Macrovision Corporation Reports First Quarter Financial Performance; Record First Quarter Results.SANTA CLARA Santa Clara, city, Cuba Santa Clara (sän`tä klä`rä), city (1994 est. pop. 217,000), capital of Villa Clara prov., central Cuba. , Calif. -- Please replace the release with the following corrected version due to multiple revisions. The corrected release reads: MACROVISION Macrovision is a company that develops and markets licensing, access control, and secure distribution technologies for electronically delivered creative works. This includes digital media (video, music), web publishing (text, images), and computer software (consumer software, CORPORATION REPORTS FIRST QUARTER FINANCIAL PERFORMANCE; RECORD FIRST QUARTER RESULTS Macrovision Corporation (Nasdaq:MVSN MVSN Milizia Volontaria per la Sicurezza Nazionale (Italy) ) announced today record first quarter revenues of $57.0 million. Non-GAAP (pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma ) earnings were also a record for a first quarter at $13.2 million, compared to $11.5 million in the first quarter of 2005. Non-GAAP (pro forma) 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 were a record $0.25 for a first quarter, compared to $0.22 in the same quarter of 2005. Non-GAAP (pro forma) earnings exclude non-cash or one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. items such as amortization of intangibles from acquisitions, discrete tax items, impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. on investments, and stock-based compensation charges, as applicable. US GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). net income for the first quarter of 2006 was $2.9 million compared to $5.5 million for the first quarter of 2005. 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. GAAP earnings per share for the quarter were $0.06, compared with $0.11 for the comparable quarter in 2005. The primary difference between GAAP earnings in 2005 and 2006 was the impact of the adoption of FAS123R, adopted on January January: see month. 1, 2006 and to date, only applicable to first quarter 2006 GAAP results. A reconciliation between net income on a GAAP and non-GAAP (pro forma) basis is provided in tables below. The Company generated a first quarter record $21.3 million of cash from operations and its liquid cash and investments at the end of the first quarter were $242.2 million. "We are pleased to be able to report record first quarter revenues and pro forma profits for our business. We have seen significant progress with customer acceptance of our transformation in extending our capability in content security and licensing to digital distribution, commerce and hardware licensing," said Fred (Friendly Rollabout Engineered for Doctors) A mobile medical conferencing unit. See videoconferencing. 1. FRED - Robert Carr. Language used by Framework, Ashton-Tate. 2. Amoroso Am`o`ro´so n. 1. A lover; a man enamored. adv. 1. (Mus.) In a soft, tender, amatory style. , President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Macrovision. "We are increasing our outlook for 2006 commensurate com·men·su·rate adj. 1. Of the same size, extent, or duration as another. 2. Corresponding in size or degree; proportionate: a salary commensurate with my performance. 3. with the overachievement o·ver·a·chieve intr.v. o·ver·a·chieved, o·ver·a·chiev·ing, o·ver·a·chieves To perform better or achieve more success than expected. o in Q1. We believe that our full year 2006 revenue will range between $239 million and $249 million and our expectation for full year fully diluted pro forma earnings pro forma earnings Income not necessarily calculated in accordance with generally accepted accounting principles. For example, a company might report pro forma earnings that exclude depreciation expense and nonrecurring expenses such as restructuring costs. per share ranges between $1.03 and $1.07 per share. In the second quarter of 2006, we expect revenue between $54 million and $56 million and we expect fully diluted pro forma earnings per share in the range of $0.20 to $0.22." "Our quarterly results were solid and we remain optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op about achieving our financial targets in 2006. Our revenues were higher than they have ever been for a first quarter. We were able to overachieve o·ver·a·chieve intr.v. o·ver·a·chieved, o·ver·a·chiev·ing, o·ver·a·chieves To perform better or achieve more success than expected. o all other meaningful metrics metrics Managed care A popular term for standards by which the quality of a product, service, or outcome of a particular form of Pt management is evaluated. See TQM. we set for ourselves, including pro forma operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: , pro forma earnings per share and cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses ," added James James, person in the Bible James, in the Gospel of St. Luke, kinsman of St. Jude. The original does not specify the relationship. James, rivers, United States James. Budge, Chief Financial Officer. "Also notable in the quarter is that the eMeta transaction closed on February 28, 2006 and