CARY, North Carolina, March 13 /PRNewswire-FirstCall/ -- Sapiens International Corporation N.V. (NASDAQ and TASE: SPNS), a member of the Emblaze/Formula Group , announces today its results of operations for the year ended December 31, 2007 and for the fourth quarter of 2007.
Highlights for 2007
- $797,000 Operating Profit on an Annual Basis, first annual Operating Profit since 1999
- $4 million Cash Flow from Operations
- Five consecutive quarters of Operating Profit with $301,000 for the fourth quarter 2007
- Continued success of the Company's turnaround plan and its preparations for 2008
- Completion of $20 Million Private Placement
- Repurchase of Debentures and Payment of Second Installment of Principal of $8.0 million in 2007, and Repurchase of Debentures in 2008 of $2.1 million
U.S. GAAP
- Operating Profit for the year of $797,000, a significant improvement from the Operating Loss of $1,257,000 in 2006
- Significant reduction in annual Net Loss by 34.2% to $2.5 million, down from $3.8 million in 2006
- Operating Profit of $301,000 in the Fourth Quarter of 2007, a significant increase of 276% from $80,000 in the Fourth Quarter of 2006, and an improvement of 62.7% from $185,000 in the Third Quarter of 2007
Non-GAAP
- Operating Profit for the year of $809,000, a turn around from the Operating Loss of $1,197,000 in 2006
- Significant increase in Fourth Quarter Operating Profit of 190% to $386,000 up from $133,000 in the Fourth Quarter of 2006
U.S. GAAP results include amortization of capitalized software developments, capitalization of software development costs, and stock-based compensation expenses.
Reconciliation between U.S. GAAP and Non-GAAP results is summarized in the following table. For a complete reconciliation, please refer to the tables at the end of this release.
U.S. Dollars in thousands, except per share amounts
(Unaudited)
For the three months ended For the year ended
U.S. GAAP 12/31/2007 12/31/2006 12/31/2007 12/31/2006
Revenues 10,176 11,213 42,395 44,311
Operating profit
(loss) 301 80 797 (1,257)
Net loss (1,136) (767) (2,544) (3,825)
Basic and diluted loss
per share (0.05) (0.05) (0.14) (0.29)
Non-GAAP
Revenues 10,176 11,213 42,395 44,311
Operating profit (loss) 386 133 809 (1,197)
Net loss (1,051) (714) (2,532) (3,765)
Basic and diluted loss
per share (0.05) (0.05) (0.14) (0.28)
Roni Al-Dor, President and CEO, commented "Among our many positive achievements in 2007, I am particularly proud to announce that Sapiens reports an Operating Profit, on an annual basis, for the first time since 1999. In addition, our hard work has paid off as we also report a $4 million positive cash flow from operations for 2007. We also report our fifth consecutive quarter of operating profit. In 2007, we completed the $20 million private placement and appointed new senior management (COO, CFO and VP R&D). We thank our customers, our investors and our employees for the good news we report today."
Mr. Al-Dor added, "We are not resting for a moment. We will leverage upon the financial successes of 2007 to grow with our existing customers and to capture new customers in the multi-billion dollar insurance markets."
Comment Regarding Non-GAAP
Sapiens' management believes that the presentation of Non-GAAP measures can enhance the understanding of the company's ongoing economic performance, and provides useful information to investors regarding financial and business trends relating to the company's financial condition and results of operations. Sapiens therefore uses internally the Non-GAAP information to evaluate and manage the Company's operations.
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. Sapiens believes that non-GAAP financial measures have limitations in that they do not reflect all of the amounts associated with Sapiens' results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate Sapiens' results of operations in conjunction with the corresponding GAAP measures.
Please refer to the Reconciliation of GAAP to Non-GAAP Results at the end of this release.
About Sapiens International
Sapiens International Corporation N.V. (Nasdaq and TASE: SPNS), a member of Formula Group , which is a member of the Emblaze Group is a leading global provider of proven IT solutions that modernize business processes and enable insurance organizations to adapt quickly to change. Sapiens' innovative solutions are widely recognized for their ability to cost-effectively align IT with the business demands for speed, flexibility and efficiency. Sapiens operates through its subsidiaries in North America, the United Kingdom, EMEA and Asia Pacific, and has partnerships with market leaders such as IBM and EDS. Sapiens' clients include AXA, ING, Liverpool Victoria, Menora Mivtachim, Norwich Union, Occidental Fire & Casualty, OneBeacon, Principal Financial Group, Santam and Texas Farm Bureau among others. For more information, please visit http://www.sapiens.com/.
