Aspen Technology Announces Financial Results for the First Quarter of Fiscal 2016

BEDFORD, MA — October 29, 2015 — Aspen Technology, Inc. (NASDAQ: AZPN), a leading provider of software and services to the process industries, today announced financial results for its first quarter of fiscal year 2016, ended September 30, 2015.

Antonio Pietri, President and Chief Executive Officer of AspenTech, said, "AspenTech delivered solid first quarter results highlighted by 50% non-GAAP operating margin and 10% year-over-year annual spend growth. Our first quarter performance reflects the strength of our business model, including long-term contracts, positive demand trends from owner-operator customers and continued best-in-class profitability, despite a challenging macro environment."

Pietri added, "We remain focused on operational excellence and working with customers to drive increased usage across the aspenONE suite. At the same time we continued to generate shareholder value through our financial and operational performance and by returning $55 million to shareholders through our stock repurchase program."

First Quarter Fiscal 2016 and Recent Business Highlights  

Annual spend, which the company defines as the annualized value of all term license and maintenance revenue contracts at the end of the quarter, was approximately $423 million at the end of the first quarter of fiscal 2016, which increased 10.0% compared to the first quarter of fiscal 2015 and 1.0% sequentially.

GAAP operating margin was 46.1%, compared to 41.7% in the first quarter of fiscal 2015. Non-GAAP operating margin was 50.1%, compared to 45.8% in the first quarter of fiscal 2015.

AspenTech repurchased 1.3 million shares of its common stock for $55.1 million in the first quarter of fiscal 2016.

Summary of First Quarter Fiscal Year 2016 Financial Results  

AspenTech's total revenue of $120.3 million increased 12.3% from $107.1 million in the first quarter of the prior fiscal year.

•Subscription and software revenue was $111.9 million in the first quarter of fiscal 2016, an increase from $98.7 million in the first quarter of fiscal 2015.

•Services and other revenue was $8.4 million in the first quarter of fiscal 2016, compared to $8.4 million in the first quarter of fiscal 2015.

For the quarter ended September 30, 2015, AspenTech reported income from operations of $55.4 million, compared to income from operations of $44.6 million for the quarter ended September 30, 2014.

Net income was $36.8 million for the quarter ended September 30, 2015, leading to net income per share of $0.44, compared to net income per share of $0.32 in the same period last fiscal year.

Non-GAAP income from operations, which adds back stock-based compensation expense, amortization of intangibles associated with acquisitions and non-capitalized acquired technology, was $60.2 million for the first quarter of fiscal 2016, compared to non-GAAP income from operations of $49.1 million in the same period last fiscal year. Non-GAAP net income was $39.8 million, or $0.47 per share, for the first quarter of fiscal 2016, compared to non-GAAP net income of $31.8 million, or $0.35 per share, in the same period last fiscal year. A reconciliation of GAAP to non-GAAP results is included in the financial tables included in this press release.

AspenTech had a cash and marketable securities balance of $181.5 million at September 30, 2015, a decrease of $37.0 million from the end of the prior quarter after using $55.0 million in cash to repurchase shares of common stock.

During the first quarter, the company generated $18.4 million in cash flow from operations and $20.2 million in free cash flow after taking into consideration the net impact of $1.1 million in capital expenditures and capitalized software, $1.6 million in excess tax benefits from stock-based compensation and $1.3 million in non-capitalized acquired technology (including a $1 million final payment related to non-capitalized acquired technology from fiscal year 2014).

About AspenTech  

AspenTech is a leading supplier of software that optimizes process manufacturing – for energy, chemicals, engineering and construction, and other industries that manufacture and produce products from a chemical process. With integrated aspenONE solutions, process manufacturers can implement best practices for optimizing their engineering, manufacturing and supply chain operations. As a result, AspenTech customers are better able to increase capacity, improve margins, reduce costs and become more energy efficient. To see how the world's leading process manufacturers rely on AspenTech to achieve their operational excellence goals, visit www.aspentech.com .