that the results of operations from close date forward are and will continue to be included in our consolidated financial results." Macrovision will hold an investor conference call on May 2, 2006, at 5:00 p.m. ET. Investors and analysts interested in participating in the conference are welcome to call 800-257-1927 (or international +1 303-262-2194) and reference the Macrovision call. The conference call can also be accessed via live Webcast at www.macrovision.com or www.fulldisclosure.com (or www.streetevents.com for subscribers) on May 2, 2006 at 5:00 p.m. ET. The on-demand audio Webcast of Macrovision's earnings conference call can be accessed approximately 1-2 hours after the live Webcast ends. Investors and analysts interested in listening to a recorded replay of the conference are welcome to call 800-405-2236 (or international +1 303-590-3000) and enter passcode 11058701#. Access to the replay is available through May 3, 2006. About Macrovision Macrovision provides distribution, commerce and consumption solutions for software and entertainment content to the home video, PC games, music, cable/satellite, consumer software, and enterprise software industries, Macrovision holds a total of 236 issued or pending 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. patents and 1,239 issued or pending international patents, and continues to increase its patent portfolio with new and innovative technologies in related fields. Macrovision is headquartered in Santa Clara, California Santa Clara, California (IPA: /ˌsæntəˈklærə/) , founded in 1777 and incorporated in 1852, is a city in Santa Clara County, in the U.S. state of California. , U.S.A. with other offices across the United States and around the world. More information about Macrovision can be found at www.macrovision.com. (C)Macrovision 2006. Macrovision and eMeta are trademarks of Macrovision Corporation. All other brands and product names and trademarks are the registered property of their respective companies. All statements contained herein, including the quotations attributed to Mr. Amoroso and Mr. Budge, as well as oral statements that may be made by the Company or by officers, directors or employees of the Company acting on the Company's behalf, that are not statements of historical fact, including statements that use the words "will," "believes," "anticipates," "estimates," "expects," "intends" or "looking to the future" or similar words that describe the Company's or its management's future plans, objectives, or goals, 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. " and are made pursuant to the Safe-Harbor provisions of 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. These forward-looking statements include, but are not limited to, the Company's forecast of future revenues and earnings and the business strategies and product plans of the Company. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause the actual results of the Company to be materially different from the historical results and/or from any future results or outcomes expressed or implied by such forward-looking statements. Among the important factors that could cause results to differ materially are the following: the failure of markets for home video, audio CDs, consumer or enterprise software value management, or markets for the technological protection of copyrighted materials contained in such products, to continue, develop or expand, and the failure of the Company's products to achieve or sustain market acceptance or to meet, or continue to meet, the changing demands of content or software providers. Other factors include those outlined in the Company'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 year ended December 31, 2005 and such other documents as are filed with the Securities and Exchange Commission from time to time (available at www.sec.gov). These factors may not constitute all factors that could cause actual results to differ materially from those discussed in any forward-looking statement. The Company operates in a continually con·tin·u·al adj. 1. Recurring regularly or frequently: the continual need to pay the mortgage. 2. changing business environment and new factors emerge from time to time. The Company cannot predict such factors, nor can it assess the impact, if any, of such factors on the Company or its results. Accordingly, forward-looking statements should not be relied upon as a prediction of actual results. The Company assumes no obligation to revise or update any forward-looking statements in order to reflect events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or that may arise after the date of this release. Macrovision uses non-GAAP (pro forma) condensed con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. consolidated statements of income in the presentation of financial results and earnings guidance. Management believes that this presentation may be more meaningful in analyzing the results of operations and income generation as this is how the business is managed. The tables below present the differences between non-GAAP (pro forma) earnings and GAAP net income on an absolute and per share basis.
