concentration and its ability to develop and commercialize new products and services, including XenDesktop and its other virtualization offerings, while maintaining sales of its established products, especially XenApp; disruptions due to changes in key personnel and succession risks; seasonal fluctuations in the company’s business; failure to execute Citrix's sales and marketing plans; failure to successfully partner with key distributors, resellers, system integrators, OEM's and strategic partners and the company's reliance on and the success of those partners for the marketing and distribution of the company's products; the company's ability to maintain and expand its business in small sized and large enterprise accounts; the size, timing and recognition of revenue from significant orders; the success of investments in its product groups, foreign operations and vertical and geographic markets; Citrix's ability to develop server, application and desktop virtualization products, and jointly market those products with Microsoft; the introduction of new products by competitors or the entry of new competitors into the markets for Citrix's products as the enterprise software landscape evolves; the ability of Citrix to make suitable acquisitions on favorable terms in the future and to successfully integrate those acquisitions; failure to further develop and successfully market the technology and products of acquired companies, including the possible failure to achieve or maintain anticipated revenues and profits from acquisitions, including the acquisition of Netviewer; the management of anticipated future growth; the recruitment and retention of qualified employees, including those of acquired companies; risks in effectively controlling operating expenses, including failure to manage unexpected expenses; impairment of the value of the company's investments; the effect of new accounting pronouncements on revenue and expense recognition; litigation and disputes, including challenges to our intellectual property rights or allegations of infringement of the intellectual property rights of third parties; the inability to further innovate our technology due to the intellectual property rights of third parties; changes in the company's pricing and licensing models, promotional programs and product mix, all of which may impact Citrix's revenue recognition, including with respect to XenDesktop and SaaS business models, or those of its competitors; charges in the event of the impairment of assets acquired through business combinations and licenses; competition, international market readiness and execution and other risks associated with the markets for Citrix's Web-based access, collaboration and IT management services and for our Web application delivery appliances; unanticipated changes in tax rates or exposure to additional tax liabilities; risks of political and social turmoil; and other risks detailed in the company's filings with the Securities and Exchange Commission. Citrix assumes no obligation to update any forward-looking information contained in this press release or with respect to the announcements described herein.
Use of Non-GAAP Financial Measures
In Citrix’s earnings release, conference call, slide presentation or webcast, Citrix may use or discuss non-GAAP financial measures as defined by SEC Regulation G. The GAAP financial measure most directly comparable to each non-GAAP financial measure used or discussed and a reconciliation of the differences between each non-GAAP financial measure and the comparable GAAP financial measure are included in this press release after the condensed consolidated financial statement or can be found on the Investor Relations page of the Citrix corporate Web site at http://www.citrix.com/investors.
Citrix®, GoToMeeting®, NetScaler®, and XenServer®, are trademarks or registered trademarks of Citrix Systems, Inc. and/or one or more of its subsidiaries, and may be registered in the U.S. Patent and Trademark Office and in other countries. Xen® is a trademark of Citrix Systems, Inc. managed on behalf of Xen.org, and may be registered in the U.S. Patent and Trademark Office and in other countries. All other trademarks and registered trademarks are property of their respective owners.
