Welcome!

IBM Cloud Authors: Liz McMillan, Elizabeth White, Yeshim Deniz, Pat Romanski, Stefan Bernbo

News Feed Item

Magic Reports Record-Breaking Annual Results for 2012 with Revenues of $126.4 Million and Non-GAAP Operating Income of $18.7 Million, an Increase of 29% Year over Year

Revenues for the fourth quarter increased 17% year over year to $35.7 million; Non-GAAP operating income increased 13% to $5.1 million

OR YEHUDA, Israel, February 13, 2013 /PRNewswire/ --

Magic Software Enterprises Ltd. (NASDAQ  and  TASE: MGIC), a global provider of mobile and cloud-enabled application and business integration platforms, announced today its financial results for the fourth quarter and full year ended December 31, 2012.

Financial Highlights for the Fourth Quarter, 2012

  • Revenues for the fourth quarter increased 17% year over year to $35.7 million from $30.5 million.
  • Non-GAAP operating income increased 13% to $5.1 million, compared to $4.5 million in the same period last year; Operating income for the fourth quarter increased 2% to $4.3 million, compared to $4.2 million in the same period last year.
  • Non-GAAP net income increased 9% to $5.1 million, compared to $4.7 million in the same period last year; Net income for the fourth quarter decreased 3% to $4.3 million compared to $4.4 million in the same period last year. The decrease was mainly attributable to tax expenses recorded with respect to the utilization of deferred tax assets.    

Financial Highlights for the Full Year Ended December 31, 2012

  • Revenues for the year ended December 31, 2012, reached $126.4 million, an increase of 12%, compared to $113.3 million in 2011.
  • Non-GAAP operating income for the year increased 29% to $18.6 million, compared to $14.5 million in the same period last year; Operating income for the year ended December 31, 2012, increased 11% to $16.4 million compared to $14.7 million in the same period last year.
  • Non-GAAP net income for the year increased 24% to $18.3 million, compared to $14.8 million in the same period last year; Net income for the year ended December 31, 2012, increased 8% to $16.2 million compared to $15.0 million in the same period last year.
  • Total cash, cash equivalents and short-term investments as of December 31, 2012, amounted to $38.8 million, with zero debt (after a cash dividend of $3.7 million paid during the fourth quarter).
  • Operating cash flow for the year ended December 31, 2012 totaled $18 million.

Results

  • For the fourth quarter ended December 31, 2012, total revenues were $35.7 million, with net income of $4.3 million, or $0.12 per fully diluted share. This compares with revenues of $30.5 million and net income of $4.4 million, or $0.12 per fully diluted share for the same period last year.
  • For the fourth quarter of 2012, operating income was $4.3 million. This compares to operating income of $4.2 million for the same period a year ago.
  • For the year ended December 31, 2012, total revenues were $126.4 million, with net income of $16.2 million, or $0.44 per fully diluted share. This compares with revenues of $113.3 million and net income of $15.0 million, or $0.41 per fully diluted share, for the same period last year.
  • Operating income for the year ended December 31, 2012, was $16.4 million. This compares to operating income of $14.7 million for the same period a year ago.

Comments of Management

Guy Bernstein, Chief Executive Officer of Magic Software Enterprises, said, "2012 was an excellent year for Magic, with strong performance across our products and professional services in all regions.

"We are proud to be continuing to produce record-breaking financial results for our shareholders and that our strong cash position has enabled us to continue to make important growth investments in our product portfolio.

"We believe we are well-positioned to continue our growth track in 2013 with our powerful and versatile enterprise-grade application development and integration solutions that enable enterprise mobility, enhance productivity and increase profitability. We are further enhancing our offerings by strengthening our relationships with partners and vendors in the enterprise mobility and enterprise software ecosystems, like Samsung, SAP, Salesforce.com, Oracle JDE, IBM and Microsoft SharePoint," added Bernstein.

