Delaware
(State or Other Jurisdiction of
Incorporation or Organization)
|
0-21174
(Commission File Number)
|
04-2977748
(I.R.S. Employer
Identification No.)
|
75 Network Drive, Burlington, Massachusetts 01803
(Address of Principal Executive Offices) (Zip Code)
|
||
(978) 640-6789
(Registrant's Telephone Number, Including Area Code)
|
||
¨
|
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))
|
Item 2.02.
|
Results of Operations and Financial Condition.
|
Item 2.05.
|
Costs Associated with Exit or Disposal Activities.
|
Item 5.02.
|
Departure of Directors and Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
|
(b)
|
Effective October 27, 2011, Paige Parisi will cease to serve as Vice President and General Counsel of the Company.
|
Item 9.01.
|
Financial Statements and Exhibits.
|
(d)
|
Exhibits.
|
||
The following exhibit relating to Item 2.02 shall be deemed to be furnished, and not filed:
|
|||
Exhibit Number
|
Description
|
||
99.1
|
Press release dated October 27, 2011.
|
||
AVID TECHNOLOGY, INC.
|
||||
(Registrant)
|
||||
Date: October 27, 2011
|
By:
|
/s/ Ken Sexton
|
||
Name:
Title:
|
Ken Sexton
Executive Vice President, Chief Financial
Officer and Chief Administrative Officer
|
Exhibit Number
|
Description
|
|
*99.1
|
Press release dated October 27, 2011.
|
AVID TECHNOLOGY, INC.
|
|||||||||||||||||
Condensed Consolidated Statements of Operations
|
|||||||||||||||||
(unaudited - in thousands, except per share data)
|
|||||||||||||||||
Three Months Ended |
Nine Months Ended
|
||||||||||||||||
September 30,
|
September 30,
|
||||||||||||||||
2011
|
2010
|
2011
|
2010
|
||||||||||||||
Net revenues:
|
|||||||||||||||||
Products
|
$131,875 | $134,231 | $398,400 | $397,044 | |||||||||||||
Services
|
33,090 | 30,828 | 94,232 | 86,131 | |||||||||||||
Total net revenues
|
164,965 | 165,059 | 492,632 | 483,175 | |||||||||||||
Cost of revenues:
|
|||||||||||||||||
Products
|
60,048 | 64,421 | 187,663 | 193,527 | |||||||||||||
Services
|
16,497 | 14,194 | 46,196 | 41,373 | |||||||||||||
Amortization of intangible assets
|
685 | 745 | 2,036 | 2,657 | |||||||||||||
Total cost of revenues
|
77,230 | 79,360 | 235,895 | 237,557 | |||||||||||||
Gross profit
|
87,735 | 85,699 | 256,737 | 245,618 | |||||||||||||
Operating expenses:
|
|||||||||||||||||
Research and development
|
28,960 | 28,929 | 89,386 | 89,348 | |||||||||||||
Marketing and selling
|
45,411 | 43,199 | 136,273 | 129,419 | |||||||||||||
General and administrative
|
13,240 | 19,698 | 43,458 | 48,179 | |||||||||||||
Amortization of intangible assets
|
2,159 | 2,283 | 6,465 | 7,557 | |||||||||||||
Restructuring and other costs, net
|
2,707 | 185 | 328 | 5,532 | |||||||||||||
(Gain) loss on sales of assets
|
- | (1,527) | 597 | (1,527) | |||||||||||||
Total operating expenses
|
92,477 | 92,767 | 276,507 | 278,508 | |||||||||||||
Operating loss
|
(4,742) | (7,068) | (19,770) | (32,890) | |||||||||||||
Interest and other income (expense), net
|
(503) | (30) | (1,571) | (132) | |||||||||||||
Loss before income taxes
|
(5,245) | (7,098) | (21,341) | (33,022) | |||||||||||||
Provision for income taxes, net
|
2,774 | 2,897 | 3,657 | 3,361 | |||||||||||||
Net loss
|
($8,019) | ($9,995) | ($24,998) | ($36,383) | |||||||||||||
Net loss per common share - basic and diluted
|
($0.21) | ($0.26) | ($0.65) | ($0.96) | |||||||||||||
Weighted-average common shares outstanding - basic and diluted
|
38,511 | 38,045 | 38,386 | 37,826 |
AVID TECHNOLOGY, INC.
