Avid Reports Second Quarter Results.TEWKSBURY Tewksbury, town (1990 pop. 27,266), Middlesex co., NE Mass.; settled 1637, set off from Billerica and inc. 1734. It was once the site of a Native American settlement. Primarily residential, the town has light manufacturing, including pharmaceuticals and computer equipment. , Mass. -- Avid Technology "Avid" redirects here. For the "Advancement Via Individual Determination" educational program, see AVID. Avid Technology, Inc NASDAQ: AVID is an American company specializing in video and audio production technology; specifically, digital non-linear media editing (NLE) , Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : AVID) today reported revenues of $160.1 million for the three months ended June June: see month. 30, 2005 compared to $139.9 million for the same period in 2004. GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). net income for the quarter was $13.6 million, or $.37 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share compared to $15.5 million, or $.45 per diluted share, in the second quarter of 2004. Excluding acquisition-related amortization and related tax benefits and acquisition-related stock-based compensation, non-GAAP net income for the second quarter of 2005 was $15.9 million, or $.43 per diluted share, compared to non-GAAP net income of $16.0 million, or $.47 per diluted share in the corresponding quarter of 2004. "This quarter's results were negatively impacted by new product delays in our core broadcast markets as well as the negative effects of foreign currency movements," said David Krall People named Krall:
The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. , and that the fundamental growth indicators in each of the markets we serve are still pointing in the right direction." Revenues for the six months ended June 30, 2005, were $326.1 million compared to revenues of $267.3 million for the same period in 2004. GAAP net income for the first six months of 2005 was $33.3 million, or $.90 per diluted share, compared to GAAP net income of $30.2 million, or $.89 per diluted share, for the same period in 2004. Excluding acquisition-related amortization and related tax benefits, acquisition-related stock-based compensation, non-recurring tax benefits, and non-recurring expenses in the first quarter of 2004 related to the settlement of a lawsuit lawsuit: see procedure; tort. , non-GAAP net income for the six months ended June 30, 2005, was $38.1 million, or $1.03 per diluted share, compared to $31.1 million, or $.92 per diluted share, for the first six months of 2004. Use of Non-GAAP Financial Measures The non-GAAP operating results listed above are "non-GAAP financial measures" under the rules of the Securities and Exchange Commission. We have included this information because we believe it is a meaningful measure of our normalized operating performance and will assist investors in understanding our results of operations on a comparative basis. This non-GAAP information supplements, and is not intended to represent a measure of performance in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with disclosures required by generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting , or GAAP. We use this information internally to help our management more accurately assess the ongoing nature of our operations and measure our performance on a comparative basis. Conference Call A conference call to discuss Avid's second quarter 2005 financial results and the company's outlook for the balance of 2005 and the full year 2006 will be held today, July July: see month. 21, at 5:00 p.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT . The call will be open to the public. The conference call can be accessed by dialing (312) 461-9457 and referencing confirmation code 4241723. The call and subsequent replay will also be available on Avid's Web site. To listen via this alternative, go to the Investors page under the Company menu at www.avid.com for complete details 10-15 minutes prior to the start of the conference call. The above release includes forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. , as defined by the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995, about Avid's future performance. There are a number of factors that could cause actual events or results to differ materially from that indicated by such forward-looking statements, such as the competitive market in which Avid operates, market acceptance of Avid's existing and new products, Avid's ability to anticipate customer needs and the other factors set forth under the caption "Certain Factors That May Affect Future Results" in Avid's Form 10-Q Form 10-Q See 10-Q. for the quarter ended March 31, 2005, and other filings with the SEC. In addition, the forward-looking statements contained herein represent Avid's estimate only as of today and should not be relied upon as representing the company's estimate as of any subsequent date. While Avid may elect to update these forward-looking statements at some point in the future, Avid specifically disclaims any obligation to do so, even if the estimate changes. About Avid Technology, Inc. Avid Technology, Inc. is the world leader in digital nonlinear A system in which the output is not a uniform relationship to the input. nonlinear - (Scientific computation) A property of a system whose output is not