Breaking News

Tweet TWEET

Magic Reports Record-Breaking Results for the Fourth Quarter of 2013 with Revenues of $41.2 Million, an Increase of 15% Year

  Magic Reports Record-Breaking Results for the Fourth Quarter of 2013 with
  Revenues of $41.2 Million, an Increase of 15% Year over Year and Non-GAAP
     Operating Income of $6.8 Million, an Increase of 34% Year over Year

Annual revenues for 2013 increased 15% year over year to a record-breaking
result of $145.0 million; Non-GAAP operating income increased 22% to $22.7
million for the year

PR Newswire

OR YEHUDA, Israel, Feb. 12, 2014

OR YEHUDA, Israel, Feb. 12, 2014 /PRNewswire/ --Magic Software Enterprises
Ltd. (NASDAQ and TASE: MGIC), a global provider ofmobileand
cloud-enabledapplication andbusiness integration platforms, announced today
its financial results for the fourth quarter and full year ended December31,
2013.

Financial Highlights for the Fourth Quarter, 2013

  oRevenues for the fourth quarter increased 15% year over year to
    $41.2million from $35.7million in the corresponding 2013 quarter.
  oNon-GAAP operating income increased 34% to $6.8million, compared to
    $5.1million in the same period last year. Operating income for the fourth
    quarter increased 28% to $5.4million, compared to $4.3million in the
    same period last year.
  oNon-GAAP net income increased 17% to $6.0million, compared to
    $5.1million in the same period last year. Net income for the fourth
    quarter increased 10% to $4.7million compared to $4.3million in the same
    period last year.

Financial Highlights for the Full Year Ended December 31, 2013

  oRevenues for the year ended December31, 2013 reached $145.0million, an
    increase of 15%, compared to $126.4million in 2012.
  oNon-GAAP operating income for2013 increased 22% to $22.7million,
    compared to $18.6million in 2012. Operating income for the year ended
    December31, 2013 increased 17% to $19.1million compared to $16.4million
    in theprior year. Operating income in 2013 was negatively impacted
    compared to 2012due tothe devaluation of the Japanese Yen and the
    appreciation of the New Israeli Shekel versus the U.S. Dollar by
    approximately $1 million.
  oNon-GAAP net income for 2013 increased 6% to $19.5million, compared to
    $18.3million in 2012. Net income for the year ended December31,2013
    decreased 2% to $15.9million compared to $16.2million in theprior year.
    Net income for 2013 was negatively impacted by $0.5 million in non-cash
    tax expenses recorded with respect to utilization of deferred tax assets
    and by $0.5 million in financial expenses recorded as a result of
    unfavorable foreign currency exchange rates. In accordance with U.S.
    generally accepted accounting principles, the Company records deferred tax
    expenses on utilization of carry-forward tax losses.
  oTotal cash, cash equivalents and short-term investments as of
    December31,2013 amounted to $36.0million.
  oOperating cash flow for the year ended December31,2013 totaled
    $18million.

Results

  oFor the fourth quarter ended December31,2013 total revenues were
    $41.2million, with net income of $4.7million, or $0.13 per fully diluted
    share. This compares with revenues of $35.7million and net income of
    $4.3million, or $0.12 per fully diluted share for the same period in
    2012.
  oFor the fourth quarter of 2013, operating income was $5.4million. This
    compares to operating income of $4.3million for the same period in 2012.
  oFor the year ended December31,2013, total revenues were $145.0million,
    with net income of $15.9million, or $0.43 per fully diluted share. This
    compares with revenues of $126.4million and net income of $16.2million,
    or $0.44 per fully diluted share, for the same period in 2012.
  oOperating income for the year ended December31, 2013, was $19.1million.
    This compares to operating income of $16.4million for the same period in
    2012.

Comments of Management

Guy Bernstein, Chief Executive Officer of Magic Software Enterprises, said,
"2013 was a tremendous year for Magic with record sales and strong performance
across all of our products and professional services in all regions. Our
results demonstrate increasing customer demand for our products and services
coupled with continued focus on operational discipline. Our award-winning
enterprise mobility solution, integration platform and complementary software
services are well-positioned for sustained growth as we enter 2014, in terms
of both immediate sales and longer-term maintenance and support revenues."

"We are continuing to strengthen our products and expand our services
portfolio to help businesses meet the increasing demand of enterprise
mobility, cloud and big data andhave expectations for accelerated growth in
2014," 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:

  oAmortization of purchased intangible assets;
  oIn-process research and development capitalization and amortization;
  oEquity-based compensation expense;
  oChange in valuation of contingent consideration; and
  oTherelated 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 www.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.