|
||||||||||||||||||||||
(unaudited - in thousands, except per share data)
|
||||||||||||||||||||||
Reconciliations of GAAP financial measures to Non-GAAP financial measures:
|
||||||||||||||||||||||
Three Months Ended September 30, 2011 | ||||||||||||||||||||||
Gross
|
Operating
|
Operating
|
Tax
|
Net
|
||||||||||||||||||
Profit
|
Expenses
|
(Loss) Income
|
Provision
|
(Loss) Income
|
||||||||||||||||||
GAAP
|
$87,735 | $92,477 | ($4,742) | $2,774 | ($8,019) | |||||||||||||||||
Amortization of intangible assets
|
685 | (2,159) | 2,844 | 2,844 | ||||||||||||||||||
Restructuring costs, net
|
(2,707) | 2,707 | 2,707 | |||||||||||||||||||
Legal settlement and acquisition-related costs (a)
|
(163) | 163 | 163 | |||||||||||||||||||
Tax adjustment
|
815 | (815) | ||||||||||||||||||||
Stock-based compensation included in:
|
||||||||||||||||||||||
Cost of products revenues
|
168 | 168 | 168 | |||||||||||||||||||
Cost of services revenues
|
63 | 63 | 63 | |||||||||||||||||||
Research and development expenses
|
(435) | 435 | 435 | |||||||||||||||||||
Marketing and selling expenses
|
(1,051) | 1,051 | 1,051 | |||||||||||||||||||
General and administrative expenses
|
(1,788) | 1,788 | 1,788 | |||||||||||||||||||
Non-GAAP
|
$88,651 | $84,174 | $4,477 | $3,589 | $385 | |||||||||||||||||
Weighted-average shares outstanding - diluted
|
38,530 | |||||||||||||||||||||
Non-GAAP net income per share - diluted
|
$0.01 | |||||||||||||||||||||
Three Months Ended September 30, 2010 | ||||||||||||||||||||||
Gross
|
Operating
|
Operating
|
Tax
|
Net
|
||||||||||||||||||
Profit
|
Expenses
|
(Loss) Income
|
Provision
|
(Loss) Income
|
||||||||||||||||||
GAAP
|
$85,699 | $92,767 | ($7,068) | $2,897 | ($9,995) | |||||||||||||||||
Amortization of intangible assets
|
745 | (2,283) | 3,028 | 3,028 | ||||||||||||||||||
Restructuring and other costs, net
|
(185) | 185 | 185 | |||||||||||||||||||
Legal settlement and acquisition-related costs (a)
|
(5,656) | 5,656 | 5,656 | |||||||||||||||||||
Gain on sales of assets
|
527 | (527) | (527) | |||||||||||||||||||
Tax adjustment
|
399 | (399) | ||||||||||||||||||||
Stock-based compensation included in:
|
||||||||||||||||||||||
Cost of products revenues
|
176 | 176 | 176 | |||||||||||||||||||
Cost of services revenues
|
287 | 287 | 287 | |||||||||||||||||||
Research and development expenses
|
(506) | 506 | 506 | |||||||||||||||||||
Marketing and selling expenses
|
(1,078) | 1,078 | 1,078 | |||||||||||||||||||
General and administrative expenses
|
(1,581) | 1,581 | 1,581 | |||||||||||||||||||
Non-GAAP
|
$86,907 | $82,005 | $4,902 | $3,296 | $1,576 | |||||||||||||||||
Weighted-average shares outstanding - diluted
|
38,065 | |||||||||||||||||||||
Non-GAAP net income per share - diluted
|
$0.04 | |||||||||||||||||||||
(a)
|
Represents costs included in general and administrative expenses
|
AVID TECHNOLOGY, INC.
|
||||||||||||||||||||||
(unaudited - in thousands, except per share data)
|
||||||||||||||||||||||
Reconciliations of GAAP financial measures to Non-GAAP financial measures:
|
||||||||||||||||||||||
Nine Months Ended September 30, 2011 | ||||||||||||||||||||||
Gross
|
Operating
|
Operating
|
Tax
|
Net
|
||||||||||||||||||
Profit
|
Expenses
|
(Loss) Income
|
Provision
|
Loss
|
||||||||||||||||||
GAAP
|
$256,737 | $276,507 | ($19,770) | $3,657 | ($24,998) | |||||||||||||||||
Amortization of intangible assets
|
2,036 | (6,465) | 8,501 | 8,501 | ||||||||||||||||||
Restructuring costs, net
|
(328) | 328 | 328 | |||||||||||||||||||
Legal settlements and acquisition-related costs (a)
|
(555) | 555 | 555 | |||||||||||||||||||
Loss on sales of assets
|
(597) | 597 | 597 | |||||||||||||||||||
Tax adjustment
|
1,115 | (1,115) | ||||||||||||||||||||
Stock-based compensation included in:
|
||||||||||||||||||||||
Cost of products revenues
|
417 | 417 | 417 | |||||||||||||||||||
Cost of services revenues
|
608 | 608 | 608 | |||||||||||||||||||
Research and development expenses
|
(1,334) | 1,334 | 1,334 | |||||||||||||||||||
Marketing and selling expenses
|
(3,625) | 3,625 | 3,625 | |||||||||||||||||||
General and administrative expenses
|
