ANSYS, Inc. Reports Third Quarter Revenue Growth of 9% in

ANSYS, Inc. Reports Third Quarter Revenue Growth of 9% in Constant Currency

Fiscal Year 2016 Preliminary Outlook

The Company currently expects the following for the fiscal year ending December 31, 2016:

GAAP revenue in the range of $1.01 - $1.05 billion
Non-GAAP revenue in the range of $1.01 - $1.05 billion
GAAP diluted earnings per share of $2.91 - $3.14
Non-GAAP diluted earnings per share of $3.58 - $3.76

These statements are forward-looking and actual results may differ materially. Non-GAAP diluted earnings per share is a supplemental financial measure and should not be considered as a substitute for, or superior to, diluted earnings per share determined in accordance with GAAP.

Conference Call Information

ANSYS will hold a conference call at 10:30 a.m. Eastern Time on November 5, 2015 to discuss third quarter results. To participate in the live conference call, dial 866-652-5200 (US) or 412-317-6060 (Canada & Int'l). The call will be recorded and a replay will be available approximately two hours after the call ends. The replay will be available for ten days by dialing 877-344-7529 (US) or 412-317-0088 (Int'l) or 855-669-9658 (CAN toll-free) and entering the pass code 10074596. The archived webcast can be accessed, along with other financial information, on ANSYS' website at http://investors.ansys.com.


ANSYS, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(in thousands)
(Unaudited)

	September 30,	December 31,
	2015	2014

ASSETS:

Cash & short-term investments	$ 776,923	$ 788,778
Accounts receivable, net	91,470	101,229
Goodwill	1,334,509	1,312,182
Other intangibles, net	233,262	259,312
Other assets	265,402	312,602

Total assets	$ 2,701,566	$ 2,774,103


LIABILITIES & STOCKHOLDERS' EQUITY:

Deferred revenue	$ 319,705	$ 332,664
Other liabilities	170,265	223,938
Stockholders' equity	2,211,596	2,217,501

Total liabilities & stockholders' equity	$ 2,701,566	$ 2,774,103


ANSYS, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Income
(in thousands, except per share data)
(Unaudited)

	Three Months Ended		Nine Months Ended
	September 30,	September 30,	September 30,	September 30,
	2015	2014	2015	2014
Revenue:
Software licenses	$ 140,197	$ 139,965	$ 405,655	$ 406,883
Maintenance and service	97,643	94,035	285,451	274,763

Total revenue	237,840	234,000	691,106	681,646

Cost of sales:
Software licenses	6,889	7,095	21,048	21,603
Amortization	9,818	9,477	28,918	28,198
Maintenance and service	19,874	20,622	60,288	63,816
Total cost of sales	36,581	37,194	110,254	113,617

Gross profit	201,259	196,806	580,852	568,029

Operating expenses:
Selling, general and administrative	61,367	58,172	181,640	174,002
Research and development	44,784	41,033	127,439	123,251
Amortization	4,925	6,793	15,037	17,374
Total operating expenses	111,076	105,998	324,116	314,627

Operating income	90,183	90,808	256,736	253,402

Interest expense	(95)	(149)	(371)	(578)
Interest income	674	655	2,125	2,206
Other (expense) income, net	(383)	(395)	475	(772)

Income before income tax provision	90,379	90,919	258,965	254,258

Income tax provision	24,346	25,440	74,465	69,201

Net income	$ 66,033	$ 65,479	$ 184,500	$ 185,057

Earnings per share – basic:
Basic earnings per share	$ 0.74	$ 0.71	$ 2.05	$ 2.01
Weighted average shares – basic	89,694	91,875	89,873	92,224


Earnings per share - diluted:
Diluted earnings per share	$ 0.72	$ 0.70	$ 2.01	$ 1.96
Weighted average shares – diluted	91,593	93,905	91,820	94,397


ANSYS, INC. AND SUBSIDIARIES
Reconciliation of Non-GAAP Measures
(Unaudited)
*(in thousands, except percentages and per share data)*

	Three Months Ended
	September 30, 2015			September 30, 2014
	As Reported	Adjustments	Non-GAAP Results	As Reported	Adjustments	Non-GAAP Results
Total revenue	$ 237,840	$ 379 ⁽¹⁾	$ 238,219	$ 234,000	$ 1,528 ⁽⁴⁾	$ 235,528

Operating income	90,183	24,257 ⁽²⁾	114,440	90,808	27,794 ⁽⁵⁾	118,602

Operating profit margin	37.9%		48.0%	38.8%		50.4%

Net income	$ 66,033	$15,978 ⁽³⁾	$ 82,011	$ 65,479	$18,176 ⁽⁶⁾	$ 83,655

Earnings per share – diluted:

Diluted earnings per share	$ 0.72		$ 0.90	$ 0.70		$ 0.89

Weighted average shares – diluted	91,593		91,593	93,905		93,905


(1) Amount represents the revenue not reported during the period as a result of the acquisition accounting adjustment associated with accounting for deferred revenue in business combinations.