proportional to its input. media creation, management, and distribution solutions, enabling film, video, audio, animation animation Process of giving the illusion of movement to drawings, models, or inanimate objects. From the mid-1850s, such optical devices as the zoetrope produced the illusion of animation. Stop-action photography enabled the production of cartoon films. , games, and broadcast professionals to work more efficiently, productively, and creatively. For more information about the company's Oscar(R), Grammy Grammy award for musical achievement. [Am. Cult.: Misc.] See : Music Grammy awarded by the National Academy of Recording Arts and Sciences for the best in the recording field. [Am. Hist.: Misc.] See : Prize (R), and Emmy Emmy awarded annually for best achievements in television programing and performance. [TV: Misc.] See : Prize (R) award-winning Adj. 1. award-winning - having received awards; "this award-winning bridge spans a distance of five miles" products and services, please visit: www.avid.com. (C) 2005 Avid Technology, Inc. All rights reserved. Avid, Digidesign Digidesign is an American digital audio technology company. It was founded in 1984 by Peter Gotcher and Evan Brooks. The company began as a project to raise money for the founders' band, selling EPROM chips for drum machines. , Film Composer This article is about composers of music. For the HTML editor, see Mozilla Composer. A composer is a person who writes music. The term refers particularly to someone who writes music in some type of musical notation, thus allowing others to perform the music. and Pro Tools are either registered trademarks or trademarks of Avid Technology, Inc. in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. other countries. Avid received an Oscar statuette representing the 1998 Scientific and Technical Award for the concept, design, and engineering of the Avid Film Composer(R) system for motion picture editing. Digidesign, Avid's audio division, received an Oscar statuette representing the 2003 Scientific and Technical Award for the design, development, and implementation of its Pro Tools(R) digital audio workstation A digital audio workstation (DAW) is a system designed to record, edit and play back digital audio. A key feature of DAWs is the ability to freely manipulate recorded sounds, much like a word processor manipulates typed words. . Oscar is Oscar I, 1799–1859, king of Sweden and Norway (1844–59), son and successor of Charles XIV. His reign was one of social and economic advance. His book on the reform of criminal law and prisons had wide influence. Oscar was succeeded by his elder son, Charles XV. a trademark and service mark of the Academy of Motion Picture Arts and Sciences. Emmy is a registered trademark of ATAS/NATAS. Grammy is a trademark of the National Academy of Recording Arts and Sciences The National Academy of Recording Arts & Sciences, Inc. is known variously as The Recording Academy or NARAS. Established in 1957, The Recording Academy is a U.S. , Inc. All other trademarks contained herein are the property of their respective owners.
AVID TECHNOLOGY, INC
Condensed Consolidated Statements of Operations
(unaudited - in thousands, except per share data)
------------------- -------------------
GAAP NON - GAAP
------------------- -------------------
Three Months Ended Three Months Ended
June 30th, June 30th,
2005 2004 2005 2004
--------- --------- --------- ---------
Revenue
Product $141,434 $124,269 $141,434 $124,269
Service 18,617 15,617 18,617 15,617
--------- --------- --------- ---------
Total Revenue 160,051 139,886 160,051 139,886
--------- --------- --------- ---------
Cost of Revenue
Product 61,244 52,152 61,244 52,152
Service 10,027 8,843 10,027 8,843
Amortization of intangible
assets 282 - - -
--------- --------- --------- ---------
Total Cost of Revenue 71,553 60,995 71,271 60,995
--------- --------- --------- ---------
Gross Profit 88,498 78,891 88,780 78,891
--------- --------- --------- ---------
Operating Expenses
Research and development 24,871 22,924 24,871 22,924
Marketing and selling 39,999 33,656 39,999 33,656
General and administrative 8,362 6,184 8,362 6,184
Stock-based compensation
(Note A) 601 - - -
Amortization of intangible
assets 1,593 549 - -
--------- --------- --------- ---------
Total Operating
Expenses 75,426 63,313 73,232 62,764
--------- --------- --------- ---------
Operating income 13,072 15,578 15,548 16,127
Interest and other income, net 1,179 595 1,179 595
--------- --------- --------- ---------
Income before income taxes 14,251 16,173 16,727 16,722
Provision for income taxes 857 700 857 700
Non-recurring tax benefits (172) - - -
--------- --------- --------- ---------
Net Income $13,566 $15,473 $15,870 $16,022
========= ========= ========= =========
Net income per common share -
basic $0.39 $0.49 $0.45 $0.51
Net income per common share -
diluted $0.37 $0.45 $0.43 $0.47
Weighted average common shares
outstanding - basic 35,177 31,623 35,177 31,623
Weighted average common shares
outstanding - diluted 37,024 34,134 37,024 34,134
Note
----
A. Stock based compensation, related to stock options issued as
part of the acquisition of M-Audio, is comprised of $38 of
Research and development expense, $163 of Marketing and
selling expense, and $400 of General and administrative
expense, based on the departmental classification of the
option holders.
