Macrovision Corporation Reports Record Second Quarter 2004 Revenues
2 August 2004, 4:30pm ET
SANTA CLARA, Calif.--(BUSINESS WIRE)--Aug. 2, 2004--Macrovision Corporation (Nasdaq:MVSN) announced today that second quarter 2004 net revenues were a record $35.7 million, compared with $29.2 million in the second quarter of 2003, an increase of 22%. Pro forma earnings (before amortization of intangibles from acquisitions, non-cash deferred compensation expense, and impairment gains and losses on investments) were $9.5 million or 14% higher than the $8.4 million recorded in last year's second quarter. Pro forma diluted earnings per share for the quarter were $0.19, or 12% higher than the comparable pro forma earnings per share of $0.17 in the second quarter a year ago.
Net income for the second quarter of 2004 was $8.8 million or 93% higher than the $4.6 million recorded in the second quarter a year ago. Diluted earnings per share for the quarter were $0.18, or 100% higher than the comparable earnings per share of $0.09 in the second quarter a year ago.
Cash and cash equivalents, short-term investments and long-term marketable securities were $302.4 million as of June 30, 2004.
"We are very pleased with our second quarter results," said Ian Halifax, CFO at Macrovision. "Our revenues benefited from continued strong performance in our DVD and pay-per-view (PPV) copy protection business and our enterprise software value management business. The second quarter was important to us for a number of reasons, including the announcement of our acquisition of InstallShield(R) Software Corporation; important legal victories that establish a broad scope for key patents related to the Company's software licensing solutions; the introduction and first sales of FLEXnet(TM) Manager, our software asset management system; and the successful launch of our Hawkeye(TM) peer-to-peer file sharing content management service. Revenues for the third quarter of 2004 are estimated to be in the $45-$47 million range, with pro forma EPS of $0.18-$0.19. For the full year 2004, we anticipate revenues of $170M-$175M, with pro forma EPS of $0.86-$0.88. These projections include the impact of the InstallShield acquisition for the second half of the year."
The Company continues to use pro forma reconciliation condensed 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 non-cash, non-operating or non-recurring items (such as amortization of intangibles from acquisitions, amortization of deferred stock-based compensation, impairment losses on investments, in-process research and development write-off and restructuring charges) are excluded from the pro forma earnings calculation. This presentation may be considered more indicative of our ongoing operational performance. The tables below present the differences between pro forma earnings and net income on an absolute and per share basis.
Immediately following the Q2 earnings release, Macrovision will hold an investor conference call on August 2, from 5:00 p.m. to 6:00 p.m. EDT. Investors and analysts interested in participating in the conference are welcome to call 800-218-0713 (or international +1 303-205-0033) and reference the Macrovision call.
The conference call can also be accessed via live Webcast at www.macrovision.com/company/investor/financial_news.shtml or www.fulldisclosure.com (or www.streetevents.com for subscribers) on August 2, 2004 at 5:00 p.m. EDT. Approximately 1-2 hours after the live Webcast ends, the on-demand Webcast of Macrovision's earnings conference call can be accessed until August 9, 2004.
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 11003547#. Access to the replay is available through August 3, 2004. The conference call script will be posted on the Company's website approximately 48 hours following the call and will be posted for 30 days.
About Macrovision
Macrovision develops and markets digital product value management solutions for content publishers, software publishers, and enterprise IT departments. Macrovision's content protection technologies are embedded in over 8.5 billion DVD, VHS, and CD units representing over $115 billion of protected entertainment content. In addition, over 280 million DVD devices and digital set-top boxes contain Macrovision's technology. Our software solutions are deployed on more than 500 million desktops worldwide, and over $70 billion of software has been FLEXenabled. Macrovision holds a total of 759 issued and 479 pending United States and international patents, and continues to increase its patent portfolio with new and innovative technologies in related fields. Macrovision has its corporate headquarters in Santa Clara, California, key development labs and sales/service centers in Schaumberg, IL and the UK, and other international offices in Amsterdam, Tel Aviv, Tokyo, Hong Kong, Taipei and Seoul. More information about Macrovision can be found at www.macrovision.com .
Note to Editors: For more information on Macrovision Corporation and its products, please visit www.macrovision.com .
All statements contained herein, including the quotations attributed to Mr. Halifax, 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" and are made pursuant to the Safe-Harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include the Company's forecast of future revenues and earnings, the business strategies and product plans of the Company and the features and benefits of the products 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 Reports on Form 10-K for 2003, its Quarterly Reports on Form 10-Q, and such other documents as are filed with the Securities and Exchange Commission from time to time. 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 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 is not obligated to revise or update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this release.
Mentioned Last Change
MVSN 22.37 1.32dollars or (6.27%)
Macrovision provides pro forma earnings and pro forma earnings per share data as additional information for its operating results. These measures are not in accordance with, or an alternative for, generally accepted accounting principles and may be different from pro forma measures used by other companies. Macrovision believes that this presentation of pro forma earnings and pro forma earnings per share provides useful information to management and investors regarding certain additional financial and business trends relating to its financial condition and results of operations. In addition, Macrovision's management uses these measures for reviewing the financial results of Macrovision and for budget planning purposes.
