Lipman posts 52.2% rise in Q2 revenue
Revenue for the second quarter of 2005 was $58.3 million, over revenues of $38.3 million for the second quarter of 2004. Net profit was $7.4 million.
Globes correspondent 27 Jul 05 09:51
Electronic payment systems provider Lipman Electronics Engineering (Nasdaq: LPMA; TASE: LPMA), has announced financial results for the second quarter ended June 30, 2005.
Net profit for the quarter was $7.4 million, or $0.27 per diluted share, compared to a net profit of $6.6 million, or $0.25 per diluted share, for the comparable period in 2004.
There were 27,536,901 diluted shares outstanding in the second quarter of 2005 compared to 26,991,269 diluted shares outstanding in the second quarter of 2004. All share and per share data were adjusted to reflect a two-for-one stock split effected on June 22, 2004.
For the second quarter of 2005, revenue was $58.3 million, an increase of 52.2% over revenue of $38.3 million for the second quarter of 2004.
Revenues increased due to the consolidation of Dione's results of operations, as well as increased sales in the United States and Latin America. Lipman acquired privately-held Dione Plc in October 2004.
Gross profit for the second quarter of 2005 was $25.2 million, or 43.3% of revenues, compared to $18.0 million, or 47.1% of revenues, for the second quarter of 2004.
Lipman stated that the lower gross margin was due mainly to the consolidation of Dione's results, as gross margin on products sold by Dione was lower than Lipman's gross margin prior to the Dione acquisition.
During the second quarter of 2005, Lipman had amortization of intangible assets expenses of $746,000, compared to $52,000 of such expenses in the second quarter of 2004.
Operating expenses for the second quarter of 2005 included $478,000 in special legal expenses in connection with patent infringement claims brought against the company, and most of the other major point of sale (POS) terminal vendors serving the US market, by Verve LLC and filed with the US International Trade Commission. In February 2005, Verve filed a motion to withdraw the complaint and terminate the ITC action without prejudice. The ITC administrative law judge terminated the ITC investigation.
Financial income for the second quarter of 2005 was $787,000, compared to $415,000 for the second quarter of 2004. Financial income in the second quarter of 2005 included $522,000, or approximately $0.02 per share related to a one-time gain from the sale of Lipman's shares in Wizcom Technologies Ltd.
Operating expenses for the three months ended June 30, 2005 also included $1.3 million of non-cash stock-based compensation expenses compared to $1.2 million of similar expenses in the comparable period in 2004. Excluding the effect of stock-based compensation, non-GAAP net income for the quarter was $8.7 million, or $0.31 per diluted share, compared to non-GAAP net income of $7.8 million, or $0.29 per diluted share, for the same period last year.
As of June 30, 2005, the company had cash and cash equivalents of $121.5 million compared to $117.4 million as of December 31, 2004.
Net profit for the first six months of 2005 was $12.6 million, or $0.46 per diluted share, compared to a net profit of $11.5 million, or $0.44 per diluted share, in the same period in 2004. There were 27,498,156 diluted shares outstanding in the six months ended June 30, 2005 compared to 26,148,486 diluted shares outstanding in the first six months of 2004.
Revenue for the six month period increased 59.8% to $112.5 million, from $70.4 million in the same period last year. Revenues increased due to the consolidation of Dione's results of operations, as well as increased sales in the US, Latin America and Turkey.
For the six months ended June 30, 2005, gross profit was $48.1 million, or 42.8% of revenues, compared to $33.8 million, or 48.0% of revenues, for the same period in 2004. The lower gross margin was due mainly to the consolidation of Dione's results.
During the first half of 2005, Lipman had amortization of intangible assets expenses of $1.6 million, compared to $103,000 of such expenses in the comparable period in 2004 and incurred $899,000 in special legal expenses related to the patent infringement claims by Verve.
Operating expenses for the six months ended June 30, 2005 included $2.6 million of non-cash stock-based compensation expenses, compared to $3.0 million of non-cash stock-based compensation expenses in the six-month period in 2004. Excluding the effect of stock-based compensation, non-GAAP net income for the period was $15.3 million, or $0.55 per diluted share, compared to non-GAAP net income of $14.5 million, or $0.56 per diluted share, for the six months ended June 30, 2004.
Cash flow from operating activities for the six months ended June 30, 2005 was $5.2 million.
In May, 2005, a public offering of 2,269,000 Lipman ordinary shares was completed by certain shareholders. Proceeds from the offering went to the selling shareholders. Lipman received approximately $1.2 million upon the exercise of options for shares sold in the offering by two of the selling shareholders.
Lipman president and CEO Isaac Angel said, "Our revenues for the second quarter were driven in part by strength in our international markets, notably Turkey, Spain and Latin America where our performance remained strong as we received major orders from a number of key customers. We believe our success in these markets is indicative of the strong relationships that we have been able to develop.
"We are also encouraged by the momentum and solid performance Lipman achieved in the United States, which we attribute to the success of our new US management team and the receipt of key certifications in 2004."
Published by Globes [online], Israel business news - www.globes.co.il - on Wednesday, July 27, 2005
Dubi
