Company Quick10K Filing
Ansys
Price217.09 EPS3
Shares86 P/E65
MCap18,612 P/FCF52
Net Debt-733 EBIT337
TEV17,879 TEV/EBIT53
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-06-30 Filed 2020-08-05
10-Q 2020-03-31 Filed 2020-05-06
10-K 2019-12-31 Filed 2020-02-27
10-Q 2019-09-30 Filed 2019-11-07
10-Q 2019-06-30 Filed 2019-08-06
10-Q 2019-03-31 Filed 2019-05-02
10-K 2018-12-31 Filed 2019-02-28
10-Q 2018-09-30 Filed 2018-11-08
10-Q 2018-06-30 Filed 2018-08-07
10-Q 2018-03-31 Filed 2018-05-03
10-K 2017-12-31 Filed 2018-02-22
10-Q 2017-09-30 Filed 2017-11-02
10-Q 2017-06-30 Filed 2017-08-03
10-Q 2017-03-31 Filed 2017-05-04
10-K 2016-12-31 Filed 2017-02-23
10-Q 2016-09-30 Filed 2016-11-03
10-Q 2016-06-30 Filed 2016-08-04
10-Q 2016-03-31 Filed 2016-05-05
10-K 2015-12-31 Filed 2016-02-25
10-Q 2015-09-30 Filed 2015-11-05
10-Q 2015-06-30 Filed 2015-08-05
10-Q 2015-03-31 Filed 2015-05-06
10-K 2014-12-31 Filed 2015-02-26
10-Q 2014-09-30 Filed 2014-11-05
10-Q 2014-06-30 Filed 2014-08-05
10-Q 2014-03-31 Filed 2014-05-01
10-K 2013-12-31 Filed 2014-02-27
10-Q 2013-09-30 Filed 2013-11-07
10-Q 2013-06-30 Filed 2013-08-01
10-Q 2013-03-31 Filed 2013-05-02
10-Q 2012-09-30 Filed 2012-11-01
10-Q 2012-06-30 Filed 2012-08-02
10-Q 2012-03-31 Filed 2012-05-03
10-K 2011-12-31 Filed 2012-02-23
10-Q 2011-09-30 Filed 2011-11-03
10-Q 2011-06-30 Filed 2011-08-04
10-Q 2011-03-31 Filed 2011-05-05
10-K 2010-12-31 Filed 2011-02-25
10-Q 2010-09-30 Filed 2010-11-04
10-Q 2010-06-30 Filed 2010-08-05
10-Q 2010-03-31 Filed 2010-05-06
10-K 2009-12-31 Filed 2010-02-25
8-K 2020-08-05 Earnings, Exhibits
8-K 2020-05-15
8-K 2020-05-06
8-K 2020-02-26
8-K 2020-02-14
8-K 2019-11-06
8-K 2019-11-01
8-K 2019-10-28
8-K 2019-10-16
8-K 2019-09-11
8-K 2019-08-05
8-K 2019-05-17
8-K 2019-05-01
8-K 2019-02-27
8-K 2018-11-07
8-K 2018-10-23
8-K 2018-08-10
8-K 2018-08-06
8-K 2018-08-02
8-K 2018-05-18
8-K 2018-05-02
8-K 2018-02-21
8-K 2018-02-07
8-K 2018-01-15

ANSS 10Q Quarterly Report

Part I - Financial Information
Item 1.Financial Statements:
Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4.Controls and Procedures
Part II - Other Information
Item 1.Legal Proceedings
Item 1A. Risk Factors
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds
Item 3.Defaults Upon Senior Securities
Item 4.Mine Safety Disclosures
Item 5.Other Information
Item 6.Exhibits
EX-15 anssexhibit15-20200630.htm
EX-31.1 anssexhibit311-20200630.htm
EX-31.2 anssexhibit312-20200630.htm
EX-32.1 anssexhibit321-20200630.htm
EX-32.2 anssexhibit322-20200630.htm

