Sapiens 2012 Annual Revenue Increases 63% to $114 Million
2012 Non-GAAP Annual Operating Profit Grows by 65% to $15.2 million
REHOVOT, Israel, March 5, 2013 /PRNewswire/ –
Sapiens International Corporation N.V.
(NASDAQ and TASE: SPNS), a provider of innovative
software solutions for the financial services and a member of the Formula Group (NASDAQ:
FORTY and TASE: FORT), announces its financial results for the fourth quarter ended
December 31, 2012.
“In the fourth quarter we continued to win new customers such as Trustmark for Life &
Annuities and Achmea Australia for P&C; we launched the newest version of Decision and
signed a new deal with a major financial institution, underscoring a year of revenue
growth of 63%, with organic growth of 17.4%.” said Roni Al Dor, President and CEO of
Sapiens International. “Our strategy to grow sales of our P&C and L&P software products,
close new deals in our target markets in North America, UK, Europe and APAC, and introduce
our new business decision management solution to top tier financial institutions has been
successful and is evident in our results, in our solid balance sheet, record high revenue
and profit, and strong cash flow from operations.”
Mr. Al Dor added, “We believe that the huge insurance industry built on legacy systems
will transform over the next decade to new technology and external vendors. We also
believe that Sapiens is well positioned to become one of the dominant players in this
market over time, and our recruitment of over 100 new employees, investment in R&D and
end-to-end coverage of core system solutions for all insurance segments, is focused on
solidifying our position as a marketplace leader and further accelerating our growth.”
Fourth Quarter Year-over-Year Highlights include:
- Revenue increased by 27% to $31.2 million, compared to revenue of $24.6 million in the fourth quarter of 2011. - Non-GAAP operating profit increased by 52 % to $4 million, compared to $2.6 million in fourth quarter of 2011. - Non- GAAP net income attributable to Sapiens' shareholders increased by 35% to 3.7 million, compared to 2.8 million in the fourth quarter of 2011. Net income attributable to Sapiens' shareholders increased by 218% to 3.3 million, compared to 1 million in the fourth quarter of 2011. - Non-GAAP operating margin expanded to 12.9%, compared to 10.6% for fourth quarter of 2011. - Non-GAAP diluted EPS was $0.09, compared to $0.07 per diluted share for the fourth quarter of 2011.
Full Year 2012 Highlights include:
- Full year revenues increased by 63% to $113.9 million, compared to $69.9 million in 2011. - Non- GAAP operating profit increased by 65 % to $15.2 million, compared to $9.2 million in 2011. - Non- GAAP net income attributable to Sapiens' shareholders increased by 57% to $14.7 million, compared to $9.4 million in 2011. Net income attributable to Sapiens' shareholders increased by 100% to $11.8 million, compared to $5.9 million in 2011. - Non-GAAP diluted EPS grew up to $0.35, compared to $0.30 per diluted share in 2011.
Balance Sheet and cash flow
- Total equity by total assets is 73%, compared to 72% as of December 31, 2011. - Cash and cash equivalent position of $29.1 million, an increase from $21.5 million as of December 31, 2011, and after completing buy-back of 5% of company's shares for total consideration of $7 million. - The Company generated $18.8 million in cash from operation activities, an increase from $8.4 million in 2011.
Non-GAAP Financial Measures
This press release contains the following non-GAAP financial measures: Non-GAAP
operating income, Adjusted EBITDA, Non-GAAP net income and Non-GAAP net income per share.
Sapiens believes that these non-GAAP measures of financial results provide useful
information to management and investors regarding certain financial and business trends
relating to Sapiens’ financial condition and results of operations. The Company’s
management uses these non-GAAP measures to compare the company’s performance to that of
prior periods for trend analyses, for purposes of determining executive and senior
management incentive compensation and for budgeting and planning purposes. These measures
are used in monthly financial reports prepared for management and in monthly and quarterly
financial reports presented to the Company’s board of directors. The Company believes that
the use of these non-GAAP financial measures provides an additional tool for investors to
use in evaluating ongoing operating results and trends and in comparing the Company’s
financial measures with other software companies, many of which present similar non-GAAP
financial measures to investors.
Management of the Company does not consider these non-GAAP measures in isolation or as
an alternative to financial measures determined in accordance with GAAP. The principal
limitation of these non-GAAP financial measures is that they exclude significant expenses
and income that are required by GAAP to be recorded in the Company’s financial statements.
