Autodesk 2004 Annual Report Download - page 6

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4FY 04 Autodesk, Inc.
The Year
in Review
Great products. Increased pre-
dictability of revenues. Dedication
to profitability. Every product
enhancement, every new release,
every decision we made reflects our
strategic commitment to better
products, more predictable rev-
enues and increased profitability.
Our product cycles are now the
shortest they’ve ever been, with
new versions of all our products
released each fiscal year. The
enhanced release cycles worked in
tandem with our Subscription
model to provide an increasingly
predictable flow of revenues.
Notable highlights of this landmark year
include the following:
• Launch of the strongest suite of products
in our history, including the AutoCAD 2004
family of products, Autodesk Inventor 8,
Autodesk Inventor Professional 8, Autodesk
Revit 6, 3ds max 6 and lustre, our new sys-
tem for digital grading and color correction
• Great strides for 3D in the Manufacturing
Solutions Division, and even greater poten-
tial ahead, with less than 20 percent of our
customers using 3D at this point
• Significant advances toward our goal of
offering a full suite of lifecycle manage-
ment solutions in each of our key design
industries
• Launch of our Subscription program in the
Asia Pacific market, completing our last
phase of worldwide availability (subscrip-
tion constitutes 12 percent of our total
revenues for fiscal 2004)
• Opening of the China Development Center
in Shanghai, a major strategic initiative that
allows us to develop and launch products
within the local context of this vast market
• Terrific rebound in the Discreet business,
with a strong fourth-quarter showing
• Stepped-up customer feedback programs,
drawing on an unprecedented number of
customers to develop next-generation
product releases
We continue making the customer the cen-
ter of all our decision making. Furthering
initiatives begun last year, we’ve vertically
aligned our sales and professional services
organizations with our customers’ industries
and with our own product divisions. Our
customers’ needs are the driving force
behind the lifecycle management vision that
is a vital component of our success strategy.
IMPROVING PROFITABILITY
This year we took a hard look at our cost
structure and saw room for significant
improvement. We benchmarked our cost
structure against that of other companies in
our industry, using the results to implement
productivity initiatives and set short- and
long-term productivity targets throughout
the company. We are already reaping the
benefits of these actions—our operating
margin has increased 8 percentage points
over fiscal 2003 to 11 percent—and we are
committed to making substantial improve-
ments in this area in the coming year.
STRONG BALANCE SHEET
Autodesk is well positioned financially. Our
strong sales generated significant cash flow
this year. In fact, in 2004 we generated
$220 million in operating cash flow. We used
$13 million for our regular quarterly divi-
dend, $178 million for our share repurchase
program and $5 million related to mergers
and acquisitions in growth initiatives. Yet
with all those programs, we still ended the
year with a strong balance sheet: we have
$530 million in cash and marketable securi-
ties and no debt.