Ansys Earnings 2020-06-30

Balance SheetIncome StatementCash Flow
3.62.92.21.40.70.02012201420172020
Assets, Equity
0.40.30.20.20.10.02012201420172020
Rev, G Profit, Net Income
0.20.10.0-0.1-0.2-0.32012201420172020
Ops, Inv, Fin

anss-20200630
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2020
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _________ to _________
Commission File Number: 0-20853
ANSYS, Inc.
(Exact name of registrant as specified in its charter)
Delaware
04-3219960
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
2600 ANSYS Drive,
Canonsburg,
PA
15317
(Address of Principal Executive Offices)
(Zip Code)
844-462-6797
(Registrant's telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of exchange on which registered
Common Stock, $0.01 par value per shareANSSNasdaq Stock Market LLC
(Nasdaq Global Select Market)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes    No  
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Yes       No  
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerAccelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes     No  
The number of shares of the Registrant’s Common Stock, $0.01 par value per share, outstanding as of July 31, 2020 was 85,789,237 shares.



ANSYS, INC. AND SUBSIDIARIES
INDEX
  
Page No.

2

Table of Contents
PART I – FINANCIAL INFORMATION
Item 1.Financial Statements:

ANSYS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands, except share and per share data)June 30,
2020
December 31,
2019
ASSETS
Current assets:
Cash and cash equivalents$744,546  $872,094  
Short-term investments433  288  
Accounts receivable, less allowance for doubtful accounts of $13,400 and $8,700, respectively343,247  433,479  
Other receivables and current assets206,038  249,619  
Total current assets1,294,264  1,555,480  
Long-term assets:
Property and equipment, net88,792  83,636  
Operating lease right-of-use assets117,242  105,671  
Goodwill2,474,299  2,413,280  
Other intangible assets, net481,694  476,711  
Other long-term assets191,326  180,032  
        Deferred income taxes24,249  24,077  
Total long-term assets3,377,602  3,283,407  
Total assets$4,671,866  $4,838,887  
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable$10,505  $14,298  
Accrued bonuses and commissions37,642  101,546  
Accrued income taxes28,291  9,996  
Current portion of long-term debt  75,000  
Other accrued expenses and liabilities142,270  142,947  
Deferred revenue325,098  351,353  
Total current liabilities543,806  695,140  
Long-term liabilities:
Deferred income taxes66,661  78,643  
Long-term operating lease liabilities103,585  91,768  
Long-term debt423,683  423,531  
Other long-term liabilities96,083  96,426  
Total long-term liabilities690,012  690,368  
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.01 par value; 2,000,000 shares authorized; zero shares issued or outstanding    
Common stock, $0.01 par value; 300,000,000 shares authorized; 94,627,585 shares issued946  946  
Additional paid-in capital1,144,193  1,188,939  
Retained earnings3,513,334  3,370,706  
Treasury stock, at cost: 8,889,945 and 8,893,177 shares, respectively(1,141,040) (1,041,831) 
Accumulated other comprehensive loss(79,385) (65,381) 
Total stockholders' equity3,438,048  3,453,379  
Total liabilities and stockholders' equity$4,671,866  $4,838,887  
The accompanying notes are an integral part of the condensed consolidated financial statements.
3

