Magic Reports Record-Breaking Results for the Fourth Quarter of 2013 with Revenues of $41.2 Million, an Increase of 15% Year ...
Wednesday 12 February 2014
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
tania@magicsoftware.com
