Given Imaging Reports Fourth Quarter and Fiscal Year 2012 Financial Results

Given Imaging Reports Fourth Quarter and Fiscal Year 2012 Financial Results 
Fourth Quarter and Fiscal Year 2012 Revenues $48.7 Million and $180.5
Million, Respectively; Americas Region PillCam SB Capsule Sales
Increase 7% in Fourth Quarter 2012; Fiscal Year 2012 GAAP and
Non-GAAP EPS Increase 15% and 11% to $0.45 and $0.72, Respectively;
Fourth Quarter and Fiscal Year EPS Affected by Acquisition and
Business Development Expenses 
YOQNEAM, ISRAEL -- (Marketwire) -- 02/12/13 --  Given Imaging Ltd.
(NASDAQ: GIVN) today announced financial results for the fourth
quarter and fiscal year ended December 31, 2012.  
Revenues were $48.7 million in the fourth quarter of 2012, compared
to $48.5 million in the fourth quarter of 2011.  
Gross margin on a GAAP-basis in the fourth quarter of 2012 was 74.6
percent, compared to 77.4 percent in the fourth quarter of 2011.
Gross margin on a non-GAAP-basis in the fourth quarter of 2012 was
76.1 percent, compared to 77.9 percent in the fourth quarter of 2011. 
On a GAAP-basis, operating profit was $3.6 million in the fourth
quarter of 2012, compared to $4.9 million in the fourth quarter of
2011. Non-GAAP operating profit was $7.0 million in the fourth
quarter of 2012, compared to $7.1 million in the same period in 2011.
The acquisition of SmartPill assets negatively impacted gross and
operating profit. The effect on GAAP and non-GAAP operating profit
was approximately $1.3 million and $0.3 million, respectively in the
fourth quarter and full year 2012. The Company recorded SmartPill
revenue of $0.6 million in the fourth quarter of 2012. 
On a GAAP-basis, net income for the fourth quarter of 2012 was $5.1
million, or $0.16 per share, compared to $5.6 million, or $0.18 per
share, in the same period in 2011. On a non-GAAP-basis, net income
for the fourth quarter of 2012 increased three percent to $7.9
million, or $0.25 per share on a fully diluted basis, compared to
$7.7 million, or $0.25 per share on a fully diluted basis, in the
fourth quarter of 2011. 
A reconciliation of GAAP results to non-GAAP results is attached.  
Cash provided by operating activities in the fourth quarter and in
fiscal year 2012 was $11.0 million and $27.8 million, respectively.
Cash and cash equivalents, short-term investments and marketable
securities 
on December 31, 2012 totaled $124.1 million. 
"We are pleased to have delivered record net income, both on a GAAP
and non-GAAP-basis in 2012. We achieved a solid six percent increase
in revenues in the Americas region. Revenues in the rest of the world
were impacted by the continuing economic weakness in Europe, delays
caused by a change in our Japanese commercial strategy and a
shortfall in revenues in China. We expect 2013 to be a pivotal year
for Given Imaging and our goal is to return to double-digit revenue
growth as we expand the market for our comprehensive line of devices
to visualize, detect, and monitor disorders in the digestive tract
and introduce new, innovative products, including our next-generation
capsule endoscope for the small bowel, PillCam SB3. We plan to launch
PillCam SB3 in Europe this quarter and in the U.S. later this year,"
said Homi Shamir, president and CEO, Given Imaging. 
Fourth Quarter 2012 Revenue Analysis 
Revenues in the Americas region in the fourth quarter of 2012
increased by one percent to $31.3 million from $30.9 million in the
same period in 2011. The increase is attributable to a seven percent
increase in sales of PillCam SB, which was partially offset by lower
functional GI diagnostics product sales. Revenues in the EMEA region
were $11.3 million compared to $11.4 million in the same period in
2011. APAC revenues were $6.1 million, compared to $6.3 million in
the same period in 2011. 
Worldwide PillCam SB sales increased two percent to 61,800 capsules
in the fourth quarter of 2012, compared to 60,300 capsules in the
same period in 2011. PillCam SB sales in the Americas region
increased by seven percent to 40,300 capsules in the fourth quarter
of 2012, compared to 37,800 capsules in the fourth quarter of 2011.
PillCam SB sales in the EMEA region decreased by eight percent to
14,200 capsules, compared to 15,400 capsules in the fourth quarter of
2011, while PillCam SB sales in the APAC region increased by two
percent to 7,300 capsules, compared to 7,200 capsules in the same
period in 2011. 
Worldwide sales of functional GI diagnostics products including the
Bravo pH Monitoring System, Digitrapper pH-Z, ManoScan and SmartPill
products increased by two percent to $14.6 million in the fourth
quarter of 2012 compared to $14.3 million in the same period in 2011.
In the Americas region, functional GI diagnostics product revenue
decreased by eight percent in the fourth quarter of 2012 to $11.0
million compared to $12.0 million in the same period in 2011.
