NICE Systems Achieves Sequential Growth in Revenues and non-GAAP EPS in Third Quarter 2009
Posted on: Monday, 2 November 2009, 05:02 CST
RA'ANANA,
Third quarter 2009 non-GAAP revenues were
Non-GAAP gross profit was
Third quarter 2009 non-GAAP net income was
On a GAAP basis: Third quarter 2009 revenues were
Third quarter 2009 operating cash flow was
"We are satisfied with our performance in the third quarter, as bookings,
revenues and non-GAAP profitability reached record levels for the year.
Furthermore, our order intake continued to improve during the quarter, with
book to bill ratio, on both a quarterly and yearly basis, exceeding one,
resulting in the company's backlog reaching an all-time record high. This
quarter we continued to strengthen our market position with major wins such
as the
Conference Call
NICE management will host a teleconference, today,
Non-GAAP financial measures consist of GAAP financial measures adjusted to exclude: amortization of acquired intangible assets, re-organization expenses, share based compensation expenses, settlement and related expenses, other than temporarily impairment on marketable securities as well as certain business combination accounting entries. The purpose of such adjustments is to give an indication of our performance exclusive of non-cash charges and other items that are considered by management to be outside of our core operating results. Our non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. Our management regularly uses our supplemental non-GAAP financial measures internally to understand, manage and evaluate our business and make operating decisions. These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. Business combination accounting rules requires us to recognize a legal performance obligation related to a revenue arrangement of an acquired entity. The amount assigned to that liability should be based on its fair value at the date of acquisition. The non-GAAP adjustment is intended to reflect the full amount of such revenue. We believe this adjustment is useful to investors as a measure of the ongoing performance of our business. We believe these non-GAAP financial measures provide consistent and comparable measures to help investors understand our current and future operating cash flow performance. These non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies. Reconciliation between results on a GAAP and non-GAAP basis is provided in a table immediately following the Consolidated Statements of Income.
About NICE
NICE Systems (NASDAQ: NICE) is the leading provider of Insight from Interactions solutions and value-added services, powered by advanced analytics of unstructured multimedia content - from telephony, web, radio and video communications. NICE's solutions address the needs of the enterprise and security markets, enabling organizations to operate in an insightful and proactive manner, and take immediate action to improve business and operational performance and ensure safety and security. NICE has over 24,000 customers in more than 150 countries, including more than 85 of the Fortune 100 companies. More information is available at http://www.nice.com/.
Trademark Note: 360degrees View, Alpha, ACTIMIZE, Actimize logo, Customer Feedback, Dispatcher Assessment, Encorder, eNiceLink, Executive Connect, Executive Insight, FAST, FAST alpha Blue, FAST alpha Silver, FAST Video Security, Freedom, Freedom Connect, IEX, Interaction Capture Unit, Insight from Interactions, Investigator, Last Message Replay, Mirra, My Universe, NICE, NICE logo, NICE Analyzer, NiceCall, NiceCall Focus, NiceCLS, NICE Inform, NICE Learning, NiceLog, NICE Perform, NiceScreen, NICE SmartCenter, NICE Storage Center, NiceTrack, NiceUniverse, NiceUniverse Compact, NiceVision, NiceVision Alto, NiceVision Analytics, NiceVision ControlCenter, NiceVision Digital, NiceVision Harmony, NiceVision Mobile, NiceVision Net, NiceVision NVSAT, NiceVision Pro, Performix, Playback Organizer, Renaissance, Scenario Replay, ScreenSense, Tienna, TotalNet, TotalView, Universe, Wordnet are trademarks and/or registered trademarks of NICE Systems Ltd. All other trademarks are the property of their respective owners.
Forward Looking Statements
This press release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements, including the statements by Messr Bregman, are based on the current expectations of the management of NICE-Systems Ltd. (the Company) only, and are subject to a number of risks and uncertainties that could cause the actual results or performance of the Company to differ materially from those described herein, including but not limited to the impact of the global economic environment on the Company's customer base (particularly financial services firms) and the resulting uncertainties; changes in technology and market requirements; decline in demand for the Company's products; inability to timely develop and introduce new technologies, products and applications; difficulties or delays in absorbing and integrating acquired operations, products, technologies and personnel; loss of market share; pressure on pricing resulting from competition; and inability to maintain certain marketing and distribution arrangements. For a more detailed description of the risk factors and uncertainties affecting the company, refer to the Company's reports filed from time to time with the Securities and Exchange Commission, including the Company's Annual Report on Form 20-F. The forward-looking statements contained in this press release are made as of the date of this press release, and the Company undertakes no obligation to update or revise them, except as required by law.
