HOLLYWOOD, Fla., Feb. 24, 2009 (GLOBE NEWSWIRE) -- STARLIMS Technologies Ltd. (Nasdaq:LIMS), a leading provider of laboratory information management systems (LIMS), today announced financial results for the fourth quarter and full fiscal year 2008 ended December 31, 2008
Total revenue for the fourth quarter of 2008 was $7.0 million, an increase of 4.5% from the $6.7 million reported in the fourth quarter of 2007. Product revenue for the fourth quarter of 2008 was $4.1 million, an increase of 2.5% from $4.0 million reported in the same period a year ago. Services revenue for the fourth quarter of 2008 was $2.9 million, up 7.6% from the $2.7 million reported in the same period a year ago.
Revenue for the full year of 2008 was $25.2 million, a 6.2% increase compared to $23.8 million for the full year of 2007. Product revenue for 2008 was $15.5 million, an 11.3% increase compared to $13.9 million for 2007. Services revenue for 2008 was $9.8 million, down 1.1% compared to $9.9 million for 2007.
"During the past year, we have expanded our solutions in order to increase our market opportunity, which we believe is especially important during this challenging economic environment. The release of our scientific data management (SDMS) solution and the upcoming release of our electronic notebook (ELN), are very significant steps towards our goal of integrating all laboratory data and information into a single web based solution, and providing the means to manage a wide range of analytical processes and workflows," said Itschak Friedman, CEO of STARLIMS. "This, combined with our ongoing efforts to expand our geographic presence, opens up new avenues for long-term growth."
GAAP operating income for the fourth quarter of 2008 was $748,000 or 10.7% of revenue, compared to GAAP operating income $605,000 or 9.0% of revenue for the fourth quarter of 2007. GAAP net income for the fourth quarter of 2008 was $673,000, or $0.08 per diluted share, compared to GAAP net income of $981,000, or $0.11 per diluted share, for the fourth quarter of 2007. GAAP operating income for the full year of 2008 was $2.4 million or 9.6% of revenue, compared to $3.8 million or 16.2% of revenue for the full year of 2007. GAAP net income for 2008 was $2.9 million, or $0.33 per diluted share, compared to GAAP net income of $4.5 million, or $0.57 per diluted share, for of 2007.
Non-GAAP operating income for the fourth quarter of 2008 was $907,000 or 13.0% of revenue, compared to $687,000 or 10.3% of revenue for the fourth quarter of 2007. Non-GAAP net income for the fourth quarter of 2008 was $780,000, or $0.09 per diluted share, compared to non-GAAP net income of $1.0 million, or $0.12 per diluted share, for the fourth quarter of 2007. Non-GAAP operating income for the full year of 2008 was $3.0 million or 11.7% of revenue, compared to $4.3 million or 17.9% of revenue for the full year of 2007. Non-GAAP net income for 2008 was $3.2 million, or $0.37 per diluted share, compared to non-GAAP net income of $4.8 million, or $0.61 per diluted share, for 2007.
The tables at the end of this press release include a reconciliation of GAAP to non-GAAP income from operations and net income for the fourth quarter and full fiscal year of 2008 and 2007.
Cash, cash equivalents, deposits and marketable securities amounted to $30.8 million on December 31, 2008, compared to $35.1 million on December 31, 2007. The Company generated $2.2 million in cash flow from operations for all of 2008.
"We have a very strong product portfolio and balance sheet and believe that even in these tough economic times, we can leverage these strengths to continuously improve our market position. In 2009, our goal is to incrementally expand operating margins from prior year levels. We believe we are well positioned to do this primarily through service margin improvement and ongoing cost containment," said Chaim Friedman, chief financial officer of STARLIMS.
Update to Stock Repurchase Program
STARLIMS purchased an aggregate of 326,308 common shares since the commencement of its stock repurchase program in February 2008, at a cost of $1.9 million, with an average price per share of $5.95.
