BMC Software Announces Fiscal Year 2000 Results; Strong Growth in Distributed Systems and E-business Continues; Company Announces $500 Million Stock Repurchase Program.Business Editors & Technology Writers HOUSTON--(BUSINESS WIRE)--April 25, 2000 BMC Software BMC Software, Inc. NYSE: BMC, is an American enterprise management software provider, focusing on IT infrastructure applications. BMC was founded in 1980 and is headquartered in Houston, Texas. Inc. (Nasdaq:BMCS BMCS Bristol Muslim Cultural Society (UK) BMCS Senior Chief Boatswain's Mate (Naval Rating) BMCS Blue Mountains Conservation Society (Wentworth Falls, NSW, Australia) ) today announced financial results for its fourth quarter of fiscal 2000, ended March 31, 2000. Strong growth in distributed systems Distributed systems (computers) A distributed system consists of a collection of autonomous computers linked by a computer network and equipped with distributed system software. license revenues as well as strong growth in the company's recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. maintenance and services revenues yielded another record breaking revenue quarter. Total revenues for the fourth quarter of fiscal 2000 increased 23 percent to $476.4 million from $386.5 million in the same quarter of fiscal 1999. In the quarter, net earnings and diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of , excluding amortization of intangibles Property that is a "right" such as a patent, Copyright, or trademark, or one that is lacking physical existence, such as good will. and special charges and benefits, increased six percent to $123.2 million and four percent to $.49, respectively, compared to net earnings of $116.5 million and diluted earnings per share of $.47 in the year-ago quarter. Net earnings and diluted earnings per share reflecting these charges and benefits were $98.0 million and $.39 for the fourth quarter of fiscal 2000, as compared to $100.4 million and $.40 in fiscal 1999, respectively. Total revenues in fiscal 2000 were $1,719.2 million, a 32 percent increase from total revenues of $1,303.9 million in fiscal 1999. Fiscal 2000 net earnings and diluted earnings per share, excluding amortization of intangibles and special charges and benefits, were $444.6 million and $1.76, respectively. This represented growth of 13 percent and 11 percent, respectively, compared to earnings and diluted earnings per share in fiscal 1999 of $392.4 million and $1.58, excluding amortization of intangibles and special charges and benefits. Net earnings and diluted earnings per share reflecting these charges and benefits were $242.5 million and $.96 for fiscal 2000, as compared to $362.6 million and $1.46 in fiscal 1999. "Fiscal 2000 brought BMC (BMC Software, Inc., Houston, TX, www.bmc.com) A leading supplier of software that supports and improves the availability, performance, and recovery of applications in complex computing environments. much success. Our PATROL product family continues to extend its lead, growing 68 percent for the year. In addition, our ITPA ITPA International Truck Parts Association ITPA International Tax Planning Association ITPA Inosine Triphosphatase ITPA International Tokamak Physics Activity ITPA Independent Telecommunications Pioneer Association ITPA Ibm Tivoli Performance Analyzer product family ended the year on a high note, exceeding our aggressive annual plans for revenue growth," said Max Watson, BMC Software's chairman, president and chief executive officer. "The exceptional growth of 59 percent for our distributed systems products in FY 2000, led by our e-business (Electronic-BUSINESS) Doing business online. The term is often used synonymously with e-commerce, but e-business is more of an umbrella term for having a presence on the Web. , Oracle and Microsoft (Microsoft Corporation, Redmond, WA, www.microsoft.com) The most successful and influential software company. Microsoft's software and Intel's hardware pioneered the PC and revolutionized the computer industry. NT solutions, reflects the increasing customer acceptance of our solutions and services. At the same time, we maintained overall operating margins Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: of 33 percent. Our results indicate that our customers believe that we have the right strategic direction and provide the best solutions in the market." Total license revenue growth was 20 percent for the fourth quarter of fiscal 2000, with North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. license revenues growing 28 percent and International license revenues growing 6 percent. Maintenance and professional services (job) professional services - A department of a supplier providing consultancy and programming manpower for the supplier's products. revenues increased 33 percent from the fourth quarter of fiscal 1999, in part because of customers' increasing implementation of the company's distributed systems, e-business solutions and a growing services business. Total distributed systems revenues of $199.3 million in the