Welcome!

Recurring Revenue Authors: Elizabeth White, Liz McMillan, Jnan Dash, Sujoy Sen, JP Morgenthal

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
[email protected]

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.

@ThingsExpo Stories
Technology vendors and analysts are eager to paint a rosy picture of how wonderful IoT is and why your deployment will be great with the use of their products and services. While it is easy to showcase successful IoT solutions, identifying IoT systems that missed the mark or failed can often provide more in the way of key lessons learned. In his session at @ThingsExpo, Peter Vanderminden, Principal Industry Analyst for IoT & Digital Supply Chain to Flatiron Strategies, will focus on how IoT de...
Fact is, enterprises have significant legacy voice infrastructure that’s costly to replace with pure IP solutions. How can we bring this analog infrastructure into our shiny new cloud applications? There are proven methods to bind both legacy voice applications and traditional PSTN audio into cloud-based applications and services at a carrier scale. Some of the most successful implementations leverage WebRTC, WebSockets, SIP and other open source technologies. In his session at @ThingsExpo, Da...
SYS-CON Events announced today that China Unicom will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. China United Network Communications Group Co. Ltd ("China Unicom") was officially established in 2009 on the basis of the merger of former China Netcom and former China Unicom. China Unicom mainly operates a full range of telecommunications services including mobile broadband (GSM, WCDMA, LTE F...
SYS-CON Events announced today that Roundee / LinearHub will exhibit at the WebRTC Summit at @ThingsExpo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. LinearHub provides Roundee Service, a smart platform for enterprise video conferencing with enhanced features such as automatic recording and transcription service. Slack users can integrate Roundee to their team via Slack’s App Directory, and '/roundee' command lets your video conference ...
DevOps at Cloud Expo, taking place Nov 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 19th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long dev...
Almost two-thirds of companies either have or soon will have IoT as the backbone of their business in 2016. However, IoT is far more complex than most firms expected. How can you not get trapped in the pitfalls? In his session at @ThingsExpo, Tony Shan, a renowned visionary and thought leader, will introduce a holistic method of IoTification, which is the process of IoTifying the existing technology and business models to adopt and leverage IoT. He will drill down to the components in this fra...
There is growing need for data-driven applications and the need for digital platforms to build these apps. In his session at 19th Cloud Expo, Muddu Sudhakar, VP and GM of Security & IoT at Splunk, will cover different PaaS solutions and Big Data platforms that are available to build applications. In addition, AI and machine learning are creating new requirements that developers need in the building of next-gen apps. The next-generation digital platforms have some of the past platform needs a...
I'm a lonely sensor. I spend all day telling the world how I'm feeling, but none of the other sensors seem to care. I want to be connected. I want to build relationships with other sensors to be more useful for my human. I want my human to understand that when my friends next door are too hot for a while, I'll soon be flaming. And when all my friends go outside without me, I may be left behind. Don't just log my data; use the relationship graph. In his session at @ThingsExpo, Ryan Boyd, Engi...
SYS-CON Events announced today that Numerex Corp, a leading provider of managed enterprise solutions enabling the Internet of Things (IoT), will exhibit at the 19th International Cloud Expo | @ThingsExpo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Numerex Corp. (NASDAQ:NMRX) is a leading provider of managed enterprise solutions enabling the Internet of Things (IoT). The Company's solutions produce new revenue streams or create operating...
Information technology is an industry that has always experienced change, and the dramatic change sweeping across the industry today could not be truthfully described as the first time we've seen such widespread change impacting customer investments. However, the rate of the change, and the potential outcomes from today's digital transformation has the distinct potential to separate the industry into two camps: Organizations that see the change coming, embrace it, and successful leverage it; and...
Data is an unusual currency; it is not restricted by the same transactional limitations as money or people. In fact, the more that you leverage your data across multiple business use cases, the more valuable it becomes to the organization. And the same can be said about the organization’s analytics. In his session at 19th Cloud Expo, Bill Schmarzo, CTO for the Big Data Practice at EMC, will introduce a methodology for capturing, enriching and sharing data (and analytics) across the organizati...
The vision of a connected smart home is becoming reality with the application of integrated wireless technologies in devices and appliances. The use of standardized and TCP/IP networked wireless technologies in line-powered and battery operated sensors and controls has led to the adoption of radios in the 2.4GHz band, including Wi-Fi, BT/BLE and 802.15.4 applied ZigBee and Thread. This is driving the need for robust wireless coexistence for multiple radios to ensure throughput performance and th...
The Internet of Things can drive efficiency for airlines and airports. In their session at @ThingsExpo, Shyam Varan Nath, Principal Architect with GE, and Sudip Majumder, senior director of development at Oracle, will discuss the technical details of the connected airline baggage and related social media solutions. These IoT applications will enhance travelers' journey experience and drive efficiency for the airlines and the airports. The session will include a working demo and a technical d...
SYS-CON Events announced today the Enterprise IoT Bootcamp, being held November 1-2, 2016, in conjunction with 19th Cloud Expo | @ThingsExpo at the Santa Clara Convention Center in Santa Clara, CA. Combined with real-world scenarios and use cases, the Enterprise IoT Bootcamp is not just based on presentations but with hands-on demos and detailed walkthroughs. We will introduce you to a variety of real world use cases prototyped using Arduino, Raspberry Pi, BeagleBone, Spark, and Intel Edison. Y...
If you’re responsible for an application that depends on the data or functionality of various IoT endpoints – either sensors or devices – your brand reputation depends on the security, reliability, and compliance of its many integrated parts. If your application fails to deliver the expected business results, your customers and partners won't care if that failure stems from the code you developed or from a component that you integrated. What can you do to ensure that the endpoints work as expect...
Enterprise IT has been in the era of Hybrid Cloud for some time now. But it seems most conversations about Hybrid are focused on integrating AWS, Microsoft Azure, or Google ECM into existing on-premises systems. Where is all the Private Cloud? What do technology providers need to do to make their offerings more compelling? How should enterprise IT executives and buyers define their focus, needs, and roadmap, and communicate that clearly to the providers?
SYS-CON Events announced today that SoftLayer, an IBM Company, has been named “Gold Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York, New York. SoftLayer, an IBM Company, provides cloud infrastructure as a service from a growing number of data centers and network points of presence around the world. SoftLayer’s customers range from Web startups to global enterprises.
The Transparent Cloud-computing Consortium (abbreviation: T-Cloud Consortium) will conduct research activities into changes in the computing model as a result of collaboration between "device" and "cloud" and the creation of new value and markets through organic data processing High speed and high quality networks, and dramatic improvements in computer processing capabilities, have greatly changed the nature of applications and made the storing and processing of data on the network commonplace.
Digital innovation is the next big wave of business transformation based on digital technologies of which IoT and Big Data are key components, For example: Business boundary innovation is a challenge to excavate third-party business value using IoT and BigData, like Nest Business structure innovation may propose re-building business structure from scratch, as Uber does in the taxicab industry The social model innovation is also a big challenge to the new social architecture with the design fr...
SYS-CON Events announced today that Pulzze Systems will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Pulzze Systems, Inc. provides infrastructure products for the Internet of Things to enable any connected device and system to carry out matched operations without programming. For more information, visit http://www.pulzzesystems.com.