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PTC Annual Report, Year Ended Sep 30, 1996

Filing Date
Filed December 24, 1996
Period End
September 30, 1996
Security
PTC
In the record · 2016–202610-K1010-Q338-K130

PTC filed 10 annual reports (10-K), 33 quarterly reports (10-Q) and 130 current reports (8-K) between 2016 and 2026.

  1. Leadership change8-K · Feb ’18Feb ’18
  2. Material agreement8-K · Feb ’20Feb ’20
  3. Deal closed8-K · May ’22May ’22
  4. Leadership change8-K · Dec ’25Dec ’25

01—Abstract

Summary

Summary of the 10-K filed December 24, 1996. Cited figures are marked; the original filing is the authoritative source.

Parametric Technology Corporation's Form 10-K for the fiscal year ended September 30, 1996 describes a company that develops, markets and supports the Pro/ENGINEER family of mechanical CAD/CAM/CAE software, with more than 70 application modules.

Total revenue for fiscal 1996 was $600.1 milliona, up 52% from $394.3 million in fiscal 1995, with license revenue of $448.7 million (up 56%) and service revenue of $151.4 million (up 43%). Net income was $137.9 million, or $1.04 per share, which includes a $32.1 million nonrecurring charge for the write-off of purchased in-process research and development from the Reflex technology acquisition. Excluding acquisition and related costs, net income was $158.4 million, or 26.4% of revenue.

Operating income was $204.7 millionb, and international customers accounted for 56% of revenue, up from 50% in fiscal 1995. The balance sheet remained strong at September 30, 1996, with cash, cash equivalents and investments of $456.1 million, working capital of $416.1 million, and stockholders' equity of $512.4 million. Operating cash flow was $229.7 million.

The company repurchased 1,779,000 shares for $66.6 millionc during the year under a 6,000,000-share buyback plan authorized in May 1994. Management expects revenue to grow in fiscal 1997 and plans to keep spending on research and development and the sales organization, while stating that it believes existing resources will be sufficient through at least fiscal 1997. The filing also flags risks that investors should weigh, including quarterly results that are hard to predict because a high share of revenue is booked in the third month of each quarter, competition from larger rivals such as IBM/Dassault, Computervision, EDS/Unigraphics and Intergraph, and stock price volatility.

The company had 2,774 employees at year-end and reported no material legal proceedings. Its auditor changed from Price Waterhouse to Coopers & Lybrand for fiscal 1996.

02—Key points

Key Highlights

  1. Total revenue rose 52% to $600.1 million in fiscal 1996, with license revenue up 56% to $448.7 million and service revenue up 43% to $151.4 million.
  2. Net income was $137.9 million, or $1.04 per share, including a $32.1 million nonrecurring charge for purchased in-process R&D from the Reflex acquisition; excluding acquisition costs, net income was $158.4 million, or 26.4% of revenue.
  3. Operating income reached $204.7 million, up from $118.6 million in fiscal 1995.
  4. International customers generated 56% of revenue in fiscal 1996, up from 50% in fiscal 1995 and 43% in fiscal 1994.
  5. Cash, cash equivalents and investments totaled $456.1 million at September 30, 1996, against stockholders' equity of $512.4 million.
  6. Operating cash flow was $229.7 million, and the company repurchased 1,779,000 shares for $66.6 million during the year.
  7. Approximately 23,000 seats were licensed in fiscal 1996, up 45% from 15,900 in fiscal 1995, with the average price per seat rising to about $19,500 from $18,100.

03—Questions

Frequently Asked Questions

  1. What drove the strong revenue growth in fiscal 1996?

    Revenue growth came from a 45% increase in seats licensed (about 23,000 versus 15,900) and a higher average price per seat of roughly $19,500, up from $18,100. The filing attributes the gains to continued market penetration, customers buying configurations with more modules, and a rising share of revenue from international markets, where prices are typically higher.

  2. How did the Reflex acquisition affect reported earnings?

    The company acquired Reflex project modeling and management technology from Greenshire License Co. NV on July 10, 1996, for $32.1 million. The full amount was expensed as a nonrecurring write-off of purchased in-process research and development, reducing reported net income. Excluding this and other acquisition-related charges, net income was $158.4 million, or $1.19 per share.

  3. What are the main risks to future results according to the filing?

    The filing lists fluctuations in operating results, since a high share of quarterly revenue is booked late in the quarter and expenses are largely fixed in the short term. Other risks include stock price volatility, competition from larger rivals with greater resources, dependence on key personnel, risks from international operations and currency exposure, the difficulty of protecting intellectual property, and the risk of delays in product development.

  4. What is the company's capital allocation strategy?

    In fiscal 1996 the company repurchased 1,779,000 shares for $66.6 million under a 6,000,000-share plan approved in May 1994, aimed at offsetting dilution from stock options and the employee stock purchase plan. It also spent $29.7 million on capital equipment and $22.1 million from cash on acquisitions. Management said existing cash, operating cash flow and stock issuance proceeds should cover working capital, financing and capital expenditure needs through at least fiscal 1997.

04—Continue

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