Functional GI diagnostics revenue in the EMEA region increased by 63
percent to $2.9 million, while revenue in the APAC region was $0.7
million, $0.1 million over the same quarter last year.  
Supplemental fourth quarter data can be found at www.givenimaging.com
in the Investor Relations section. 
Fiscal Year 2012 Financial Results 
For the full year ended December 31, 2012, revenues increased by one
percent to $180.5 million compared to $178.0 million in the same
period in 2011. Revenues in the Americas region in 2012 increased by
six percent to $115.1 million from $108.8 million in the same period
in 2011. Revenues in the EMEA region decreased by five percent to
$42.9 million compared to $45.1 million in 2011. APAC revenues
decreased by six percent to $22.5 million, compared to $24.0 million
in the same period in 2011. The decrease was attributable to weakness
in sale of functional GI diagnostics products in the Far East and to
lower capsule sales in the first half of 2012 in Australia and Japan. 
Worldwide PillCam SB sales increased by 2 percent to 235,700 capsules
in 2012, compared to 232,200 capsules in the same period in 2011.
PillCam SB sales in the Americas region increased two percent to
approximately 145,500 capsules, compared to the 142,200 capsules that
were sold in 2011. PillCam SB sales in the EMEA region decreased by
one percent to 58,900 capsules, compared to 59,400 capsules in 2011,
while PillCam SB sales in the APAC region increased by two percent to
31,300 capsules, compared to 30,600 capsules in the same period in
2011.  
Worldwide sales of Given Imaging's functional GI diagnostics products
increased by eight percent to $53 million in 2012 compared to $48.2
million in the same period in 2011. In the Americas region,
functional GI diagnostics product revenue increased by 11 percent in
2012 to $41.7 million compared to $37.5 million in the same period in
2011. Functional GI diagnostics revenue in the EMEA region were $8.1
million, 13 percent higher than 2011, while revenue in the APAC
region was $2.9 million compared to $3.5 million in the same period
in 2011.  
Gross margin on a GAAP-basis in 2012 was 76.2 percent, compared to
76.7 percent in 2011. Gross margin on a non-GAAP-basis in 2012 was
77.2 percent, similar to 2011.  
On a GAAP-basis, operating profit was $13.9 million in 2012, compared
to $13.0 million in the same period in 2011. Non-GAAP operating
profit was $23.1 million, compared to $21.6 million in the same
period in 2011. On a GAAP-basis, net income for 2012 was $14.4
million, or $0.45 per share, compared to $12.0 million, or $0.39 per
share, in 2011. GAAP net income and EPS in 2012 increased 20 percent
and 15 percent over 2011, respectively. On a non-GAAP-ba
sis, net
income for 2012 increased 12 percent to $22.6 million, or $0.72 per
share on a fully diluted basis, compared to $20.1 million, or $0.65
per share on a fully diluted basis, in the same period in 2011. 
2013 Guidance 
The Company expects that 2013 revenues will be between $195 million
and $205 million.  
The Company expects that earnings per share will be between $0.55 -
$0.63 on a GAAP-basis and between $0.80 - $0.88 on a non-GAAP-basis.
EPS expectations have been reduced by approximately 8 cents per share
related to the effect of the newly imposed Medical Device Tax in the
U.S.  
Conference Call / Webcast Information 
Given Imaging will host a conference call on Wednesday, February 13,
2013 at 9:00am ET, 4:00pm Israel time to discuss fourth quarter and
fiscal year 2012 financial results. To participate in the
teleconference, please dial the following numbers fifteen minutes
before the call is scheduled to begin: U.S. and Canada,
1-888-438-5448; Israel, 1-80-924-5906. Callers in other countries
should dial 719-457-2645. The call will also be webcast live at
www.givenimaging.com.  
A replay of the call will be available for two weeks on the company's
website, or until February 27, 2013, by dialing 888-203-1112. Callers
in Israel should dial 1-80-924-6038. Callers outside of the U.S. and
Israel should dial 719-457-0820. The replay participant code is
9489476. 
Use of Non-GAAP Measures 
This press release provides financial measures for net income and
basic and diluted earnings per share that exclude certain items and
are therefore not calculated in accordance with generally accepted
accounting principles (GAAP). Management believes that these non-GAAP
financial measures provide meaningful supplemental information
regarding our performance that enhances management's and investors'
ability to evaluate the Company's net income and earnings per share
and to compare it with historical net income and earnings per share. 
The presentation of this non-GAAP financial information is not
intended to be considered in isolation or as a substitute for the
financial information prepared and presented in accordance with GAAP.
