Symantec 1998 Annual Report Download - page 17

SYMANTEC CORPORATION
Symantec did not complete any acquisi-
tions during fiscal 1998. During fiscal 1997,
Symantec acquired Fast Track, Inc.
(“Fast Track”) in a transaction accounted
for as a pooling of interests. As the
results of operations of Fast Track were
not material to Symantec’s consolidated
financial statements, amounts prior to the
date of acquisition were not restated to
reflect the combined operations of the
companies. In fiscal 1996, Delrina
Corporation was acquired and was
accounted for as a pooling of interests and
amounts prior to the date of acquisition
were restated to reflect the combined
operations of the companies.
RESULTS OF OPERATIONS
The following table sets forth each item from the consolidated statements of opera-
tions as a percentage of net revenues and the percentage change in the total amount of
each item for the periods indicated.
Period-to-Period Percentage
Increase (Decrease)
1998 1997
Year Ended March 31, Compared Compared
1998 1997 1996 to 1997 to 1996
Net revenues 100% 100% 100% 22% 6%
Cost of revenues 15 20 25 (7) (14)
Gross margin 85 80 75 30 13
Operating expenses:
Research and development 16 19 21 3 (6)
Sales and marketing 45 47 52 18 (4)
General and administrative 7 7 7 12 4
Acquisition, restructuring and
other expenses — 2 6 (100) (69)
Total operating expenses 68 75 86 11 (8)
Operating income (loss) 17 5 (11) 282 *
Interest income 2 2 2 83 (4)
Interest expense — — — (13) (6)
Other income (expense), net — — (1) (89) (21)
Income (loss) before income taxes 19 7 (10) 269 *
Provision (benefit) for income taxes 4 1(1) 522 *
Net income (loss) 15% 6% (9)% 227 *
Percentage change is not meaningful.
FORWARD-LOOKING STATEMENTS
AND FACTORS THAT MAY AFFECT
FUTURE RESULTS
The following discussion contains forward-
looking statements that are subject to risks
and uncertainties. There are several im-
portant factors that could cause actual
results to differ materially from those anti-
cipated by the forward-looking statements
contained in the following discussion.
Readers should pay particular attention to
the risk factors set forth within this sec-
tion. Nothing in this report shall impose
upon Symantec or any person a duty to
update any forward-looking statement.
OVERVIEW
Symantec is a world leader in utility software for business and personal computing.
Founded in 1982, the Company has offices in the United States, Canada, Asia,
Australia, Europe, Africa, Latin America and South America.
During the last three fiscal years, Symantec has acquired the following companies:
Shares of Symantec Acquired Company
Common Stock Stock Options
Companies Acquired Date Acquired Issued Assumed
Fast Track, Inc. (“Fast Track”) May 28, 1996 600,000 —
Delrina Corporation November 22, 1995 13,684,174* 1,271,677
(“Delrina”)
Includes Delrina exchangeable stock that is traded on the Toronto Stock Exchange. Delrina stockholders
received Delrina exchangeable stock in exchange for Delrina common stock at a rate of 0.61 per share.
Delrina exchangeable stock may be converted into Symantec common stock on a one-for-one basis at
each stockholder’s option.
20
The following selected financial data is
qualified in its entirety by and should be
read in conjunction with the more detailed
consolidated financial statements and
related notes included elsewhere herein.
Symantec did not complete any acquisi-
tions during fiscal 1998. During fiscal
1997, Symantec acquired Fast Track, Inc.
(“Fast Track”) in a transaction accounted
for as a pooling of interests. As the results
of operations of Fast Track were not
material to Symantec’s consolidated
financial statements, amounts prior to
the date of acquisition were not restated
to reflect the combined operations of the
companies. In fiscal 1996, Delrina
Corporation was acquired. In fiscal 1995,
acquisitions included Intec Systems
Corporation, Central Point Software,
Inc. and SLR Systems, Inc. In fiscal 1994,
acquisitions included Fifth Generation
Systems, Inc. and Contact Software
International, Inc. Each of the fiscal 1996,
1995 and 1994 acquisitions was accounted
for as poolings of interests. The Company
has never paid cash dividends on its
stock with the exception of distributions
to stockholders of acquired companies.
Five Year Summary
Year Ended March 31,
(In thousands, except net income (loss) per share) 1998 1997 1996 1995 1994
Statements of Operations Data:
Net revenues $ 578,361 $ 472,183 $ 445,432 $ 431,268 $ 403,206
Acquisition, restructuring and other expenses — 8,585 27,617 9,545 56,094
Operating income (loss) 100,345 26,289 (48,279) 40,286 (47,290)
Net income (loss) 85,089 26,038 (39,783) 33,409 (44,421)
Net income (loss) per share - basic $ 1.52 $ 0.48 $ (0.76) $ 0.68 $ (0.96)
Net income (loss) per share - diluted $ 1.42 $ 0.47 $ (0.76) $ 0.64 $ (0.96)
Shares used to compute net
income (loss) per share - basic 56,097 54,705 52,664 49,338 46,270
Shares used to compute net
income (loss) per share - diluted 60,281 55,407 52,664 54,303 46,270
March 31,
(In thousands) 1998 1997 1996 1995 1994
Balance Sheet Data:
Working capital $ 175,537 $ 129,569 $ 134,643 $ 143,405 $ 101,644
Total assets 476,460 339,398 282,674 305,356 262,335
Long-term obligations, less current portion 5,951 15,066 15,393 25,413 25,967
Stockholders’ equity 317,507 217,979 180,317 184,874 129,193
SYMANTEC CORPORATION 21
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