Citrix Extends End-to-End Application Delivery Strategy with Entry into Fast-Growing WAN Optimization Market; Acquisition of Orbital Data Creates New Citrix WANScaler Product Line.FORT LAUDERDALE Fort Lauderdale (lô`dərdāl), residential, commercial, and resort city (1990 pop. 149,377), seat of Broward co., SE Fla., on the Atlantic coast; settled around a fort built (c.1837) in the Seminole War, inc. 1911. , Fla. -- Citrix Systems Citrix Systems' (NASDAQ: CTXS) is an American technology company, based in Fort Lauderdale, Florida, with subsidiary operations in California and Massachusetts, with additional development centers in Australia, India and the UK. , Inc. (Nasdaq: CTXS CTXS Citrix Systems (NASDAQ stock ticker symbol) ): Move Expands Citrix's Growing Leadership in Application Delivery Market Giving Customers the Best Way to Deliver Any Application to Any User in Any Location Citrix Systems, Inc. (Nasdaq: CTXS) today announced a significant expansion of its end-to-end end-to-end a pattern of anastomosis in which severed ends are matched and united, in contrast with other patterns such as end-to-side or side-to-side. Usually applied to anastomosis of the intestine. application delivery strategy, making it faster, simpler, and more cost-effective cost-effective, n the minimal expenditure of dollars, time, and other elements necessary to achieve the health care result deemed necessary and appropriate. to deliver applications to users in branch offices and other remote locations. As a cornerstone cornerstone Ceremonial building block, dated or otherwise inscribed, usually placed in an outer wall of a building to commemorate its dedication. Often the stone is hollowed out to contain newspapers, photographs, or other documents reflecting current customs, with a view to of this strategy, Citrix (Citrix Systems, Inc., Ft. Lauderdale, FL, www.citrix.com) The leader in access infrastructure solutions, which includes network access, single sign-on, VPN capabilities, presentation services, remote control and remote support applications. announced that it has signed a definitive agreement to acquire privately held Orbital orbital Mathematical expression, called a wave function, that describes properties characteristic of no more than two electrons near an atomic nucleus or molecule. An orbital can be considered a three-dimensional region in which there is a 95% probability of finding an Data Corp., a leading provider of solutions that optimize optimize - optimisation the delivery of applications over wide area networks(WANs). As an emerging leader in the fast-growing adj. 1. tending to spread quickly; - used mostly of plants. Adj. 1. fast-growing - tending to spread quickly; "an aggressive tumor" strong-growing, aggressive WAN optimization WAN optimization products seek to accelerate a broad range of applications accessed by distributed enterprise users via eliminating redundant transmissions, staging data in local caches, compressing and prioritizing data, and streamlining chatty protocols (e.g., CIFS).. market, Orbital Data(R) gives Citrix best-in-class See best-of-class. technology as well as a strategic presence at the entry point to branch offices worldwide. The all-cash consideration payable to the shareholders of Orbital Data Corp. is approximately $50 million, and the acquisition is expected to close in the third quarter of 2006. The company also assumed approximately 0.3 million unvested stock-based instruments each of which upon vesting Vesting The process by which employees accrue non-forfeitable rights over employer contributions that are made to the employee's qualified retirement plan account. Notes: will be exercisable for the right to receive one share of the company's common stock. Strategic Importance of the Branch Office An estimated 55 percent of enterprise employees today access all of their mission-critical business applications from a remote office or branch location, often hundreds or even thousands of miles away from the corporate data center. As these applications are used by remote employees, application data must travel back-and-forth back and forth adv. 1. Backward and forward; to and fro. 2. From side to side. back many times over long-distance WANs, a process which can significantly degrade TO DEGRADE, DEGRADING. To, sink or lower a person in the estimation of the public. 2. As a man's character is of great importance to him, and it is his interest to retain the good opinion of all mankind, when he is a witness, he cannot be compelled to disclose performance and the user experience, and force expensive bandwidth upgrades in an attempt to solve these challenges. This growing problem has given rise in recent years to a new category of products that optimize the flow of all applications over the WAN, including client-server, web, file sharing Copying files from one computer to another. See peer-to-peer network, file sharing protocol and file and printer sharing. , bulk data transfer and even new application types such as voice-over-IP and video. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. IDC Research, the market for WAN optimization products was $314 million last year and is expected to nearly double over the next three years, reaching $610 million by 2009(1). Acquisition of Orbital Data Founded in 2002, Orbital Data has over 75 enterprise customers and over 60 employees. Citrix selected the San Mateo San Mateo (săn mətā`ō), city (1990 pop. 85,486), San Mateo co., W Calif., on San Francisco Bay; inc. 1894. It is a commercial and retail center with some high-technology manufacturing. San Mateo, Spanish for St. , Calif.