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© 2012 ANSYS, Inc. Created for ANSYS, Inc. by BullsEye Resources www.bullseyeresources.com.

ANSYS 2012 Investor Day Executive Summary

ANSYS 2012 Investor Day March 1, 2012 New York, NY

2 © 2012 ANSYS, Inc. PROPRIETARY & CONFIDENTIAL Created for ANSYS by BullsEye Resources

TABLE OF CONTENTS

Session Session Title Speaker(s) Page

Key Themes 3

1 A Renaissance in Engineering James E. Cashman III, President and CEO 5

2 Key Initiatives Driving Revenues Joshua Fredberg, Vice President, Marketing 8

3 Sales and Service Update Frank Bernieri, Vice President, North American Sales

11

4 Apache Design: History, Market, and Potential Value of ANSYS/Apache

Andrew Yang, Ph.D., Vice President and General Manager; President, Apache Design, Inc.

13

5 Financial Update Maria T. Shields, Vice President, Finance and Administration, and CFO

16

6 Questions and Answers Annette N. Arribas (Moderator), Investor Relations and Global Insurance Officer

Frank Bernieri, Vice President, North American Sales

James E. Cashman III, President and CEO

Joshua Fredberg, Vice President, Marketing

Maria T. Shields, Vice President, Finance and Administration; Chief Financial Officer

Andrew Yang, Ph.D., Vice President and General Manager; President, Apache Design, Inc.

18

Biographies 21

Important Factors Regarding Future Results The Company cautions investors that its performance is subject to risks and uncertainties. Some matters that will be discussed throughout this presentation may constitute forward‐looking statements that involve risks and uncertainties which could cause actual results to differ materially from those projected. These risks and uncertainties are discussed at length, and may be amended from time to time, in the Company’s Annual Report to Stockholders and its filings with the SEC, including our most recent filings on Forms 10‐K and 10‐Q. We undertake no obligation to publicly update or revise any forward‐looking statements, whether changes occur as a result of new information or future events, after the date they were made. THESE SUMMARIES REFLECT BULLSEYE RESOURCES, INC.’S SUBJECTIVE CONDENSED SUMMARIZATION OF THE ANSYS, INC. 2012 INVESTOR DAY CONFERENCE, AND THERE MAY BE MATERIAL ERRORS, OMISSIONS OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE SESSIONS. IN NO WAY DOES ANSYS, INC. OR BULLSEYE RESOURCES ASSUME ANY RESPONSIBILITY FOR THE INFORMATION CONTAINED HEREIN, OR ANY DECISIONS MADE BASED UPON THE INFORMATION PROVIDED IN THIS DOCUMENT.



Key Themes

Overview

ANSYS performed well in 2011 and is well positioned to

continue to do so in 2012 and beyond. Despite decades of

growth, the penetration of simulation software remains low

and the upside potential remains very high. The market for

simulation continues to grow as enterprises emphasize R&D

and because simulation enables companies to develop products

better, faster, and less expensively. ANSYS is focused on

accelerating the adoption of simulation.

As the simulation market grows, ANSYS is well positioned. The

Company has the industry’s largest and best development

team; market‐leading solutions; global reach; a large customer

base of industry leaders; and a unique sales model with strong

channel partners. The Company also has the financial strength

to continue to invest in R&D, sales and marketing, and strategic

acquisitions. The Company’s focus and strengths enable ANSYS

to capitalize on the market’s emerging opportunities.

Context At ANSYS’ 2012 Investor Day, Marketing, Sales, and Finance

leaders joined CEO Jim Cashman in reviewing results from

2011, describing the Company’s vision and product strategy,

and discussing initiatives to accelerate the penetration of

simulation software. Also, Andrew Yang explained what Apache

Design does, why ANSYS acquired Apache, and why it is a good

fit.

Key Themes

ANSYS’ focus and discipline have enabled the Company to continue to deliver on its commitments.

ANSYS has a long and consistent history of meeting

commitments, reflected by the Company’s continued growth.

The past year was no exception, as in 2011 ANSYS once again

performed well. The Company’s non‐GAAP revenue, earnings

per share, and margins all exceeded the original outlook for the

year. These results reflect the Company’s focus, technology,

geographic and industry diversity, customer relationships, and

continued investments in product development.

A renaissance is under way in engineering.

After decades of incrementalism in the adoption of engineering

simulation, the market is primed to jump to a new adoption

curve. A renaissance is truly at hand, which bears similarities to

the Renaissance that took place around 500 years ago.

Similarities include a globalization in commerce, convergence of

art and science, explosion of information technology, and need

for multidiscipline approaches. The renaissance under way in

engineering makes this an exciting and transformational time

for the simulation space.

The pressures on engineers and product developers have never been greater.

In today’s highly competitive global context, companies see

innovation and product development as critical to their future

success—and are investing heavily in R&D. In all industries,

enterprises are developing sophisticated new products.

Engineers are under pressure to make sure these complex

products work as intended, while getting them to market

quickly. With companies betting their future on product

development, the cost of being wrong and value of being right

have never been greater.

Simulation provides the ability to transform product development.

Historically, the process for product development has involved

developing a concept, locking in a design, developing a physical

prototype, testing it, analyzing it, and either fixing it or

proceeding to production. The need to lock in design

parameters decreased flexibility, slowed development, and

increased costs.

ANSYS’ vision of Simulation‐Driven Product Development™

(SDPD) provides a better way. Early in the design process—

before locking in—engineers can run numerous simulations to

understand how a component, system, or product will perform

in the real world. Engineers can ask what‐if questions, create

virtual prototypes, conduct design analysis, and optimize the

design. The results of utilizing simulation early in the design

process are shorter development cycles, less expensive design

processes, and products that perform better in the real world.

Also, ANSYS simulation tools transform the process for

development, shifting it from a silo‐based approach to a more

collaborative, enterprise‐wide approach.

Despite proven success, simulation penetration remains low. ANSYS is focused on accelerating penetration.

Industry leaders in all geographies, industries, and segments

use ANSYS simulation tools. This includes aerospace and

defense, automotive, electronics, industrial equipment,

materials and chemical processing, energy, consumer products,

and more. As numerous case studies reveal, ANSYS is helping

transform how companies develop new products, with

breakthrough results.

Still, despite compelling data on cost savings and cycle time,

positive ROI, and strong testimonials, the Company estimates

that just 1% of engineers at “average” customer companies and



only 2–8% at “advanced” customers use ANSYS tools. The

market is far from saturated, and there remains plenty of

opportunity for future growth.

The key is driving adoption by overcoming the hurdles that

hinder adoption. The major hurdle is convincing potential users

of the accuracy of simulation so they will have confidence in

the results. Other hurdles include training engineers to be

comfortable using simulation tools and changing design

processes and cultures to incorporate simulation. These hurdles

are surmountable, but they are significant and will take time.

ANSYS mobilizes around a number of customer initiatives that

present opportunity for ANSYS growth. These are centered on

increasing the number of users as well as density and intensity

of usage. Initiatives include amplifying engineering by broadly

“democratizing simulation”; creating an open collaboration

platform for simulation; working with IT departments so

organizations can develop a cost‐effective, scalable IT

infrastructure that enables simulation to take place; changing

corporate culture through use of systems‐level simulation of

smart products; and encouraging the use of robust design.

As the penetration of simulation increases, ANSYS is extremely well positioned.