Non-GAAP Financial Measures

This release includes non-GAAP operating income, net income, basic and diluted earnings per share and other non-GAAP financial measures. These non-GAAP measures exclude the following items:

  • Amortization of purchased intangible assets
  • In-process research and development capitalization and amortization
  • Equity-based compensation expense
  • And the related tax effects of the above items

Magic Software's management believes that the presentation of non-GAAP measures provides useful information to investors and management regarding financial and business trends relating to the Company's financial condition and results of operations as well as the net amount of cash generated by its business operations after taking into account capital spending required to maintain or expand the business.

These non-GAAP financial measures are not in accordance with, or an alternative for, generally accepted accounting principles and may be different from non-GAAP financial measures used by other companies. In addition, these non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles. Magic Software believes that non-GAAP financial measures have limitations in that they do not reflect all of the amounts associated with Magic Software's results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate Magic Software's results of operations in conjunction with the corresponding GAAP measures.

Refer to the Reconciliation of Selected Financial Metrics from GAAP to Non-GAAP tables below.

About Magic Software Enterprises

Magic Software Enterprises Ltd. (NASDAQ and TASE: MGIC) is a global provider of mobile and cloud-enabled application and business integration platforms.

For more information, visit http://www.magicsoftware.com/en/company/?catID=6.


   
Press Contact:
Tania Amar, VP Global Marketing
Magic Software Enterprises
Tel: +972(0)3-538-9300
tania@magicsoftware.com

Except for the historical information contained herein, the matters discussed in this news release include forward-looking statements that may involve a number of risks and uncertainties. Actual results may vary significantly based upon a number of factors including, but not limited to, risks in product and technology development, market acceptance of new products and continuing product conditions, both here and abroad, release and sales of new products by strategic resellers and customers, and other risk factors detailed in the Company's most recent annual report and other filings with the Securities and Exchange Commission. These forward-looking statements are made only as of the date hereof, and the Company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.

Magic is a registered trademark of Magic Software Enterprises Ltd. All other product and company names mentioned herein are for identification purposes only and are the property of, and might be trademarks of, their respective owners.

    MAGIC SOFTWARE ENTERPRISES LTD.
    CONSOLIDATED STATEMENTS OF INCOME
    U.S. dollars in thousands (except per share data)

                                           Three months ended        Year ended
                                              December 31,          December 31,
                                       -----------------------   --------------------
                                            2012          2011      2012         2011
                                       ---------   -----------   -------   ----------
                                                Unaudited      Unaudited
                                       -----------------------   -------
    Revenues                              35,730        30,483   126,380      113,328
    Cost of Revenues                      20,792        17,968    73,393       67,258
                                       ---------   -----------   -------   ----------
    Gross profit                          14,938        12,515    52,987       46,070
                                       ---------   -----------   -------   ----------
    Research and development, net            813           469     2,947        2,047
    Selling, marketing and general and
    administrative expenses                9,867         7,870    33,632       29,306
    Total operating costs and expenses    10,680         8,339    36,579       31,353
                                       ---------   -----------   -------   ----------
    Operating income                       4,258         4,176    16,408       14,717
                                       ---------   -----------   -------   ----------
    Financial income (expenses), net         193           (90)       10          221
    Other income, net                          -            33       136          125
                                       ---------   -----------   -------   ----------
    Income before taxes on income          4,451         4,119    16,554       15,063
    Taxes on income                           52          (270)       94         (203)
    Minority interest                       (146)          (24)     (277)        (222)
                                       ---------   -----------   -------   ----------
    Net income                             4,253         4,365    16,183       15,044

    Net earnings per share
    Basic                                   0.12          0.12      0.44         0.41
    Diluted                                 0.12          0.12      0.44         0.41

    Weighted average number of shares used in
    computing net earnings per share

    Basic                                 36,553        36,348    36,502       36,268
                                       =========   ===========   =======   ==========

    Diluted                               37,042        37,010    37,108       37,046
                                       =========   ===========   =======   ==========


    MAGIC SOFTWARE ENTERPRISES LTD.
    RECONCILIATION BETWEEN GAAP AND NON-GAAP
    STATEMENTS OF INCOME FOR COMPARATIVE PURPOSES
    U.S. dollars in thousands (except per share data)

