Parametric Technology New Reports Operating Results (10-Q)
Parametric Technology New has a market cap of $2.05 billion; its shares were traded at around $17.67 with a P/E ratio of 30.4 and P/S ratio of 2.2. PMTC is in the portfolios of Westport Asset Management, George Soros of Soros Fund Management LLC, Chuck Royce of Royce& Associates.
Highlight of Business Operations: Fluctuations in foreign currency exchange rates continue to impact our business. At foreign currency exchange rates consistent with the comparable periods of 2009, reported revenue in the third quarter and first nine months of 2010 would have been higher by approximately $0.2 million and lower by $20 million, respectively, and reported expenses would have been lower by approximately $2 million and $16 million, respectively, a net increase in operating income of approximately $2 million for the third quarter and a net decrease of approximately $4 million for the first nine months of 2010.
Cash flow from operating activities remained strong with $141.1 million generated in the first nine months of 2010 compared with $64.2 million generated in the first nine months of 2009. We used some of our cash flow from operations to repurchase shares of our common stock and to repay all amounts outstanding on our revolving credit facility. Our balance sheet remained strong with $219 million of cash and $230 million available under our revolving credit facility as of July 3, 2010.
Approximately two-thirds of our revenue and half of our expenses are transacted in currencies other than the U.S. Dollar. Because we report our results of operations in U.S. Dollars, currency translation affects our reported results. On a year-over-year comparative basis, our revenues for the first nine months of 2010 were favorably impacted as a result of changes in currency exchange rates, primarily the Euro to U.S. Dollar exchange rate. Conversely, our expenses were higher as a result of changes in these rates. If actual reported results for the third quarter and first nine months of 2010 had been converted into U.S. Dollars based on the foreign currency exchange rates in effect for the third quarter and first nine months of 2009, revenue would have been higher by $0.2 million and lower by $20.4 million, respectively, and expenses would have been lower by $1.8 million and $15.8 million, respectively. As a result, at foreign currency exchange rates consistent with the comparable 2009 periods, operating income in the third quarter and first nine months of 2010 would have been $2.0 million higher and $4.6 million lower, respectively. Revenue by line of business and revenue by geographic region in the tables that follow present both actual percentage changes year over year and percentage changes year over year on a constant currency basis, calculated by multiplying the actual results for 2010 by the exchange rates in effect for 2009.
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