Press Contact:

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



MAGIC SOFTWARE ENTERPRISES LTD. AND ITS SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
U.S. dollars in thousands (except per
share data)
                                        Three months ended  Year ended
                                        December 31,        December 31,
                                        2013       2012     2013      2012
                                        Unaudited           Unaudited
Revenues                                $41,192    $35,730  $144,958  $126,380
Cost of Revenues                        24,305     20,792   85,893    73,393
Gross profit                            16,887     14,938   59,065    52,987
Research and development, net           925        813      3,706     2,947
Selling, marketing and general and      10,513     9,867    36,232    33,632
administrative
Total operating expenses                11,438     10,680   39,938    36,579
Operating income                        5,449      4,258    19,127    16,408
Financial (expenses) income, net        (90)       193      (684)     10
Other (expenses) income, net            (12)       -        (12)      136
Income before taxes on income           5,347      4,451    18,431    16,554
Taxes on income                         441        52       1,575     94
Net income                              4,906      4,399    16,856    16,460
Change in redeemable non-controlling    (208)      -        (401)     -
interests
Net income attributable to              (8)        (146)    (575)     (277)
non-controlling interests
Net income attributable to Magic's      $4,690     $4,253   $15,880   $16,183
shareholders
Net earnings per share
Basic                                   $0.13      $0.12    $0.43     $0.44
Diluted                                 0.13       0.12     0.43      0.44
Weighted average number of shares used
in
 computing net earnings per share
 Basic                             37,081     36,553   36,835    36,502
                                                   .
 Diluted                           37,454     37,042   37,294    37,108





MAGIC SOFTWARE ENTERPRISES LTD. AND ITS
SUBSIDIARIES
RECONCILIATION OF GAAP AND NON-GAAP
RESULTS
U.S. dollars in thousands (except per
share data)
                                         Three months ended  Year ended
                                         December 31,         December 31,
                                         2013       2012      2013     2012
                                         Unaudited            Unaudited
GAAP operating income                    $5,449     $4,258    $19,127  $16,408
Amortization of capitalized software and 2,212      2,376     7,722    6,687
other intangible assets
Change in valuation of contingent        230        -         230      -
consideration
Capitalization of software               (1,147)    (1,625)   (4,713)  (4,969)
development
Stock-based compensation                 70         75        325      515
Total adjustments to GAAP                1,365      826       3,564    2,233
Non-GAAP operating income                $6,814     $5,084    $22,691  $18,641
GAAP net income attributable to         $4,690     $4,253    $15,880  $16,183
Magic's shareholders
Operating income adjustments             1,365      826       3,564    2,233
Unwinding of discount in connection with 45         -         310      -
liabilities due to acquisitions
Amortization expenses attributed to      (49)       -         (164)    -
redeemable non-controlling interests
Deferred taxes on the above items        (80)       17        (83)     (98)
Total adjustments to GAAP               1,281      843       3,627    2,135
Non-GAAP net income                      $5,971     $5,096    $19,507  $18,318
Non-GAAP basic net earnings per          $0.16      $0.14     $0.53    $0.50
share
Weighted average number of shares
used in
 computing basic net earnings per      37,081     36,553    36,835   36,502
share
Non-GAAP diluted net earnings per        $0.16      $0.14     $0.52    $0.49
share
Weighted average number of shares
used in
 computing diluted net earnings        37,487     37,091    37,337   37,198
per share





MAGIC SOFTWARE ENTERPRISES LTD. AND ITS SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands
                                                    December 31,  December 31,
                                                    2013          2012
                                                    Unaudited
 ASSETS
CURRENT ASSETS:
 Cash and cash equivalents                        $35,134       $37,744
 Available-for-sale marketable securities         854           890
 Trade receivables, net                           31,976        28,367
 Other accounts receivable and prepaid expenses   5,209         6,696
Total current assets                                73,173        73,697
LONG-TERM RECEIVABLES:
 Severance pay fund                               403           351
 Other long-term receivables                      3,792         2,287
Total long-term receivables                         4,195         2,638
PROPERTY AND EQUIPMENT, NET                         1,773         1,898
IDENTIFIABLE INTANGIBLE ASSETS AND
 GOODWILL, NET                                    86,529        74,721
TOTAL ASSETS                                        165,670       152,954
 LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
 Short-term credit and current maturities of      1055          -
long-term loans
 Trade payables                                   4,149         4,722
 Accrued expenses and other accounts payable      16,937        17,188
 Deferred tax liabilities                         3,045         3,422
 Deferred revenues                                3,294         4,160
Total current liabilities                           28,480        29,492
NON CURRENT LIABILITIES:
 Accrued severance pay                            1,275         1,245
 Loans                                            2,274         -
 Long term liabilities                            1,726         750
 Liability due to acquisition activities          1,396         1,192
Total non-current liabilities                       6,671         3,187
Redeemable non- controlling interest                2,460         1,914
SHAREHOLDERS' EQUITY:
 Magic Shareholders' equity                       127,072       117,786
 Non-controlling interests                        987           575
Total shareholders' equity                          128,059       118,361
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY          $165,670      $152,954





SOURCE Magic Software Enterprises Ltd.

Website: http://www.magicsoftware.com
 
Press spacebar to pause and continue. Press esc to stop.