fourth quarter represent an increase of 52 percent over the fourth quarter of fiscal 1999. Total distributed systems revenues of $620.0 million represent an increase of 59 percent for the fiscal year. Total revenues in the company's core mainframe IMS (1) See IP Multimedia Subsystem. (2) (Information Management System) An early IBM hierarchical DBMS for IBM mainframes. IMS was widely implemented throughout the 1970s under MVS and continues to be used under z/OS. and DB2 database tools and utilities decreased six percent over the fourth quarter of fiscal 1999. Total mainframe revenues increased eight percent over the fourth quarter of fiscal 1999 and increased 20 percent for the fiscal year. $500 Million Stock Repurchase Stock repurchase A firm's repurchase of outstanding shares of its common stock. Program Authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: BMC Software's board of directors has authorized the company to repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. up to $500 million in common stock. The company plans to buy stock on the open market from time to time, depending on market conditions. In announcing the $500 million stock repurchase program, Bill Austin William Lee Austin (born October 18, 1928 in San Pedro, California) is a former NFL player and coach, having played for the New York Giants for 7 seasons (1949-50, 1953-57) and served as head coach of the Pittsburgh Steelers from 1966 to 1968. , BMC Software's senior vice president and chief financial officer, said, "As our results announced today indicate, our business remains strong. We continue to generate significant cash flow and believe our stock is undervalued Undervalued A stock or other security that is trading below its true value. Notes: The difficulty is knowing what the "true" value actually is. Analysts will usually recommend an undervalued stock with a strong buy rating. ." Fiscal 2000 Highlights -- Integrated Boole Boole , George 1815-1864. British mathematician and logician who developed a calculus of symbolic logic. Noun 1. Boole - English mathematician; creator of Boolean algebra (1815-1864) George Boole & Babbage's MAINVIEW(TM) technology with BMC Software's IMS and DB2 utilities and integrated COMMAND/POST(R) and PATROL(R); -- Launched strategic minority investment program; -- Unveiled the world's first complete e-business management initiative backed by three new customer-proven solutions and services (PATROL(R) for E-Business Management, MAINVIEW(R) for E-Business Management and Service Assurance Center(TM) for E-Business) that assure non-stop non-stop non adj → ununterbrochen; (flight) → Nonstop-, Non-Stop- adv → ununterbrochen; [fly] → , real-time 1. real-time - Describes an application which requires a program to respond to stimuli within some small upper limit of response time (typically milli- or microseconds). Process control at a chemical plant is the classic example. application service assurance for the enterprise; -- Announced BMC Software OnSite(TM), the industry's first certification and branding program for e-businesses, targeted to the Application Service Provider market; -- Launched global marketing and branding efforts including new company strategic message -- Assuring Business Availability(TM) -- and logo; -- Became the first enterprise systems management vendor to be awarded Certification for Microsoft Windows See Windows. (operating system) Microsoft Windows - Microsoft's proprietary window system and user interface software released in 1985 to run on top of MS-DOS. Widely criticised for being too slow (hence "Windoze", "Microsloth Windows") on the machines available then. 2000; -- Strengthened strategic development 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. distribution partnerships with Compaq Computer Corporation (company) Compaq Computer Corporation - The largest US manufacturer and vendor of IBM PC compatible personal computers and servers. Compaq was started in 1982 by three ex-Texas Instruments employees. Quarterly sales $2499M, profits $210M (Aug 1994). http://compaq.com/. , Hitachi Hitachi (hētä`chē), city (1990 pop. 202,141), Ibaraki prefecture, E central Honshu, Japan, on the Kashima Sea. The city is a leading producer of Japan's electrical equipment. Ltd., Microsoft Corporation (company) Microsoft Corporation - The biggest supplier of operating systems and other software for IBM PC compatibles. Software products include MS-DOS, Microsoft Windows, Windows NT, Microsoft Access, LAN Manager, MS Client, SQL Server, Open Data Base Connectivity (ODBC), MS Mail, , Qwest (Qwest Communications International Inc., Denver, CO, www.qwest.com) A telecommunications company that offers services to telecom carriers, businesses and homes using an extensive fiber-optic network throughout the U.S. and Mexico. Cyber.Solutions, Sun Microsystems Inc. and other key enterprise technology players; -- Named as one of Fortune Magazine's "100 Best Companies To Work For" for second consecutive year; -- Named the top software company by Forbes Forbes , B(ertie) C(harles) 