Except for historical information contained herein, the matters set forth in this release are forward-looking statements that are dependent on certain risks and uncertainties, including such factors, among others, as market acceptance, market demand, pricing, changing regulatory environment, changing economic conditions, risks in new product and service development, the effect of the Company's accounting policies, specific system configurations and software needs of individual customers and other risk factors detailed in the Company's SEC filings.
SAPIENS INTERNATIONAL CORPORATION N.V.
Condensed Consolidated Balance Sheets
(U.S. Dollars in thousands)
12/31/2007 12/31/2006
(Unaudited) (Audited)
Assets
Cash and cash equivalents $ 13,125 $ 3,108
Short-term investments - 32
Trade receivables, net 7,549 11,010
Other current assets 1,835 1,689
Total current assets 22,509 15,839
Property and equipment, net 1,219 1,495
Other assets, net 28,804 28,285
Total Assets $ 52,532 $ 45,619
Liabilities and shareholders' equity
Short-term bank credit and current
maturities of long-term debt and
convertible debentures $ 9,456 $ 15,603
Trade payables 1,088 2,019
Other liabilities and accrued expenses 8,375 7,370
Deferred revenue 4,203 3,463
Total current liabilities 23,122 28,455
Long-term debt and other
long-term liabilities 1,132 1,439
Convertible debentures and warrants 6,428 11,796
Shareholders' equity 21,850 3,929
Total liabilities and shareholders' equity $ 52,532 $ 45,619
SAPIENS INTERNATIONAL CORPORATION N.V.
Condensed Consolidated Statements of Operations
(U.S. Dollars in thousands, except per share amounts)
For the three months ended For the year ended
12/31/2007 12/31/2006 12/31/2007 12/31/2006
(Unaudited) (Unaudited) (Unaudited) (Audited)
Revenues $ 10,176 $ 11,213 $ 42,395 $ 44,311
Cost of revenues $ 5,085 $ 7,319 $ 25,583 $ 28,801
Gross Profit 5,091 3,894 16,812 15,510
Operating expenses
Research and
development, net $ 1,823 $ 483 $ 3,502 $ 2,451
Selling, marketing,
general and
administrative $ 2,967 $ 3,254 $ 12,303 $ 13,558
Restructuring expenses - $ 77 $ 210 $ 758
Operating Profit (Loss) 301 80 797 (1,257)
Financial expenses,
net$ 1,058 $ 644 $ 2,689 $ 2,230
Other expenses, net (a) $ 379 $ 203 $ 652 $ 338
Net Loss $ 1,136 $ 767 $ 2,544 $ 3,825
Basic and diluted
net loss per share (b) $ 0.05 $ 0.05 $ 0.14 $ 0.29
Weighted average
shares used to
compute basic and
diluted net
loss per share (b) 21,550 14,854 18,218 13,395
Note
a: Includes taxes, equity losses, minority interest and capital losses
due to repurchase of debentures.
b: Due to the net loss in 2006 and 2007 the inclusion of dilutive
securities would be antidilutive.
SAPIENS INTERNATIONAL CORPORATION N.V.
Reconciliation of GAAP to Non-GAAP Results
(U.S. Dollars in thousands, except per share amounts)
For the three months ended For the year ended
12/31/2007 12/31/2006 12/31/2007 12/31/2006
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
GAAP operating
profit (loss) 301 80 797 (1,257)
Amortization of
intangibles and
capitalization of software
development 62 53 (98) 60
Stock-based compensation 23 - 110 -
Total adjustments to GAAP 85 53 12 60
Non-GAAP operating profit
(loss) 386 133 809 (1,197)
GAAP net loss (1,136) (767) (2,544) (3,825)
Total adjustments to
GAAP as above 85 53 12 60
Non-GAAP net loss (1,051) (714) (2,532) (3,765)
Non-GAAP basic and
diluted net loss per
share (0.05) (0.05) (0.14) (0.28)
Weighted average number
of shares used in
computing basic and
diluted net loss
per share 21,550 14,854 18,218 13,395
For Additional Information:
Roni Giladi Roni Al-Dor
Chief Financial Officer Chief Executive Officer
Sapiens International Sapiens International
Tel: +972-8-938-2721 Tel: +972-8-938-2721
E-mail: IR.Sapiens@sapiens.com E-mail: IR.Sapiens@sapiens.com
Sapiens International Corporation N.V.
