Welcome!

News Feed Item

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

OR YEHUDA, Israel, Feb. 12, 2014 /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, 2013.

Financial Highlights for the Fourth Quarter, 2013

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

Financial Highlights for the Full Year Ended December 31, 2013

  • Revenues for the year ended December 31, 2013 reached $145.0 million, an increase of 15%, compared to $126.4 million in 2012.
  • Non-GAAP operating income for 2013 increased 22% to $22.7 million, compared to $18.6 million in 2012. Operating income for the year ended December 31, 2013 increased 17% to $19.1 million compared to $16.4 million in the prior year. Operating income in 2013 was negatively impacted compared to 2012 due to the devaluation of the Japanese Yen and the appreciation of the New Israeli Shekel versus the U.S. Dollar by approximately $1 million.
  • Non-GAAP net income for 2013 increased 6% to $19.5 million, compared to $18.3 million in 2012. Net income for the year ended December 31, 2013 decreased 2% to $15.9 million compared to $16.2 million in the prior 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.
  • Total cash, cash equivalents and short-term investments as of December 31, 2013 amounted to $36.0 million.
  • Operating cash flow for the year ended December 31, 2013 totaled $18 million.

Results

  • For the fourth quarter ended December 31, 2013 total revenues were $41.2 million, with net income of $4.7 million, or $0.13 per fully diluted share. This compares with revenues of $35.7 million and net income of $4.3 million, or $0.12 per fully diluted share for the same period in 2012.
  • For the fourth quarter of 2013, operating income was $5.4 million. This compares to operating income of $4.3 million for the same period in 2012.
  • For the year ended December 31, 2013, total revenues were $145.0 million, with net income of $15.9 million, or $0.43 per fully diluted share. This compares with revenues of $126.4 million and net income of $16.2 million, or $0.44 per fully diluted share, for the same period in 2012.
  • Operating income for the year ended December 31, 2013, was $19.1 million. This compares to operating income of $16.4 million 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 and have 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:

  • Amortization of purchased intangible assets;
  • In-process research and development capitalization and amortization;
  • Equity-based compensation expense;
  • Change in valuation of contingent consideration; 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 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
[email protected]

 

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 administrative

10,513


9,867


36,232


33,632

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 interests

(208)


-


(401)


-

Net income attributable to non-controlling interests

(8)


(146)


(575)


(277)

Net income attributable to Magic's shareholders

$4,690


$4,253


$15,880


$16,183









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 other intangible assets

2,212


2,376


7,722


6,687

Change in valuation of contingent consideration



230


-


230


-

Capitalization of software development



(1,147)


(1,625)


(4,713)


(4,969)

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 Magic's shareholders


$4,690


$4,253


$15,880


$16,183

Operating income adjustments



1,365


826


3,564


2,233

Unwinding of discount in connection with liabilities due to acquisitions

45


-


310


-

Amortization expenses attributed to redeemable non-controlling interests 

(49)


-


(164)


-

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 share 



$0.16


$0.14


$0.53


$0.50

Weighted average number of shares used in










   computing basic net earnings per share 



37,081


36,553


36,835


36,502













Non-GAAP diluted net earnings per share 



$0.16


$0.14


$0.52


$0.49

Weighted average number of shares used in










   computing diluted net earnings per share



37,487


37,091


37,337


37,198

 

 

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 long-term loans

1055


-

   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.

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.