(2) Amount represents $14.7 million of amortization expense associated with intangible assets acquired in business combinations, $8.9 million of stock-based compensation expense, the $0.4 million adjustment to revenue as reflected in (1) above and $0.3 million of transaction expenses related to business combinations.

(3) Amount represents the impact of the adjustments to operating income referred to in (2) above, adjusted for the related income tax impact of $8.3 million.

(4) Amount represents the revenue not reported during the period as a result of the acquisition accounting adjustment associated with accounting for deferred revenue in business combinations.

(5) Amount represents $16.3 million of amortization expense associated with intangible assets acquired in business combinations, $10.0 million of stock-based compensation expense and the $1.5 million adjustment to revenue as reflected in (4) above.

(6) Amount represents the impact of the adjustments to operating income referred to in (5) above, adjusted for the related income tax impact of $9.6 million.


ANSYS, INC. AND SUBSIDIARIES
Reconciliation of Non-GAAP Measures
(Unaudited)
(in thousands, except percentages and per share data)

	Nine Months Ended
	September 30, 2015			September 30, 2014
	As Reported	Adjustments	Non-GAAP Results	As Reported	Adjustments	Non-GAAP Results
Total revenue	$ 691,106	$ 1,365 ⁽¹⁾	$ 692,471	$ 681,646	$ 4,307 ⁽⁴⁾	$ 685,953

Operating income	256,736	71,885 ⁽²⁾	328,621	253,402	78,430 ⁽⁵⁾	331,832

Operating profit margin	37.1%		47.5%	37.2%		48.4%

Net income	$ 184,500	$ 46,458 ⁽³⁾	$ 230,958	$ 185,057	$ 52,063 ⁽⁶⁾	$ 237,120

Earnings per share – diluted:

Diluted earnings per share	$ 2.01		$ 2.52	$ 1.96		$ 2.51

Weighted average shares – diluted	91,820		91,820	94,397		94,397


(1) Amount represents the revenue not reported during the period as a result of the acquisition accounting adjustment associated with accounting for deferred revenue in business combinations.

(2) Amount represents $44.0 million of amortization expense associated with intangible assets acquired in business combinations, $25.7 million of stock-based compensation expense, the $1.4 million adjustment to revenue as reflected in (1) above and $0.8 million of transaction expenses related to business combinations.

(3) Amount represents the impact of the adjustments to operating income referred to in (2) above, adjusted for the related income tax impact of $25.4 million.

(4) Amount represents the revenue not reported during the period as a result of the acquisition accounting adjustment associated with accounting for deferred revenue in business combinations.

(5) Amount represents $45.6 million of amortization expense associated with intangible assets acquired in business combinations, $27.6 million of stock-based compensation expense, the $4.3 million adjustment to revenue as reflected in (4) above and $1.0 million of transaction expenses related to business combinations.

(6) Amount represents the impact of the adjustments to operating income referred to in (5) above, adjusted for the related income tax impact of $26.4 million.


ANSYS, INC. AND SUBSIDIARIES
Reconciliation of Forward-Looking Guidance
Quarter Ending December 31, 2015

	Earnings Per Share Range – Diluted


U.S. GAAP expectation	$0.66 - $0.73
Adjustment to exclude acquisition accounting adjustment to deferred revenue	-
Adjustment to exclude acquisition–related amortization	$0.09 - $0.10
Adjustment to exclude stock–based compensation	$0.06 - $0.07

Non-GAAP expectation	$0.83 - $0.88


ANSYS, INC. AND SUBSIDIARIES
Reconciliation of Forward-Looking Guidance
Year Ending December 31, 2015
	Earnings Per Share Range – Diluted


U.S. GAAP expectation	$2.67 - $2.74
Adjustment to exclude acquisition accounting adjustment to deferred revenue	$0.01
Adjustment to exclude acquisition–related amortization	$0.39 - $0.40
Adjustment to exclude stock–based compensation	$0.25 - $0.26
Adjustment to exclude acquisition-related transaction expenses	$0.01

Non-GAAP expectation	$3.35 - $3.40


ANSYS, INC. AND SUBSIDIARIES
Reconciliation of Forward-Looking Guidance
Year Ending December 31, 2016
	Earnings Per Share Range – Diluted


U.S. GAAP expectation	$2.91 - $3.14
Adjustment to exclude acquisition accounting adjustment to deferred revenue	-
Adjustment to exclude acquisition–related amortization	$0.34 - $0.36
Adjustment to exclude stock–based compensation	$0.28 - $0.31

Non-GAAP expectation	$3.58 - $3.76

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