Note on Use of Non-GAAP Financial Information
To supplement the consolidated financial statements presented in accordance with generally accepted accounting principles, or GAAP, STARLIMS uses non-GAAP measures of gross margin, net income and earnings per share, which are adjustments from results based on GAAP to exclude non recurring expenses, non-cash equity based compensation in accordance with SFAS 123(R) and amortization of intangibles related to acquisitions. Our management believes that the non-GAAP financial information provided in this release can assist investors in understanding and assessing the Company's on-going core operations and prospects for the future. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. Our management also uses both GAAP and non-GAAP information in evaluating and operating business internally and as such deemed it important to provide all this information to investors. Reconciliation between GAAP to non-GAAP statement of income is provided in the table below.
Conference Call and Webcast Information
STARLIMS will host a live webcast of its fourth quarter and full fiscal year 2008 financial results conference call on Tuesday, February 24, at 8:30 a.m. Eastern Standard Time (15:30 Israeli time). The listen-only webcast can be accessed from the Investor Relations page of the Company's web site at http://www.starlims.com. Those interested in participating in the question and answer session should dial (303) 262-2139.
The webcast will be archived on the STARLIMS Technologies Investor Relations page of the Company's website, at http://www.starlims.com starting at 11:00 a.m. on Tuesday, February 24, 2009
About STARLIMS
STARLIMS Technologies Ltd. (Nasdaq:LIMS) is a leading provider of laboratory information management systems (LIMS), with over 20 years of LIMS experience. The Company's flagship product, STARLIMS(r), improves the reliability of laboratory sampling processes, supports compliance with domestic and international regulations and industry standards, and provides comprehensive reporting, monitoring and analysis capabilities. STARLIMS software is used for quality assurance and control, testing and monitoring, and research and development in government, manufacturing and life sciences organizations. With operations in the United States, Canada, the United Kingdom, Israel and Hong Kong, the Company serves over 500 organizations in 40 countries. For more information, please see http://www.starlims.com.
Safe Harbor for Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties which could cause the actual results, performance or achievements of the Company to be materially different from those which may be expressed or implied by such statements, including, among others, changes in general economic and business conditions, changes in demand for products and services, the timing and amount or cancellation of orders, loss of market share and other risks detailed from time to time in STARLIMS's filings from time to time with the Securities and Exchange Commission. Such filings contain and identify these and other important factors that could cause actual results to differ materially from those contained in our projections or forward-looking statements. Shareholders and other readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of today.
STARLIMS TECHNOLOGIES LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands, except share data and per share data)
Dec. 31, Dec. 31,
----------------------
2007 2008
--------- ---------
ASSETS Audited Unaudited
Current Assets
Cash and cash equivalents 31,704 21,942
Short-term deposits -- 1,191
Restricted short-term deposits 195 338
Marketable securities 1,012 5,686
Accounts receivable (net of allowance
for doubtful accounts of $192 and $238,
respectively) 9,215 10,341
Other current assets 1,667 2,891
--------- ---------
Total current assets 43,793 42,389
--------- ---------
Long-Term Assets
Marketable securities - held-to-maturity 2,206 1,608
Other long-term assets 564 949
Fixed assets, net 1,601 1,416
Goodwill 1,326 2,227
Other assets, net 37 213
--------- ---------
Total long-term assets 5,734 6,413
--------- ---------
--------- ---------
Total assets 49,527 48,802
--------- ---------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Trade accounts payable 201 934
Deferred revenues 2,276 2,876
Other current liabilities and accrued
expenses 2,291 2,228
--------- ---------
Total current liabilities 4,768 6,038
--------- ---------
Long-Term Liabilities
Long-term deferred revenues 68 251
Accrued severance pay 52 19
Deferred taxes 841 483
--------- ---------
Total long-term liabilities 961 753
--------- ---------
Shareholders' Equity
Ordinary shares, NIS 1.00 par value;
authorized 15,000,000 shares; issued
9,994,544 and 9,997,919 shares,
respectively ; outstanding 8,724,675
and 8,407,742 shares,
respectively 3,151 3,152
Additional paid-in capital 30,893 31,355
Accumulated other comprehensive income 260 (27)
Retained earnings 12,267 12,198
Treasury stock, at cost - 1,269,869 and