(5,783) | 5,783 | 5,783 | |||||||||||||||||||
Non-GAAP
|
$259,798 | $257,820 | $1,978 | $4,772 | ($4,365) | |||||||||||||||||
Weighted-average shares outstanding - diluted
|
38,386 | |||||||||||||||||||||
Non-GAAP net loss per share - diluted
|
($0.11) | |||||||||||||||||||||
Nine Months Ended September 30, 2010 | ||||||||||||||||||||||
Gross
|
Operating
|
Operating
|
Tax
|
Net
|
||||||||||||||||||
Profit
|
Expenses
|
Loss
|
Provision
|
Loss
|
||||||||||||||||||
GAAP
|
$245,618 | $278,508 | ($32,890) | $3,361 | ($36,383) | |||||||||||||||||
Amortization of intangible assets
|
2,657 | (7,557) | 10,214 | 10,214 | ||||||||||||||||||
Restructuring and other costs, net (b)
|
(5,532) | 5,532 | 5,532 | |||||||||||||||||||
Legal settlement and acquisition-related costs (a)
|
(6,425) | 6,425 | 6,425 | |||||||||||||||||||
Gain on sales of assets
|
527 | (527) | (527) | |||||||||||||||||||
Tax adjustment
|
854 | (854) | ||||||||||||||||||||
Stock-based compensation included in:
|
||||||||||||||||||||||
Cost of products revenues
|
562 | 562 | 562 | |||||||||||||||||||
Cost of services revenues
|
822 | 822 | 822 | |||||||||||||||||||
Research and development expenses
|
(1,704) | 1,704 | 1,704 | |||||||||||||||||||
Marketing and selling expenses
|
(3,153) | 3,153 | 3,153 | |||||||||||||||||||
General and administrative expenses
|
(4,373) | 4,373 | 4,373 | |||||||||||||||||||
Non-GAAP
|
$249,659 | $250,291 | ($632) | $4,215 | ($4,979) | |||||||||||||||||
Weighted-average shares outstanding - diluted
|
37,826 | |||||||||||||||||||||
Non-GAAP net loss per share - diluted
|
($0.13) | |||||||||||||||||||||
(a)
|
Represents costs included in general and administrative expenses
|
|||||||||||||||||||||
(b)
|
Includes costs of $3.7 million related to exiting our former Tewksbury, Massachusetts headquarters lease
|
|||||||||||||||||||||
Revenue Summary:
|
||||||||||||||||||||||
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||||||||
Video revenues
|
$98,443 | $100,186 | $289,325 | $278,060 | ||||||||||||||||||
Audio revenues
|
66,522 | 64,873 | 203,307 | 205,115 | ||||||||||||||||||
Total net revenues
|
$164,965 | $165,059 | $492,632 | $483,175 | ||||||||||||||||||
AVID TECHNOLOGY, INC.
|
||||||||
Condensed Consolidated Balance Sheets
|
||||||||
(unaudited - in thousands)
|
||||||||
September 30,
|
December 31,
|
|||||||
2011
|
2010
|
|||||||
ASSETS:
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$33,652 | $42,782 | ||||||
Accounts receivable, net of allowances of $13,277 and $17,149
|
||||||||
at September 30, 2011 and December 31, 2010, respectively
|
92,904 | 101,171 | ||||||
Inventories
|
126,029 | 108,357 | ||||||
Deferred tax assets, net
|
1,081 | 1,068 | ||||||
Prepaid expenses
|
6,598 | 7,688 | ||||||
Other current assets
|
15,065 | 16,130 | ||||||
Total current assets
|
275,329 | 277,196 | ||||||
Property and equipment, net
|
57,063 | 62,519 | ||||||
Intangible assets, net
|
21,327 | 29,750 | ||||||
Goodwill
|
246,658 | 246,997 | ||||||
Other assets
|
10,788 | 10,109 | ||||||
Total assets
|
$611,165 | $626,571 | ||||||
LIABILITIES AND STOCKHOLDERS' EQUITY:
|
||||||||
Current liabilities:
|
||||||||
Borrowings under revolving credit facilities
|
$13,000 | $0 | ||||||
Accounts payable
|
35,090 | 47,340 | ||||||
Accrued compensation and benefits
|
28,551 | 41,101 | ||||||
Accrued expenses and other current liabilities
|
32,200 | 40,986 | ||||||
Income taxes payable
|
4,570 | 4,640 | ||||||
Deferred revenues
|
52,752 | 40,585 | ||||||
Total current liabilities
|
166,163 | 174,652 | ||||||
Long-term liabilities
|
30,060 | 25,309 | ||||||
Total liabilities
|
196,223 | 199,961 | ||||||
Stockholders' equity:
|
||||||||
Common stock
|
423 | 423 | ||||||
Additional paid-in capital
|
1,015,770 | 1,005,198 | ||||||
Accumulated deficit
|
(524,717 | ) | (495,254 | ) | ||||
Treasury stock at cost, net of reissuances
|
(83,612 | ) | (91,025 | ) | ||||
Accumulated other comprehensive income
|
7,078 | 7,268 | ||||||
Total stockholders' equity
|
414,942 | 426,610 | ||||||
Total liabilities and stockholders' equity
|
$611,165 | $626,571 | ||||||
AVID TECHNOLOGY, INC.