As the simulation market continues to grow and mature—with

initiatives by ANSYS accelerating the process—ANSYS is in a

good spot. Reasons why ANSYS will take advantage of changes

taking place in the market include:

• Focus. ANSYS is dedicated exclusively to engineering

simulation; this is all ANSYS does. As a result of this focus

over the past 40 years, ANSYS has become the world’s

leading provider of simulation software and services; has

produced a continuous stream of product innovations; and

has built long‐term trust‐based relationships. There is no

change in the Company’s focus.

• Technology. ANSYS technology enables customers to

predict with confidence that their products will survive

and thrive in the real world. Customers can simulate

multiple concepts virtually and decide what to invest in.

Customers trust ANSYS software to help ensure the

integrity of their products. The Company’s technological

innovations are produced by the world’s largest and most

capable development team focused on simulation.

• Product vision/strategy. ANSYS has a clear vision for

Simulation‐Driven Product Development, a product

strategy focused on providing a complete simulation

system, and unequaled product depth and breadth.

• Sales and service model. ANSYS’ sales model focuses on

developing long‐term relationships, which produces a

significant recurring revenue stream. These relationships

are supported by industry and technology expertise. The

Company has a unique hybrid model of direct sales,

indirect sales, service, and support. In addition, long‐

standing channel partners bring technical sophistication

and local support. This model provides a competitive

advantage for ANSYS.

• Financial stability. ANSYS’ business model provides good

visibility into future revenues. The Company’s financial

stability allows ANSYS to continue to invest in product

development, sales and marketing, and strategic

acquisitions.

These strengths and advantages position ANSYS well to

capitalize on the opportunities that will exist as more engineers

adopt simulation software.

The acquisition of Apache Design further strengthens ANSYS’ position.

The acquisition of Apache (the leading provider of low‐power

simulation solutions) strengthens ANSYS’ product portfolio with

best‐in‐class solutions in a growing, strategically important

area. It brings to ANSYS new technology, new customers, and

new talent, all of which will help accelerate ANSYS’ growth.



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Ansys Inc. (ANSS)Daily from 22-Feb-2002 to 23-Feb-2012 High:1102.00Indexed Total Return as of 22-Feb-2002 = 100 Low: 58.47U.S. Dollar (Split / Spinoff - Adjusted) Last: 1050.92

Data Source: IDC / Exshare

A Renaissance in Engineering Speaker: James E. Cashman III, President and Chief Executive Officer

Overview

As the pace of innovation accelerates and R&D spending

continues to rise, companies in all industries are focused on

product development. They want to get to market faster with

more sophisticated products, but they need confidence that

their products will work. The cost of being wrong in product

development and the value of being right have never been

greater.

Being right means solving extremely complex design problems.

Historically, product development processes have been slow,

expensive, and inflexible. ANSYS’ vision is Simulation‐Driven

Product Development™ (SDPD), in which product developers

transform their product development processes through use of

multiphysics simulation tools.

This transformation is under way in many organizations. Yet,

despite ANSYS’ consistent growth, the use of simulation tools

by engineers remains low, even at ANSYS’ leading customers—

and the opportunity is significant. ANSYS will drive growth by

increasing the number of simulation users, density of usage,

and intensity of use. This growth requires accelerating adoption

by continuing to innovate.

Context

Mr. Cashman provided an introduction to ANSYS, shared

ANSYS’ vision for Simulation‐Driven Product Development™

(SDPD), and explained the trends ANSYS sees. He also discussed

the Company’s penetration, the hurdles to increasing

penetration, and what ANSYS is doing to accelerate adoption.

Key Takeaways

Through focus and technological innovation, ANSYS has met commitments and created significant advantages.

Over the past 10 years, ANSYS has consistently met

commitments, a history reflected by the Company’s continued

growth and the appreciation of the share price.

Once again in 2011, ANSYS delivered on its commitments. The

Company’s non‐GAAP revenue, earnings per share, and margins

all exceeded the outlook for the year. (The 2011 results, capital

deployment plans, and 2012 outlook were discussed by CFO

Maria Shields. A summary of her remarks is on page 16.)

ANSYS results reflect:

• Focus. ANSYS is dedicated exclusively to engineering

simulation; this is all ANSYS does. As a result of this focus,

over the past 40 years ANSYS has become the world’s

leading provider of simulation software and services,

produced a continuous stream of product innovations, and

built long‐term trust‐based relationships. There is no

change in the Company’s focus.

• Technology. ANSYS technology enables customers to

predict with confidence that their products will survive

and thrive in the real world. Customers can simulate

multiple concepts virtually and decide what to invest in.

Customers trust ANSYS software to help ensure the

integrity of their products. The Company’s technological

innovations are produced by the world’s largest

development team focused on simulation.

• Support and services. ANSYS technology and people bring

clarity and insight to customers’ most complex

phenomena through fast, accurate, and reliable

simulation. This includes sharing best practices about

SDPD.

• Diversity. ANSYS is truly international, with more than 60%

of revenue coming from outside the United States. In

2011, 33% of revenue was from North America, 34% was

from Europe, and 33% was from Asia and other markets.

ANSYS business is also highly diversified by industry. No

industry accounts for more than 20% of ANSYS revenue,

with electronics, automotive, and aerospace and defense

each representing 16% to 18%. No individual customer

represents more than 5% of the Company’s revenue.

• Customer leadership. In every industry—from automotive

to energy to biomed to consumer products—the leading

companies use and rely on ANSYS technology. Today

ANSYS has more than 40,000 customers, including 96 of

the top 100 industrial companies on the FORTUNE Global

500 list. Many of these customers are underpenetrated,

providing significant opportunities for further growth.

• Independence. ANSYS is financially independent, with long‐

term financial stability. ANSYS is also technologically

independent, with flexibility to bridge all CAD and eCAD

systems, as well as all major IT operating systems.



ANSYS’ Vision: Simulation‐Driven Product Development™.

ANSYS customers face increasing competitive pressure and

have little margin for error. They are competing in global

markets, and their customers have high expectations. Success

requires shorter product lifecycles and faster time to market.

These competitive pressures are increasing the pace of

innovation and R&D spending. The number of patents filed

continues to increase each year, and the rate of growth in

worldwide R&D spending outpaces GDP growth. Companies in

all industries are committed to R&D, and a frequent refrain

among executives is, “We will win with tomorrow’s products,

not today’s.” Companies are seeking to “jump the ‘S’ curve” by

developing next‐generation technologies that leapfrog the

existing technologies in a market.

“The cost of being wrong [with product development] has

never been greater and the value of being right has never

been greater.” – Jim Cashman

To succeed in today’s competitive environment, companies

need to rethink how they develop products. Historically

product development has been a sequential process (shown

below) of developing a concept, locking in a design, developing

a physical prototype, testing it, analyzing it, and either fixing it

or proceeding to production. The need to lock in design

parameters decreased flexibility, slowed development, and

increased costs.

ANSYS’ vision of Simulation‐Driven Product Development™

(SDPD) transforms how companies develop products. Product

designers can run simulations, ask what‐if questions, create

virtual prototypes, conduct design analysis, and engage in

parametric design optimization. SDPD can occur rapidly and

repeatedly, and organizations can get it right before locking in

decisions about components, tooling, or processes. The vision

for SDPD involves:

• Advanced technologies. This entails using simulation

technologies to study all aspects of a product including

structural mechanics, fluid dynamics, high‐ and low‐

frequency electromagnetics, thermal mechanics, and

more.

