Summary
Cadence Design Systems, Inc. (CDNS) reported its third-quarter and nine-month results for the period ending September 30, 2000. Total revenue for the nine months increased by 8% to $888.6 million, driven by strong performance in product and maintenance revenue, although services revenue saw a decline. The company reported a net income of $7.5 million for the nine-month period, a decrease from $8.4 million in the prior year. Diluted EPS was $0.03 for both periods. A significant event during the quarter was the plan to separate the electronics design services group into a new entity, Tality Corporation. While Tality's separation was effective October 4, 2000, its initial public offering (IPO) was postponed due to unfavorable market conditions. The financial statements reflect Tality's operations, and Cadence expects to retain approximately 80% ownership post-IPO. The company also secured new senior unsecured credit facilities totaling $350 million, replacing a previous facility, with no borrowings outstanding as of quarter-end.
Key Highlights
- 1Total revenue for the nine months ended September 30, 2000, increased by 8% to $888.6 million, compared to $825.3 million in the prior year.
- 2Product revenue saw a substantial increase of 105% in the third quarter to $165.3 million, indicating strong demand for software products, particularly integrated circuit implementation and intellectual property creation products.
- 3The company reported a net income of $7.5 million for the nine months ended September 30, 2000, down from $8.4 million in the same period last year.
- 4Diluted earnings per share (EPS) remained steady at $0.03 for both the nine-month periods ended September 30, 2000, and October 2, 1999.
- 5Cadence established new senior unsecured credit facilities totaling $350 million, replacing a previous $355 million facility, with no outstanding borrowings as of September 30, 2000.
- 6The company announced plans to separate its electronics design services group into Tality Corporation, effective October 4, 2000, though Tality's IPO was subsequently postponed.
- 7Cash provided by operating activities increased significantly to $145.3 million for the nine months ended September 30, 2000, up from $103.1 million in the prior year.