1,590,177 ordinary shares,
respectively (2,773) (4,667)
--------- ---------
Total shareholders' equity 43,798 42,011
--------- ---------
--------- ---------
Total liabilities and shareholders' equity 49,527 48,802
--------- ---------
STARLIMS TECHNOLOGIES LTD.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(U.S. dollars in thousands, except share data and per share data)
Year ended Three Months Ended
--------------------- ---------------------
December 31, December 31,
--------------------- ---------------------
2007 2008 2007 2008
---------- ---------- ---------- ----------
Audited Unaudited Audited Unaudited
Revenues
Software licensing $ 10,656 $ 10,238 $ 3,129 $ 2,672
Maintenance 3,241 5,234 910 1,466
---------- ---------- ---------- ----------
Total product revenues 13,897 15,472 4,039 4,138
Services 9,878 9,770 2,652 2,853
---------- ---------- ---------- ----------
Total revenues 23,775 25,242 6,691 6,991
---------- ---------- ---------- ----------
Cost of revenues
Cost of products 374 409 348 118
Cost of services 8,095 9,137 2,304 2,448
---------- ---------- ---------- ----------
Total cost of revenues 8,469 9,546 2,652 2,566
---------- ---------- ---------- ----------
Gross profit 15,306 15,696 4,039 4,425
---------- ---------- ---------- ----------
Operating expenses
Research and development 2,872 3,408 822 818
Selling and marketing 5,792 6,299 1,814 1,805
General and
administrative 2,799 3,573 798 1,054
---------- ---------- ---------- ----------
Total operating
expenses 11,463 13,280 3,434 3,677
---------- ---------- ---------- ----------
Operating income 3,843 2,416 605 748
Financial income, net 1,551 1,050 629 62
---------- ---------- ---------- ----------
Income before income
taxes 5,394 3,466 1,234 810
Income tax expense 885 589 253 137
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Net income $ 4,509 $ 2,877 $ 981 $ 673
========== ========== ========== ==========
---------- ---------- ---------- ----------
Basic earnings per share $ 0.58 $ 0.33 $ 0.11 $ 0.08
========== ========== ========== ==========
Weighted average number
of ordinary shares used
in computing basic
earnings per share
---------- ---------- ---------- ----------
7,799,583 8,591,614 8,723,574 8,493,138
========== ========== ========== ==========
---------- ---------- ---------- ----------
Diluted earnings per
share $ 0.57 $ 0.33 $ 0.11 $ 0.08
========== ========== ========== ==========
Weighted average number
of ordinary shares used
in computing diluted
earnings per share
---------- ---------- ---------- ----------
7,897,036 8,713,394 8,827,487 8,673,226
========== ========== ========== ==========
STARLIMS TECHNOLOGIES LTD.
NON-GAAP CONSOLIDATED
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(U.S. dollars in thousands, except share data and per share data)
Year ended Three Months Ended
--------------------- ---------------------
December 31, December 31,
--------------------- ---------------------
2007 2008 2007 2008
---------- ---------- ---------- ----------
Audited Unaudited Audited Unaudited
Revenues
Software licensing $ 10,656 $ 10,238 $ 3,129 $ 2,672
Maintenance 3,241 5,234 910 1,466
---------- ---------- ---------- ----------
Total product revenues 13,897 15,472 4,039 4,138
Services 9,878 9,770 2,652 2,853
---------- ---------- ---------- ----------
Total revenues 23,775 25,242 6,691 6,991
---------- ---------- ---------- ----------
Cost of revenues
Cost of products 374 409 348 118
Cost of services 8,066 8,994 2,283 2,412
---------- ---------- ---------- ----------
Total cost of revenues 8,440 9,403 2,631 2,530
---------- ---------- ---------- ----------
Gross profit 15,335 15,839 4,060 4,461
---------- ---------- ---------- ----------
Operating expenses
Research and development 2,849 3,349 807 799
Selling and marketing 5,569 6,042 1,771 1,731
General and
administrative 2,660 3,493 795 1,024
---------- ---------- ---------- ----------
Total operating
expenses 11,078 12,884 3,373 3,554
---------- ---------- ---------- ----------
Operating income 4,257 2,955 687 907
Financial income, net 1,551 1,050 629 62
---------- ---------- ---------- ----------
Income before income
taxes 5,808 4,005 1,316 969
Income tax expense 976 770 282 189
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Net income $ 4,832 $ 3,235 $ 1,034 $ 780
========== ========== ========== ==========
---------- ---------- ---------- ----------
Basic earnings per share $ 0.62 $ 0.38 $ 0.12 $ 0.09
---------- ---------- ---------- ----------
Weighted average number
of ordinary shares used
in computing basic
earnings per share 7,799,583 8,591,614 8,723,574 8,493,138
========== ========== ========== ==========
---------- ---------- ---------- ----------
Diluted earnings per
share $ 0.61 $ 0.37 $ 0.12 $ 0.09
---------- ---------- ---------- ----------
Weighted average number
of ordinary shares used
in computing diluted
earnings per share 7,897,036 8,713,394 8,827,487 8,673,226
========== ========== ========== ==========
STARLIMS TECHNOLOGIES LTD.
