Formula Systems Reports Strong Start to 2012 with Record-breaking First-Quarter Revenues of $178-Million and Operating Income of $14-Million
All Formula Group Subsidiaries Report Substantial Growth in First Quarter of 2012
OR YEHUDA, Israel, May 10, 2012 /PRNewswire/ --
Formula Systems (1985) Ltd. (NASDAQ: FORTY) a leading provider of software consulting services, computer-based business solutions, and proprietary software products, today announced its results for the first quarter of 2012.
Financial Highlights for the first Quarter of 2012
- Revenues for the first quarter ended March 31, 2012, increased by 14% to $178.3-million compared to $155.9-million in the same period last year.
- Operating income for the first quarter ended March 31, 2012 increased by 13% to $13.9-million, compared to $12.3-million in the same period last year.
- Net income for the first quarter ended March 31, 2012 increased by 87% to $7.8-million compared to $4.2-million in the same period last year. Net income included a net gain of $2.9 million resulting from the remeasurement of the Company's investments, primarily attributable to regaining the controlling interest in Sapiens.
- Formula's consolidated cash and short-term and long-term investments in marketable securities totaled approximately $128.0 million, as of March 31, 2012.
- Total equity on March 31, 2012 was $456.4 million, representing 53% of the total balance sheet.
Comments of Management
Commenting on the results, Guy Bernstein, CEO of Formula Systems, said: "These outstanding results reflect the strong start to the year made by Formula and its subsidiaries. Matrix reported record-breaking results for the first quarter of 2012, with substantial growth in all its activities, in particular in its core business as a leader in the provision of software solutions and services in Israel. Magic continued its success from 2011, with double-digit growth for the tenth consecutive quarter and very strong performance across the board in all of its regional centers of activity. Magic expects to continue its growth with new releases of its enterprise mobile and cloud-based technology. On January 27, 2012, Formula regained a controlling interest in Sapiens, demonstrating our firm belief in Sapiens' current and future performance. Following successful acquisitions, which have enhanced its product offering and expanded its global reach, Sapiens reported significant growth in the first quarter of 2012. We are confident that we can build on this impressive start to the year to achieve even greater success moving forward."
About Formula
Formula Systems Ltd. is a global information technology company principally engaged, through its subsidiaries and affiliates, in providing software consulting services, developing proprietary software products, and providing computer-based business solutions.
For more information, visit http://www.formulasystems.com.
Statements made in this press release that are not historical facts are forward-looking statements. Such statements involve various risks that may cause actual results to differ materially. These risks and uncertainties include, but are not limited to: market demand for the company's products, dependence on strategic partners, integration of new business, successful implementation of Formula's products, economic and competitive factors, international market conditions, management of growth, technological developments, the ability to finance operations and other factors which are detailed in Formula's Securities and Exchange Commission filings, including its most recent report on Form 20-F. Formula undertakes no obligation to publicly release any revision to any forward-looking statement.
FORMULA SYSTEMS (1985) LTD.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
U.S. dollars in thousands (except per share data)
Three months ended
March 31,
_______________________
2012 2011
__________ __________
Unaudited
_______________________
Revenues 178,305 155,916
Cost of revenues 136,336 119,716
_______________________
Gross profit 41,969 36,200
Research and development costs, net 2,439 1,685
Selling, general and administrative
expenses 25,607 22,272
Other income, net - 31
_______________________
Operating income 13,923 12,274
Financial expenses, net 1,494 1,358
_______________________
Income before taxes on income 12,429 10,916
Taxes on income 2,042 2,176
_______________________
10,387 8,740
Gain derived from consolidation of
subsidiary and
equity in gains (losses) of affiliated
companies, net 3,719 -240
_______________________
Net income 14,106 8,500
Net income attributable to
non-controlling interests 6,304 4,323
_______________________
Net income attributable to Formula's
shareholders 7,802 4,177
Earnings per share:
Basic 0.58 0.31
Diluted 0.56 0.30
Shares used in computing earnings per
share :
Basic 13,596 13,464
_______________________
Diluted 13,749 13,646
_______________________
FORMULA SYSTEMS (1985) LTD.
CONSOLIDATED CONDENSED BALANCE SHEETS
U.S. dollars in thousands
March 31, December 31,
___________ ___________
2012 2011
___________ ___________
(Unaudited) (Unaudited)
___________ ___________
ASSETS
CURRENT ASSETS:
Cash and cash equivalents 110,665 88,172
Marketable securities 14,929 14,347
Short-term deposits 414 5,170
Trade receivables 188,333 163,219
Other accounts receivable 42,642 36,085
___________ ___________
Total current assets 356,983 306,993
___________ ___________
LONG-TERM INVESTMENTS:
Marketable securities 2,752 2,746
Deferred Taxes 18,095 11,630
Investments in affiliated companyies 3,042 77,107
Prepaid expenses and other accounts receivable 2,729 3,885
___________ ___________
Total long-Term Investments 26,618 95,368
___________ ___________
SEVERANCE PAY FUND 62,712 49,507
___________ ___________
PROPERTY, PLANTS AND EQUIPMENT, NET 21,033 19,165
___________ ___________
NET INTANGIBLE ASSETS AND GOODWILL 388,123 198,188
___________ ___________
TOTAL ASSETS 855,469 669,221
___________ ___________
CURRENT LIABILITIES:
Liabilities to banks 15,758 16,642
Debentures 15,970 31,472
Trade payables 49,412 40,344
Deferred revenues 53,327 22,653
Other accounts payable 84,051 70,054
Dividend payable to non controling interests 3,221 -
___________ ___________
Total current liabilities 221,739 181,165
___________ ___________
LONG-TERM LIABILITIES:
Liabilities to banks and others 40,975 34,459
Debentures 15,690 15,246
Deferred revenue 1,553 2,094
Other long-term pyables 10,700 9,258
Accrued severance pay 78,156 63,321
___________ ___________
Total long-term liabilities 147,074 124,378
___________ ___________
REDEEMABLE NON-CONTROLING INTEREST 30,283 11,469
___________ ___________
EQUITY
Formula shareholders' equity 233,616 218,668
Non-controlling interests 222,757 133,541
___________ ___________
Total equity 456,373 352,209
___________ ___________
TOTAL LIABILITIES AND EQUITY 855,469 669,221
___________ ___________
Press Contact:
Formula Systems (1985) Ltd.
+972-3-5389487
SOURCE Formula Systems
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