                                                 Three months ended          Year ended
                                                    December 31,            December 31,
                                             ----------------------  --------------------
                                                2012           2011     2012         2011
                                             -------       --------  -------     --------
                                                     Unaudited              Unaudited
                                             ----------------------  --------------------

    GAAP operating income                      4,258          4,176   16,408       14,717
    Amortization of capitalized software
    and other intangible assets                2,376          1,506    6,687        4,335
    Capitalization of software development    (1,625)        (1,376)  (4,969)      (5,222)
    Stock-based compensation                      75            186      515          633
                                             -------       --------  -------     --------
    Total adjustments to GAAP                    826            316    2,233         (254)
                                             -------       --------  -------     --------
    Non-GAAP operating income                  5,084          4,492   18,641       14,463
                                             -------       --------  -------     --------

    GAAP net income                            4,253          4,365   16,183       15,044
    Amortization of capitalized software
    and other intangible assets                2,376          1,506    6,687        4,335
    Capitalization of software development    (1,625)        (1,376)  (4,969)      (5,222)
    Stock-based compensation                      75            186      515          633
    Taxes on the above items                      17              -      (98)           -
    Total adjustments to GAAP                    843            316    2,135         (254)
                                             -------       --------  -------     --------
    Non-GAAP net income                        5,096          4,681   18,318       14,790
                                             =======       ========  =======     ========

    Non-GAAP basic net earnings per share       0.14           0.13     0.50         0.41
                                             =======       ========  =======     ========
    Weighted average number of shares used in
    computing basic net earnings per share    36,553         36,348   36,502       36,268
                                             -------       --------  -------     --------

    Non-GAAP diluted net earnings per share     0.14           0.13     0.49         0.40
                                             =======       ========  =======     ========
    Weighted average number of shares used in
    computing diluted net earnings per share  37,091         37,084   37,198       37,137
                                             -------       --------  -------     --------


    MAGIC SOFTWARE ENTERPRISES LTD.
    CONSOLIDATED BALANCE SHEETS
    U.S. dollars in thousands


                                                    December 31,  December 31,
                                                   -------------  ------------
                                                        2012          2011
                                                   -------------  ------------
                                                      Unaudited
                                                   -------------

    ASSETS
    CURRENT ASSETS:
    Cash and cash equivalents                             37,582        28,711
    Short-term bank deposits                                 325         2,170
    Available-for-sale marketable securities                 890         1,241
    Trade receivables, net                                28,367        24,946
    Other accounts receivable and prepaid expenses         6,533         6,401
                                                   -------------  ------------
    Total current assets                                  73,697        63,469
                                                   -------------  ------------

    LONG-TERM RECEIVABLES:
    Severance pay fund                                       351           351
    Other long-term receivables                            2,287         3,824
                                                   -------------  ------------
    Total other long-term receivables                      2,638         4,175

    PROPERTY AND EQUIPMENT, NET                            1,898         2,029
    IDENTIFIABLE INTANGIBLE ASSETS AND
    GOODWILL, NET                                         74,005        66,298
                                                   -------------  ------------

    TOTAL ASSETS                                         152,238       135,971
                                                   =============  ============

    LIABILITIES AND EQUITY

    CURRENT LIABILITIES:
    Short-term credit and current maturities
    of long term loans                                        12             4
    Trade payables                                         4,722         3,545
    Accrued expenses and other accounts payable           18,717        15,748
    Deferred tax liabilities                               2,355         2,509
    Deferred revenues                                      4,160         5,359
                                                   -------------  ------------
    Total current liabilities                             29,966        27,165
                                                   -------------  ------------

    NON CURRENT LIABILITIES:
    Long-term loans                                           12             9
    Deferred tax liabilities                                 738           735
    Liability due to acquisition activities                    -         1,350
    Accrued severance pay                                  1,245         1,087
                                                   -------------  ------------
    Total non-current liabilities                          1,995         3,181
                                                   -------------  ------------

    EQUITY:
    Magic Shareholders' equity                           117,786       105,156
    Non-controlling interests                              2,491           469
                                                   -------------  ------------
    Total equity                                         120,277       105,625