1880-1954. American publisher and businessman who founded and edited (1916-1954) Forbes magazine. His son Malcolm Stevenson Forbes Global magazine. About BMC Software One of the world's largest independent software vendors, BMC Software delivers the most comprehensive e-business systems management software with the fastest guaranteed implementation. This Service Assurance(TM) strategy enhances the availability, performance and recoverability of companies' business-critical applications. Companies can use this management methodology to demonstrate their ability to deliver optimal service to their customers and partners by joining BMC Software OnSite(TM), a certification program which includes solution implementation and regular HealthChecks performed by BMC Software Professional Services. BMC Software is a Forbes 500 company and a member of the S&P 500, with fiscal year 2000 revenues exceeding $1.7 billion. The company is headquartered in Houston, Texas “Houston” redirects here. For other uses, see Houston (disambiguation). Houston (pronounced /'hjuːstən/) is the largest city in the state of Texas and the , with offices worldwide. For more information please visit BMC Software's Web site at www.bmc.com, or call 800/841-2031 or 713/918-8800. This news release contains both historical information and forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. information. Statements of plans, objectives, strategies and expectations for future operations and results, identified by words such as "we believe," "we anticipate" and "we expect," are 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. . Numerous important factors affect BMC Software's operating results and could cause BMC Software's actual results to differ materially from the results indicated by this press release or by any other forward-looking statements made by, or on behalf of, BMC Software, and there can be no assurance that future results will meet expectations, estimates or projections. These factors include, but are not limited to, the following: 1) BMC Software's revenues and earnings are subject to a number of factors, including the significant percentage of quarterly sales typically closed at the end of each quarter, that make estimation estimation In mathematics, use of a function or formula to derive a solution or make a prediction. Unlike approximation, it has precise connotations. In statistics, for example, it connotes the careful selection and testing of a function called an estimator. of operating results prior to the end of a quarter extremely uncertain; 2) BMC Software's financial growth depends on the continued success of PATROL and other distributed systems products, which were the primary sources of revenue growth in the March quarter; 3) competition for BMC Software's products is at an all-time all-time adj. Exceeding all others up to the present time: an all-time speed skating record. all-time Adjective Informal high and continues to increase for both the distributed systems and the mainframe database utility products; 4) international results have been volatile over the last two years and EMEA (Europe, Middle East, Africa) Refers to that region of the world. For example, one might see products packaged differently for the UK, EMEA and Asia Pacific markets. results were flat in the March quarter; 5) BMC Software continues to depend on large enterprise license transactions as an integral part of its core mainframe business; 6) continued demand for significant additional mainframe MIPS (Million Instructions Per Second) The execution speed of a computer. For example, .5 MIPS is 500,000 instructions per second; 100 MIPS is a hundred million instructions per second. capacity; 7) the uncertainties of whether new software products and product strategies will be successful; and 8) the additional risks and important factors described in the company's quarterly reports on Form 10-Q Form 10-Q See 10-Q. and in its Annual Report to Stockholders on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the fiscal year ended March 31, 1999 and other filings with the SEC. Note to interested parties: BMC Software has scheduled a conference call for 4:00 p.m. CST CST abbr. 1. Central Standard Time 2. convulsive shock treatment CST Central Standard Time Noun 1. today to discuss the fourth quarter and fiscal year results. Interested parties may participate by calling 847/619-6818. You may also access the conference call over the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the through Vcall at http://www.vcall.com. To listen to the live call, please go to the Web site at least 15 minutes early to register, download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. and install any necessary audio software. BMC Software, BMC Software OnSite, the BMC Software logos, and all other BMC Software product or service names are registered trademarks or trademarks of BMC Software Inc. All other trademarks or registered trademarks belong to their respective companies. (c) 2000 BMC Software Inc. All rights reserved.
