Parametric Technology CEO Discusses F1Q2011 Results – Earnings Call Transcript

Parametric Technology CEO Discusses F1Q2011 Results â¿¿ Earnings Call Transcript
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Parametric Technology Corp. (



F1Q 2011 Earnings Call

October 27, 2010; 08:30 am ET


Jim Heppelmann - President & Chief Executive Officer

Jeff Glidden - Executive Vice President & Chief Financial Officer

Barry Cohen - Executive Vice President of Strategy

Kristian Talvitie - Vice President of Corporate Communications


Richard Davis – Canaccord Genuity

Steven Koenig – Longbow Research

Sasa Zorovic – Janney Montgomery Scott

Michael Olson – Piper Jaffray

Blair Abernethy – Stifel Nicolaus

Ross Macmillan - Jefferies & Company

Sterling Auty – JP Morgan

Yun Kim – Gleacher



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Good morning ladies and gentlemen and welcome to PTC’s fourth quarter fiscal year 2010 results conference call. After brief comments by management, we will go directly into the question and answer session. (Operator Instructions) As a reminder, ladies and gentlemen this conference is being recorded.

I would now like to introduce Kristian Talvitie, PTC’s Vice President of Corporate Communications. Please go ahead.

Kristian Talvitie

Great, thank you. Good morning everyone and thank you for joining us today. Before we get started, I wanted to quickly cover a couple of housekeeping items. First, as you hopefully all know by now we’re hosting a live event in Boston tomorrow to unveil our Project Lighting strategy. This promises to be a pretty exciting event so please register on to attend the live virtual event, which starts at 10:00 a.m. Easter tomorrow.

Second, as you also hopefully all know, we are having our fiscal 2011 Investor Day next week on Wednesday, November 3 in Manhattan at the Nasdaq market sight. The event will last from 9:30 to about 3:30 Eastern Time and it include presentations from management as well as some customers, as we share our longer-term business strategies from key product platforms and talk in more detail about our 2011 targets and financial model.

If you haven’t registered already please contract me or Kristian to do so. With that moving on to the Safe Harbor language, this call in Q-&-A session may include forward-looking statements regarding PTC’s products or anticipated future operations or financial performance. Any such statements will be based on the current assumptions of PTC’s management and are subject to risks and uncertainties that could cause actual events and results to differ materially.

Information concerning these risks and uncertainties is contained in PTC’s most recent Form 10-K and Form 10-Q on filed with the SEC. All financial measures on this call are non-GAAP financial measures; a reconciliation between the non-GAAP measures and the comparable GAAP measures is located in the prepared remarks document on the Investor Relations page of our website at


Participating on today’s call are Jim Heppelmann, President and Chief Executive Officer, Jeff Glidden, Executive Vice President and Chief Financial Officer and Barry Cohen, Executive Vice President of Strategy. With that I will turn the call over to Jim.

James Heppelmann

Thank you, Kristian. Good morning. I am very excited to be joining you here today, on my first earnings call as the company’s new CEO and though I am the new CEO, I think most of will recognize that I am not really a new voice on the call and in fact many of you have known me for years already.

So, just quickly recap my background for those of you who maybe know. I’ve been with PTC for about 13 years since I was choired into the company in 1998 as the Founder and Leader of the Windchill Technology Company. I stayed with PTC following that acquisition and then for most of the decades it followed. I was the head of product development and strategic marketing functions at PTC.

You may remember that this was the time, during which we completely reinvented our strategy and our product portfolio, and remerged as the technology leader, which is an accomplishment that, naturally I am very proud.

So, during my time here, I have also invested much of my time in the sales process and with the customers. So, I feel that with the combination of background, I’ve had a chance to learn the business very well and to learn it from several different perspectives. I had a great opportunity to help steer the company in the time I’ve been here and feel that I’ve been a key driver in efforts to reshape the CAD Company of the 1990s, into the growing enterprise solutions company that we have today.

Then finally, I was probably one of the most thoughtful succession plans I am aware of, I joined the Board in 2008. I became President and Chief Operating Officer in 2009 and now I am taking the helmet [ph] of CEO going into fiscal 2011.

So I have to say it’s a really exciting time to take over, the company is in a good position today and I think we have a legitimate opportunity to make this one of the great stories in the tech industry going forward.

So looking back at fiscal 2010, I think the year will go down in the record books as a terrific accomplishment. Let me first remind you that we begin the year with guidance of $980 million in revenue and $0.96 in EPS. That goal represented 4% revenue growth, which we based on an assumption of 20% license growth, which many people including some on the calls thought was far too aggressive at the time. But throughout the course of the year, the business kept getting stronger and we raised our revenue and EPS target.

We ultimately ended the year at $1.10 billion in revenues and $1 in earnings per share. That represents 8% of revenue growth based on nearly 40% license growth which I think ranks us amongst the strongest growth companies in the software industry right now.

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