Management uses both GAAP and non-GAAP measures when evaluating the
business internally and therefore felt it is important to make these
non-GAAP adjustments available to investors.  
About Given Imaging Ltd. 
Since pioneering the field of capsule endoscopy in 2001, Given
Imaging has become a world leader in GI medical devices, offering
health care providers a range of innovative options for visualizing,
diagnosing and monitoring the digestive system. The company offers a
broad product portfolio including PillCam(R) capsule endoscope for
the small bowel, esophagus and colon. The company also offers
industry-leading GI functional diagnostic solutions including
ManoScan(TM) high-resolution manometry, Bravo(R) capsule-based pH
monitoring, Digitrapper(R) pH-Z impedance, and the SmartPill(R) GI
monitoring systems. Given Imaging is committed to delivering
breakthrough innovations to the GI community and supporting its
ongoing clinical needs. Given Imaging's headquarters are located in
Yoqneam, Israel, with operating subsidiaries in the United States,
Germany, France, Japan, Australia, Vietnam, Hong Kong and Brazil. For
more information, please visit www.givenimaging.com. 
Forward-Looking Statements 
This press release contains forward-looking statements within the
meaning of the "safe harbor" provisions of the U.S. Private
Securities Litigation Reform Act of 1995. These forward-looking
statements include, but are not limited to, projections about our
business and our future revenues, expenses and profitability.
Forward-looking statements may be, but are not necessarily,
identified by the use of forward-looking terminology such as "may,"
"anticipates," "estimates," "expects," "intends," "plans,"
"believes," and words and terms of similar substance. Forward-looking
statements involve known and unknown risks, uncertainties and other
factors which may cause the actual events, results, performance,
circumstances or achievements of the Company to be materially
different from any future events, results, performance, circumstances
or achievements expressed or implied by such forward-looking
statements. Such forward-looking statements include statements
relating to the Company exploring strategic alternatives and
considering possible strategic transactions involving the Company.
Factors that could cause actual events, results, performance,
circumstances or achievements to differ from such forward-looking
statements include, but are not limited to, the ability of the
Company to reach agreement on any strategic alternative and/or to
complete any such alternative, as well as the following: (1) our
ability to develop and bring to market new products, (2) our ability
to successfully complete any necessary or required clinical studies
with our products, (3) our ability to receive regulatory clearance or
approval to market our products or changes in regulatory environment,
(4) our success in implementing our sales, marketing and
manufacturing plans, (5) the level of adoption of our products by
medical practitioners, (6) the emergence of other products that may
make our products obsolete, (7) lack of an appropriate bowel
preparation materials to be used with our PillCam COLON capsule, (8)
protection and validity of patents and other intellectual property
rights, (9) the impact of currency exchange rates, (10) the effect of
competition by other companies, (11) the outcome of significant
litigation, (12) our ability to obtain reimbursement for our product
from government and commercial payors, (13) quarterly variations in
operating results, (14) the possibility of armed conflict or civil or
military unrest in Israel, (15) the impact of global economic
conditions, (16) our ability to successfully integrate acquired
businesses, (17) changes and reforms in applicable healthcare laws
and regulations, (18) quality issues and adverse events related to
our products, such as capsule retention, aspiration and failure to
attach or detach, bleeding or perforation that could require us to
recall products and impact our sales and net income, and (19) other
risks and factors disclosed in our filings with the U.S. Securities
and Exchange Commission, including, but not limited to, risks and
factors identified under such headings as "Risk Factors," "Cautionary
Language Regarding Forward-Looking Statements" and "Operating Results
and Financial Review and Prospects" in the Company's Annual Report on
Form 20-F for the year ended December 31, 2011. You are cautioned not
to place undue reliance on these forward-looking statements, which
speak only as of the date of this press release. Except to the extent
expressly required under applicable law, the Company undertakes no
obligation to release publicly any revisions to any forward-looking
statements, to report events or to report the occurrence of
unanticipated events. 
Financial Tables Follow 


