In February 2007, UGS announced its 2006 year-end results, reporting
an encouraging $1.2 billion in annual revenue and a surging fourth
quarter. This was after the surprise announcement that Siemens had
agreed to acquire UGS, a move that took almost everyone by surprise.
UGS is on an interesting journey. The company has a long history in
CAD and engineering software: [ reference:
http://en.wikipedia.org/wiki/UGS_Corp.] Starting out as United
Computing in 1963, it released a CAD product called UNIAPT in 1969.
After acquiring Automated Drafting and Machining (ADAM) in 1973, the CAD
software was then released as UNI-GRAPHICS in 1975. It was promptly
acquired in 1976 by McDonnell Douglas, and reorganized as the
Unigraphics Group within the company.
UGS has also focused consistent energy and resources on its
Teamcenter PLM offerings and its open business model, including JT. In
2006, it also started to more vigorously promote Solid Edge, which at
one time seemed to be the proverbial red-headed step child of the UGS
portfolio. The company made the 2D version available as a free download.
Q4 2006 results included a 30% increase in license revenue for the UGS
Velocity Series portfolio that includes SolidEdge, as well as Teamcenter
Express, Femap, and NX CAM Express.
Then comes the good news: After two quarters of below-average
industry growth UGS announced strong revenue growth and a 76% net income
growth to $22 million in Q4 2006, after interest, depreciation and
taxes. Earnings in the quarter prior to those deductions was $110
million, an increase of 19% over the same quarter in 2005. License
revenue has increased, although specific breakdowns for each category
are not available.
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