-based company because it offers the best WAN optimization technology in five areas critical to Citrix's end-to-end application delivery strategy. 1) Best Ease-of-Use. Unlike alternative products that can be difficult to deploy and manage, Orbital Data offers several unique capabilities that make it virtually "plug-and-play," a critical advantage for under-staffed IT departments in remote branch office locations. Its AutoOptimizer(TM) technology automatically applies the best combination of performance-boosting techniques for each data flow to match the application, the data and the network conditions without requiring configuration or management changes. Orbital Data is also the only solution on the market to feature true "network and application transparency (1) The quality of being able to see through a material. The terms transparency and translucency are often used synonymously; however, transparent would technically mean "seeing through clear glass," while translucent would mean "seeing through frosted glass." See alpha blending. ," meaning that network monitoring The term network monitoring describes the use of a system that constantly monitors a computer network for slow or failing systems and that notifies the network administrator in case of outages via email, pager or other alarms. tools, firewalls, routers and applications need no modification when the Orbital solution is deployed. Just plug it in, and it works. This advantage will help drive faster adoption throughout the existing Citrix installed base and will make the Orbital solution an ideal fit for the extensive Citrix channel. 2) Best Solution for Small Branches and Mobile Users. Orbital Data was the first company in the industry to deliver a compact, software-based version of its branch appliance A stand-alone hardware device or software environment dedicated to a specific task. See hardware appliance and software appliance. technology that can be deployed directly on a remote user's PC. In contrast, most alternative solutions are delivered only as appliances, limiting their value to employees who are physically located in a large branch office. Solutions that do offer software clients are limited to accelerating only a narrow class of applications. Orbital Data's software client addresses both of these limitations, accelerating all TCP-based applications to all remote users, including employees in small "micro branches," home offices or on the road. This client capability also provides an ideal strategic fit with Citrix's end-to-end strategy, extending application delivery from the datacenter to the desktop. 3) Best Acceleration over Long Distances. The Orbital Data solution excels in some of the most problematic branch office application delivery scenarios, most notably file sharing and bulk data transfer applications that deliver large files over long distances. With the growing importance of business requirements such as disaster recovery, outsourcing (1) Contracting with outside consultants, software houses or service bureaus to perform systems analysis, programming and datacenter operations. Contrast with insourcing. See netsourcing, ASP, SSP and facilities management. , digital asset management and collaborative engineering, these advantages can be significant to many large enterprises. 4) Best Acceleration of Citrix Presentation Server Software from Citrix that provides a timeshared, multiuser environment for Unix and Windows servers. Formerly MetaFrame, Citrix Presentation Server uses the ICA protocol to turn the client machine into a terminal and governs the input/output between the client and server. . Orbital Data also offers the best solution to further accelerate applications delivered by other Citrix products, most notably, Citrix Presentation Server(TM). In internal tests, Orbital Data has been shown to improve the performance of Presentation Server by as much as five times for end users, especially for remote printing and local file save tasks that necessitate ne·ces·si·tate tr.v. ne·ces·si·tat·ed, ne·ces·si·tat·ing, ne·ces·si·tates 1. To make necessary or unavoidable. 2. To require or compel. the transfer of large volumes of data over the WAN. This capability gives Citrix an ideal opportunity to leverage its installed base of more than 160,000 Citrix Presentation Server customers and presence in enterprise WANs across the globe. 5) Highly Extensible Architecture. Orbital Data also offers a highly-extensible architecture, making it easier for Citrix to add innovative new capabilities, including tighter integration with other elements of the Citrix end-to-end application delivery infrastructure. Introducing Citrix WANScaler Upon close of this acquisition, Citrix plans to reintroduce Re`in`tro`duce´ v. t. 1. To introduce again. Verb 1. reintroduce - introduce anew; "We haven't met in a long time, so let me reintroduce myself" re-introduce the Orbital Data product line under the Citrix WANScaler brand. The new Citrix WANScaler team will become part of the company's Application Networking Group headquartered in San Jose, California San Jose (IPA: /ˌsænhoʊˈzeɪ/) is the third-largest city in California, and the tenth-largest in the United States. It is the county seat of Santa Clara County. , which is responsible for appliance-based solutions such as Citrix(R) NetScaler(R), Citrix Access Gateway(TM) and Citrix Application Firewall. Citrix WANScaler will be sold through two distinct go-to-market initiatives. Networking buyers, who drive many WAN optimization decisions today, will be addressed through Citrix partners 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: in application networking, and a dedicated WANScaler sales specialist team, much like the company's NetScaler solutions are sold today. In addition, Citrix plans to offer specialized spe·cial·ize v. spe·cial·ized, spe·cial·iz·ing, spe·cial·iz·es v.intr. 1. To pursue a special activity, occupation, or field of study. 