Given Imaging Reports Second Quarter 2010 Results

YOQNEAM, ISRAEL--(Marketwire - August 11, 2010) - Given Imaging Ltd. (NASDAQ: GIVN) today announced financial results for the second quarter ended June 30, 2010.

Worldwide revenues were $42.1 million in the second quarter of 2010, a 17 percent increase from $36 million in the second quarter of 2009. Second quarter revenues include $5.7 million from Sierra Scientific Instruments (SSI) which the company acquired in April. Global sales of existing PillCam SB products were essentially flat as Americans cut back on visits to the doctor and healthcare utilization in general was much lower in the second quarter due to economic uncertainty. Specifically, overall GI procedures have fallen considerably in the U.S. from levels a year ago. The European economic crisis associated with the weak Euro also negatively impacted European revenue growth. However, gross margin on a non-GAAP basis in the second quarter of 2010 was 77.3 percent, compared to gross margin of 76.1 percent in the second quarter of 2009 due to productivity improvements and headcount control. On a GAAP basis, gross margin in the second quarter of 2010 includes a one-time charge of $1.5 million from the SSI acquisition and was 73.7 percent, compared to 76.1 percent in second quarter of 2009.

On a non-GAAP basis, net income for the second quarter of 2010 increased 10.5 percent and reached $6.3 million, or $0.20 per share on a fully diluted basis, compared to net income of $5.7 million or $0.19 per share on a fully diluted basis in the second quarter of 2009. Non-GAAP net income excludes $1.3 million of expenses related to the SSI acquisition and $2.8 million of equity related compensation expenses (FAS 123R). Non-GAAP net income for the second quarter of 2009 also excluded compensation expenses of $2.2 million and a one-time tax gain of $1.4 million. On GAAP basis, net income for the second quarter of 2010 was $2.2 million, or $0.07 per share, compared to $4.9 million, or $0.16 per share in the same quarter of last year. A reconciliation of GAAP results to non-GAAP results is attached.

Net cash provided by operating activities in the second quarter was $7.7 million, compared to $6.6 million in the second quarter of 2009. Cash and cash equivalents, short-term investments and marketable securities on June 30, 2010 totaled $72.9 million.

"We sold approximately 60,000 PillCam SB capsules during the second quarter, close to our quarterly sales record. We are very pleased with our strong operating cash flow, as well as the ongoing improvement in our operating and net income margins, which reached 17.0 percent and 14.9 percent, respectively as reflected in our non-GAAP results," said Homi Shamir, president and CEO of Given Imaging. "We remain confident that our PillCam business will continue to grow during the second half of 2010, despite the fact that sales were impacted by the trend of lower utilization of healthcare services, especially in the U.S., and the adverse effect of the weak Euro."

Second Quarter 2010 Revenue Analysis

Revenues in the Americas region were $22.4 million, including revenues of $4.5 million from the Bravo pH Monitoring System. In the same period in 2009 revenues in the Americas region were $22.9 million, including revenues of $3.3 million from Bravo. Revenues in the EMEA region were $10.0, the same as in the corresponding period last year. Revenues in the EMEA region were impacted by the weakness of the Euro. APAC revenues increased by 28 percent to $4.1 million compared to $3.2 million in the same period in 2009. SSI contributed $5.7 million to the Company's consolidated revenues.

Worldwide PillCam SB sales amounted to 59,900 capsules in the second quarter of 2010, compared to 57,500 in the same period last year. PillCam SB sales in the Americas region declined by 3 percent to 37,200 in the second quarter of 2010. PillCam SB sales in the EMEA region increased by 10 percent to 16,500 compared to the second quarter of 2009, while PillCam SB sales in the APAC region grew almost 50 percent to 6,100 from 4,100 in the same period in 2009.

Supplemental second data can be found at www.givenimaging.com in the Investor Relations section.