    TOTAL LIABILITIES AND EQUITY                         152,238       135,971
                                                   =============  ============


SOURCE Magic Software Enterprises Ltd

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

IoT & Smart Cities Stories
Discussions of cloud computing have evolved in recent years from a focus on specific types of cloud, to a world of hybrid cloud, and to a world dominated by the APIs that make today's multi-cloud environments and hybrid clouds possible. In this Power Panel at 17th Cloud Expo, moderated by Conference Chair Roger Strukhoff, panelists addressed the importance of customers being able to use the specific technologies they need, through environments and ecosystems that expose their APIs to make true ...
In an era of historic innovation fueled by unprecedented access to data and technology, the low cost and risk of entering new markets has leveled the playing field for business. Today, any ambitious innovator can easily introduce a new application or product that can reinvent business models and transform the client experience. In their Day 2 Keynote at 19th Cloud Expo, Mercer Rowe, IBM Vice President of Strategic Alliances, and Raejeanne Skillern, Intel Vice President of Data Center Group and G...
The current age of digital transformation means that IT organizations must adapt their toolset to cover all digital experiences, beyond just the end users’. Today’s businesses can no longer focus solely on the digital interactions they manage with employees or customers; they must now contend with non-traditional factors. Whether it's the power of brand to make or break a company, the need to monitor across all locations 24/7, or the ability to proactively resolve issues, companies must adapt to...
We are seeing a major migration of enterprises applications to the cloud. As cloud and business use of real time applications accelerate, legacy networks are no longer able to architecturally support cloud adoption and deliver the performance and security required by highly distributed enterprises. These outdated solutions have become more costly and complicated to implement, install, manage, and maintain.SD-WAN offers unlimited capabilities for accessing the benefits of the cloud and Internet. ...
Business professionals no longer wonder if they'll migrate to the cloud; it's now a matter of when. The cloud environment has proved to be a major force in transitioning to an agile business model that enables quick decisions and fast implementation that solidify customer relationships. And when the cloud is combined with the power of cognitive computing, it drives innovation and transformation that achieves astounding competitive advantage.
DXWorldEXPO LLC announced today that "IoT Now" was named media sponsor of CloudEXPO | DXWorldEXPO 2018 New York, which will take place on November 11-13, 2018 in New York City, NY. IoT Now explores the evolving opportunities and challenges facing CSPs, and it passes on some lessons learned from those who have taken the first steps in next-gen IoT services.
Founded in 2000, Chetu Inc. is a global provider of customized software development solutions and IT staff augmentation services for software technology providers. By providing clients with unparalleled niche technology expertise and industry experience, Chetu has become the premiere long-term, back-end software development partner for start-ups, SMBs, and Fortune 500 companies. Chetu is headquartered in Plantation, Florida, with thirteen offices throughout the U.S. and abroad.
DXWorldEXPO LLC announced today that ICC-USA, a computer systems integrator and server manufacturing company focused on developing products and product appliances, will exhibit at the 22nd International CloudEXPO | DXWorldEXPO. DXWordEXPO New York 2018, colocated with CloudEXPO New York 2018 will be held November 11-13, 2018, in New York City. ICC is a computer systems integrator and server manufacturing company focused on developing products and product appliances to meet a wide range of ...
SYS-CON Events announced today that DatacenterDynamics has been named “Media Sponsor” of SYS-CON's 18th International Cloud Expo, which will take place on June 7–9, 2016, at the Javits Center in New York City, NY. DatacenterDynamics is a brand of DCD Group, a global B2B media and publishing company that develops products to help senior professionals in the world's most ICT dependent organizations make risk-based infrastructure and capacity decisions.
René Bostic is the Technical VP of the IBM Cloud Unit in North America. Enjoying her career with IBM during the modern millennial technological era, she is an expert in cloud computing, DevOps and emerging cloud technologies such as Blockchain. Her strengths and core competencies include a proven record of accomplishments in consensus building at all levels to assess, plan, and implement enterprise and cloud computing solutions. René is a member of the Society of Women Engineers (SWE) and a m...