Table of Contents

ANSYS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months EndedSix Months Ended
(in thousands, except per share data)June 30,
2020
June 30,
2019
June 30,
2020
June 30,
2019
Revenue:
Software licenses$169,341  $170,499  $257,171  $293,543  
Maintenance and service216,320  198,136  433,475  392,222  
Total revenue385,661  368,635  690,646  685,765  
Cost of sales:
Software licenses8,511  6,204  13,437  10,912  
Amortization9,764  4,755  19,316  9,302  
Maintenance and service35,585  29,538  71,223  55,098  
Total cost of sales53,860  40,497  103,976  75,312  
Gross profit331,801  328,138  586,670  610,453  
Operating expenses:
Selling, general and administrative128,698  120,412  259,220  232,581  
Research and development86,133  75,302  172,245  146,040  
Amortization4,163  3,796  8,325  7,555  
Total operating expenses218,994  199,510  439,790  386,176  
Operating income112,807  128,628  146,880  224,277  
Interest income934  2,980  3,709  6,422  
Interest expense(3,040) (231) (6,691) (322) 
Other income (expense), net1,884  (1,436) 2,011  (1,770) 
Income before income tax provision112,585  129,941  145,909  228,607  
Income tax provision16,021  20,191  3,281  32,627  
Net income$96,564  $109,750  $142,628  $195,980  
Earnings per share – basic:
Earnings per share$1.13  $1.31  $1.66  $2.34  
Weighted average shares85,651  83,978  85,724  83,871  
Earnings per share – diluted:
Earnings per share$1.11  $1.28  $1.64  $2.29  
Weighted average shares86,934  85,483  87,152  85,488  
The accompanying notes are an integral part of the condensed consolidated financial statements.
4

Table of Contents

ANSYS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
 Three Months EndedSix Months Ended
(in thousands)June 30,
2020
June 30,
2019
June 30,
2020
June 30,
2019
Net income$96,564  $109,750  $142,628  $195,980  
Other comprehensive income (loss):
Foreign currency translation adjustments10,288  558  (14,004) (7,000) 
Comprehensive income$106,852  $110,308  $128,624  $188,980  
The accompanying notes are an integral part of the condensed consolidated financial statements.
5

Table of Contents

ANSYS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
 Six Months Ended
(in thousands)June 30,
2020
June 30,
2019
Cash flows from operating activities:
Net income$142,628  $195,980  
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and intangible assets amortization41,356  27,518  
Operating lease right-of-use assets expense10,216  8,970  
Deferred income tax benefit(15,684) (6,238) 
Provision for bad debts5,672  2,010  
Stock-based compensation expense65,071  52,922  
Other2,099  1,536  
Changes in operating assets and liabilities:
Accounts receivable79,444  (2,949) 
Other receivables and current assets44,377  11,780  
Other long-term assets(9,280) (1,474) 
Accounts payable, accrued expenses and current liabilities(88,099) (38,216) 
Accrued income taxes19,576  (179) 
Deferred revenue(25,678) (10,341) 
Other long-term liabilities7,306  (1,202) 
Net cash provided by operating activities279,004  240,117  
Cash flows from investing activities:
Acquisitions, net of cash acquired(100,194) (285,323) 
Capital expenditures(16,967) (16,946) 
Other investing activities(2,405) (9,008) 
Net cash used in investing activities(119,566) (311,277) 
Cash flows from financing activities:
Principal payments on long-term debt
(75,000)   
Purchase of treasury stock(161,029) (59,116) 
Restricted stock withholding taxes paid in lieu of issued shares(65,396) (35,605) 
Proceeds from shares issued for stock-based compensation15,874  20,780  
Other financing activities  (1,617) 
Net cash used in financing activities(285,551) (75,558) 
Effect of exchange rate fluctuations on cash and cash equivalents(1,435) 1,034  
Net decrease in cash and cash equivalents(127,548) (145,684) 
Cash and cash equivalents, beginning of period872,094  777,139  
Cash and cash equivalents, end of period$744,546  $631,455  
Supplemental disclosure of cash flow information:
Income taxes paid$13,483  $55,700  
Interest paid$8,412  $144  
The accompanying notes are an integral part of the condensed consolidated financial statements.


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ANSYS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(Unaudited)
 Common StockAdditional
Paid-In
Capital
Retained
Earnings
Treasury StockAccumulated
Other
Comprehensive (Loss)/Income
Total
Stockholders'
Equity
(in thousands)SharesAmountSharesAmount
Balance, January 1, 2020
94,628$946  $1,188,939  $3,370,706  8,893  $(1,041,831) $(65,381) $3,453,379  
Treasury shares acquired