Six Month Financial Results

For the six month period ended June 30, 2010, revenues increased by 11.6 percent to $74.2 million compared to $66.5 million in the same period of 2009. First half 2010 revenues also include second quarter 2010 SSI revenues of $5.7 million. Sales in the Americas region in the first half of 2010 were $42.9 million, slightly below the $43.1 million in the same period in 2009. For the six month period, sales of PillCam SB in the Americas region declined approximately 3 percent. Sales in the Americas region include $7.2 million from sales of Bravo, compared to $5.9 million in the first half of 2009. Sales in the EMEA region increased by 2 percent to $18.5 million, from $18.1 million in the same period in 2009. Revenues in the EMEA region were adversely impacted by the weakness of the Euro during the second quarter. Sales in the APAC region were $7.2 million, a 33 percent increase from $5.4 million last year.

On a non-GAAP basis, gross profit margin for the six month period was 77.2 percent compared to 76 percent in 2009. On a GAAP basis, gross profit margin in the first six months of 2010 was 73.7 percent, and includes a one-time charge of $1.5 million from the SSI acquisition, compared to 76.1 percent in the second quarter of 2009. On a non-GAAP basis net income for the first six months of 2010 grew 43 percent to $10.6 million, or $0.35 per share on a fully diluted GAAP basis, compared to net income of $7.4 million or $0.25 per share for the same period in 2009. GAAP net income for the first six months of 2010 was $4.3million, or $0.14 per share, compared to $5.1 million or $0.17 in the same quarter of last year.

2010 Guidance Update

The Company is updating its 2010 earnings per share guidance to reflect the acquisition of SSI. As a result of the provisional purchase price allocation, the Company now projects GAAP earnings per share of $0.44 - $0.52. Non-GAAP earnings per share guidance (excluding charges relating to FAS123R and SSI acquisition expenses) remains unchanged at $0.76 - $0.84.

The Company anticipates that as a result of the continued trend of lower utilization of healthcare services by Americans, and persistent global economic weakness, 2010 revenues will be in the lower range of guidance, previously updated to reflect the SSI acquisition on April 1, 2010, which is between $167 million and $174 million.

Conference Call / Webcast Information

U.S. Call / Webcast

The company will host a conference call in English at 9:00am ET on Thursday, August 12, 2010. To participate in this teleconference, please dial 888-206-4913 fifteen minutes before the conference is scheduled to begin. Callers outside of the U.S. should dial 913-312-9313. The call will also be webcast live at www.givenimaging.com. A replay of the call will be available for two weeks on the company's website, or until August 26 by dialing 888-203-1112. Callers outside of the U.S. should dial 719-457-0820. The replay participant code is 3918364.

Hebrew Call

A conference call in Hebrew will take place on August 12 at 2:00pm Israel time, 7:00am ET. To access this call, please dial +972 3 9180609 ten minutes before the conference is scheduled to begin. A replay of the call will be available from August 12 until August 14 by dialing +972 3 9255937.

About Given Imaging Ltd.