 
                                                                            
            Given Imaging Ltd. and its Consolidated Subsidiaries            
                               Excluded Items                               
            For the Three Months Ended December 31, 2011 and 2012           
                      (Unaudi
ted, dollars in thousands)                     
                                                                            
                                                                            
                           Research   Selling   General     Tax             
                 Gross       And        And       And     Expense           
                 Profit  Development Marketing   Admin   (Benefit)    Total 
               --------- ----------- --------- --------- ---------  --------
                                                                            
Three month                                                                 
 period ended                                                               
 December 31,                                                               
 2012                                                                       
                                                                            
Compensation                                                                
 expenses      $       - $       180 $     551 $     810 $       -  $  1,541
One time                                                                    
 expenses                                                                   
 (SmartPill,                                                                
 Strategic                                                                  
 Alternatives)       250           -       677       325      (352) $    900
PPA (Sierra &                                                               
 SmartPill)          483           -        93         -      (173)      403
               --------- ----------- --------- --------- ---------  --------
Total          $     733 $       180 $   1,321 $   1,135 $    (525) $  2,844
               ========= =========== ========= ========= =========  ========
                                                                            
Three month                                                                 
 period ended                                                               
 December 31,                                                               
 2011                                                                       
                                                                            
Compensation                                                                
 expenses      $       - $       208 $     640 $   1,042 $       -  $  1,890
PPA (Sierra)         237           -        81         -      (128)      190
               --------- ----------- --------- --------- ---------  --------
Total          $     237 $       208 $     721 $   1,042 $    (128) $  2,080
               ========= =========== ========= ========= =========  ========
                                                                            
                                                                            
                                                                            
            Given Imaging Ltd. and its Consolidated Subsidiaries            
                               Excluded Items                               
           For the Twelve Months Ended December 31, 2011 and 2012           
                      (Unaudited, dollars in thousands)                     
                                                                            
                                                                            
                           Research   Selling   General     Tax             
                 Gross       And        And       And     Expense           
                 Profit  Development Marketing   Admin   (Benefit)    Total 
               --------- ----------- --------- --------- ---------  --------
                                                                            