• Virtual prototypying. Engineers don’t want to use just one

advanced technology; they want to use multiple technol‐

ogies, and they want them to be integrated. Virtual

prototyping provides the ability to look at multiple physics

and complete systems. It also enables not just looking at

the product, but simulating the entire environment in

which the product will operate.

• Process compression. ANSYS’ vision involves automating

aspects of the product development process, spreading

best practices, and democratizing simulation.

• Dynamic CAE collaboration. Product development will be

transformed when development silos give way to

collaborative organizational development processes.

In achieving this vision, ANSYS is committed to ongoing

investment in R&D, which has increased more than 10 times

over the past 15 years. These investments, which include

internal R&D efforts coupled with technology acquisitions and

partnerships, have produced breakthrough multiphysics

technologies and a portfolio of products with unequalled depth

and breadth. ANSYS solutions—which provide a competitive

advantage—are scalable, flexible, and fit within different

customer environments and workflows.

ANSYS will drive future growth by accelerating the adoption of simulation.

ANSYS’ leadership position is based on repeatedly jumping the

‘S’ curve in the simulation market with a stream of innovative

new technologies. (In many cases, ANSYS has jumped its own S

curve.) Yet, even though ANSYS’ business and the simulation

market have steadily grown, the market is still unpenetrated.



The Company estimates that, currently, fewer than 10% of the

engineers at ANSYS’ leading customer companies use ANSYS

products, and only about 1% of all engineers are users at

average accounts.

“We have had steady growth in a highly unpenetrated

market.” – Jim Cashman

Projecting the future addressable market for simulation is

impossible, just as it once was for the computer market.

Looking back, in 1943 IBM’s Thomas Watson thought the world

market for computers was five, and in 1977 Ken Olsen of Digital

said there was no reason why anyone would want a computer

in his home. It is clear that many more engineers will adopt

simulation technology in the coming years. Could the

simulation market be 10 times greater? 20 times greater? 100

times greater than it is today? It is impossible to know. The key

question is not how big the potential market could be; it is how

to accelerate the timing of adoption. From ANSYS’ perspective,

the key to driving adoption is overcoming the hurdles that exist.

Hurdles to Adoption

The key hurdles are:

• Internal validation. Potential users need confidence that

simulation will work.

• Accuracy. Potential users must know that they can trust

the results of simulation. Results that are within 90%

aren’t good enough.

• Training. Users must be taught to use simulation tools,

thereby becoming comfortable using them for complex

design projects.

• Process. Developing products by using SDPD is a different

organizational development process.

The good news is that none of these hurdles is insurmountable,

but all of them take time. Importantly, neither price nor

distribution is a barrier. While price is always an issue, the ROI

of ANSYS software is extremely high. When engineers have

confidence in the results and organizations change their

processes, price is no longer a barrier.

Accelerating Adoption

Adoption will occur over time by eliminating the hurdles that

exist. ANSYS’ goal is to accelerate this process.

ANSYS thinks about growth along the following dimensions:

growing the number of users; growing the density of users; and

growing the intensity of usage. Actions can be taken along each

dimension to accelerate usage.

• Number of users. With only an estimated 2% to 8% of

engineers at ANSYS customer companies using simulation,

the growth potential even at existing customers is

significant. This is already happening as the number of

users at ANSYS accounts is growing faster than the

engineering headcount. Customers are using ANSYS tools

to amplify engineering resources.

Accelerating the number of users will be done by

democratizing simulation. This involves making products

more automated and easier to use—but not less

sophisticated—and offering services to assist users.

• Density of usage. At major accounts, usage has increased

as customers buy more modules and use them more

often, especially for systems‐level analysis of complex

smart products.

The density of usage will be accelerated with products that

accurately solve complex problems.

• Intensity of usage. One way that intensity is increasing is

through the use of high‐performance computing (HPC)

solutions, which is growing rapidly at advanced and lead

accounts.

Adoption will be accelerated through robust design that

delivers extreme innovation and provides design

confidence to more users.

Other accelerants include cost‐effective and scalable solutions,

along with an open collaboration platform.

Other Important Points

ANSYS academic program. ANSYS academic products are

currently used at over 2,400 institutions in 79 countries.

This has multiple benefits for ANSYS, including training

students in simulation, accelerating students’ capabilities,

building relationships, and gaining exposure to future

technologies to incorporate as part of ANSYS. Also, ANSYS’

presence in academia helps attract potential employees.

New release. ANSYS’ continued innovation is seen in the

newest release of the Company’s software, R14, which

occurred in the fourth quarter of 2011. This release was

on schedule and has been well received.



Key Initiatives Driving Revenues Speaker: Joshua Fredberg, Vice President, Marketing

Overview

ANSYS is focused on five specific initiatives to drive the

adoption of simulation. These are: smart products, which

simulate complete systems and increase the density of usage;

amplifying engineering, which increases the number of

simulation users; product integrity through robust design,

which drives the intensity of usage; cost‐effective and scalable

IT; and an open collaboration platform.

These initiatives will not only drive penetration, they will also

affect ANSYS’ product strategy. In the future, ANSYS’ product

portfolio will simulate more of the complete system (including

single physics, multiphysics, multiscale, and multifidelity) while

also delivering high efficiency, productivity, and flexibility to

customers.

Context

Following Mr. Cashman’s ANSYS overview and discussion of

simulation adoption, Mr. Fredberg described five initiatives to

drive adoption. He then explained how these initiatives are

being translated into ANSYS’ product strategy.

Key Takeaways

Smart products are driving system simulation, which increases

the density of usage and provides a cross‐selling opportunity.

Smart products are everywhere. These are products with built‐

in intelligence that are able to react to the user and their

environment. Aerospace applications, phones, televisions, cars,

and consumer products are all examples of products that are

increasingly smart.

These products are extremely complex to design and build, as

they often incorporate thousands of electronic parts and

numerous systems that have to work together. Traditionally,

companies design each system and subsystem in separate silos.

Then, they spend billions of dollars on physical testing late in

the product design process.

But the design process is changing in many industries.

Companies began using single‐physics simulation to simulate

the design of individual parts. This evolved to simulation of

single components using multiphysics. Now, due to the growth

of smart products, engineers are simulating entire systems and

environments. Use of simulation decreases the costs of physical

testing and provides important insights early in the design

process. Also, companies are evolving from a siloed approach

to a comprehensive, enterprise‐wide design view.

“Simulation is not just about saving costs; it is about

getting insights earlier in the design process.” – Josh Fredberg

A systems‐level analysis approach comprises a number of key

requirements—which ANSYS uniquely provides. These include

multiphysics technology (mechanical, electromechanical, and

fluids physics simulation capabilities with automated and

interoperable coupling), multiple users (individuals and groups

working on the same project, either simultaneously or

sequentially), multiscale capabilities (physical model scope

ranging from parts to subassemblies to assemblies), and

multifidelity (3‐D detailed and reduced‐order models, as well as

combinations of both). These are all ANSYS strengths. The focus

on systems simulations increases the density of simulation

usage and presents cross‐selling opportunities for ANSYS. An

analysis of several key accounts shows that, in 2011, most

engaged in mechanical, electromechanical, and fluids

simulation. Growth in smart products with multiple complex

systems bodes well for ANSYS.

Because enterprises are under pressure to do more with their

existing design teams, they need to amplify their engineering

talent.