|
||||||||||||||||
Condensed Consolidated Statements of Cash Flows
|
||||||||||||||||
(unaudited - in thousands)
|
||||||||||||||||
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||||||
Cash flows from operating activities:
|
||||||||||||||||
Net loss
|
($8,019) | ($9,995) | ($24,998) | ($36,383) | ||||||||||||
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||||||||||||||
Depreciation and amortization
|
7,817 | 8,529 | 23,538 | 25,026 | ||||||||||||
Provision for doubtful accounts
|
75 | 295 | 534 | 285 | ||||||||||||
Non-cash provision for restructuring
|
133 | 42 | 258 | 291 | ||||||||||||
(Gain) loss on sales of assets
|
- | (1,527) | 597 | (1,527) | ||||||||||||
Gain on disposal of fixed assets
|
(4) | (24) | (10) | (70) | ||||||||||||
Compensation expense from stock grants and options
|
3,505 | 3,628 | 11,767 | 10,614 | ||||||||||||
Non-cash interest expense
|
74 | - | 228 | - | ||||||||||||
Unrealized foreign currency transaction (gains) losses
|
(2,502) | 5,501 | 3,988 | 253 | ||||||||||||
Changes in deferred tax assets and liabilities, excluding initial effects of acquisitions
|
- | (1,143) | (4) | (1,393) | ||||||||||||
Changes in operating assets and liabilities, excluding initial effects of acquisitions:
|
||||||||||||||||
Accounts receivable
|
5,346 | 10,319 | 7,574 | (7,202) | ||||||||||||
Inventories
|
3,767 | (17,088) | (17,671) | (15,344) | ||||||||||||
Prepaid expenses and other current assets
|
489 | 1,763 | 778 | 7,032 | ||||||||||||
Accounts payable
|
(9,637) | (7,088) | (12,262) | 13,832 | ||||||||||||
Accrued expenses, compensation and benefits, and other liabilities
|
(7,883) | (6,539) | (24,129) | (25,021) | ||||||||||||
Income taxes payable
|
1,822 | 3,257 | (209) | 2,290 | ||||||||||||
Deferred revenues
|
4,649 | (1,583) | 16,464 | 6,763 | ||||||||||||
Net cash used in operating activities
|
(368) | (11,653) | (13,557) | (20,554) | ||||||||||||
Cash flows from investing activities:
|
||||||||||||||||
Purchases of property and equipment
|
(2,784) | (3,417) | (8,862) | (25,926) | ||||||||||||
Decrease (increase) in other long-term assets
|
102 | (149) | (969) | (82) | ||||||||||||
Payments for business acquisitions, net of cash acquired
|
- | - | - | (27,008) | ||||||||||||
Purchases of marketable securities
|
- | - | - | (2,250) | ||||||||||||
Proceeds from sales of marketable securities
|
- | - | - | 19,605 | ||||||||||||
Proceeds from sales of assets
|
- | 1,000 | - | 1,000 | ||||||||||||
Net cash used in investing activities
|
(2,682) | (2,566) | (9,831) | (34,661) | ||||||||||||
Cash flows from financing activities:
|
||||||||||||||||
Proceeds from (payments related to) the issuance of common stock under employee stock plans, net
|
404 | 261 | 1,753 | (61) | ||||||||||||
Proceeds from revolving credit facilities
|
- | - | 21,000 | - | ||||||||||||
Payments on revolving credit facilities
|
- | - | (8,000) | - | ||||||||||||
Net cash provided by (used in) financing activities
|
404 | 261 | 14,753 | (61) | ||||||||||||
Effect of exchange rate changes on cash and cash equivalents
|
(1,259) | 1,526 | (495) | (1,880) | ||||||||||||
Net decrease in cash and cash equivalents
|
(3,905) | (12,432) | (9,130) | (57,156) | ||||||||||||
Cash and cash equivalents at beginning of period
|
37,557 | 46,793 | 42,782 | 91,517 | ||||||||||||
Cash and cash equivalents at end of period
|
$33,652 | $34,361 | $33,652 | $34,361 |