Twelve month                                                                
 period ended                                                               
 December 31,                                                               
 2012                                                                       
                                                                            
Compensation                                                                
 expenses      $       - $       724 $   1,985 $   3,449 $       -  $  6,158
One time                                                                    
 expenses                                                                   
 (SmartPill,                                                                
 Strategic                                                                  
 Alternatives)       250           -       677       325      (352)      900
PPA (Sierra &                                                               
 SmartPill)         1527           -       336         -      (687)    1,176
               --------- ----------- --------- --------- ---------  --------
Total          $   1,777 $       724 $   2,998 $   3,774 $  (1,039) $  8,234
               ========= =========== ========= ========= =========  ========
                                                                            
Twelve month                                                                
 period ended                                                               
 December 31,                                                               
 2011                                                                       
                                                                            
Compensation                                                                
 expenses      $       - $       708 $   2,175 $   4,480 $       -  $  7,363
PPA (Sierra)         948           -       324         -      (509)      763
               --------- ----------- --------- --------- ---------  --------
Total          $     948 $       708 $   2,499 $   4,480 $    (509) $  8,126
               ========= =========== ========= ========= =========  ========
                                                                            
                                                                            
                                                                            
            Given Imaging Ltd. and its Consolidated Subsidiaries            
             Reconciliation of GAAP results to non-GAAP results             
            For the three months ended December 31, 2011 and 2012           
     Condensed, unaudited, in thousands except share and per share data     
                                                                            
                                                                            
                                Q4/12                       Q4/11           
                              Specified    Non            Specified    Non  
                       GAAP   Items (*)    GAAP     GAAP  Items (*)    GAAP 
                     
-------  ---------  -------  ------- ---------  -------
                                                                            
Gross profit         $36,347  $     733  $37,080  $37,533 $     237  $37,770
Research and                                                                
 development, net      5,658       (180)   5,478    7,089      (208)   6,881
Sales and marketing   20,841     (1,321)  19,520   19,890      (721)  19,169
General and                                                                 
 administrative        5,907     (1,135)   4,772    5,560    (1,042)   4,518
Income tax expense                                                          
 (Income)             (1,187)       525     (662)      70       128      198
Net income                                                                  
 attributable to                                                            
 shareholders        $ 5,100  $   2,844  $ 7,944  $ 5,622 $   2,080  $ 7,702
Diluted EPS                                                                 
 attributable to                                                            
 shareholders        $  0.16  $    0.09  $  0.25  $  0.18 $    0.07  $  0.25
                                                                            
(*)See specified items                                                      
                                                                            
                                                                            
                                                                            

 
            Given Imaging Ltd. and its Consolidated Subsidiaries            
             Reconciliation of GAAP results to non-GAAP results             
           For the Twelve months ended December 31, 2011 and 2012           
     Condensed, unaudited, in thousands except share and per share data     
                                                                            
                              YTD 12                       YTD 11           
                            Specified     Non            Specified     Non  
                     GAAP   Items (*)    GAAP     GAAP   Items (*)    GAAP  
                   -------- ---------  -------- -------- ---------  --------
                                                                            
Gross profit       $137,530 $   1,777  $139,307 $136,489 $     948  $137,437
Research and                                                                
 development, net    24,188      (724)   23,464   25,016      (708)   24,308
Sales and marketing  76,272    (2,998)   73,274   75,014    (2,499)   72,515
General and                                                                 
 administrative      22,746    (3,774)   18,972   23,078    (4,480)   18,598
Income tax expense      459     1,039     1,498    2,158       509     2,667
Net income                                                                  
 attributable to                                                            
 shareholders      $ 14,350 $   8,234  $ 22,584 $ 11,978 $   8,126  $ 20,104
Diluted EPS                                                                 
 attributable to                                                            
 shareholders      $   0.45 $    0.27  $   0.72 $   0.39 $    0.26  $   0.65
                                                                            