Since 2001, Given Imaging has advanced gastrointestinal visualization by developing innovative, patient-friendly tools based on its PillCam® Platform. PillCam® capsule endoscopy provides physicians with natural images of the small intestine via PillCam® SB, the esophagus through PillCam® ESO and the colon with PillCam® COLON [PillCam COLON is not cleared for use in the USA]. The PillCam® capsules are miniature video cameras that patients ingest. Given Imaging's other capsule products include Agile™ patency capsule, to verify intestinal patency, and Bravo®, the only wireless, catheter-free, 48-hour pH test commercially available for pH testing to assess gastroesophageal reflux disease (GERD). Given Imaging's products use cutting-edge, wireless technology and advanced software to enable gastroenterologists to visualize diseases of the esophagus, small bowel and colon. All Given Imaging products allow patients to maintain normal activities. In April 2010 Given Imaging acquired Sierra Scientific Instruments, a leading provider of specialty GI diagnostic solutions and pioneer of high-resolution manometry for assessing gastrointestinal motility. Sierra Scientific is now a wholly-owned subsidiary of Given Imaging. Given Imaging's headquarters, manufacturing and R&D facilities are located in Yoqneam, Israel, with operating subsidiaries in the United States, Germany, France, Japan, Australia and Singapore. For more information, please visit www.givenimaging.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, projections about our business and our future revenues, expenses and profitability. Forward-looking statements may be, but are not necessarily, identified by the use of forward-looking terminology such as "may," "anticipates," "estimates," "expects," "intends," "plans," "believes," and words and terms of similar substance. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual events, results, performance, circumstances or achievements of the Company to be materially different from any future events, results, performance, circumstances or achievements expressed or implied by such forward-looking statements. Factors that could cause actual events, results, performance, circumstances or achievements to differ from such forward-looking statements include, but are not limited to, the following: (1) our ability to develop and bring to market new products, (2) our ability to successfully complete any necessary or required clinical studies with our products, (3) our ability to receive regulatory clearance or approval to market our products or changes in regulatory environment, (4) our success in implementing our sales, marketing and manufacturing plans, (5) the level of adoption of our products by medical practitioners, (6) the emergence of other products that may make our products obsolete, (7) lack of an appropriate bowel preparation materials to be used with our PillCam COLON capsule, (8) protection and validity of patents and other intellectual property rights, (9) the impact of currency exchange rates, (10) the effect of competition by other companies, (11) the outcome of significant litigation, (12) our ability to obtain reimbursement for our product from government and commercial payors, (13) quarterly variations in operating results, (14) the possibility of armed conflict or civil or military unrest in Israel, (15) the impact of global economic conditions, (16) our ability to successfully integrate acquired businesses, (17) changes and reforms in applicable healthcare laws and regulations and (18) other risks and factors disclosed in our filings with the U.S. Securities and Exchange Commission, including, but not limited to, risks and factors identified under such headings as "Risk Factors," "Cautionary Language Regarding Forward-Looking Statements" and "Operating Results and Financial Review and Prospects" in the Company's Annual Report on Form 20-F for the year ended December 31, 2009. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Except for the Company's ongoing obligations to disclose material information under the applicable securities laws, it undertakes no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events.

           Given Imaging Ltd. and its Consolidated Subsidiaries
                              Excluded Items
            For the Three Months Ended June 30, 2009 and 2010
                    (Unaudited, dollars in thousands)


                          Research   Selling   General    Tax
                 Gross      And        And       And    Expense
                 Profit  Development Marketing  Admin  (Benefit)    Total
                --------- ---------- --------- -------- --------  --------

Three month period
 ended June 30, 2010

Compensation
 expenses       $       - $       73 $     299 $  2,420 $      -  $  2,792
Sierra PPA          1,509        111        82      250     (679)    1,273
                --------- ---------- --------- -------- --------  --------
Total           $   1,509 $      184 $     381 $  2,670 $   (679) $  4,065
                ========= ========== ========= ======== ========  ========

Three month period
ended June 30, 2009

Compensation
 expenses       $       - $      115 $     845 $  1,218 $      -  $  2,178
Tax (benefit)           -          -         -        -   (1,390)   (1,390)
                --------- ---------- --------- -------- --------  --------
Total           $       - $      115 $     845 $  1,218 $ (1,390) $    788
                ========= ========== ========= ======== ========  ========




           Given Imaging Ltd. and its Consolidated Subsidiaries
                              Excluded Items
            For the Six Months Ended June 30, 2009 and 2010
                   (Unaudited, dollars in thousands)

                           Research   Selling  General  Tax
                  Gross     And        And      And    Expense
                  Profit Development Marketing  Admin  (Benefit)    Total
                --------- ---------- --------- -------- --------  --------

Six month period
 ended June 30, 2010

Compensation
 expenses       $       - $      156 $     626 $  3,623 $      -  $  4,405
Sierra PPA          1,509        111        82      930     (679)    1,953
                --------- ---------- --------- -------- --------  --------
Total           $   1,509 $      267 $     708 $  4,553 $   (679) $  6,358
                ========= ========== ========= ======== ========  ========