NICE SYSTEMS LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME U.S. dollars in thousands (except per share amounts) Three months ended Nine months ended September 30, September 30. _____________ __________ __________ ________ 2008 2009 2008 2009 Unaudited Unaudited Unaudited Unaudited _____________ __________ __________ ________ Revenue Product $ 87,991 $ 69,233 $260,112 $203,509 Services 74,501 75,451 200,962 220,785 _____________ __________ __________ ________ Total revenue 162,492 144,684 461,074 424,294 Cost of revenue Product 25,070 22,648 70,431 63,323 Services 37,120 36,612 106,940 108,747 _____________ __________ __________ ________ Total cost of revenue 62,190 59,260 177,371 172,070 _____________ __________ __________ ________ Gross profit 100,302 85,424 283,703 252,224 Operating Expenses: Research and development, net 19,676 19,454 57,697 55,465 Selling and marketing 37,163 35,116 110,684 102,995 General and administrative 23,529 21,964 73,100 55,249 Amortization of acquired intangible assets 3,837 4,077 10,821 11,329 Settlement and related expenses - - 9,870 - _____________ __________ __________ ________ Total operating expenses 84,205 80,611 262,172 225,038 _____________ __________ __________ ________ Operating income 16,097 4,813 21,531 27,186 Financial income (expense), net (1,367) 1,622 6,137 6,240 Other expenses, net (16) (27) (31) (100) _____________ __________ __________ ________ Income before taxes on income 14,714 6,408 27,637 33,326 Taxes (tax benefit) on income 3,790 (1,388) 7,270 3,319 _____________ __________ __________ ________ Net income $ 10,924 $ 7,796 $ 20,367 $ 30,007 _____________ __________ __________ ________ Basic earnings per share $ 0.18 $ 0.13 $ 0.34 $ 0.49 _____________ __________ __________ ________ Diluted earnings per share $ 0.18 $ 0.12 $ 0.33 $ 0.48 _____________ __________ __________ ________ Weighted average number of shares outstanding used to compute: Basic earnings per share 60,388 61,332 59,944 61,118 Diluted earnings per share 61,547 62,887 61,311 62,082 NICE SYSTEMS LTD. AND SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP RESULTS U.S. dollars in thousands (except per share amounts) Table of Reconciliation from GAAP Revenues to Non-GAAP Revenues Quarter Ended September 30, Year to Date September 30, 2008 2009 2008 2009 _____________ __________ __________ ________ GAAP revenues $ 162,492 $ 144,684 $ 461,074 $ 424,294 US GAAP Valuation adjustment on acquired deferred revenue* 504 1,367 3,959 1,455 _____________ __________ __________ ________ Non-GAAP revenues $ 162,996 $ 146,051 $ 465,033 $ 425,749 _____________ __________ __________ ________ *adjustment on product revenue - 480 1,945 480 adjustment on service revenue 504 887 2,014 975 Table of Reconciliation from GAAP Cost Of Revenue to Non-GAAP Cost Of Revenue Quarter Ended September 30, Year to Date September 30, 2008 2009 2008 2009 _____________ __________ __________ ________ GAAP cost of revenue $ 62,190 $ 59,260 $ 177,371 $ 172,070 Amortization of acquired intangible assets (4,146) (4,330) (12,461) (12,429) Share-based compensation (663) (713) (2,493) (1,760) Re-organization expenses - - - (321) _____________ __________ __________ ________ Non-GAAP cost of revenue $ 57,381 $ 54,217 $ 162,417 $ 157,560 _____________ __________ __________ ________ Table of Reconciliation from GAAP Gross Profit to Non-GAAP Gross Profit Quarter Ended September 30, Year to Date September 30, 2008 2009 2008 2009 _____________ __________ __________ ________ GAAP gross profit $ 100,302 $ 85,424 $ 283,703 $ 252,224 US GAAP valuation adjustment on acquired deferred revenue 504 1,367 3,959 1,455 Amortization of acquired intangible assets 4,146 4,330 12,461 12,429 Share-based compensation 663 713 2,493 1,760 Re-organization expenses - - - 321 _____________ __________ __________ ________ Non-GAAP gross profit $ 105,615 $ 91,834 $ 302,616 $ 268,189 _____________ __________ __________ ________ Table of Reconciliation from GAAP Operating Expenses to Non-GAAP Operating Expenses Quarter Ended September 30, Year to Date September 30, 2008 2009 2008 2009 _____________ __________ __________ ________ GAAP operating expenses $ 84,205 $ 80,611 $ 262,172 $ 225,038 Amortization of acquired intangible assets (3,837) (4,077) (10,821) (11,329) Acquisition related compensation expense (306) (716) (1,284) (1,327) Share-based compensation (4,721) (4,815) (16,802) (11,179) Re-organization expenses - - - (1,840) Acquisition related expenses - (4,069) - (4,069) Settlement and related expenses - - (9,870) - _____________ __________ __________ ________ Non-GAAP operating expenses $ 75,341 $ 66,934 $ 223,395 $ 195,294 _____________ __________ __________ ________ Table of Reconciliation from GAAP Operating Income to Non-GAAP Operating Income Quarter Ended September 30, Year to Date September 30, 2008 2009 2008 2009 _____________ __________ __________ ________ GAAP operating income $ 16,097 $ 4,813 $ 21,531 $ 27,186 US GAAP valuation adjustment on acquired deferred revenue 504 1,367 3,959 1,455 Amortization of acquired intangible assets 7,983 8,407 23,282 23,758 Acquisition related compensation expense 306 716 1,284 1,327 Share-based compensation 5,384 5,528 19,295 12,939 Re-organization expenses - - - 2,161 Acquisition related expenses - 4,069 - 4,069 Settlement and related expenses - - 9,870 - _____________ __________ __________ ________ Non-GAAP operating income $ 30,274 $ 24,900 $ 79,221 $ 72,895 _____________ __________ __________ ________ Table of Reconciliation from GAAP Net Finance & Other Income (Expense) to Non-GAAP Net Finance & Other Income (Expense) Quarter Ended September 30, Year to Date September 30, 2008 2009 2008 2009 _____________ __________ __________ ________ GAAP finance & other income (expense) $ (1,367) $ 1,622 $ 6,137 $ 6,240 Other than Temporary impairment on marketable securities 4,512 - 4,512 - Re-organization expenses - - - 52 _____________ __________ __________ ________ Non-GAAP operating income $ 3,145 $ 1,622 $ 10,649 $ 6,292 _____________ __________ __________ ________ NICE SYSTEMS LTD. AND SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP RESULTS (continued) U.S. dollars in thousands (except per share amounts) Table of Reconciliation from GAAP Taxes (Tax Benefit) on Incometo Non- GAAP Taxes (Tax Benefit) on Income Quarter Ended September 30, Year to Date September 30, 2008 2009 2008 2009 _____________ __________ __________ ________ GAAP taxes $ 3,790 $ (1,388) $ 7,270 $ 3,319 Tax adjustments re non-gaap adjustments 2,916 3,898 10,030 8,371 _____________ __________ __________ ________ Non-GAAP taxes $ 6,706 $ 2,510 $ 17,300 $ 11,690 _____________ __________ __________ ________ Table of Reconciliation from GAAP Net Income to Non-GAAP Net Income Quarter Ended September 30, Year to Date September 30, 2008 2009 2008 2009 _____________ __________ __________ ________ GAAP net income $ 10,924 $ 7,796 $ 20,367 $ 30,007 US GAAP valuation adjustment on acquired deferred revenue 504 1,367 3,959 1,455 Amortization of acquired intangible assets 7,983 8,407 23,282 23,758 Acquisition related compensation expense 306 716 1,284 1,327 Share-based compensation 5,384 5,528 19,295 12,939 Re-organization expenses - - - 2,213 Acquisition related expenses - 4,069 - 4,069 Settlement and related expenses - - 9,870 - Other than temporary impairment on marketable securities 4,512 - 4,512 - Tax adjustments re non-gaap adjustments (2,916) (3,898) (10,030) (8,371) _____________ __________ __________ ________ Non-GAAP net income $ 26,697 $ 23,985 $ 72,539 $ 67,397 _____________ __________ __________ ________ Table Comparing GAAP Diluted Earnings Per Share to Non-GAAP Earnings Per Share Quarter Ended September 30, Year to Date September 30, 2008 2009 2008 2009 _____________ __________ __________ ________ GAAP diluted earnings per share $ 0.18 $ 0.12 $ 0.33 $ 0.48 _____________ __________ __________ ________ Non-GAAP diluted earnings per share $ 0.43 $ 0.38 $ 1.17 $ 1.09 _____________ __________ __________ ________ Shares used in computing US GAAP diluted earnings per share (in thousands) 61,547 62,887 61,311 62,082 Shares used in computing Non-GAAP diluted earnings per share (in thousands) 61,874 62,792 61,791 62,051 Share-based Compensation Quarter Ended September 30, Year to Date September 30, 2008 2009 2008 2009 _____________ __________ __________ ________ Cost of product revenue $ (85) $ (10) $ (275) $ (238) Cost of service revenue (578) (703) (2,218) (1,522) Research and development (937) (1,194) (4,743) (2,096) Sales and marketing (1,519) (1,654) (5,198) (4,171) General and administrative (2,265) (1,967) (8,235) (4,912) _____________ __________ __________ ________ $ (5,384) $ (5,528) $ (20,669) $ (12,939) ============= ========== ========== ======== NICE SYSTEMS LTD. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS U.S. dollars in thousands December 31, September 30, 2008 2009 ___________ ___________ Unaudited Unaudited ___________ ___________ ASSETS CURRENT ASSETS: Cash and cash equivalents $ 144,376 $ 144,685 Short-term investments 186,072 179,906 Trade receivables 104,115 93,780 Other receivables and prepaid expenses 23,697 30,129 Inventories 11,500 12,504 Deferred tax assets 8,400 9,323 ___________ ___________ Total current assets 478,160 470,327 ___________ ___________ LONG-TERM ASSETS: Marketable securities 170,923 193,763 Other long-term assets 17,949 23,418 Deferred tax assets 7,373 7,711 Property and equipment, net 23,394 22,332 Other intangible assets, net 145,402 172,413 Goodwill 445,504 498,115 ___________ ___________ Total long-term assets 810,545 917,752 ___________ ___________ TOTAL ASSETS $ 1,288,705 $ 1,388,079 =========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Trade payables $ 23,060 $ 16,466 Accrued expenses and other liabilities 237,589 267,986 ___________ ___________ Total current liabilities 260,649 284,452 ___________ ___________ LONG-TERM LIABILITIES: Deferred tax liabilities 37,060 39,154 Other long-term liabilities 20,174 22,670 ___________ ___________ Total long-term liabilities 57,234 61,824 ___________ ___________ SHAREHOLDERS' EQUITY 970,822 1,041,803 ___________ ___________ TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 1,288,705 $ 1,388,079 =========== =========== NICE SYSTEMS LTD. AND SUBSIDIARIES CONSOLIDATED CASH FLOW STATEMENTS U.S. dollars in thousands Three months ended Nine months ended September 30, September 30. 2008 2009 2008 2009 Unaudited Unaudited Unaudited Unaudited _____________ __________ __________ ________ Cash flows from operating activities: Net income $ 10,924 $ 7,796 $ 20,367 $ 30,007 Adjustments required to reconcile net income to net cash provided by operating activities: Depreciation and amortization 10,964 11,831 31,624 33,776 Stock based compensation 5,382 5,528 19,383 12,939 Excess tax shortfall (benefit) from share-based payment arrangements 80 (633) (754) (632) Accrued severance pay, net 1,101 (301) 1,224 (1,347) Amortization of discount (premium) and accrued interest on marketable securities 236 728 1,383 1,394 Loss (gain) on marketable securities sold, called or impaired 4,512 (126) 4,881 (823) Deferred taxes, net (123) (2,213) (3,616) (7,095) Decrease (increase) in trade receivables 1,394 (3,072) (4,288) 16,895 Increase in other receivables and prepaid expenses (480) (4,991) (2,533) (5,539) Decrease in inventories 1,190 697 1,095 1,692 Decrease in trade payables (3,786) (5,314) (1,763) (8,328) Increase in accrued expenses and other liabilities 1,077 18,582 26,024 17,251 Other (127) (164) (56) 112 _____________ __________ __________ ________ Net cash provided by operating activities 32,344 28,348 92,971 90,302 _____________ __________ __________ ________ Cash flows from investing activities: Purchase of property and equipment (4,938) (2,095) (11,855) (6,012) Proceeds from sale of property and equipment 12 3 18 38 Investment in marketable securities (13,269) (17,398) (147,786) (123,519) Proceeds from maturity, call and sale of marketable securities 20,660 48,025 108,261 149,640 Investment in short-term bank deposits (44,020) (31,021) (44,040) (110,021) Proceeds from short-term bank deposits 26 17,014 39,074 69,464 Capitalization of software development costs (408) (387) (1,151) (943) Purchase of intangible assets (3,501) - (3,501) (1,000) Refunds (payments) for acquisitions 76 (80,459) (21,674) (84,903) Received upon the realization of investment in an affiliate - - 964 - ___________ ________ ________ ________ Net cash used in investing activities (45,362) (66,318) (81,690) (107,256) ___________ ________ ________ ________ Cash flows from financing activities: Proceeds from issuance of shares upon exercise of share options and ESPP, net 1,281 11,551 14,016 15,550 Excess tax benefit (shortfall) from share-based payment arrangements (80) 633 754 632 ___________ ________ __________ ________ Net cash provided by financing activities 1,201 12,184 14,770 16,182 ___________ ________ __________ ________ Effect of exchange rate changes on cash (1,053) 367 (985) 1,081 ___________ ________ __________ ________ Increase (decrease) in cash and cash equivalents (12,870) (25,419) 25,066 309 Cash and cash equivalents at beginning of period 154,555 170,104 116,619 144,376 ___________ ________ __________ ________ Cash and cash equivalents at end of period $ 141,685 $ 144,685 $141,685 $144,685 =========== ======== ========== ======== Corporate Media Galit Belkind NICE Systems +1-877-245-7448 galit.belkind@nice.com Investors Daphna Golden NICE Systems +1-877-245-7449 ir@nice.comSOURCE NICE Systems
Source: PR Newswire
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