(*)See specified items                                                      
                                                                            
                                                                            
                                                                            
                                                                            
                  Given Imaging Ltd. and its Subsidiaries                   
                                                                            
                        Consolidated Balance Sheets                         
                      (In thousands except share data)                      
                                                                            
                                                                            
                                                         December 31,       
                                                   ------------------------ 
                                                       2012                 
                                                   (Unaudited)      2011    
                                                   -----------  ----------- 
                                                                            
Assets                                                                      
                                                                            
Current assets                                                              
Cash and cash equivalents                          $    35,442  $    24,285 
Short-term investments                                  58,446       64,762 
Accounts receivable:                                                        
  Trade                                                 31,279       32,406 
  Other                                                  4,654        5,259 
Inventories                                             22,591       22,921 
Advances to suppliers                                    1,349        1,207 
Deferred tax assets                                      3,526        1,538 
Prepaid expenses                                         1,809        1,373 
                                                   -----------  ----------- 
                                                                            
Total current assets                                   159,096      153,751 
                                                                            
Other long term assets                                     924        1,266 
                                                                            
Assets held for employees' severance payments            7,974        6,854 
                                                                            
Long-term investments                                   30,188       16,003 
                                                                            
Non-current inventory                                    6,150        4,926 
                                                                            
Fixed assets, less accumulated depreciation             12,335       12,301 
                                                                            
Intangible assets, less accumulated amortization        30,705       29,075 
                                                                            
Goodwill                                                26,942       24,089 
                                                   -----------  ----------- 
                                                                            
                                                                            
Total Assets                                       $   274,314  $   248,265 
                                                   ===========  =========== 
                                                                            
                                                                            
                                                                            
                  Given Imaging Ltd. and its Subsidiaries                   
                                                                            
                        Consolidated Balance Sheets                         
                      (In thousands except share data)                      
                                                                            
                                                                            
                                                         December 31,       
                                                   ------------------------ 
                                                       2012                 
                                                   (Unaudited)      2011    
                                                   -----------  ----------- 
                                                                            
Liabilities and equity                                                      
                                                                            
                                                                            
Current liabilities                                                         
                                                                            
Current installments of obligation under capital                            
 lease                                             $        38  $       139 
Accounts payable:    
                                                       
  Trade                                                  8,756        8,081 
  Other                                                 27,091       28,397 
Deferred income                                            929          521 
                                                   -----------  ----------- 
                                                                            
Total current liabilities                               36,814       37,138 
                                                   -----------  ----------- 
                                                                            
Long-term liabilities                                                       
Obligation under capital lease, net                         78          120 
Liability in respect of employees' severance                                
 payments                                                8,761        7,720 
Contingent consideration in respect of business                             
 combination                                             1,038            - 
Deferred tax liabilities                                 4,675        5,362 
                                                   -----------  ----------- 
Total long-term liabilities                             14,552       13,202 
                                                   -----------  ----------- 
                                                                            
Total liabilities                                       51,366       50,340 
                                                   -----------  ----------- 
                                                                            
Commitments and contingencies                                               
                                                                            
                                                                            
Equity                                                                      
Shareholders' equity:                                                       
Ordinary Shares, NIS 0.05 par value each                                    
 (90,000,000 shares authorized as of December 31,                           
 2012 and 2011, 31,080,876 and 30,448,838 shares                            
 issued and fully paid as of December 31, 2012 and                          
 2011, respectively)                                       367          359 
Additional paid-in capital                             219,103      208,838 
Capital reserve                                          1,591        2,051 
Accumulated other comprehensive income (loss)              266         (885)
Retained earnings (accumulated deficit)                  1,621      (12,729)
                                                   -----------  ----------- 
Total shareholders' equity                             222,948      197,634 
                                                   -----------  ----------- 
Non-controlling interests                                    -          291 
                                                   -----------  ----------- 
Total equity                                           222,948      197,925 
                                                   -----------  ----------- 
                                                                            