Six month period
 ended June 30, 2009

Compensation
 expenses       $       - $      193 $     998 $  2,497 $      -  $  3,688
Tax (benefit)           -          -         -        -   (1,390)   (1,390)
                --------- ---------- --------- -------- --------  --------
Total           $       - $      193 $     998 $  2,497 $ (1,390) $  2,298
                ========= ========== ========= ======== ========  ========





           Given Imaging Ltd. and its Consolidated Subsidiaries
            Reconciliation of GAAP results to non-GAAP results
            For the three months ended June 30, 2010 and 2009
          Condensed, in thousands except share and per share data

                                Q2                          Q2
                               2010                        2009
                            Specified                   Specified
                              Items     Non               Items     Non
                      GAAP     (*)      GAAP      GAAP     (*)      GAAP
                    --------  ------  --------  --------  ------  --------


Revenues            $ 42,134  $    -  $ 42,134  $ 36,030  $    -  $ 36,030
Cost of revenues     (11,062)  1,509    (9,553)   (8,621)      -    (8,621)

Gross profit          31,072   1,509    32,581    27,409            27,409
       Gross profit
        as a % of
        revenues        73.7%      -      77.3%     76.1%             76.1%

Operating expenses
Research and
 development, net     (5,163)    184    (4,979)   (4,214)    115    (4,099)
Sales and marketing  (16,345)    381   (15,964)  (16,541)    845   (15,696)
General and
 administrative       (6,956)  2,670    (4,286)   (4,564)  1,218    (3,346)
Other, net              (171)      -      (171)       (3)      -        (3)

Total operating
 expenses            (28,635)  3,235   (25,400)  (25,322)  2,178   (23,144)

Operating profit
 (loss)                2,437   4,744     7,181     2,087   2,178     4,265

    Operating
     profit as a % of
     revenues            5.8%             17.0%      5.8%             11.8%

Financing income, net   (175)      -      (175)    1,316       -     1,316

Profit (loss)
 before taxes on
 income                2,262   4,744     7,006     3,403   2,178     5,581
Income tax benefit
 (expense)              (100)   (679)     (779)    1,194  (1,390)     (196)

Net Profit (loss)      2,162   4,065     6,227     4,597     788     5,385

Net loss
 attributable to
 non-controlling
 interest                 49       -        49       291       -       291

Net profit (loss)
 attributable to
 shareholders       $  2,211  $4,065  $  6,276  $  4,888  $  788  $  5,676

  Net profit (loss)
   attributable to
   shareholders as
   a % of revenues       5.2%             14.9%     13.6%             15.8%

Earnings per share

Basic Earnings
 (losses)
 attributable to
 shareholders per
 Ordinary Share     $   0.07  $ 0.14  $   0.21  $   0.17  $ 0.02  $   0.19

Diluted Earnings
 (losses)
 attributable to
 shareholders per
 Ordinary Share     $   0.07  $ 0.13  $   0.20  $   0.16  $ 0.03  $   0.19

(*)See specified items




           Given Imaging Ltd. and its Consolidated Subsidiaries
            Reconciliation of GAAP results to non-GAAP results
        For the three and six months ended June 30, 2010 and 2009
          Condensed, in thousands except share and per share data
                  
                          YTD 2010                      YTD 2009
                          Specified                    Specified
                           Items      Non                Items      Non
                  GAAP      (*)       GAAP      GAAP      (*)       GAAP
                --------  --------  --------  --------  --------  --------

Revenues        $ 74,231  $      -  $ 74,231  $ 66,503  $      -  $ 66,503
Cost of
 revenues        (18,398)    1,509   (16,889)  (15,939)        -   (15,939)

Gross profit      55,833     1,509    57,342    50,564         -    50,564
   Gross profit
    as a % of
    revenues        75.2%               77.2%     76.0%               76.0%

Operating
 expenses
Research and
 development,
 net              (8,940)      267    (8,673)   (7,890)      193    (7,697)
Sales and
 marketing       (31,094)      708   (30,386)  (30,499)      998   (29,501)
General and
 administrative  (12,090)    4,553    (7,537)   (8,979)    2,497    (6,482)
Other, net          (234)        -      (234)      (15)        -       (15)

