One accomplishment was another substantially profitable year, significant in view of the key investments we made for the future. We successfully introduced several major new products, increased support and resources to help our world-wide sales channels reach new customers, and made several key additions to our management team.
For Fiscal Year 1997, ANSYS Inc. reported net income of $7.4 million, or $0.45 per diluted share of common stock. Total revenue was $50.5 million, a seven percent increase from the previous year. We also ended the year with cash, cash equivalents and short-term investments of $27.8 million, compared to a year-end balance of $17.1 million in 1996.
The title of this year's report, "No Boundaries," reflects our vision of technology and business. To our customers, this means no self-imposed limits on the advanced capabilities and the features we can offer."No Boundaries" also means seamless integration between their design and analysis systems. To our employees, it means no limits to their creativity and energy. To our business partners, it means no arbitrary limits on new ways to help each other prosper.
For our products, "No Boundaries" means that diverse, complex problems can be solved, engineering and design data can be accessed, and real-world environments can be modeled. This past year, we delivered a wide range of new products including ANSYS 5.4, multiple ANSYS design-integrated products, and DesignSpace® versions 2 and 3, which offer the flexibility and functionality analysts and engineers need to implement analysis tools company wide.
Taking full advantage of these new offerings can mean changes in the ways companies develop their products. Big gains often come from reengineering the product development processes and reorganizing engineering tasks. For example, many companies now train and coach design engineers in the appropriate use of analysis.
But not all companies can change overnight. This takes time, and our 1997 revenue growth rate was impacted by the speed of this transition. We are, however, most encouraged by our longer-term growth prospects and opportunities. Organizations of all sizes are beginning to recognize the value of integrated design analysis as a source of business advantage, and they are turning to us as their strategic partner.
Three dramatic "No Boundaries" success stories follow. At Eaton Corporation, design optimization and analysis have been formally integrated into new product development. For Eaton engineers, analysis is now a standard operating procedure. At Buck Knives, the new BuckLite Tool was created with unheard-of speed using DesignSpace. This let Buck Knives break into mass-retailing just in time for holiday shoppers. A German shipyard, Joseph L. Meyer GmbH & Co., builds $350 million cruise ships in as little as eight months and relies on ANSYS software to deal with last-minute changes. All three firms have overcome long-established boundaries or removed them altogether. They all continue to build strategic foundations for greater prosperity using our software.
As we move forward with the "No Boundaries" vision, our business goals remain clear and unchanged:
- Deepening our penetration of the established ANSYS user community of engineering analysts.
- Increasing our product capabilities to meet the needs of design engineers, analysts and engineering management.
- Speeding the adoption by new industries of our design analysis tools.
Investments were made internationally as well. We extended our ASD network in Japan and China, and established our own base of operations in the United Kingdom. Domestically, we reinforced our marketing and reseller programs for DesignSpace with several key partnerships. Last year also marked expansions of our product development, marketing and operations management teams. Several seasoned executives joined us, and we completed the move to our new corporate headquarters.
In closing, I must emphasize that without the hard work, dedication and determination of ANSYS customers, ASDs, and employees, there would have been no accomplishments. The expertise and energy of these people are unmatched in this industry. Taken together, they are the most important reason for my confidence in the future.
Peter J. Smith
Chairman of the Board, President and Chief Executive Officer