With good engineers being expensive and hard to find,

enterprises want to drive the efficiency and effectiveness of

their engineering resources. The opportunity for ANSYS is to

amplify current engineers’ output and increase the number

using ANSYS by democratizing simulation to the engineering

masses.

ANSYS’ platform strategy:

• Makes multiphysics easier. ANSYS simulation tools have

“connected the dots” and made multiphysics analysis

doable by mainstream engineers.

• Automates for a heterogeneous IT environment. ANSYS’

open and flexible platform amplifies engineering because

it works well in a wide range of customer IT environments.

• Allows for ANSYS® WorkbenchTM customization. ANSYS

Workbench can be customized to fit with an enterprise’s

existing environment and processes, making it easier for

more people to use it. ANSYS Workbench is an enabler to

grow the user base.

• Involves sharing know‐how. ANSYS knows a great deal

about simulation and shares best practices with customers

through training and services.



“There is not a company on the planet that knows more

about simulation than we do . . . We are not just a product

company; we are also a service company. We help

companies work differently to increase their value from

simulation.” – Josh Fredberg

Cummins is a great example of amplifying engineering. The

company previously engaged in a great deal of physical testing,

but changed its culture and strategy to incorporate simulation.

This meant involving Cummins’ engineers early in the design

process by customizing for them. For Cummins, this resulted in

deriving important insights earlier in the design process and

decreasing development cycle times from one year to five

months. For ANSYS, the democratization of simulation resulted

in three times more Cummins users of ANSYS tools.

By using simulation for robust product design, enterprises

assure greater product integrity.

Enterprises engaged in product design are typically trying to

solve extremely difficult problems. There can be dozens,

hundreds, or even thousands of inputs into a design; some are

within an enterprise’s control while others are driven by

external factors. Variations in operating conditions,

manufacturing processes, and material properties create

uncertainty in the success of a product design.

ANSYS tools provide product developers with the ability to run

numerous scenarios and simulations to understand how their

product will perform along multiple dimensions in real‐world

conditions. Doing so results in a more robust design and greater

product integrity.

The path to robust design (below) starts with a single physics

solution, evolves to multiphysics, and then allows what‐if

studies. It continues with design exploration, optimization

based on a range of conditions, and then robust design, which

is an optimized design for a likely set of conditions.

When organizations move along this path, their usage intensity

increases. This is because hundreds of simulations may be

required for a robust design. The result for ANSYS has been

10% to 20% growth in revenue per user over the past three

years. Interest in robust design is also causing advanced

customers to look into and adopt ANSYS’ high‐performance

computing solutions.

Cost‐effective and scalable IT enables productive access to

simulation.

Within large enterprises, the customer’s IT department is a

strategic partner for ANSYS. This is because a scalable

infrastructure is necessary for democratization of simulation.

ANSYS is working with customers’ IT departments to scale up

high‐performance computing (HPC) to support more and bigger

simulation workloads. The other priority is working with

customers to create a centralized IT infrastructure that provides

effective remote access.

For smaller enterprises, the startup and infrastructure costs

have put simulation and HPC beyond their reach. New cost‐

effective IT environments, such as cloud computing, are needed

to open up the simulation market for smaller and mid‐sized

enterprises.

For ANSYS, HPC within large enterprises is an opportunity for

future growth, as are solutions that make simulation accessible

to smaller and mid‐market enterprises.

An open collaboration platform will change how organizations

develop products.

Not only do ANSYS simulation tools produce valuable insights

early in the design process and save testing costs, they give

organizations with distributed product development teams the

ability to change and evolve how they develop products.

An open collaboration platform, made possible through a

sophisticated IT environment, allows organizations to create

integrated teams across regions, share data, standardize on

best practices, and reuse data, processes, methods, and know‐

how.

The MANN+HUMMEL Group, a German firm with an R&D

center in India, used ANSYS technology to enable global access

to simulation data and standardize on simulation practices. This

collaborative platform increased productivity and confidence in

predicting product performance, decreased testing cycles,

improved audit trails, and decreased costs by reducing rework.

These initiatives will directly affect ANSYS’ product strategy.

The customer needs reflected in these initiatives include

systems simulation; optimizing design across a range of real‐

world operating conditions; amplifying engineering



productivity; cost‐effective and scalable IT; and a platform that

enables collaboration.

Providing comprehensive solutions to address these needs is

reflected in ANSYS’ product strategy.

ANSYS takes a multidimensional view of engineering simulation,

which means simulating the complete system, not just single‐

physics simulation and coupled multiphysics (which is what

point‐provider competitors offer). As shown in the table, the x

axis shows the requirements for simulating a complete system.

Point‐provider competitors offer only single physics. ANSYS

simulates for the complete system, with capabilities that

include single physics, multiple physics, multiscale, and

multifidelity.

In addition, ANSYS’ product strategy focuses on effectiveness,

efficiency, and flexibility. It ranges from developing and

delivering best‐in‐class solvers to enabling a cost‐effective,

scalable modern architecture.

The table shows both ANSYS’ mature (dark blue) and emerging

(light blue) software capabilities. ANSYS’ distinctive product

strategy over the next few years is to have mature capabilities

in every section. The Company is well on the way to achieving

this strategy.



Sales and Service Update Speaker: Frank Bernieri, Vice President, North American Sales

Overview

ANSYS has a proven sales model that provides a competitive

advantage. This model combines a geographically based sales

organization with industry marketing, product experts, and

local channel partners. This structure creates deep relationships

while also providing the industry knowledge and technical

expertise to customize solutions to meet customers’ specific

needs.

This model continues to work well, but the selling environment

for simulation software has grown more complex, influenced by

the new realities of the competitive global economy. To

continue to win and drive growth, ANSYS has sharpened its

sales execution strategy to elevate conversations about

simulation. It is investing to strengthen the skills of its

salespeople, and is improving the Company’s sales processes.

Context Mr. Bernieri described the changing sales landscape and

explained what ANSYS is doing to continue to win in this

environment. He provided detailed examples of ANSYS’

successes in the automotive, aerospace and defense, and

energy sectors.

Key Takeaways

The ANSYS sales model has proven successful and will be sustained.

ANSYS goes to market through a geographic sales, distribution,

and service model that allows the Company to build long‐term,

value‐based customer relationships. The geographic structure

involves a hybrid model that combines both direct ANSYS sales

representatives and channel partners who report to local sales

managers. This structure promotes cooperation.

“We focus on relationships, not individual transactions.” – Frank Bernieri

Geographic sales representatives are tightly linked with

industry marketing experts and product marketing teams.

Industry experts understand the context for each industry,

providing insights so solutions can be customized for each

customer’s situation. Product marketing provides deep

technical knowledge that helps customers apply ANSYS’

technology to maximize their value.

ANSYS’ technical support includes strong pre‐sale technical

support, post‐sale support, training, and consulting services.

This geographic‐based hybrid model with industry and technical

experts has been ANSYS’ model for years. It has worked well,

has created value for customers, has created a competitive

advantage, and will continue to be ANSYS’ fundamental model.

ANSYS’ sales model has yielded success across industries and geographies.

Case studies illustrate the success of ANSYS’ sales model in the

automotive, aerospace and defense, and energy industries.

While each of these industries is different, customers in these

industries share many similarities:

• They face increasingly global competition. Companies in

every industry must compete globally. They are focused on

competing in the stabilizing U.S. market and capitalizing on

opportunities in rapidly growing emerging markets.