Total operating
 expenses        (52,358)    5,528   (46,830)  (47,383)    3,688   (43,695)

Operating
 profit (loss)     3,475     7,037    10,512     3,181     3,688     6,869
   Operating
    profit as a %
    of revenues      4.7%               14.2%      4.8%               10.3%

Financing
 income, net         803         -       803       190         -       190

Profit before
 taxes on
 income            4,278     7,037    11,315     3,371     3,688     7,059
Income tax
 benefit
 (expense)          (229)     (679)     (908)    1,166    (1,390)     (224)

Net Profit         4,049     6,358    10,407     4,537     2,298     6,835

Net loss
 attributable to
 non-controlling
 interest            215         -       215       590         -       590

Net profit
 attributable to
 shareholders   $  4,264  $  6,358  $ 10,622  $  5,127  $  2,298  $  7,425

   Net profit
    attributable
    to shareholders
    as a % of
    revenues         5.7%               14.3%      7.7%               11.2%

Earnings per share

Basic Earnings
 attributable to
 shareholders
 per Ordinary
 Share          $   0.14  $   0.22  $   0.36  $   0.18  $   0.08  $   0.26

Diluted
 Earnings
 attributable to
 shareholders
 per Ordinary
 Share          $   0.14  $   0.21  $   0.35  $   0.17  $   0.08  $   0.25





           Given Imaging Ltd. and its Consolidated Subsidiaries
                    Interim Consolidated Balance Sheets
                      In thousands except share data
                                (Unaudited)

                                                    June 30,   December 31,
                                                  ------------ ------------
                                                      2010         2009
                                                  ------------ ------------
Assets

Current assets
Cash and cash equivalents                         $     39,056 $     46,458
Short-term investments                                  27,891       31,736
Accounts receivable:
  Trade                                                 26,369       24,742
  Other                                                  4,787        3,799
Inventories                                             18,472       17,302
Prepaid expenses                                         1,559        1,036
Deferred tax assets                                      1,834        2,207
Advances to suppliers                                      733          534
                                                  ------------ ------------

Total current assets                                   120,701      127,814
                                                  ------------ ------------

Deposits                                                 1,147        1,062

Assets held for employee severance payments              5,252        4,968

Marketable Securities                                    5,915       16,956

Non-current Inventory                                    5,920        6,015

Fixed assets, at cost, less accumulated
 depreciation                                           14,205       13,843

Deferred tax assets                                        192          192

Intangible assets, less accumulated amortization
 (Note 4)                                               26,864       11,284

Goodwill                                                24,109        3,586
                                                  ------------ ------------


Total Assets                                      $   204,305  $    185,720
                                                  ===========  ============





           Given Imaging Ltd. and its Consolidated Subsidiaries
                    Interim Consolidated Balance Sheets
                      In thousands except share data
                                (Unaudited)

                                                    June 30,   December 31,
                                                  ------------ ------------
                                                      2010         2009
                                                  ------------ ------------
Liabilities and equity

Current liabilities

Current installments of obligation under capital
 lease                                            $       162  $       145
Accounts payable
  Trade                                                 7,376        6,789
  Other                                                25,173       20,060
Deferred income                                           869          234
                                                  -----------  -----------
Total current liabilities                              33,580       27,228
                                                  -----------  -----------

Long-term liabilities
Obligation under capital lease, net                       311          356
Liability in respect of employees' severance
 payments                                               5,779        5,530
                                                  -----------  -----------
Total long-term liabilities                             6,090        5,886
                                                  -----------  -----------
Total liabilities                                      39,670       33,114
                                                  -----------  -----------

Equity
Shareholders' equity
Ordinary Shares, NIS 0.05 par value each
 (90,000,000 shares authorized; 29,745,352
 and 29,370,972 shares issued and fully paid
 as of March 31, 2010 and December 31, 2009,
 respectively)                                            349          345
Additional paid-in capital                            190,395      182,203
Capital reserve                                         2,166        2,166
Accumulated other comprehensive loss                      183          399
Accumulated deficit                                   (28,921)     (33,185)
                                                  -----------  -----------
Shareholders' equity                                  164,172      151,928
                                                  -----------  -----------
Non-controlling interest                                  463          678
                                                  -----------  -----------
Total Equity                                          164,635      152,606
                                                  -----------  -----------