690  (161,029) (161,029) 
Stock-based compensation activity
(70,769) (541) 48,997  (21,772) 
Other comprehensive loss
(24,292) (24,292) 
Net income
46,064  46,064  
Balance, March 31, 2020
94,628$946  $1,118,170  $3,416,770  9,042  $(1,153,863) $(89,673) $3,292,350  
Acquisition of Livermore Software Technology, LLC
1,030  (6) 501  1,531  
Stock-based compensation activity
24,993  (146) 12,322  37,315  
Other comprehensive income
10,288  10,288  
Net income
96,564  96,564  
Balance, June 30, 2020
94,628$946  $1,144,193  $3,513,334  8,890  $(1,141,040) $(79,385) $3,438,048  
        
 Common StockAdditional
Paid-In
Capital
Retained
Earnings
Treasury StockAccumulated
Other
Comprehensive (Loss)/ Income
Total
Stockholders'
Equity
(in thousands)SharesAmountSharesAmount
Balance, January 1, 2019
93,236$932  $867,462  $2,919,411  9,602  $(1,075,879) $(62,379) $2,649,547  
Treasury shares acquired
250  (44,856) (44,856) 
Stock-based compensation activity
(42,465) (494) 43,483  1,018  
Other comprehensive loss
(7,558) (7,558) 
Net income
86,230  86,230  
Balance, March 31, 2019
93,236$932  $824,997  $3,005,641  9,358  $(1,077,252) $(69,937) $2,684,381  
Treasury shares acquired
80  (14,260) (14,260) 
Stock-based compensation activity
14,699  (241) 22,158  36,857  
Other comprehensive income
558  558  
Net income
109,750  109,750  
Balance, June 30, 2019
93,236$932  $839,696  $3,115,391  9,197  $(1,069,354) $(69,379) $2,817,286  
The accompanying notes are an integral part of the condensed consolidated financial statements.

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ANSYS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2020
(Unaudited)

1.Organization
ANSYS, Inc. (Ansys, we, us, our) develops and globally markets engineering simulation software and services widely used by engineers, designers, researchers and students across a broad spectrum of industries and academia, including aerospace and defense, automotive, electronics, semiconductors, energy, materials and chemical processing, turbomachinery, consumer products, healthcare, and sports.
As defined by the accounting guidance for segment reporting, we operate as one segment.
Given the integrated approach to the multi-discipline problem-solving needs of our customers, a single sale of software may contain components from multiple product areas and include combined technologies. We also have a multi-year product and integration strategy that will result in new, combined products or changes to the historical product offerings. As a result, it is impracticable for us to provide accurate historical or current reporting among our various product lines.
We are closely monitoring the spread of COVID-19 and continually assessing its potential effects on our business. The COVID-19 pandemic has had, and is expected to continue to have, an adverse impact on our business, employees, liquidity, financial condition, results of operations and cash flows.