Latest Stories
WebRTC is great technology to build your own communication tools. It will be even more exciting experience it with advanced devices, such as a 360 Camera, 360 microphone, and a depth sensor camera. In his session at @ThingsExpo, Masashi Ganeko, a manager at INFOCOM Corporation, will introduce two experimental projects from his team and what they learned from them. "Shotoku Tamago" uses the robot audition software HARK to track speakers in 360 video of a remote party. "Virtual Teleport" uses a...
SYS-CON Events announced today that App2Cloud will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct. 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. App2Cloud is an online Platform, specializing in migrating legacy applications to any Cloud Providers (AWS, Azure, Google Cloud).
Cloud resources, although available in abundance, are inherently volatile. For transactional computing, like ERP and most enterprise software, this is a challenge as transactional integrity and data fidelity is paramount – making it a challenge to create cloud native applications while relying on RDBMS. In his session at 21st Cloud Expo, Claus Jepsen, Chief Architect and Head of Innovation Labs at Unit4, will explore that in order to create distributed and scalable solutions ensuring high availa...
When shopping for a new data processing platform for IoT solutions, many development teams want to be able to test-drive options before making a choice. Yet when evaluating an IoT solution, it’s simply not feasible to do so at scale with physical devices. Building a sensor simulator is the next best choice; however, generating a realistic simulation at very high TPS with ease of configurability is a formidable challenge. When dealing with multiple application or transport protocols, you would be...
In his session at @DevOpsSummit at 20th Cloud Expo, Kelly Looney, director of DevOps consulting for Skytap, showed how an incremental approach to introducing containers into complex, distributed applications results in modernization with less risk and more reward. He also shared the story of how Skytap used Docker to get out of the business of managing infrastructure, and into the business of delivering innovation and business value. Attendees learned how up-front planning allows for a clean sep...
In IT, we sometimes coin terms for things before we know exactly what they are and how they’ll be used. The resulting terms may capture a common set of aspirations and goals – as “cloud” did broadly for on-demand, self-service, and flexible computing. But such a term can also lump together diverse and even competing practices, technologies, and priorities to the point where important distinctions are glossed over and lost.
Internet-of-Things discussions can end up either going down the consumer gadget rabbit hole or focused on the sort of data logging that industrial manufacturers have been doing forever. However, in fact, companies today are already using IoT data both to optimize their operational technology and to improve the experience of customer interactions in novel ways. In his session at @ThingsExpo, Gordon Haff, Red Hat Technology Evangelist, shared examples from a wide range of industries – including en...
Detecting internal user threats in the Big Data eco-system is challenging and cumbersome. Many organizations monitor internal usage of the Big Data eco-system using a set of alerts. This is not a scalable process given the increase in the number of alerts with the accelerating growth in data volume and user base. Organizations are increasingly leveraging machine learning to monitor only those data elements that are sensitive and critical, autonomously establish monitoring policies, and to detect...
Enterprise architects are increasingly adopting multi-cloud strategies as they seek to utilize existing data center assets, leverage the advantages of cloud computing and avoid cloud vendor lock-in. This requires a globally aware traffic management strategy that can monitor infrastructure health across data centers and end-user experience globally, while responding to control changes and system specification at the speed of today’s DevOps teams. In his session at 20th Cloud Expo, Josh Gray, Chie...
To get the most out of their data, successful companies are not focusing on queries and data lakes, they are actively integrating analytics into their operations with a data-first application development approach. Real-time adjustments to improve revenues, reduce costs, or mitigate risk rely on applications that minimize latency on a variety of data sources. Jack Norris reviews best practices to show how companies develop, deploy, and dynamically update these applications and how this data-first...
Intelligent Automation is now one of the key business imperatives for CIOs and CISOs impacting all areas of business today. In his session at 21st Cloud Expo, Brian Boeggeman, VP Alliances & Partnerships at Ayehu, will talk about how business value is created and delivered through intelligent automation to today’s enterprises. The open ecosystem platform approach toward Intelligent Automation that Ayehu delivers to the market is core to enabling the creation of the self-driving enterprise.
"At the keynote this morning we spoke about the value proposition of Nutanix, of having a DevOps culture and a mindset, and the business outcomes of achieving agility and scale, which everybody here is trying to accomplish," noted Mark Lavi, DevOps Solution Architect at Nutanix, in this SYS-CON.tv interview at @DevOpsSummit at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
"We're here to tell the world about our cloud-scale infrastructure that we have at Juniper combined with the world-class security that we put into the cloud," explained Lisa Guess, VP of Systems Engineering at Juniper Networks, in this SYS-CON.tv interview at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
SYS-CON Events announced today that Grape Up will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct. 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Grape Up is a software company specializing in cloud native application development and professional services related to Cloud Foundry PaaS. With five expert teams that operate in various sectors of the market across the U.S. and Europe, Grape Up works with a variety of customers from emergi...
"We're a cybersecurity firm that specializes in engineering security solutions both at the software and hardware level. Security cannot be an after-the-fact afterthought, which is what it's become," stated Richard Blech, Chief Executive Officer at Secure Channels, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.