CITRIX SYSTEMS, INC. Condensed Consolidated Statements of Income (In thousands, except per share data - unaudited) |
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Three Months Ended
March 31, |
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2011 | 2010 | |||
Revenues: | ||||
Product licenses | $150,260 | $122,706 | ||
License updates | 177,876 | 162,955 | ||
Online services | 99,772 | 84,950 | ||
Technical services | 62,980 | 43,661 | ||
Total net revenues | 490,888 | 414,272 | ||
Cost of net revenues: | ||||
Cost of product license revenues | 14,041 | 12,651 | ||
Cost of services revenues | 30,666 | 23,690 | ||
Amortization of product related intangible assets | 12,699 | 12,358 | ||
Total cost of net revenues | 57,406 | 48,699 | ||
Gross margin | 433,482 | 365,573 | ||
Operating expenses: | ||||
Research and development | 82,718 | 77,702 | ||
Sales, marketing and services | 194,243 | 170,520 | ||
General and administrative | 72,105 | 60,619 | ||
Amortization of other intangible assets | 3,509 | 4,157 | ||
Restructuring | 24 | 500 | ||
Total operating expenses | 352,599 | 313,498 | ||
Income from operations | 80,883 | 52,075 | ||
Other income, net | 7,572 | 3,933 | ||
Income before income taxes | 88,455 | 56,008 | ||
Income taxes | 15,108 | 8,659 | ||
Net income | 73,347 | 47,349 | ||
Net loss attributable to non-controlling interest | 156 | - | ||
Net income attributable to Citrix Systems, Inc | $73,503 | $47,349 | ||
Earnings per common share – diluted | $0.38 | $0.25 | ||
Weighted average shares outstanding – diluted | 191,500 | 188,842 |
CITRIX SYSTEMS, INC. Condensed Consolidated Balance Sheets (In thousands - unaudited) |
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March 31, 2011 |
December 31, 2010 |
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ASSETS: | ||||
Cash and cash equivalents | $515,340 | $396,162 | ||
Short-term investments | 414,579 | 497,643 | ||
Accounts receivable, net | 297,190 | 378,395 | ||
Other current assets, net | 204,730 | 198,279 | ||
Total current assets | 1,431,839 | 1,470,479 | ||
Long-term investments | 708,906 | 791,854 | ||
Property and equipment, net | 261,235 | 250,482 | ||
Goodwill and other intangible assets, net | 1,239,469 | 1,099,244 | ||
Other long-term assets | 111,116 | 91,541 | ||
Total assets | $3,752,565 | $3,703,600 | ||
LIABILITIES AND STOCKHOLDERS’ EQUITY: | ||||
Accounts payable and accrued expenses | $295,876 | $355,680 | ||
Current portion of deferred revenues | 678,186 | 664,332 | ||
Total current liabilities | 974,062 | 1,020,012 | ||
Long-term portion of deferred revenues | 110,569 | 114,638 | ||
Other liabilities | 48,960 | 8,362 | ||
Stockholders' equity | 2,618,974 | 2,560,588 | ||
Total liabilities and stockholders’ equity | $3,752,565 | $3,703,600 |
CITRIX SYSTEMS, INC. Condensed Consolidated Statement of Cash Flows (In thousands - unaudited) |
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Three Months |
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OPERATING ACTIVITIES | $73,347 | |
Net Income | ||
Adjustments to reconcile net income to net cash provided by |
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Amortization and depreciation | 35,849 | |
Stock-based compensation expense | 17,884 | |
Provision for accounts receivable allowances | 629 | |
Other non-cash items | (1,389) | |
Total adjustments to reconcile net income to net cash |
52,973 | |
provided by operating activities | ||
Changes in operating assets and liabilities, net of the effects of acquisitions: | ||
Accounts receivable | 85,622 | |
Prepaid expenses and other current assets | (7,059) | |
Other assets | (1,293) | |
Deferred tax assets, net | (14,196) | |
Accounts payable and accrued expenses | (63,215) | |
Deferred revenues | 2,240 | |
Other liabilities | 30,809 | |
Total changes in operating assets and liabilities, net of the effects of acquisitions | 32,908 | |
Net cash provided by operating activities | 159,228 | |
INVESTING ACTIVITIES | ||
Proceeds from available-for-sale investments, net of purchases | 166,523 | |
Purchases of property and equipment | (26,845) | |
Purchases of other assets | (1,852) | |
Cash paid for acquisitions, net of cash acquired | (118,440) | |
Cash paid for licensing and core technology | (1,522) | |
Net cash provided by investing activities | 17,864 | |
FINANCING ACTIVITIES | ||
Proceeds from issuance of common stock under stock-based compensation plans | 42,337 | |
Payment on debt from acquisitions | (10,926) | |
Excess tax benefit from exercise of stock options | 15,502 | |
Stock repurchases, net | (108,751) | |
Net cash used in financing activities | (61,838) | |
Effect of exchange rate changes on cash and cash equivalents | 3,924 | |
Change in cash and cash equivalents | 119,178 | |
Cash and cash equivalents at beginning of period | 396,162 | |
Cash and cash equivalents at end of period | $515,340 |
Reconciliation of Non-GAAP Financial Measures to Comparable U.S. GAAP Measures
(Unaudited)
Pursuant to the requirements of Regulation G, the Company has provided a reconciliation of each non-GAAP financial measure used in this earnings release and related conference call, slide presentation or webcast to the most directly comparable GAAP financial measure. These measures differ from GAAP in that they exclude amortization primarily related to business combinations, stock-based compensation expenses, charges associated with the Company’s 2009 restructuring program and the related tax effect of those items. The Company's basis for these adjustments is described below.