                                                                            
Total liabilities and equity                       $   274,314  $   248,265 
                                                   ===========  =========== 
                                                                            
                                                                            
                                                                            
                  Given Imaging Ltd. and its Subsidiaries                   
                                                                            
                     Consolidated Statements of Income                      
               (In thousands except share and per share data)               
                                                                            
                                                                            
                                             Year ended December 31,        
                                      ------------------------------------- 
                                          2012                              
                                      (Unaudited)      2011         2010    
                                      -----------  -----------  ----------- 
                                                                            
Revenues                              $   180,501  $   177,955  $   157,809 
Cost of revenues                          (42,971)     (41,466)     (37,629)
                                      -----------  -----------  ----------- 
                                                                            
Gross profit                              137,530      136,489      120,180 
                                      -----------  -----------  ----------- 
                                                                            
Operating expenses                                                          
Research and development, gross           (25,627)     (26,129)     (21,695)
Government grants                           1,439        1,113        1,477 
                                      -----------  -----------  ----------- 
Research and development, net             (24,188)     (25,016)     (20,218)
                                                                            
Sales and marketing                       (76,272)     (75,014)     (67,114)
General and administrative                (22,746)     (23,078)     (25,138)
Other, net                                   (455)        (397)        (759)
                                      -----------  -----------  ----------- 
                                                                            
Total operating expenses                 (123,661)    (123,505)    (113,229)
                                      -----------  -----------  ----------- 
                                                                            
Operating profit                           13,869       12,984        6,951 
                                                                            
Financial income, net                         847        1,343        2,599 
                                      -----------  -----------  ----------- 
                                                                            
Profit before taxes on income              14,716       14,327        9,550 
                                                                            
Income tax expense                           (459)      (2,158)      (1,362)
                                      -----------  -----------  ----------- 
                                                                            
Net Profit                                 14,257       12,169        8,188 
                                                                            
Net loss (profit) attributable to non-                                      
 controlling interest                          93         (191)         290 
                                      -----------  -----------  ----------- 
                                                                            
Net profit attributable to                                                  
 shareholders                         $    14,350  $    11,978  $     8,478 
                                                                            
Net change in respect of available for                                      
 sale securities                            1,151         (980)        (304)
                       
               -----------  -----------  ----------- 
Total comprehensive profit                                                  
 attributable to Shareholders         $    15,501  $    10,998  $     8,174 
                                                                            
Total comprehensive profit (loss)                                           
 attributable to non-controlling                                            
 interest                                     (93)         191         (290)
                                      -----------  -----------  ----------- 
                                                                            
Total comprehensive profit            $    15,408  $    11,189  $     7,884 
                                      ===========  ===========  =========== 
                                                                            
Earnings per share:                                                         
                                                                            
Basic Earnings attributed to                                                
 shareholders per Ordinary Share      $      0.47  $      0.40  $      0.29 
                                      ===========  ===========  =========== 
                                                                            
Diluted Earnings attributed to                                              
 shareholders per Ordinary Share      $      0.45  $      0.39  $      0.28 
                                      ===========  ===========  =========== 
                                                                            
Weighted average number of Ordinary                                         
 Shares used to compute basic Earnings                                      
 per Ordinary Share                    30,853,581   30,212,787   29,670,842 
                                      ===========  ===========  =========== 
Weighted average number of Ordinary                                         
 Shares used to compute diluted                                             
 Earnings per Ordinary Share           31,563,208   31,089,499   30,525,654 
                                      ===========  ===========  =========== 
                                                                            
                                                                            
                                                                            
                  Given Imaging Ltd. and its Subsidiaries                   
                                                                            
                   Consolidated Statements of Cash Flows                    
                               (In thousands)                               
                                                                            