• They emphasize innovation and product development. The

way companies in these industries win is by innovating to

develop sophisticated new products. As an example,

automobiles now have astounding amounts of electronics

on board, which comprise 35% of a car's cost. The

challenge that companies face is that innovation is often

slow and costly; they want to innovate more quickly and at

lower cost.

• They derive tremendous value from ANSYS simulation

software. The ability to conduct sophisticated simulations

incorporating multiphysics can improve the speed and

quality of product development, while dramatically

decreasing the cost. Examples in each industry show how

use of ANSYS tools has saved significant amounts (often

millions of dollars) in product‐development costs and has

reduced product‐development cycles, allowing these

companies to get to market quicker.

• They are the leading companies in their industries. In each

of these industries, ANSYS serves the market leaders, as

well as the leaders in each segment and subsegment.

• Their use of ANSYS simulation software often started small

and then grew. Customers often walk before they run.

Customers may start with one ANSYS license, gain

confidence, see value, and then broaden their use of

ANSYS’ software from one type of physics to multiphysics,

and from one user to multiple users. This is how ANSYS has

grown for over 40 years and plans to continue to grow.



However, new realities are changing how customers buy.

Beginning in 2008, economic uncertainty has made customers

more conservative and cautious in making investments. While

simulation is playing a greater role in customers’ product

development processes—which is good for ANSYS—product

requirements are growing in number and complexity, and the

buying process is receiving more scrutiny. Within organizations,

more people are now involved in purchase decisions, making

sales cycles longer and more complicated.

At the same time, customers are increasingly self‐sufficient and

don’t believe they need sales help. In fact, research shows that

57% of sales transactions are done by buyers who conduct their

own research and don’t require a salesperson. In this

environment, finding ready‐made customers will lose out to

being able to “make” customers.

Success in this changing environment requires new sales strategies, sales processes, and sales skills.

To address these new realities, ANSYS is undertaking several

key initiatives. They include:

• Sales execution strategy. This strategy (shown below) has

three components:

‐ Secure. This involves strengthening technical relation‐

ships with existing customers so customers see value

in purchasing more ANSYS licenses.

‐ Extend. This involves leveraging ANSYS’ existing

relationships throughout an organization and using

more ANSYS solutions in more ways.

‐ Elevate. This is about elevating the importance and

value of simulation to the executive level. Doing so

produces long‐term strategic partnerships. When

elevation occurs, RFPs are no longer a requirement

and recurring revenues are more predictable.

“Data modeling, simulation, and other digital tools are

reshaping how we innovate.” – Frank Bernieri, quoting Procter & Gamble CEO Robert McDonald

(describing how simulation is on executives’ radar, including at firms

like his)

• Strategic account management. The goal of strategic

account management is to develop a consistent,

collaborative sales methodology that increases the depth

and breadth of penetration at the Company’s most

important accounts. ANSYS’ strategy of extend and elevate

at strategic accounts is paying off. In 2011, the number of

customers producing $1 million in sales for ANSYS grew by

10%, and sales from these customers grew by 20%.

• Improving sales performance. ANSYS defined the

competencies of high‐performing salespeople and

assessed each salesperson to see how their skills measure

up. Then, a plan was created for each salesperson to

develop the competencies needed. Also, the Company has

launched the ANSYS Sales Academy. This is an online

training toolkit to help individuals develop the necessary

competencies.

• Improved and synchronized sales processes. While ANSYS

has experienced tremendous growth and success, the

Company has not had one uniform sales process. To

improve overall sales performance, the Company has

created Sales Process 101, which is based on best

practices. This maps out all steps of the sales process. It is

supplemented by Sales Process 201, which includes tools,

research, and process insights to create and close new

sales opportunities.

ANSYS will continue to drive growth by adding salespeople,

increasing productivity of the sales organization, defining and

disseminating best practices, improving sales processes, and

strengthening the skills of everyone in the sales organization.



Apache Design: History, Market, & Potential Value of ANSYS/Apache Speaker: Andrew Yang, Ph.D., Vice President and General Manager; President, Apache Design, Inc.

Overview

With a laser focus, Apache has staked out a leadership position

in low‐power solutions for designers of semiconductor chips.

Apache sells to all leading semi and fabless semi companies.

And, with power efficiency increasing as a strategic priority for

semiconductor designers, the power analysis category is

primed to grow—with Apache leading the way.

As successful as Apache and ANSYS each have been over the

past decade, joining together provides greater growth potential

for both. The companies share a similar vision of convergence

and have complementary product lines, and ANSYS’ sales

organization, channels, geographic reach, and diverse customer

base all represent new opportunities for Apache.

Context Dr. Yang described Apache Design’s products and the problems

the company solves, the shared vision that brought Apache and

ANSYS together, and new growth opportunities for Apache

based on aligning with ANSYS.

As background, Apache was founded in 2003, is headquartered

in San Jose, California, has 300 employees, and was recently

acquired by ANSYS.

Key Takeaways

A renaissance is under way in smart engineering, driven by powerful tiny chips.

Smart mobile devices have become entrenched in consumer

society, and the trend of smart technologies is only going to

accelerate. There are now smart TVs, smart cars, smart homes,

smart grids, and smart technologies used for health and

wellness.

These smart technologies are made possible by

semiconductors, which are the tiny chips that act as the

electronic brains of these technologies. The performance of

semiconductors has improved exponentially over the past 30

years, as predicted by Moore’s Law. According to Moore’s Law,

the speed of semiconductors will double every 18 to 24 months

as the density of transistors on a chip increases and the cost per

transistor decreases.

A new measure and basis for competition is emerging for semiconductors: power efficiency.

Historically, the key metrics for semiconductors were

performance and price. And, conventional wisdom was that

when the speed of a semiconductor increased, energy

consumption also was expected to increase.

But this is changing. Over the past six years, as semiconductor

speeds have increased, power consumption requirements have

decreased. This is critical because it has implications for the

battery life of smart devices and the amount of heat produced

by these technologies. Power has become a new metric for

semiconductor competitiveness, and a new rule has emerged:

the 3P rule. According to this rule, semiconductor companies

now compete on performance, price—and also power.

Companies will have to pick their 3P strategy and decide

whether they will attempt to focus on power, performance, or

price.

“This 3P rule basically redefines the survival strategy of the

semiconductor companies . . . Companies will need a clear

strategy for the 3Ps to stay ahead. Those that don’t, in the

next two to three years, will be left behind.” – Andrew Yang

Chip designers today face three key challenges related to

power efficiency:

• Increasing power budget gap. Consumers are addicted to

using more and more power‐hungry applications. In fact,

forecasts indicate that over the next decade, power

consumption demand will increase by 10x. But while

demand is expected to grow by 10x, battery technology is

rather fixed, and the supply of power is expected to be

largely constant over the next decade. This gap between

expected demand and supply is the “power budget gap,”

expected to increase dramatically. The power budget gap

is the greatest challenge for power‐efficient chip designs.

• Power delivery integrity. Power is precious and can’t be

wasted. So, chip designers want to deliver exactly the right

amount of power to the right place at the right time so a

chip can perform at its desired speed, without wasting any

power.

• Power‐induced noise. Whenever there is a flow of

electricity there is unintended and unwanted interference

or noise. This could be in the form of cross‐talk,

electromagnetic interference, or heat, which can affect a

product’s quality, reliability, safety, and/or performance.

Apache’s industry‐leading solutions help chip designers maximize power efficiency in all design phases.

