Shamir Optical falls short of forecasts with 1.5% revenue growth in Q4
01.3.06 | 10:40 By Shirley Yom Tov
As the year 2005 progressed, revenue growth at Shamir Optical Industry (Nasdaq: SHMR) did nothing but contract. First-quarter 2005 growth had been more than 30% but by the time the fourth quarter arrived, growth had contracted to 1.5%.
Shamir Optical, a Kibbutz Shamir company, disappointed the Street yet again, this time missing forecasts with fourth-quarter 2005 revenues of $20.1 million, versus expectations of $22.4 million. The company explained that it had to defer $0.9 million revenues that had been included in its guidance. The missing income will be recognized in the first quarter of 2006.
Also, the weakness of the euro against the dollar during the relevant period impaired its results, explained Shamir, which makes complex lenses for the seeing-impaired.
In the parallel quarter of 2004,.revenues had been $19.8 million.
Despite the slowing growth, gross profit continued to increase, rising to $11.4 million in the fourth quarter of 2005, or 56.8% of revenues, compared to $11.2 million, or 56.3% of revenues for the same period of 2004.
As in the third quarter, operating costs ran close to a million dollars and operating profit therefore shrank to 13%, from 16.5% in the parallel quarter of 2004.
For the fourth quarter of 2005, operating income was $2.6 million, down 20.4% from operating income of $3.3 million for the same period last year.
During the quarter, Shamir established a new operation in France and expanded its marketing and distribution platform in Turkey. These activities resulted in an operational loss of $0.8 million, it explained.
Net income for the quarter was $2.1 million or $0.13 per diluted share, an increase of 10.6% compared to pro forma net income of $1.9 million for the comparable period in 2004.
For the year 2005, revenues were $80.4 million, up almost 13% compared to revenues of $71.3 million for 2004. Shamir grossed $44.3 million or 55.2% of revenues, up 17.1% against the year before.
It netted $8.1 million or 52 cents per share in 2005, up 14.1% against $7.1 million in 2004.
At year-end 2005, Shamir had cash and cash equivalents including short-term investments of $42 million.
Shamir Optical also published its guidance for the year 2006, and it's a let down for investors. While Street players had been looking at $99 million, Shamir counseled them to lower their sights to $91-96 million. It expects to earn $9.1 million to $10 million net, instead of $11.9 million. http://www.haaretz.com/hasen/spages/688974.html