                                                                            
                                             Year ended December 31,        
                                      ------------------------------------- 
                                          2012                              
                                      (Unaudited)      2011         2010    
                                      -----------  -----------  ----------- 
                                                                            
Cash flows from operating activities:                                       
Net profit                            $    14,257  $    12,169  $     8,188 
                                                                            
Adjustments required to reconcile net                                       
 profit to net cash provided by                                             
 operating activities:                                                      
                                                                            
Depreciation and amortization               8,597        8,296        7,662 
Goodwill impairment                             -            -           20 
Deferred tax assets                        (1,988)         100          761 
Deferred tax liabilities                     (687)        (509)        (888)
Stock based compensation                    6,158        7,363        8,482 
Loss from disposal of long term assets        484          397          739 
Decrease (increase) in accounts                                             
 receivable - trade                           977       (4,544)         560 
Decrease (increase) in other accounts                                       
 receivable - other                         1,252         (968)        (488)
Decrease (increase) in prepaid                                              
 expenses                                    (436)         212          (23)
Decrease (increase) in advances to                                          
 suppliers                                   (142)        (766)          93 
Decrease (increase) in inventories           (299)      (3,145)       2,331 
Increase (decrease) in accounts                                             
 payable                                     (691)       1,433        3,389 
Increase (decrease) in deferred                                             
 revenue                                      408         (267)         554 
Other                                         (62)         158          304 
                                      -----------  -----------  ----------- 
Net cash provided by operating                                              
 activities                                27,828       19,929       31,684 
                                      -----------  -----------  ----------- 
                                                                            
Cash flows from investing activities:                                       
Purchase of fixed assets and                                                
 intangible assets                         (7,005)     (10,551)      (5,056)
                                                                            
Other long term assets, net                  (538)         (39)          (6)
Acquisition of Businesses, net of cash                                      
 acquired (1)                              (6,000)           -      (34,709)
Change in short term deposit, net           4,968      (20,176)     (26,830)
Proceeds from sales and maturity of                                         
 marketable securities                     13,343       11,141       25,167 
Investments in marketable securities      (24,827)     (16,910)      (5,953)
                                      -----------  -----------  ----------- 
Net cash used in investing activities     (20,059)     (36,535)     (47,387)
                                      -----------  -----------  ----------- 
                                                                            
Cash flows from financing activities:                                       
Principal payments on capital lease                                         
 obligation                                  (129)        (168)        (143)
Proceeds from the issuance of Ordinary                                      
 Shares                                     4,115        6,585        4,219 
Purchase of shares from a non-                                              
 controlling shareholder in a                                               
 subsidiary                                  (658)           -         (403)
                                      -----------  -----------  ----------- 
Net cash provided by financing                                              
 activities                                 3,328        6,417        3,673 
                                      -----------  -----------  ----------- 
                                                                            
Effect of exchange rate c
hanges on                                          
 cash and cash equivalents                     60         (145)         191 
                                      -----------  -----------  ----------- 
Increase (decrease) in cash and cash                                        
 equivalents                               11,157      (10,334)     (11,839)
Cash and cash equivalents at beginning                                      
 of year                                   24,285       34,619       46,458 
                                      -----------  -----------  ----------- 
Cash and cash equivalents at end of                                         
 year                                 $    35,442  $    24,285  $    34,619 
                                      ===========  ===========  =========== 
                                                                            
Supplementary cash flow information:                                        
                                                                            
Income taxes paid                     $     2,883  $     2,179  $       234 
                                      ===========  ===========  =========== 

  
For further information contact: 
Fern Lazar/David Carey
Lazar Partners Ltd.
1-212-867-1768
flazar@lazarpartners.com
dcarey@lazarpartners.com 
Israel Investor Contact:
Nava Ladin
Gelbart Kahana Investor Relations
+972-3-6074717
nava@gk-biz.com