Total liabilities and equity                      $   204,305  $   185,720
                                                  ===========  ===========




           Given Imaging Ltd. and its Consolidated Subsidiaries
              Interim Consolidated Statements of Operations
               In thousands except share and per share data
                                (Unaudited)

                 Six month period ended Three month period ended  Year
                         June 30                June 30           ended
                ----------------------  ----------------------  December 31
                   2010        2009        2010        2009        2009
                ----------  ----------  ----------  ----------  ----------
Revenues        $   74,231  $   66,503  $   42,134  $   36,030  $  141,763

Cost of
 revenues          (18,398)    (15,939)    (11,062)     (8,621)    (33,145)
                ----------  ----------  ----------  ----------  ----------

Gross profit        55,833      50,564      31,072      27,409     108,618
                ----------  ----------  ----------  ----------  ----------

Operating
 expenses
Research and
 development,
 gross              (9,447)     (8,524)     (5,423)     (4,514)    (17,842)

Government
 grants                507         634         260         300       1,109
                ----------  ----------  ----------  ----------  ----------
Research and
 development,
 net                (8,940)     (7,890)     (5,163)    ( 4,214)    (16,733)

Sales and
 marketing         (31,094)    (30,499)    (16,345)    (16,541)    (61,428)
General and
 administrative    (12,090)     (8,979)     (6,956)     (4,564)    (18,919)
Other, net            (234)        (15)       (171)         (3)     (1,220)
                ----------  ----------  ----------  ----------  ----------

Total operating
 expenses          (52,358)    (47,383)    (28,635)    (25,322)    (98,300)
                ----------  ----------  ----------  ----------  ----------

Operating
 income              3,475       3,181       2,437       2,087      10,318
Financing
 income
 (expense), net        803         190        (175)      1,316       1,584
                ----------  ----------  ----------  ----------  ----------

Income before
 taxes
 on income           4,278       3,371       2,262       3,403      11,902
Income tax
 (expense)
 benefit              (229)      1,166        (100)      1,194       1,542
                ----------  ----------  ----------  ----------  ----------

Net income           4,049       4,537       2,162       4,597      13,444

Net loss
 attributable to
 non-controlling
 interest              215         590          49         291         891
                ----------  ----------  ----------  ----------  ----------

Net income
 attributable to
 Shareholders   $    4,264  $    5,127  $    2,211  $    4,888  $   14,335
                ==========  ==========  ==========  ==========  ==========

Earnings  per
 share

Basic Earnings
 attributable
 to shareholders
 per Ordinary
 Share          $     0.14  $     0.18  $     0.07  $     0.17  $     0.49
                ==========  ==========  ==========  ==========  ==========

Diluted
 Earnings
 attributable
 to shareholders
 per Ordinary
 Share          $     0.14  $     0.17  $     0.07  $     0.16  $     0.47
                ==========  ==========  ==========  ==========  ==========

Weighted
 average number
 of Ordinary
 Shares used to
 compute basic
 Earnings
 per Ordinary
 share          29,551,276  29,258,035  29,674,785  29,258,285  29,281,897
                ==========  ==========  ==========  ==========  ==========

Weighted
 average number
 of Ordinary
 Shares used to
 compute dilute
 Earnings
 per Ordinary
 share          30,676,309  29,838,686  30,706,200  29,766,429  30,423,162
                ==========  ==========  ==========  ==========  ==========




           Given Imaging Ltd. and its Consolidated Subsidiaries
                  Consolidated Statements of Cash Flows
                               In thousands
                                (Unaudited)

                       Six month period      Three month period
                             ended                 ended           Year
                            June 30               June 30         ended
                     --------------------  -------------------- December 31
                       2010       2009        2010       2009      2009
                     ---------  ---------  ---------  ---------  ---------
Cash flows from
 operating
 activities:
Net income           $   4,049  $   4,537  $   2,162  $   4,597  $  13,444