Apache offers a full suite of power products that customers use

throughout the chip design process. These tools are:



• PowerArtist™. This product focuses on the early, micro‐

architectural stage of design. It helps customers to manage

power consumption and identify wasted power early in

the design process. Helping engineers make their chips

10% more power efficient can give customers an edge. (An

analogy is looking at every block and every building in a

city to see what lights are left on and where power is

wasted, so that lights can be turned off and power saved.)

• Totem™. This is for customers designing custom IP or

macros, in which power is also important. Totem is used to

analyze power behavior down to the transistor level and

generate a customer power model.

• RedHawk™. This is Apache’s flagship product, the industry

gold standard for power delivery. Almost all leading‐edge

chips are developed using RedHawk to validate the chip’s

power delivery network. This product helps customers

identify hotspots (or red hotspots), which are places on

the chip or geometries that could potentially have a power

supply collapse. RedHawk identifies these hotspots early in

the design process so customers can resolve power

delivery issues. (In a way, a chip that provides power for

multiple applications is analogous to a household where

appliances are constantly turned on and off, causing

changes in the power demanded and possibly resulting in

instability of the power supply.) RedHawk works in concert

with PowerArtist to manage power delivery.

• Sentinel™. This product helps analyze noise, including chip‐

to‐chip noise and I/O noise.

These four products span all design processes from the early micro‐architecture stages, to finishing the chip, to packaging.

“PowerArtist and RedHawk provide state‐of‐the‐art power

methodology for the semiconductor industry today.” – Andrew Yang

Apache’s strategy has resulted in a leadership position in a growing market.

There are four key aspects of Apache’s strategy:

• Innovation‐driven R&D culture. This is the most important

aspect of Apache’s strategy. Ten years ago when others

involved with the semiconductor industry were focused on

timing, Apache was focused on low power. Apache was

ahead of everyone else in this area and has continued to

innovate with first‐in‐class technologies that have been

turned into best‐in‐class products.

• Foundry ready. Apache’s technology leadership and close

relationships with foundries such as Intel, TSMC, and

Samsung have created a high barrier to entry.

• World‐class support. Customers see Apache as a trusted

partner with deep domain expertise in power. They don’t

just invest in Apache for software; they work with Apache

due to domain expertise and support.

• Product leasing model. From day one, Apache has offered

only a time‐based license model, which has proved

extremely successful. The renewal rate is over 99%; the

only customers that haven’t renewed have gone out of

business.

As a result of this strategy, Apache is the leader in the power

analysis market. Currently, all of the top 20 semiconductor

companies use Apache, as do all of the top 15 fabless

semiconductor companies. In addition, industry leaders in

mobile phones, cars, and systems manufacturers who haven’t

previously invested in chip development are beginning to do so

to differentiate their products—and are using Apache tools.

While the timing and place and route segments are predicted

to decline, the power analysis market is expected to grow. So,

Apache is well positioned in an attractive market.

Apache and ANSYS share a common vision.

As shown below, over the past 10 years ANSYS has expanded

from structural mechanics to fluid dynamics to

electromagnetics. During this time, Apache has expanded from

system on chip (SoC) power to package/PCB power, to RTL

power, and now to chip‐package power. As chip‐package‐

system convergence occurs, Apache and ANSYS share a vision

of system‐level simulation.

“The vision that drove the two companies together is this

vision of convergence.” – Andrew Yang

Previously, because of the complexity of the electronic product

design process, design typically took place sequentially and in

silos, with each silo designing independently. But with today’s

more complex products and the need to design according to a

company’s 3P strategy, companies have to break their silos and



change design processes. The best companies are looking for

tools to break silos, foster collaboration, and allow

organizations to work on models simultaneously. The tools

provided by Apache and ANSYS make this possible.

In combination, ANSYS and Apache offer an end‐to‐end chip‐

package system for the chip, package, board, and connector.

This set of tools allows customers to design for low power,

performance, and safety, which are the primary needs for chip‐

package systems. Instead of designing in silos and testing late in

the cycle, the use of simulation with the tools from ANSYS and

Apache can improve the design process.

By combining with ANSYS, Apache has a host of new and exciting growth opportunities.

These opportunities include:

• Getting OEMs to “pull” Apache. Apache sells to

semiconductor companies, which then sell their products

to OEMs. ANSYS enjoys strong relationships with OEMs. By

working together, Apache and ANSYS can develop an

ecosystem in which OEMs use ANSYS simulation products

and demand that their semiconductor suppliers use

Apache products, since Apache provides a chip power

model. This will pull Apache and increase use.

• Targeting new segments. In combination with ANSYS,

Apache sees attractive opportunities in the aviation and

defense market, as well as the automotive market. By

working with the ANSYS direct sales and sales channel

model, Apache can better reach customers in these

segments.

• Targeting new geographic markets. Apache has not had a

strong presence in geographies such as India and Latin

America. Again, the ANSYS sales channel provides the

potential for growth by selling to new and existing

customers in these areas.



Financial Update Speaker: Maria T. Shields, Vice President, Finance and Administration; Chief Financial Officer

Overview

2011 marked another strong year for ANSYS as the Company

performed well on all major financial metrics. The 2012 outlook

is for sustained growth. ANSYS will continue to make

investments in people and infrastructure to grow the core

business. It will consider strategic acquisitions that create long‐

term value. As the industry leader in engineering simulation,

with a sound business model, ANSYS is uniquely positioned to

build on its success and take advantage of the tremendous

growth opportunities that exist.

Context Ms. Shields reviewed the Company’s 2011 results and discussed

the outlook and key assumptions going forward.

Key Takeaways

2011 was another strong year of growth for ANSYS.

The past year was another milestone year as ANSYS delivered

strong performance on all key financial metrics: non‐GAAP

revenue, earnings, operating margin, and operating cash flow.

The Company’s revenues were evenly distributed among North

America, Europe, and GIA, and 68% of revenue was recurring.

This is a testament to the Company’s long‐term customer

relationships and provides great visibility going forward. ANSYS

finished the year with a record $270.3 million in deferred

revenue.

Continued growth is expected in 2012.

The outlook for 2012 is positive, with continued growth

expected in non‐GAAP revenue and earnings.

Among the key assumptions for 2012 are:

• Relative macro‐economic stability. The assumption is that

with economic stability, ANSYS’ customers will continue to

invest in their own businesses.

• Continued investments for the long term. ANSYS will

continue to invest in its own people, infrastructure, and

facilities. Investments in people include hiring and training

salespeople so they are equipped to extend and elevate

relationships with customers.

• Revenue composition. ANSYS expects a 65/35 split

between licenses and services and expects recurring

revenue to represent 66% to 67% of all revenue.



ANSYS will deploy capital to continue to drive long‐term value.

The Company’s capital deployment plans are largely unchanged

from those of 2011. Capital will be deployed to create value

over the next three to five years by investing in:

• Organic growth of the core business. ANSYS will invest to

deepen relationships with customers, accelerate the

democratization of simulation, add new users, industries,

and products, and continue channel expansion.

Investments will also focus on R&D investment in areas

such as high‐performance computing, which is a significant

opportunity.

• Strategic acquisitions. ANSYS plans to continue to invest in

acquisitions that fit with the Company’s vision, strategy,

culture, and product direction. Keys to potential

acquisitions include proven technology, experienced

talent, the ability to integrate with the ANSYS Workbench

platform, synergy with customers and channels, and being

financially accretive in a reasonable timeframe.

