MICROS SYSTEMS INC - 10-Q Quarterly Report

Form 10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

For the quarter ended September 30, 2004

Commission file number 0-9993

MICROS SYSTEMS, INC.

(Exact name of Registrant as specified in its charter)

MARYLAND	52-1101488
(State of incorporation)	(I.R.S. Employer
	Identification Number)

7031 Columbia Gateway Drive, Columbia, Maryland 21046-2289
(Address of principal executive offices) (Zip code)

Registrant’s telephone number, including area code: 443-285-6000

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 report(s)), and (2) has been subject to such filing requirements for the past 90 days.

YES ý NO o

Indicate by check mark whether the Registrant is an Accelerated Filer (as defined in Rule 12b-2 of the Securities Exchange Act of 1934).

YES ý NO o

At the close of business on October 31, 2004, there were issued and outstanding 18,509,797 shares of Registrant’s Common Stock at $.025 par value.

MICROS SYSTEMS, INC. AND SUBSIDIARIES

Form 10-Q

For the Quarter Ended September 30, 2004

Part I - Financial Information

Item 1. Financial Statements

General

The information contained in this report is furnished for the Registrant, MICROS Systems, Inc., and its subsidiaries (referred to collectively herein as “MICROS” or the “Company”). In the opinion of management, the information in this report contains all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair statement of the results for the interim periods presented. The financial information presented herein should be read in conjunction with the financial statements included in the Registrant’s Form 10-K for the fiscal year ended June 30, 2004, as filed with the Securities and Exchange Commission.

MICROS SYSTEMS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited, in thousands, except per share data)

	September 30,		June 30,
	2004		2004
ASSETS
Current assets:
Cash and cash equivalents	$	98,952	$	91,451
Accounts receivable, net of allowance for doubtful accounts of $12,733 at September 30, 2004 and $11,903 at June 30, 2004	102,162		101,367
Inventories, net of allowance for obsolescence of $6,704 at September 30, 2004 and $6,380 at June 30, 2004	38,273		36,095
Deferred income taxes	9,905		9,396
Prepaid expenses and other current assets	16,685		16,242
Total current assets	265,977		254,551

Property, plant and equipment, net of accumulated depreciation and amortization of $60,398 at September 30, 2004 and $58,245 at June 30, 2004	20,150		19,550
Deferred income taxes, non-current	24,393		24,288
Goodwill, net of accumulated amortization of $29,070 at September 30, 2004 and $28,687 at June 30, 2004	70,813		70,715
Intangible assets, net of accumulated amortization of $2,469 at September 30, 2004 and $2,291 at June 30, 2004	5,321		5,476
Purchased and internally developed software costs, net of accumulated amortization of $32,569 at September 30, 2004 and $30,484 at June 30, 2004	41,226		41,112
Other investments	413		415
Other assets	2,664		2,785

Total assets	$	430,957	$	418,892

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Bank lines of credit	$	2,493	$	2,481
Current portion of capital lease obligations	181		139
Accounts payable	24,473		29,681
Accrued expenses and other current liabilities	53,081		58,693
Income taxes payable	2,351		1,541
Deferred income taxes	333		512
Deferred service revenue	53,596		43,019
Total current liabilities	136,508		136,066

Capital lease obligations, net of current portion	167		166
Deferred income taxes, non-current	15,547		15,544
Other non-current liabilities	1,431		1,401
Commitments and contingencies
Minority interests	2,881		2,742

Shareholders’ equity:
Common stock, $0.025 par; authorized 50,000 shares; issued and outstanding 18,411 at September 30, 2004 and 18,335 at June 30, 2004	459		457
Capital in excess of par	70,545		71,525
Retained earnings	195,321		185,660
Accumulated other comprehensive income	8,098		5,331
Total shareholders’ equity	274,423		262,973

Total liabilities and shareholders’ equity	$	430,957	$	418,892

The accompanying notes are an integral part of the consolidated financial statements.

MICROS SYSTEMS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited, in thousands, except per share data)

	Three Months Ended September 30,
	2004			2003
Revenue:
Hardware	$	39,301		$	33,946
Software	22,878			17,838
Service	67,783			54,633
Total revenue	129,962			106,417

Cost of sales:
Hardware	26,211			23,742
Software	5,169			5,004
Service	33,448			25,536
Total cost of sales	64,828			54,282

Gross margin	65,134			52,135

Selling, general and administrative expenses	41,068			35,562
Research and development expenses	6,711			6,174
Depreciation and amortization	2,401			2,317
Total operating expenses	50,180			44,053

Income from operations	14,954			8,082

Non-operating income (expense):
Interest income	352			239
Interest expense	(49		)	(189		)
Other income, net	126			105
Total non-operating income