Adjustments required
 to reconcile net
 income to net cash
 used in operating
 activities:

Depreciation and
 amortization            4,056      2,982      2,558      1,517      6,096
Goodwill impairment          -          -          -          -        483
Deferred tax assets        373        183        167        173     (1,221)
Stock based
 compensation            4,405      3,688      2,792      2,178      7,268
Other                        -       (136)         -       (145)       570
Net increase in
 trading securities        323     (3,372)       236     (3,372)         -
Decrease (increase)
 in accounts receivable
 - trade                 2,053       (708)      (975)      (527)    (3,069)
Decrease(increase)
 in accounts receivable
 - other                  (984)     1,674       (664)      (660)       863
Decrease in prepaid
 expenses                    3        382        562        637        595
Decrease (increase)
 in advances to suppliers (199)     2,701       (356)     2,742      3,006
Decrease (increase)
 in inventories          2,641     (2,688)     1,216        676     (4,386)
Increase (decrease)
 in accounts payable    (5,593)      (509)      (383)      (687)     1,819
Increase (decrease) in
 deferred income           635       (918)       383       (524)    (1,289)
                     ---------  ---------  ---------  ---------  ---------
Net cash provided by
 operating activities   11,762      7,816      7,698      6,605     24,179
                     ---------  ---------  ---------  ---------  ---------

Cash flows from
 investing
 activities:
Purchase of fixed
 assets and
 intangible assets      (2,550)    (2,448)    (1,328)    (1,392)    (4,794)

Deposits                   (27)       (10)        (3)       (13)        34
Acquisition of
 Sierra, net
 cash acquired (1)     (34,709)         -        291          -          -
Proceeds from sales of
 marketable
 securities and
 short term
 investments            22,393     20,726      4,185     (1,055)    38,085
Investments in
 trading and
 marketable
 securities             (7,786)   (12,208)      (240)   (11,958)   (27,410)
                     ---------  ---------  ---------  ---------  ---------
Net cash provided by
 (used in) investing
 activities          $ (22,679) $   6,060  $   2,905  $ (14,418) $   5,915
                     ---------  ---------  ---------  ---------  ---------




           Given Imaging Ltd. and its Consolidated Subsidiaries
                  Consolidated Statements of Cash Flows
                               In thousands
                                (Unaudited)

                           Six month period   Three month period    Year
                                ended               ended          ended
                               June 30             June 30        December
                          ------------------  ------------------     31
                            2010      2009      2010      2009      2009
                          --------  --------  --------  --------  --------
Cash flows from financing
 activities:
Principal payments on
 capital lease obligation,
 net                      $    (49) $    (65) $    (15) $    (32) $   (131)
Proceeds from the
 issuance of
 Ordinary Shares             3,791         -     1,800         -       954

Dividend distribution            -   (15,799)        -         -   (15,799)
Purchase of shares from a
 non-controlling
 shareholder in a
 subsidiary                      -      (382)        -      (382)     (382)
                          --------  --------  --------  --------  --------
Net cash (used in)
 provided by financing
 activities                  3,742   (16,246)    1,785      (414)  (15,358)
                          --------  --------  --------  --------  --------

Effect of exchange rate
changes on cash               (227)      (89)     (307)      169        25
                          --------  --------  --------  --------  --------

Increase (decrease) in
 cash and cash equivalents  (7,402)   (2,459)   12,081    (8,058)   14,761
Cash and cash equivalents
 at beginning of period     46,458    31,697    26,975    37,296    31,697
                          --------  --------  --------  --------  --------

Cash and cash equivalents
 at end of period         $ 39,056  $ 29,238  $ 39,056  $ 29,238  $ 46,458
                          ========  ========  ========  ========  ========

Supplementary cash flow
 information
Income taxes paid         $     94  $     85  $     46  $     41  $    877
                          ========  ========  ========  ========  ========

Contact Information: For further information contact: Fern Lazar/David Carey Lazar Partners Ltd. 1-212-867-1768 /