Capital will also be used to repay debt and for opportunistic

stock repurchases.

ANSYS’ future is extremely attractive.

ANSYS is uniquely positioned to continue to grow. After 41

years in the engineering simulation market, ANSYS is the clear

technology leader. ANSYS has a breadth of products with

competitive advantage, has strong diversification, tremendous

customer loyalty, and a consistent long‐term focus. Still, after

years of consistent performance, there remains tremendous

upside potential.

“We’ve been doing this for over 41 years and we have

barely scratched the surface. There is so much future

opportunity ahead of us.” – Maria Shields

ANSYS’ future growth is predicated on the Company’s sound

business model. This model has a solid recurring revenue

stream, sustainable top‐line growth potential, hybrid

distribution, and strong operating leverage. Earnings have

consistently grown and will continue to do so. The Company

has a good balance sheet and strong cash flows. The business

model will continue to be built as the Company focuses on

realizing the significant upside potential that exists.



Questions and Answers Moderator: Annette N. Arribas, Investor Relations and Global Insurance Officer Speakers: Frank Bernieri, Vice President, North American Sales

James E. Cashman III, President and Chief Executive Officer Joshua Fredberg, Vice President, Marketing Maria T. Shields, Vice President, Finance and Administration; Chief Financial Officer Andrew Yang, Ph.D., Vice President and General Manager; President, Apache Design, Inc.

Overview

Attendees were quite interested in the factors that will drive

ANSYS’ future growth, including the penetration rates of

simulation technology and multiphysics. There was also much

interest in all aspects of the Apache acquisition, including how

Apache fits with ANSYS’ sales organization and channels.

Context Members of the ANSYS management team fielded questions

from attendees on a wide range of topics including adoption,

drivers of growth, and integration of Apache.

Questions & Answers Q. Can you talk more about the expectation that worldwide

R&D spending will increase?

A. Multiple third‐party sources project that worldwide R&D

spending will continue to rise. Even the most bearish

assessments are that dollars spent on R&D and headcount will

grow. The reason is that in up or down markets, companies

believe that R&D is the key to differentiation. Companies have

so much at stake and see so much opportunity that investing in

engineering‐driven R&D is a necessity.

Q. You showed that penetration in major accounts is 2% to 8%.

Why do you think that someday penetration will be higher?

A. There is anecdotal evidence at certain accounts in which use

of simulation has spread pervasively throughout the entire

engineering organization. These organizations provide

examples of what we can expect in the future as other

organizations catch up.

Q. What is the adoption rate of multiphysics among your

customers?

A. Many customers purchase multiple modules; the question is

how many actually implement and use multiphysics. An

estimate is that currently fewer than half of all customers use

multiphysics, perhaps 25% to 40%. But the use of multiphysics

is growing rapidly and ANSYS is taking steps to accelerate it.

Q. What percentage of engineers work on CAD versus other

areas?

A. Ten years ago the simulation market was much smaller than

the CAD market as most engineers used CAD. At that time, the

people doing CAD were typically not the people doing

simulation. The way to think about it today is as an overlapping

Venn diagram. There are some people who are using both CAD

and simulation, but many people use one or the other.

Longer term, the simulation market may become larger than

the CAD market. This is because a CAD user is creating one

thing at a time. With simulation, a person can be running a

large number of simulations simultaneously. Also, increasingly,

a CAD draftsman may not be an engineer, but almost any

engineer could use simulation.

Q. It was mentioned that the drivers of growth are number of

users, intensity of use, and density. Is one of these drivers more

significant than the others?

A. In 2009 and 2010, growth was not based on new users being

added. At that time, it was coming from greater density and

intensity of usage. However, during more normal times, all

three factors are fairly balanced in driving ANSYS’ growth, but

number of users is probably the greatest growth driver. The

second‐greatest driver of growth right now is high‐performance

computing (HPC), which is growing about double the rate of

some other products. Density of usage probably ranks third, but

it is not insignificant. Usage density is the amount of time an

engineer is actually using the software. Ten or 15 years ago,

engineers used simulation software for perhaps a few months

and then didn’t use it for a while. Today people are using

simulation much more regularly.

Q. Do you see the ordering of growth drivers changing over

time?

A. They could change over time, but how they might change is

unknown. With high‐performance computing, people can do

more simulation without necessarily increasing the number of

heads, so this might be an even greater driver of growth in the

future.



Q. Is the key to growth making the software easier to use?

A. Ease of use is a factor, but first the key is solving a

customer’s problem and delivering accuracy so the customer is

confident about the solution. This requires enough computing

power to solve hard problems. Once there is adequate

computing power and simulation provides an accurate solution

in which customers are confident, then ease of use is a factor.

Improvements to ease of use include using automation to

simplify certain steps.

Q. Does simulation have the potential to disintermediate

physical test equipment?

A. Yes. Simulation is an alternative to physical testing that

enables companies to develop new products faster, better, and

less expensively. Changing how companies develop products

and replacing physical test equipment are absolutely a source

of ANSYS’ long‐term growth.

Q. Could ANSYS’ growth be greater than 10% to 15%?

A. When all of the drivers of growth kick in and adoption

increases, these factors may compound one another. When this

happens, it is possible that the growth rate could be greater.

Q. When would you anticipate an EPS growth rate that is at

least in line with revenue growth?

A. Long term, ANSYS would like to see bottom‐line growth that

closely ties in with the top line. But ANSYS is currently at a

unique time. The greatest opportunity for long‐term

shareholder value is to invest in the business because it is

underpenetrated. The Company doesn’t want to underinvest in

the business and miss the opportunity that exists.

That said, when ANSYS outperforms on the top line (as

occurred in 2011), because of the natural leverage built into the

model combined with spending discipline, revenue

outperformance disproportionally flows to the bottom line.

Q. With dividends being currently in vogue, what considerations

has ANSYS’ board given to paying a dividend?

A. The board believes that the best use of the Company’s cash

is to invest in the Company’s business, primarily by accelerating

the product roadmap as well as investing in strategic

acquisitions.

Q. Why have the average revenues per user increased?

A. This is driven by people who were using a single level of

physics who are migrating to multiphysics to solve tougher

problems with greater accuracy. Also, as this occurs within

organizations, existing simulation tools become tied up so

organizations need to add more. (An analogy is a library in

which all copies of a book are checked out. For simulation

users, this isn’t acceptable; because of high utilization,

companies add additional copies.)

Q. Could you comment on your pricing strategy?

A. Before addressing the pricing strategy, it is important to keep

in mind that ANSYS’ overall business strategy is focused on

building long‐term trusted customer relationships. ANSYS does

periodically increase prices. The Company also may increase

prices to capture demonstrable value created by the

Company’s software. But ANSYS doesn’t modify prices in the

short term in relation to market fluctuations. ANSYS doesn’t try

to squeeze a bit more out of customers in the short term, even

when this might be possible, and the Company’s discounting

didn’t change a bit in the turbulent conditions of 2009. ANSYS is

focused on long‐term relationships and value creation.

Q. When ANSYS does acquisitions of smaller companies, do they

tend to think about pricing differently?

A. No. ANSYS isn’t acquiring a bunch of older products to

engage in rampant discounting. ANSYS acquires companies that

are technological leaders and successful ongoing concerns. An

acquisition may have a slightly different philosophy that reflects

differences in the amount of licensing and leasing, but there is

nothing inherently broken in these companies that requires

changing how they price.