Management uses these non-GAAP measures for internal reporting and forecasting purposes, when publicly providing its business outlook, to evaluate the Company's performance and to evaluate and compensate the Company's executives. The Company has provided these non-GAAP financial measures in addition to GAAP financial results because it believes that these non-GAAP financial measures provide useful information to certain investors and financial analysts for comparison across accounting periods not influenced by certain non-cash items that are not used by management when evaluating the Company's historical and prospective financial performance. In addition, the Company has historically provided this or similar information and understands that some investors and financial analysts find this information helpful in analyzing the Company's operating margins, operating expenses and net income and comparing the Company's financial performance to that of its peer companies and competitors.
Management typically excludes the amounts described above when evaluating the Company's operating performance and believes that the resulting non-GAAP measures are useful to investors and financial analysts in assessing the Company's operating performance due to the following factors:
These non-GAAP financial measures are not prepared in accordance with accounting principles generally accepted in the United States ("GAAP") and may differ from the non-GAAP information used by other companies. There are significant limitations associated with the use of non-GAAP financial measures. The additional non-GAAP financial information presented here should be considered in conjunction with, and not as a substitute for or superior to, the financial information presented in accordance with GAAP (such as net income and earnings per share) and should not be considered measures of the Company's liquidity. Furthermore, the Company in the future may exclude amortization primarily related to new business combinations, additional charges related to its restructuring program and the related tax effects from financial measures that it releases, and the Company expects to continue to incur stock-based compensation expenses.
CITRIX SYSTEMS, INC. Non-GAAP Financial Measures Reconciliation (In thousands, except per share and operating margin data - unaudited) |
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The following tables show the non-GAAP financial measures used in this press release reconciled to the most directly comparable GAAP financial measures. |
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Three Months Ended March 31, 2011 | ||||
GAAP operating margin | 16.5% | |||
Add: stock-based compensation | 3.6 | |||
Add: amortization of product related intangible assets | 2.6 | |||
Add: amortization of other intangible assets | 0.7 | |||
Add: 2009 restructuring charges | − | |||
Non-GAAP operating margin | 23.4% | |||
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Three Months Ended March 31, | ||||
2011 | 2010 | |||
GAAP net income | $73,503 | $47,349 | ||
Add: stock-based compensation | 17,884 | 24,927 | ||
Add: amortization product related intangible assets | 12,699 | 12,358 | ||
Add: amortization of other intangible assets | 3,509 | 4,157 | ||
Add: 2009 restructuring charges | 24 | 500 | ||
Less: tax effects related to above items | (10,975) | (14,242) | ||
Non-GAAP net income | $96,644 | $75,049 | ||
Three Months Ended March 31, | ||||
2011 | 2010 | |||
GAAP earnings per share – diluted | $0.38 | $0.25 | ||
Add: stock-based compensation | 0.09 | 0.13 | ||
Add: amortization of product related intangible assets | 0.07 | 0.07 | ||
Add: amortization of other intangible assets | 0.02 | 0.02 | ||
Add: 2009 restructuring charges | − | − | ||
Less: tax effects related to above items | (0.06) | (0.07) | ||
Non-GAAP earnings per share – diluted | $0.50 | $0.40 |
CITRIX SYSTEMS, INC. Forward Looking Guidance |
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For the Three Months Ended
|
For the Twelve Months Ended |
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2011 | 2011 | |||
GAAP earnings per share - diluted | $0.41 to $0.42 | $1.91 to $1.94 | ||
Add: Adjustments to exclude the effects of amortization of intangible assets |
0.08 |
0.31 |
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Add: Adjustments to exclude the effects of expenses related to
stock-based compensation
Less: Differential between the GAAP and non-GAAP tax rates and tax effects related to above items |
0.12
(0.06) to (0.08) |
0.44
(0.25) to (0.31) |
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Non-GAAP earnings per share - diluted | $0.54 to $0.55 | $2.38 to $2.41 |
Three Months Ended June 30, 2011 | ||
GAAP tax rate | 17.0% to 18.0% | |
Add: tax effects of stock-based compensation and amortization of intangible assets | 5.0% | |
Non-GAAP tax rate | 22.0% to 23.0% |
CONTACT:
Citrix Systems, Inc.
Media Inquiries
Eric Armstrong,
954-267-2977
eric.armstrong@citrix.com
or
Investor
Inquiries
Eduardo Fleites, 954-229-5758
eduardo.fleites@citrix.com