MACROVISION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
RECONCILIATION OF GAAP TO NON-GAAP (PRO FORMA)
QUARTER ENDED MARCH 31, 2006
Three Months
Ended March 31,
------------------------------------------------------
2006 2006 2006 2005 2005 2005
-------- -------- -------- ------- ------- --------
Non-GAAP Non-GAAP
(Pro (Pro
Forma) Non-GAAP Forma) Non-GAAP
Adjust- (Pro Adjust- (Pro
US GAAP ments Forma) US GAAP ments Forma)
-------- -------- -------- ------- ------- --------
Net
Revenues: 57,018 57,018 51,257 51,257
Cost and
expenses:
Cost of
revenues 8,306 (398)(a) 7,908 5,142 5,142
TTR
amortization 222 (222) -- 236 (236) --
Amortization
of
intangibles 3,243 (3,243) -- 2,416 (2,416) --
-------- -------- -------- ------- ------- --------
Total cost
of revenues 11,771 (3,863) 7,908 7,794 (2,652) 5,142
Research and
development 12,442 (1,475)(a) 10,967 8,697 -- 8,697
Selling and
marketing 16,466 (1,680)(a) 14,786 12,922 -- 12,922
General and
administrative 8,719 (1,422)(a) 7,297 8,426 -- 8,426
IPR&D -- -- -- -- --
Impairment
charges, net
of gains -- 5,726 (5,726) --
Restructuring
charge -- -- -- -- -- --
-------- -------- -------- ------- ------- --------
Total
costs
and
expenses 49,398 (8,440) 40,958 43,565 (8,378) 35,187
Operating
income 7,620 8,440 16,060 7,692 8,378 16,070
Interest and
other income
(expense), net 2,049 -- 2,049 937 -- 937
-------- -------- -------- ------- ------- --------
Income before
income taxes 9,669 8,440 18,109 8,629 8,378 17,007
Provision for
income taxes 6,766 (1,853) 4,913 3,162 2,365 5,527
-------- -------- -------- ------- ------- --------
Net income $2,903 $10,293 $13,196 $5,467 $6,013 $11,480
======== ======== ======== ======= ======= ========
Pro Forma
Shares
for EPS:
Basic 51,989 -- 51,989 50,349 -- 50,349
Diluted 52,543 4 52,547 51,341 -- 51,341
Basic EPS $ 0.06 $ 0.19 $ 0.25 $ 0.11 $ 0.12 $ 0.23
Diluted EPS $ 0.06 $ 0.19 $ 0.25 $ 0.11 $ 0.11 $ 0.22
(a) Stock-based compensation during the first quarter 2006 totalled
$4,975,000. There was no stock-based compensation recorded in the
first quarter of 2005.
MACROVISION CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
March 31, December 31,
2006 2005
----------- -------------
ASSETS
Cash and cash equivalents 89,709 135,625
Short-term investments 149,345 111,039
Accounts receivable, net 48,606 45,254
Prepaid expenses and other assets 9,697 7,508
----------- -------------
Total Current Assets 297,357 299,426
Property and equipment, net 15,635 13,398
Long-term marketable investment
securities 18,166 15,040
Goodwill 136,660 107,329
Other intangibles from acquisitions,
net 34,988 32,755
Deferred tax assets 18,483 18,895
Patents and other assets 11,080 11,082
----------- -------------
TOTAL ASSETS 532,369 497,925
----------- -------------
LIABILITIES
Accounts payable 7,585 5,380
Accrued expenses 46,168 40,174
Deferred revenue 30,525 23,262
----------- -------------
Total Current Liabilities 84,278 68,816
Other liabilities 741 959
----------- -------------
TOTAL LIABILITIES 85,019 69,775
----------- -------------
STOCKHOLDERS' EQUITY 447,350 428,150
----------- -------------
TOTAL LIABILITIES & STOCKHOLDERS'
EQUITY 532,369 497,925
----------- -------------
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