In addition, they are subject to inherent limitations as they reflect the exercise of
judgment by management about which expenses and income are excluded or included in
determining these non-GAAP financial measures. In order to compensate for these
limitations, management presents non-GAAP financial measures in connection with GAAP
results. Sapiens urges investors to review the reconciliation of its non-GAAP financial
measures to the comparable GAAP financial measures, which it includes in press releases
announcing quarterly financial results, including this press release, and not to rely on
any single financial measure to evaluate the Company’s business.
Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP
financial measures used in this press release are included with the financial tables of
U.S. Dollars in thousands, except per share amounts For the three months ended For the year ended U.S GAAP basis 31/12/2012 31/12/2011 31/12/2012 31/12/2011 (Unaudited) (Unaudited) (Unaudited) (Unaudited) Revenues 31,170 24,586 113,909 69,927 Operating profit 3,519 864 12,045 5,624 Net income attributed to Sapiens' shareholders 3,316 1,044 11,780 5,897 Basic earnings per share 0.08 0.03 0.29 0.21 Diluted earnings per share 0.08 0.02 0.28 0.19 NonGAAP Revenues 31,134 24,835 114,192 70,301 Operating profit 4,011 2,636 15,179 9,224 Net income attributed to Sapiens' shareholders 3,716 2,761 14,694 9,377 Basic earnings per share 0.09 0.07 0.37 0.33 Diluted earnings per share 0.09 0.07 0.35 0.30
Sapiens International Corporation (NASDAQ and TASE: SPNS) is a global provider of
innovative software solutions for the financial services industry. We offer core,
end-to-end solutions for the general insurance, property & casualty, life, pension and
annuities markets, and business decision management software, globally. We have a track
record of over 30 years in delivering superior software solutions to more than 100
financial services organizations. Our team operates through our fully-owned subsidiaries
in North America, the United Kingdom, EMEA and Asia Pacific. For more information please
visit Sapiens website at 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. AND ITS SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME U.S. dollars in thousands (except per share amounts)
Three months ended Years ended December 31, December 31, 2012 2011 2012 2011 Unaudited Unaudited Unaudited Unaudited Revenues $ 31,170 $ 24,586 $ 113,909 $ 69,927 Cost of revenues 19,075 15,354 66,459 $ 40,067 Gross profit 12,095 9,232 47,450 29,860 Operating Expenses: Research and development, net 2,594 1,126 10,169 5,008 Selling, marketing, general and administrative 5,982 6,517 25,236 18,113 - 725 - 1,115 Total operating expenses 8,576 8,368 35,405 24,236 Operating income 3,519 864 12,045 5,624 Financial income, net 192 86 (193) (104) Taxes and other expenses (income), net 11 (271) 435 (230) Net income $ 3,316 $ 1,049 $ 11,803 $ 5,958 Attributetable to non-controlling interest - $ 5 $ 23 $ 61 Net income attributable to Sapiens shareholders $ 3,316 $ 1,044 $ 11,780 $ 5,897 Basic earnings per share $ 0.08 $ 0.03 $ 0.29 $ 0.21 Diluted earnings per share $ 0.08 $ 0.02 $ 0.28 $ 0.19 Weighted average number of shares outstanding used to compute: Basic earnings per share 39,665 39,647 39,953 28,460 Diluted earnings per share 41,224 41,955 41,671 30,764
- Total Common shares as of December 31, 2012 were 38,679,505 (post buyback of 2,000,000 common shares at November 29, 2012).