BMC SOFTWARE INC. AND SUBSIDIARIES
STATEMENTS OF EARNINGS
(Unaudited)
Three Months Ended
March 31,
------------------
Fiscal Fiscal %
1999 2000 Increase
------ ------
(In millions, except
per share data)
Revenues:
Licenses $275.8 $329.6 20%
Maintenance and services 110.7 146.8 33%
------ ------
Total revenues 386.5 476.4 23%
Selling and marketing expenses 126.8 178.4 41%
Research and development expenses 46.5 51.8 11%
Cost of maintenance services
and product licenses 45.7 55.4 21%
General and administrative expenses 26.6 33.7 27%
Merger related costs 38.3 (0.2) N/A
Legal settlement -- -- N/A
Amortization of goodwill and
intangibles 1.1 36.3 N/A
------ ------
Operating income 101.5 121.0 19%
Other income 16.9 9.4 -44%
------ ------
Earnings before income taxes 118.4 130.4 10%
Income taxes 16.5 32.4 96%
------ ------
Earnings before accounting change 101.9 98.0
Effect of accounting change 1.5 -- N/A
------ ------
Net earnings $100.4 $98.0 -2%
====== ======
Diluted earnings per share $0.40 $0.39 -3%
====== ======
Shares used in computing
diluted earnings per share 248.7 253.8 2%
====== ======
BMC SOFTWARE INC. AND SUBSIDIARIES
STATEMENTS OF EARNINGS
(Unaudited)
Year Ended
March 31,
------------------
Fiscal Fiscal %
1999 2000 Increase
------ ------
(In millions, except
per share data)
Revenues:
Licenses $906.9 $1,180.2 30%
Maintenance and services 397.0 539.0 36%
------- --------
Total revenues 1,303.9 1,719.2 32%
Selling and marketing expenses 417.7 633.8 52%
Research and development expenses 163.9 213.2 30%
Cost of maintenance services
and product licenses 152.0 177.2 17%
General and administrative expenses 95.1 135.1 42%
Acquired research and
development costs 17.3 80.8 N/A
Merger related costs 38.3 14.1 N/A
Legal settlement -- 55.4 N/A
Amortization of goodwill
and intangibles 4.3 139.1 N/A
------- --------
Operating income 415.3 270.5 -35%
Other income 62.6 40.9 -35%
------- --------
Earnings before income taxes 477.9 311.4 -35%
Income taxes 113.8 68.9 -39%
------- --------
Earnings before
accounting change 364.1 242.5 -33%
Effect of accounting change 1.5 -- N/A
------- --------
Net earnings $362.6 $242.5 -33%
======= ========
Diluted earnings per share $1.46 $0.96 -34%
======= ========
Shares used in computing
diluted earnings per share 248.6 253.0 2%
======= ========
BMC SOFTWARE INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
March 31, March 31,
1999 2000
--------- ---------
(unaudited)
(in millions)
Current Assets:
Cash and cash equivalents $347.9 $151.3
Investment securities 106.3 102.8
Trade receivables 359.0 532.2
Other current assets 60.2 91.6
-------- --------
Total current assets 873.4 877.9
Investment securities 750.4 820.3
Fixed Assets 244.4 337.7
Goodwill -- 335.8
Other long term assets 414.5 570.9
-------- --------
$2,282.7 $2,942.6
======== ========
Current liabilities:
Accounts payable, accrued
liabilities and other $239.6 $191.3
Current portion of deferred revenue 411.2 406.6
Short-term debt -- 263.0
-------- --------
Total current liabilities 650.8 860.9
Deferred revenue and other 297.5 297.6
Total stockholders' equity 1,334.4 1,784.1
-------- --------
$2,282.7 $2,942.6
======== ========
BMC SOFTWARE INC. AND SUBSIDIARIES
SCHEDULE OF SPECIAL ITEMS
FOR THE THREE MONTHS ENDED MARCH 31, 2000
(Unaudited)
(in millions)
Special Items
--------------------------------------------------
Operations Amortization
(before of Goodwill
Special Merger and other Net,
items) Expenses Intangibles as Reported
---------- -------- ----------- -----------
Earnings before
Income taxes $166.5 $0.2 $(36.3) $130.4
Income taxes (43.3) (0.1) 11.0 (32.4)
-------- ------ ------- --------
Net earnings 123.2 0.1 (25.3) 98.0
======== ====== ======= ========
Diluted earnings
per share $0.49 $-- $(0.10) $0.39
======== ====== ======= ========
BMC SOFTWARE INC. AND SUBSIDIARIES
SCHEDULE OF SPECIAL ITEMS
FOR THE YEAR ENDED MARCH 31, 2000
(Unaudited)
(in millions)
Special Items
--------------------------------------------------
Operations Amortization
(before of Goodwill Net,
Special Acquired Merger Legal and Other as
items) R&D Costs Costs Settlement Intangibles Reported
--------- --------- ------ ---------- ----------- --------
Earnings
before
Income
taxes $600.8 $(80.8) $(14.1) $(55.4) $(139.1) $311.4
Income
taxes (156.2) 24.2 1.9 19.4 41.8 (68.9)
------- ------ ------ ------ ------- -------
Net
earnings 444.6 (56.6) (12.2) (36.0) (97.3) 242.5
======= ====== ====== ====== ======= =======
Diluted
earnings
per share $1.76 $(0.22) $(0.05) $(0.14) $(0.38) $0.96
======= ====== ====== ====== ======= =======
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