Q. Does ANSYS see risks related to Europe or related to defense

industry budgets that are under pressure?

A. Obviously, the overall economic climate is important

because sinking tides can sink all ships. While the situation in

Europe is somewhat tumultuous, especially related to

government programs, the areas in Europe where ANSYS tends

to do best are continuing to invest.

In the United States, most of the defense cuts being discussed

are on programs that were already developed and in

maintenance mode. Defense funds are being shifted toward

unmanned vehicles and other types of new technologies that

are R&D intensive. This actually could help ANSYS.

Q. Is the sales organization currently equipped to sell across

ANSYS’ entire portfolio of products?

A. Yes. The Company is well into training the entire sales

organization to sell the entire portfolio of products. Training is

also under way on Apache to equip everyone to sell it.



Q. How has the sales process evolved for Apache since ANSYS

acquired it?

A. Related to the acquisition of Apache, one basic principle is

“do no harm,” and a second principle is to present a single face

to the customer. While doing the latter, there are some areas in

which Apache has the greater strength and relationships, and

other situations in which ANSYS is stronger. So, the Company

has made decisions based on who is the best person to manage

the relationship. In general, the ANSYS and Apache sales forces

are collaborating. Account representatives are managing

relationships, and industry sales specialists and technical

specialists are brought in for support as necessary.

Q. How would you characterize the opportunity for the channel

with Apache?

A. ANSYS’ basic philosophy is that it is not a given that the

channel will sell Apache. Channel partners must first present a

business plan that lays out how they will grow. Channel

partners have done a great job of this over the last decade, but

they must continue to do so with Apache. In addition, they

must go through a rigorous certification process that ensures

that they can provide the level of support that ANSYS expects.

This takes time, commitment, and investment from the

channel.

Q. How much of Ansoft has penetrated the channel?

A. ANSYS is entering its fourth year with Ansoft, and probably

25% to 30% of the channel has been certified.

Q. Can you comment on keeping Apache’s management team

and key employees?

A. Apache has a list of the top 150 people that are important

for sustaining the business. Since the acquisition was

announced, the turnover rate among these individuals has

been just 1% to 2%, which is within the range of natural

attrition. Apache’s acquisition by ANSYS actually has provided a

greater sense of stability for the people working at Apache,

who view ANSYS as a great company.

Q. What is going on with Apache’s relationships and joint

ventures?

A. Apache has not seen any adverse effects on its relationships

from the acquisition. In fact, because ANSYS is a bigger

company, there are even more compelling reasons for

organizations to want to partner with Apache; the acquisition

actually helps with partnerships, including partnerships with

CAD and eCAD vendors.

Q. It was mentioned that Apache believes the acquisition by

ANSYS will cause OEMs to demand Apache from semiconductor

producers, which will cause “pull” for Apache. Why wasn’t this

happening prior to the acquisition?

A. It was happening. But because ANSYS has strong

relationships with OEMs that purchase semiconductors, the

acquisition of Apache by ANSYS should help accelerate this.

Q. How do ANSYS and Apache think about services?

A. Both companies think about services similarly. The goal is not

to become a services company, but to use services to overcome

obstacles, to help generate license sales, and to help customers

with best practices so they can use the technology to derive the

greatest value.

Q. How does ANSYS think about the competitive landscape?

A. There is not a lot of pure competition today, particularly at

the enterprise level. There are some point solutions that might

be loosely coupled, but none that offers the degree of

multiphysics that ANSYS offers. Longer term, some of the

smaller companies may grow larger and some may be acquired

by larger companies.



BIOGRAPHIES Annette N. Arribas

Investor Relations and Global Insurance Officer

Annette N. Arribas has been the ANSYS Investor Relations and

Global Insurance Officer since November 2007. Prior to joining

ANSYS she was the Vice President, Investor Relations,

Compliance and Treasurer of an electric utility in Maine. Ms.

Arribas also held various positions in banking with KeyCorp and

assisted in the establishment of a de‐novo bank. Ms. Arribas

holds a Bachelor of Arts degree in Management and a Masters

of Business Administration from the University of Maine, and is

a Certified Treasury Professional.

Frank Bernieri

Vice President, North American Sales

Frank Bernieri joined ANSYS in September, 2010 as the Vice

President of Sales for North America. Frank brings a wealth of

large company sales experience to the leadership team. Prior to

ANSYS, Frank spent sixteen years at ADP, most recently as a

Division Vice President of Sales in their Major Account Group.

Prior to ADP, Frank spent fourteen years at IBM progressing

through various sales, product management and sales

management responsibilities. Frank has a B.A. in Economics

from Upsala College and an MBA in Marketing from the Cornell

University Johnson School of Management.

James E. Cashman III

President and Chief Executive Officer

James E. Cashman III has been ANSYS’ Chief Executive Officer

since February 2000 and President since April 1999. Mr.

Cashman served as Senior Vice President of Operations from

September 1997 to April 1999. Prior to joining the Company,

Mr. Cashman was Vice President of Marketing and

International Operations at PAR Technology Corporation, a

computer software and hardware company involved in

transaction processing, from May 1995 to September 1997.

From September 1994 to May 1995, he was Vice President of

Product Development and Marketing at Metaphase

Technology, Inc., a product data management company. Prior

to joining Metaphase, Mr. Cashman was employed by

Structural Dynamics Research Corporation, a computer‐aided

design company, from 1976 to 1994 in a number of sales and

technical positions. Mr. Cashman is also a Director of the

Pittsburgh Technology Council and a Board Member of the

Carnegie Museum of Natural History.

Joshua Fredberg

Vice President, Marketing

Joshua Fredberg joined ANSYS in 2009, bringing a rich, diverse

background in engineering and technology to the leadership

team. Before joining ANSYS, Fredberg was Senior Vice President

of product and market strategy at Parametric Technology

Corporation (PTC), where he worked on industry strategy,

marketing and business development. Prior to joining PTC, he

held leadership roles with both ARIBA and Andersen Consulting

Strategic Services. He holds a B.S. in electrical engineering from

Tufts University, an M.S. in systems engineering from the

University of Pennsylvania, and an M.B.A in finance from The

Wharton School.

Maria T. Shields

Vice President, Finance and Administration, and Chief Financial

Officer

Maria T. Shields has been ANSYS’ Chief Financial Officer and

Vice President, Finance and Administration since September

1998. Previously, she served as Corporate Controller since

September 1994 and as a Vice President since May 1998. Prior

to joining the Company, Ms. Shields held various positions as a

CPA with Deloitte and Touche LLP, including that of Audit

Manager. Ms. Shields holds a Bachelor of Science degree in

accounting from Pennsylvania State University.

Andrew Yang, Ph.D.

Vice President and General Manager; President, Apache Design,

Inc.

Andrew Yang joined ANSYS in 2011 when the Company

acquired Apache Design, which Yang founded in 2001. Prior to

his work at ANSYS, Yang was an active entrepreneur and EDA

investor, founding Anagram and serving as Chairman and CTO

until its acquisition by Avant! Corporation. Yang also served as

lead investor in several successful technology companies

including CADMOS Design Technology (now Cadence Design

Systems), InnoLogic Systems (now Synopsys), Ultima

Interconnect Technology (now Cadence Design Systems), and

Mojave (now Magma Design Automation). A former tenured

professor at the University of Washington, Yang holds a B.S. in

electrical engineering from the University of California,

Berkeley and M.S. and Ph.D. degrees from the University of

Illinois.

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