2.Accounting Policies
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information for commercial and industrial companies, the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, the accompanying unaudited condensed consolidated financial statements do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements (and notes thereto) included in our Annual Report on Form 10-K for the year ended December 31, 2019 (2019 Form 10-K). The condensed consolidated December 31, 2019 balance sheet presented is derived from the audited December 31, 2019 balance sheet included in the 2019 Form 10-K. In our opinion, all adjustments considered necessary for a fair presentation of the financial statements have been included, and all adjustments are of a normal and recurring nature. Certain items in the condensed consolidated financial statements of prior years have been reclassified to conform to the current year's presentation. These reclassifications had no effect on reported net income, comprehensive income, cash flows, total assets or total liabilities and stockholders' equity. Operating results for the three and six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for any future period.
Changes in Accounting Policies
Our accounting policies are described in Note 2, “Accounting Policies,” in the 2019 Form 10-K. Summarized below is the accounting guidance adopted subsequent to December 31, 2019.
Credit losses: In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASU 2016-13), which modifies the measurement of expected credit losses of certain financial instruments. We adopted ASU 2016-13 on January 1, 2020 with no material impact to our condensed consolidated financial statements. Previous guidance required the allowance for doubtful accounts to be estimated based on an incurred loss model, which considered past and current conditions. ASU 2016-13 requires us to use an expected loss model that also considers reasonable and supportable forecasts of future conditions, referred to as the current expected credit loss (CECL) methodology.
Under ASU 2016-13, we make judgments as to our ability to collect outstanding receivables and provide allowances for a portion of receivables over the lifetime of the receivables. Provisions are made based upon a specific review of all significant outstanding invoices from both value and delinquency perspectives. For those invoices not specifically reviewed, provisions are estimated at differing rates based upon the age of the receivable. In determining these percentages, we consider our historical loss experience, current economic trends and future conditions.
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The changes in the allowance for doubtful accounts during the six months ended June 30, 2020 were as follows:
(in thousands)Six Months Ended June 30, 2020
Beginning balance – January 1$8,700  
Additions: Charges to costs and expenses
5,672  
Deductions: Returns and write-offs
(972) 
Ending balance – June 30$13,400  
The increase in the allowance for doubtful accounts was driven by expected losses related to COVID-19.
Accounting Guidance Issued and Not Yet Adopted
Income taxes: In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12), as part of its initiative to reduce complexity in the accounting standards. The amendments in ASU 2019-12 eliminate certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. ASU 2019-12 also clarifies and simplifies other aspects of the accounting for income taxes. ASU 2019-12 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted, including adoption in any interim period. We do not expect the adoption of this guidance to have a material impact on our financial position or results of operations.
Cash and Cash Equivalents
Cash and cash equivalents consist primarily of highly liquid investments such as deposits held at major banks and money market funds. Cash equivalents are carried at cost, which approximates fair value. Our cash and cash equivalents balances comprise the following:
 June 30, 2020December 31, 2019
(in thousands, except percentages)Amount% of TotalAmount% of Total
Cash accounts$518,734  69.7  $549,639  63.0  
Money market funds225,812  30.3  322,455  37.0  
Total$744,546  $872,094  

Our money market fund balances are held in various funds of two issuers. The decrease in money market funds during the six months ended June 30, 2020 was a result of redemptions for share repurchases and the Lumerical Inc. (Lumerical) acquisition. See Note 4, "Acquisitions", for additional disclosures regarding the Lumerical acquisition.

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3.Revenue from Contracts with Customers
Disaggregation of Revenue
The following table summarizes revenue:
Three Months EndedSix Months Ended
(in thousands, except percentages)June 30,
2020
June 30,
2019
June 30,
2020
June 30,
2019
Revenue:
Lease licenses$113,209  $100,004  $158,083  $169,260  
Perpetual licenses56,132  70,495  99,088  124,283  
Software licenses169,341  170,499  257,171  293,543  
Maintenance203,179  185,118  403,667  366,579  
Service13,141  13,018  29,808  25,643  
Maintenance and service216,320  198,136  433,475  392,222  
Total revenue$385,661  $368,635  $690,646  $685,765  
Direct revenue, as a percentage of total revenue78.1 %79.7 %76.2 %75.4 %
Indirect revenue, as a percentage of total revenue21.9 %20.3 %23.8 %24.6 %
Our software licenses revenue is recognized up front, while maintenance and service revenue is generally recognized over the term of the contract.
Deferred Revenue
Deferred revenue consists of billings made or payments received in advance of revenue recognition from customer agreements. The timing of revenue recognition may differ from the timing of billings to customers. Payment terms vary by the type and location of customer and the products or services offered. The time between invoicing and when payment is due is not significant.
The changes in deferred revenue, inclusive of both current and long-term deferred revenue, during the six months ended June 30, 2020 and 2019 were as follows:
(in thousands)20202019
Beginning balance – January 1$365,274  $343,174  
Acquired deferred revenue1,405  3,266  
Deferral of revenue661,790  675,209  
Recognition of revenue(690,646) (685,765) 
Currency translation(1,635) (500) 
Ending balance – June 30$336,188  $335,384  
Revenue allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes both deferred revenue and backlog. Our backlog represents installment billings for periods beyond the current quarterly billing cycle. Revenue recognized during the six months ended June 30, 2020 and 2019 included amounts in deferred revenue