SAPIENS INTERNATIONAL CORPORATION N.V. AND SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP RESULTS U.S. dollars in thousands (except per share amounts)
Three months ended Years ended 2012 2011 2012 2011 GAAP revenues $ 31,170 $ 24,586 $ 113,909 $ 69,927 Valuation adjustment on acquired deferred revenue and long term contract (36) 249 283 374 Non-GAAP revenues $ 31,134 $ 24,835 $ 114,192 $ 70,301 GAAP gross profit $ 12,095 $ 9,238 $ 47,450 $ 29,860 Revenues adjustment (36) 249 283 374 Amortization of capitalized software 1,191 1,227 3,757 4,639 Amortization of other intangible assets 212 275 843 418 Non-GAAP gross profit $ 13,462 $ 10,989 $ 52,333 $ 35,291 GAAP operating income $ 3,519 $ 864 $ 12,045 $ 5,624 Gross profit adjustments 1,367 1,751 4,883 5,431 Capitalization of software development (819) (1,287) (3,464) (4,768) Amortization of other intangible assets (282) 479 1,023 1,487 Stock-based compensation 226 104 692 335 - 725 - 1,115 Non-GAAP operating income $ 4,011 $ 2,636 $ 15,179 $ 9,224 GAAP net income attributable to Sapiens shareholders $ 3,316 $ 1,044 $ 11,780 $ 5,897 Operating income adjustments 492 1,772 3,134 3,600 Non-controlling interest in amortization intangible assets (22) (35) (88) (35) Deferred taxes related to acquisition (70) (20) (132) (85) Non-GAAP net income attributable to Sapiens shareholders $ 3,716 $ 2,761 $ 14,694 $ 9,377 Non-GAAP basic earnings per share $ 0.09 $ 0.07 $ 0.37 $ 0.33 Non-GAAP diluted earnings per share $ 0.09 $ 0.07 $ 0.35 $ 0.30
SAPIENS INTERNATIONAL CORPORATION N.V. AND ITS SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS U.S. dollars in thousands
December 31, December 31, 2012 2011 Unaudited Unaudited ASSETS CURRENT ASSETS: Cash and cash equivalents $ 29,050 $ 21,460 Restricted cash 536 456 Trade receivables, net 16,299 14,484 Other receivables and prepaid expenses 1,785 1,823 Deferred Taxes 2,750 1,406 Total current assets 50,420 39,629 LONG-TERM ASSETS: Property and equipment, net 2,243 1,814 Severance pay fund 10,306 10,172 Other intangible assets, net 29,212 31,592 Other long-term assets 2,316 3,546 Goodwill 68,087 66,715 Total long-term assets 112,164 113,839 TOTAL ASSETS $ 162,584 $ 153,468 LIABILITIES AND EQUITY CURRENT LIABILITIES: Trade payables $ 4,382 $ 2,559 Accrued expenses and other liabilities 20,014 19,731 Deferred revenue 7,301 9,603 Total current liabilities 31,697 31,893 LONG-TERM LIABILITIES: Other long-term liabilities 803 617 Accrued severance pay 11,645 10,711 Total long-term liabilities 12,448 11,328 EQUITY 118,439 110,247 TOTAL LIABILITIES AND EQUITY $ 162,584 $ 153,468
CONSOLIDATED STATEMENTS OF CASH FLOWS U.S. dollars in thousands
December 31, 2012 2011 Cash flows from operating activities: Net income $ 11,803 $ 5,958 Reconciliation of net income to net cash provided by operating activities: Depreciation and amortization 7,392 6,748 Stock-based compensation 690 336 Compensation associated with acquisition of subsidiary 128 755 Net changes in operating assets and liabilities, net of amount acquired: Trade receivables, net (1,649) (3,333) Other operating assets 152 (480) Deferred tax assets, net (194) 222 Trade payables 1,746 (1,279) Other operating liabilities 334 (804) Deferred revenues and customer advances (2,372) (408) Accrued severance pay, net 762 698 Net cash provided by operating activities 18,792 8,413 Cash flows from investing activities: Purchase of property and equipment (1,327) (482) Capitalized software development costs (3,464) (4,735) Issuance expenses relating to FIS and IDIT acquisition - (102) Earn-out payment with respect to Harcase acquisition - (952) Payments for business acquisitions, net of cash acquired - 3,741 Restricted cash (68) - Net cash used in investing activities (4,859) (2,530) Cash flows from financing activities: Proceeds from employee stock options exercised 1,199 207 Repurchase of shares (7,000) - Dividend to non-controlling interests (182) (134) Net cash provided by (used in) financing activities (5,983) 73 Effect of exchange rate changes on cash (360) (678) Increase in cash and cash equivalents 7,590 5,278 Cash and cash equivalents at beginning of year 21,460 16,182 Cash and cash equivalents at end of year $ 29,050 $ 21,460
Contact: James Carbonara, Regional Vice President Hayden IR Office: +1-(646)-755-7412 e-Mail: James@haydenir.com [James@haydenir.com?subject=Sapiens%20PR%20Contact ] Moshe Shamir, VP Marketing Sapiens International Tel: +972-3-6250951 e-Mail: firstname.lastname@example.org [email@example.com?subject=PR%20Contact ]
SOURCE Sapiens International Corporation