2. , easy-to-deploy versions of the product, including a Citrix WANScaler for Presentation Server offering, which will have broad applicability to the larger Citrix installed base and worldwide field and channel organization. The Citrix WANScaler product line will offer three distinct advantages to Citrix customers as part of the company's end-to-end application delivery strategy. For more information on Citrix WANScaler, see http://www.citrix.com/site/resources/dynamic/news/Citrix_WANScaler.pps
a) Citrix WANScaler will further accelerate client/server and web
applications delivered by Citrix Presentation Server and Citrix
NetScaler to branch offices, making them run up to five times
faster.
b) Citrix WANScaler will accelerate applications that are most
problematic for branch office workers by up to 50 times, most
notably file sharing apps and bulk data transfer applications.
c) Citrix WANScaler will give branch users additional application
delivery benefits, such as improved quality of service, for new
application types like voice and video.
"Citrix continues to research, develop and acquire leading technologies that give the company a unique position in the market, solving the complete end-to-end application delivery challenge for companies of all sizes," said BV Jagadeesh, vice president and general manager for application networking at Citrix. "With more than half of all employees worldwide accessing their applications through branch offices, and even more connecting from home or on the road, the Orbital Data solution and team will significantly enhance the Citrix value proposition for this important market. Just as importantly, they will improve our ability to be a trusted partner for customers looking for Looking for In the context of general equities, this describing a buy interest in which a dealer is asked to offer stock, often involving a capital commitment. Antithesis of in touch with. the best way to deliver any application to any user in any location." "The enterprise-wide breadth of our application delivery technology will now be further enhanced through this combination of forces with Citrix," said Dick Pierce Pierce may refer to: Places
2. Every voyage must have a terminus a quo and a terminus ad quem. under a new flag." Terms of the Deal Under terms of the definitive agreement, Citrix will acquire Orbital Data for approximately $50 million. The company also assumed approximately 0.3 million unvested stock-based instruments each of which upon vesting will be exercisable for the right to receive one share of the company's common stock. Assuming the transaction closes as expected, the acquisition is expected to add approximately $2 million in revenue to the second half of 2006 and is expected to be $0.04 dilutive to Citrix's earnings per share on a GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). basis and $0.03 dilutive to Citrix's earnings per share on an adjusted basis, excluding the effects of amortization of intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. and stock-based compensation expense. For 2007, the transaction is expected to add $10 to $12 million in revenue and is expected to be $0.06 to $0.07 dilutive to Citrix's earnings per share on a GAAP basis and $0.04 to $0.05 dilutive to Citrix's earnings per share on an adjusted basis, excluding the effects of amortization of intangible assets and stock-based compensation expense. Orbital Data was advised by Evercore Partners Evercore Partners NYSE: EVR is a boutique investment bank and private equity investment firm located in New York. It was founded by Blackstone Group alumni Austin Beutner and Roger Altman in 1996. in this transaction. Conference Call Information Citrix will host a conference call today at 8:00 a.m. Eastern Time to discuss the terms of the transaction and the company's strategy regarding the acquisition. The call will be 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 Investor relations The process by which the corporation communicates with its investors. 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 through August 11, 2006, by dialing (800) 642-1687 or (706) 645-9291 (passcode required: 4067591). About Citrix Citrix Systems, Inc. (Nasdaq:CTXS) is the global leader and most trusted name in on-demand access. More than 180,000 organizations around the world rely on Citrix to provide the best possible access experience to any application for any user. Citrix customers include 100% of the Fortune 100 companies and 98% of the Fortune Global 500, as well as hundreds of thousands of small businesses and individuals. Citrix has approximately 6,200 channel and alliance partners in more than 100 countries. Citrix annual revenues in 2005 were $909 million. Learn more at www.citrix.com. For Citrix Investors This release contains 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. which