Back to GetFilings.com



Table of Contents

 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
FORM 10-Q
 
 
x
 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
 
For the Quarterly Period Ended September 30, 2002
 
OR
 
 
¨
 
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period from              to             
 
 
Commission File No. 000-22688
 
MACROMEDIA, INC.
(A Delaware Corporation)
 
I.R.S. Employer Identification No. 94-3155026
 
600 Townsend Street
San Francisco, California 94103
(415) 252-2000
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x    No ¨
 
Indicate the number of shares outstanding of each of the Registrant’s classes of common stock, as of the latest practicable date: 60.3 million shares of Common Stock, $0.001 par value per common share, outstanding on October 23, 2002.
 


Table of Contents
MACROMEDIA, INC. AND SUBSIDIARIES
 
REPORT ON FORM 10-Q
FOR THE QUARTER ENDED SEPTEMBER 30, 2002
 
INDEX
 
PART I.    FINANCIAL INFORMATION
    
    
Item 1.    
  
Financial Statements (Unaudited)
    
            
3
            
4
            
5
            
6
    
Item 2.
     
15
    
Item 3.
     
34
    
Item 4.
     
36
PART II.    OTHER INFORMATION
    
    
Item 1.
     
37
    
Item 2.
     
38
    
Item 3.
     
38
    
Item 4.
     
38
    
Item 5.
     
39
    
Item 6.
     
39
       
40
       
41


Table of Contents
MACROMEDIA, INC. AND SUBSIDIARIES
 
Condensed Consolidated Balance Sheets
(In thousands, except per share data)
(Unaudited)
 
      
September 30,
2002

      
March 31,
2002

 
ASSETS
                     
Current assets:
                     
Cash and cash equivalents
    
$
148,269
 
    
$
66,874
 
Short-term investments
    
 
45,402
 
    
 
95,097
 
      


    


Total cash, cash equivalents and short-term investments
    
 
193,671
 
    
 
161,971
 
Accounts receivable, net
    
 
18,910
 
    
 
24,181
 
Inventory, net
    
 
1,473
 
    
 
3,032
 
Related party loans, current
    
 
1,311
 
    
 
36
 
Prepaid expenses and other current assets
    
 
26,407
 
    
 
27,477
 
      


    


Total current assets
    
 
241,772
 
    
 
216,697
 
Related party loans, non-current
    
 
5,665
 
    
 
8,305
 
Fixed assets, net
    
 
41,966
 
    
 
49,189
 
Intangible assets, net
    
 
202,535
 
    
 
226,579
 
Restricted cash
    
 
10,922
 
    
 
11,409
 
Other non-current assets
    
 
4,349
 
    
 
5,659
 
      


    


Total assets
    
$
507,209
 
    
$
517,838
 
      


    


LIABILITIES AND STOCKHOLDERS’ EQUITY
                     
Current liabilities:
                     
Accounts payable
    
$
4,020
 
    
$
6,719
 
Accrued liabilities
    
 
54,229
 
    
 
56,082
 
Accrued restructuring, current
    
 
11,158
 
    
 
12,224
 
Unearned revenues
    
 
26,949
 
    
 
24,791
 
      


    


Total current liabilities
    
 
96,356
 
    
 
99,816
 
Accrued restructuring, non-current
    
 
25,387
 
    
 
30,809
 
Other non-current liabilities
    
 
6,490
 
    
 
6,492
 
      


    


Total liabilities
    
 
128,233
 
    
 
137,117
 
      


    


Stockholders’ equity:
                     
Common stock and additional paid-in capital, par value $0.001 per common share;
200,000 shares authorized; 62,112 and 60,987 shares issued at September 30, 2002 and
March 31, 2002, respectively
    
 
746,370
 
    
 
734,816
 
Treasury stock at cost; 1,818 common shares at September 30, 2002 and March 31, 2002
    
 
(33,649
)
    
 
(33,649
)
Deferred stock compensation
    
 
(84
)
    
 
(281
)
Accumulated other comprehensive loss
    
 
(7
)
    
 
(158
)
Accumulated deficit
    
 
(333,654
)
    
 
(320,007
)
      


    


Total stockholders’ equity
    
 
378,976
 
    
 
380,721
 
      


    


Total liabilities and stockholders’ equity
    
$
507,209
 
    
$
517,838
 
      


    


 
See accompanying notes to condensed consolidated financial statements.

3


Table of Contents
MACROMEDIA, INC. AND SUBSIDIARIES
 
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
 
<
      
Three Months Ended
September 30,

      
Six Months Ended
September 30,

 
      
2002

      
2001

      
2002

      
2001

 
Net revenues
    
$
85,407
 
    
$
87,086
 
    
$
169,096
 
    
$
175,829
 
Cost of revenues
    
 
7,662
 
    
 
9,887
 
    
 
18,168
 
    
 
21,024
 
      


    


    


    


Gross profit
    
 
77,745
 
    
 
77,199
 
    
 
150,928
 
    
 
154,805
 
      


    


    


    


Operating expenses:
                                           
Sales and marketing
    
 
35,442
 
    
 
45,806
 
    
 
72,820
 
    
 
94,427
 
Research and development
    
 
23,674
 
    
 
27,540
 
    
 
50,046
 
    
 
57,486
 
General and administrative
    
 
9,761
 
    
 
9,887
 
    
 
20,374
 
    
 
22,623
 
Impairment of intangible assets
    
 
17,316
 
    
 
 
    
 
17,316
 
    
 
 
Amortization of intangible assets
    
 
3,364
 
    
 
28,448
 
    
 
6,728
 
    
 
57,513
 
Restructuring expenses
    
 
 
    
 
 
    
 
 
    
 
39,539
 
      


    


    


    


Total operating expenses
    
 
89,557
 
    
 
111,681
 
    
 
167,284
 
    
 
271,588
 
      


    


    


    


Operating loss
    
 
(11,812
)
    
 
(34,482
)
    
 
(16,356
)
    
 
(116,783
)
      


    


    


    


Other income (expense):
                                           
Interest income and other, net
    
 
739
 
    
 
1,752
 
    
 
1,887
 
    
 
4,578
 
Gain (loss) on investments
    
 
53
 
    
 
98
 
    
 
(750
)
    
 
(6,585
)
Loss on equity affiliate
    
 
 
    
 
(9,155
)
    
 
 
    
 
(36,016
)
Litigation settlements
    
 
 
    
 
(28,500
)
    
 
2,822
 
    
 
(28,500
)
      


    


    


    


Total other income (expense)
    
 
792
 
    
 
(35,805
)
    
 
3,959
 
    
 
(66,523
)
      


    


    


    


Loss before income taxes
    
 
(11,020
)
    
 
(70,287
)
    
 
(12,397
)
    
 
(183,306
)
Benefit (provision) for income taxes
    
 
(643
)
    
 
(417
)
    
 
(1,250
)
    
 
828
 
      


    


    


    


Net loss
    
$
    (11,663
)
    
$
    (70,704
)
    
$
    (13,647
)
    
$
  (182,478
)
      


    


    


    


Net loss per common share:
                                           
Basic and diluted
    
$
(0.19
)
    
$
(1.22
)
    
$
(0.23
)
    
$
(3.16
)
      


    


    


    


Weighted average common shares outstanding used in calculating net loss per common share:
                                           
Basic and diluted
    
 
60,040
 
    
 
57,943
 
    
 
59,800
 
    
 
57,759