Macrovision Corporation and Subsidiaries
Condensed Consolidated Statements of Income (Unaudited)
(In thousands, except per share data)
Three Months Six Months
Ended June 30, Ended June 30,
----------------- -----------------
2004 2003 2004 2003
-------- -------- -------- --------
Net Revenues $35,670 $29,212 $73,652 $57,264
Costs and expenses:
Costs of revenues, including
amortization of intangibles of
$777 and $856 for the three
months ended June 30, 2004 and
2003, respectively, and $1,556
and $1,712 for the six months
ended June 30, 2004 and 2003,
respectively 3,240 2,636 6,324 4,974
Research and development 5,708 4,156 11,295 7,899
Selling and marketing 8,770 6,472 17,326 12,876
General and administrative 5,120 4,648 10,633 8,972
Deferred compensation
expense relating to
Globetrotter - 752 185 1,520
Impairment losses (gains) on
investments - 3,850 (1,040) 3,850
-------- -------- -------- --------
Total costs and expenses 22,838 22,514 44,723 40,091
-------- -------- -------- --------
Income before interest and income
taxes 12,832 6,698 28,929 17,173
Interest and other income, net 985 953 1,713 2,053
-------- -------- -------- --------
Income before income taxes 13,817 7,651 30,642 19,226
Income taxes 4,974 $3,060 11,031 7,690
-------- -------- -------- --------
Net income $8,843 $4,591 19,611 11,536
======== ======== ======== ========
Diluted earnings per share $0.18 $0.09 $0.39 $0.24
======== ======== ======== ========
Shares used in computing diluted
earnings per share 50,411 49,299 50,311 49,038
======== ======== ======== ========
Macrovision Corporation and Subsidiaries
Pro forma Reconciliation of Condensed
Consolidated Statements of Income (Unaudited) (1)
(In thousands, except per share data)
Three Months Six Months
Ended June 30, Ended June 30,
--------------- -----------------
2004 2003 2004 2003
------- ------- -------- --------
Net income $8,843 $4,591 $19,611 11,536
Add:
Amortization of intangibles from
acquisitions (net of taxes) 643 585 1,290 1,119
Deferred compensation expense
relating to Globetrotter - 752 185 1,520
Impairment losses on investments
(net of taxes) - 2,423 (670) 2,423
------- ------- -------- --------
Pro forma net income $9,486 $8,351 $20,416 $16,598
======= ======= ======== ========
Diluted earnings per share
reconciliation:
Net income $0.18 $0.09 $0.39 $0.24
Add:
Amortization of intangibles
from acquisitions (net of
taxes) 0.01 0.01 0.03 0.02
Deferred compensation expense
relating to Globetrotter - 0.02 - 0.03
Impairment losses on investments
(net of taxes) - 0.05 (0.01) 0.05
------- ------- -------- --------
Pro forma diluted earnings per
share research and development $0.19 $0.17 $0.41 $0.34
======= ======= ======== ========
Shares used in computing diluted
earnings per share 50,411 49,299 50,311 49,038
======= ======= ======== ========
Notes: (1)
Pro forma results for the three and six months ended June 30, 2004 and
2003 are presented for information purposes only. These results
present the operating results of Macrovision Corporation, excluding
costs associated with amortization of intangibles from acquisitions,
amortization of capitalized patents from our acquisition of TTR's
assets in the second quarter of 2003, deferred compensation expense,
and impairment losses on investments. These costs were $643 for the
three month period ended June 30, 2004, and $805 for the six month
period ending June 30, 2004, net of taxes when applicable, using the
Company's pro forma effective rate. The amortization expense for
capitalized TTR patents included in cost of revenues was $225 and $450
for the three and six months ended June 30, 2004, respectively. The
format presented above is not in accordance with Generally Accepted
Accounting Principles.
Macrovision Corporation and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
(In thousands)
June 30, December 31,
2004 2003
------------- ------------
ASSETS
Cash and cash equivalents $140,350 $27,918
Short-term investments 64,234 95,563
Accounts receivable, net 22,266 30,169
Prepaid expenses and other assets 18,056 15,079
------------- ------------
Total Current Assets 244,906 168,729
Property and equipment, net 7,575 6,689
Patents and other intangibles, net 11,010 10,826
Long-term marketable investment
securities 97,833 146,151
Goodwill 29,434 28,630
Other intangibles from
acquisitions, net 7,040 8,512
Other assets 16,177 16,029
------------- ------------
TOTAL ASSETS $413,975 $385,566
============= ============
LIABILITIES
Accounts payable $5,660 $4,457
Accrued expenses and income taxes
payable 26,097 25,936
Deferred revenue 12,325 10,333
------------- ------------
Total Current Liabilities 44,082 40,726
Other liabilities 1,022 874
------------- ------------
TOTAL LIABILITIES 45,104 41,600
STOCKHOLDERS' EQUITY 368,871 343,966
------------- ------------
TOTAL LIABILITIES &
STOCKHOLDERS' EQUITY $ 413,975 $ 385,566
============= ============
CONTACT: Macrovision Corporation
Ian Halifax, 408-743-8600 (Investors)
ir-info@macrovision.com
SOURCE: Macrovision Corporation