are made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of Section 27A of the Securities Act of 1933 and 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 the company's vice president and general manager for application networking and by the CEO of Orbital Data; statements concerning the proposed acquisition; statements concerning the terms and timing of the acquisition; statements concerning revenue and earnings per share; statements concerning the WAN optimization and branch office markets, marketing plans, customers, the Citrix installed base, products and technology; statements concerning expectations as to demand for growth of the products; statements concerning expectations as to market growth; and statements concerning management's plans, objectives, strategies and assessments of market factors, 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 possibility that the proposed acquisition will not close; that the closing may be delayed or that the companies may be required to modify aspects of the acquisition to close the acquisition; the satisfaction of closing conditions to the acquisition; the reaction of customers of Citrix and Orbital Data to the acquisition; Citrix's timing and ability to successfully integrate Orbital Data's products, operations (including migration of Orbital Data to Citrix's systems and controls) and employees; the introduction of new products by competitors or the entry of new competitors into the markets for Citrix's and Orbital Data's products; the failure by Citrix to retain key employees of Orbital Data; failure to further develop and successfully market Orbital Data's technology and products; failure to achieve anticipated revenues; and costs related to the acquisition. More information about potential factors that could affect Citrix's business and financial results is included in Citrix's Annual Report 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 December 31, 2005 and Quarterly Report on Form 10-Q Form 10-Q See 10-Q. for the quarterly period ended June 30, 2006, including (without limitation) under the captions "Risk Factors" and "Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial of Financial Condition and Results of Operations," and in the company's other filings with the Securities and Exchange Commission, which are available at the Security and Exchange Commission's website at http://www.sec.gov. Citrix assumes no obligation to update any forward-looking information contained in this press release or with respect to the announcements described herein. Citrix(R), NetScaler(R), Citrix Presentation Server(TM) and Citrix Access Gateway(TM) are 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. Orbital(R), Orbital Data(R) and AutoOptimizer(TM) are registered trademarks and trademarks of Orbital Data Corp. All other trademarks and registered trademarks are property of their respective owners. (1)IDC, "Worldwide WAN Optimization Management 2005-2009 Forecast and Analysis," May 2005, #33371
Use of Non-GAAP Financial Measures and Reconciliation of Non-GAAP
Financial Measures to Comparable U.S. GAAP Measures
(Unaudited)
This press release contains non-GAAP financial measures as defined
by SEC Regulation G. We utilize certain non-GAAP financial measures to
evaluate our performance and for internal planning and forecasting
purposes. We consider these measures important indicators of our
success. In addition, we provide these non-GAAP measures of the
company's performance to investors to enable them to better compare
our results of operations against financial models prepared by the
company's investors and securities analysts and to provide additional
information concerning the impact of business acquisitions on Citrix's
results of operations. These non-GAAP financial measures should not be
construed as superior to GAAP financial measures, nor should these
measures be considered an alternative to measurements required by
accounting principles generally accepted in the United States, such as
net income and earnings per share, and should not be considered
measures of our liquidity. In addition, our non-GAAP financial
measures may not be comparable to similar measures reported by other
companies. The GAAP financial measure most directly comparable to each
non-GAAP financial measure used or discussed in this press release and
a reconciliation of the differences between each non-GAAP financial
measure and the comparable GAAP financial measure can be found on the
Investor Relations page of the Citrix corporate web site at
http://www.citrix.com/investors.
The following table reconciles the non-GAAP financial measure used
in this release to the most comparable U.S. GAAP measure for the
respective periods:
Anticipated Earnings Per Share Dilution for the
Six Months Ended December 31, 2006
Dilution to
Earnings Per
Share Range -
Diluted
-------
U.S. GAAP measure $0.04
Adjustments to exclude the
effects of amortization of
intangible assets acquired
and stock-based
compensation expense, net
of tax $0.01
-------
Adjusted figures $0.03
=======
Anticipated Earnings Per Share Dilution for the
Year Ended December 31, 2007
Dilution to
Earnings Per
Share Range -
Diluted
-------
U.S. GAAP measure $0.06 to $0.07
Adjustments to exclude the
effects of amortization of
intangible assets acquired
and stock-based
compensation expense, net
of tax $0.02
--------
Adjusted figures $0.04 to $0.05
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