Reconciliation of Non-GAAP net income to GAAP net income:
Three months ended
June 30,
2005 2004
--------- ---------
Non-GAAP net income $15,870 $16,022
Stock-based compensation (601)
Amortization of intangible
assets (1,875) (549)
Non-recurring tax benefits 172
--------- ---------
GAAP net income $13,566 $15,473
========= =========
AVID TECHNOLOGY, INC
Condensed Consolidated Statements of Operations
(unaudited - in thousands, except per share data)
------------------- -------------------
GAAP NON - GAAP
------------------- -------------------
Six Months Ended Six Months Ended
June 30th, June 30th,
2005 2004 2005 2004
--------- --------- --------- ---------
Revenue
Product $288,812 $237,853 $288,812 $237,853
Service 37,240 29,407 37,240 29,407
--------- --------- --------- ---------
Total Revenue 326,052 267,260 326,052 267,260
--------- --------- --------- ---------
Cost of Revenue
Product 122,141 98,666 122,141 98,666
Service 20,097 16,432 20,097 16,432
Amortization of intangible
assets 563 - - -
--------- --------- --------- ---------
Total Cost of Revenue 142,801 115,098 142,238 115,098
--------- --------- --------- ---------
Gross Profit 183,251 152,162 183,814 152,162
--------- --------- --------- ---------
Operating Expenses
Research and development 49,495 45,216 49,495 45,216
Marketing and selling 79,454 63,510 79,454 63,510
General and administrative 16,335 12,070 16,335 12,070
Stock-based compensation
(Note A) 1,372 - - -
Amortization of intangible
assets 3,185 988 - -
--------- --------- --------- ---------
Total Operating
Expenses 149,841 121,784 145,284 120,796
--------- --------- --------- ---------
Operating income 33,410 30,378 38,530 31,366
Interest and other income, net 2,016 1,085 2,016 1,085
Legal settlement - 1,050 - -
--------- --------- --------- ---------
Income before income taxes 35,426 30,413 40,546 32,451
Provision for income taxes 2,459 1,400 2,459 1,400
Non-recurring tax benefits (345) (1,200) - -
--------- --------- --------- ---------
Net Income $33,312 $30,213 $38,087 $31,051
========= ========= ========= =========
Net income per common share -
basic $0.95 $0.96 $1.09 $0.99
Net income per common share -
diluted $0.90 $0.89 $1.03 $0.92
Weighted average common shares
outstanding - basic 35,083 31,413 35,083 31,413
Weighted average common shares
outstanding - diluted 37,154 33,912 37,154 33,912
Note
----
A. Stock based compensation, related to stock options issued as
part of the acquisition of M-Audio, is comprised of $93 of
Research and development expense, $355 of Marketing and
selling expense, and $924 of General and administrative
expense, based on the departmental classification of the
option holders.
Reconciliation of Non-GAAP net income to GAAP net income:
Six months ended
June 30,
2005 2004
--------- ---------
Non-GAAP net income $38,087 $31,051
Stock-based compensation (1,372)
Amortization of intangible
assets (3,748) (988)
Non-recurring tax benefits 345 1,200
Legal settlement (1,050)
-------------------
GAAP net income $33,312 $30,213
===================
AVID TECHNOLOGY, INC.
Condensed Consolidated Balance Sheets
(unaudited - in thousands)
June 30, December 31,
2005 2004
------------- -------------
ASSETS:
Current assets:
Cash and marketable securities $192,553 $155,419
Accounts receivable, net of allowances
of $9,358 and $9,334 at June 30, 2005
and December 31, 2004, respectively 99,132 97,536
Inventories 63,492 53,946
Prepaid and other current assets 22,652 19,407
------------- -------------
Total current assets 377,829 326,308
Property and equipment, net 29,976 29,092
Goodwill 167,211 165,803
Other intangible assets, net 43,139 46,884
Other assets 8,634 8,147
------------- -------------
Total assets $626,789 $576,234
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Accounts payable $28,960 $26,517
Accrued expenses and other current
liabilities 71,781 74,727
Deferred revenues 59,244 48,680
------------- -------------
Total current liabilities 159,985 149,924
Long term liabilities, less current
portion 1,465 1,689
------------- -------------
Total liabilities 161,450 151,613
------------- -------------
Stockholders' equity:
Common stock 353 348
Additional paid-in capital 555,766 546,849
Accumulated deficit (89,463) (122,775)
Deferred compensation (2,858) (4,392)
Accumulated other comprehensive income 1,541 4,591
------------- -------------
Total stockholders' equity 465,339 424,621
------------- -------------
Total liabilities and stockholders'
equity $626,789 $576,234
============= =============
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