RECONCILIATION BETWEEN GAAP AND NON-GAAP CONSOLIDATED
STATEMENT OF INCOME
Year ended Three Months Ended
---------------------- ----------------------
December 31, December 31,
---------------------- ----------------------
2007 2008 2007 2008
---------- ---------- ---------- ----------
Audited Unaudited Audited Unaudited
GAAP total Cost
of revenues 8,469 9,546 2,652 2,566
Stock based
compensation
expenses (29) (143) (21) (36)
---------- ---------- ---------- ----------
NON-GAAP total
cost of
revenues 8,440 9,403 2,631 2,530
========== ========== ========== ==========
GAAP Research
and
Development
expenses 2,872 3,408 822 818
Stock based
compensation
expenses (23) (59) (15) (19)
---------- ---------- ---------- ----------
NON-GAAP
Research and
Development
expenses 2,849 3,349 807 799
========== ========== ========== ==========
GAAP Selling
and marketing
expenses 5,792 6,299 1,814 1,805
Stock based
compensation
expenses (123) (257) (43) (74)
Issuance
related
expenses (100) -- -- --
---------- ---------- ---------- ----------
NON-GAAP
Selling and
marketing
expenses 5,569 6,042 1,771 1,731
========== ========== ========== ==========
GAAP General and
administrative
expenses 2,799 3,573 798 1,054
Stock based
compensation
expenses (9) (25) 1 (5)
Issuance
related
expenses (99) -- -- --
Amortization
of purchased
intangible
assets (31) (55) (4) (25)
---------- ---------- ---------- ----------
NON-GAAP General
and
administrative
expenses 2,660 3,493 795 1,024
========== ========== ========== ==========
GAAP total tax
expenses 885 589 253 137
Stock based
compensation
expenses 70 181 29 52
Issuance
related
expenses 21 -- -- --
---------- ---------- ---------- ----------
NON-GAAP total
tax expenses 976 770 282 189
========== ========== ========== ==========
STARLIMS TECHNOLOGIES LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in thousands)
Year ended Three Months Ended
---------------------- ----------------------
December 31, December 31,
---------------------- ----------------------
2007 2008 2007 2008
---------- ---------- ---------- ----------
Audited Unaudited Audited Unaudited
CASH FLOWS -
OPERATING
ACTIVITIES
Net income $ 4,509 $ 2,877 $ 981 $ 673
Adjustments to
reconcile net
income to cash
provided by (used
in)operating
activities:
Depreciation and
amortization 510 593 141 174
Stock-based
compensation 177 488 80 139
Loses (gains)
related to
marketable
securities (326) (79) (286) 78
Increase (decrease)
in accrued
severance pay 20 (33) (3) (59)
Deferred income
taxes (732) (452) (142) (90)
Capital loss from
sales of fixed
assets 8 2 8 --
The effect of
exchange rate
changes (241) 54 (441) 203
Changes in assets
and liabilities:
Decrease (increase)
in accounts
receivable (30) (834) 30 (989)
Increase (decrease)
in allowance for
doubtful accounts (99) 46 (49) 30
Decrease (increase)
in other current
assets 75 (613) 41 (5)
Increase (decrease)
in trade accounts
payable (182) 509 (281) 204
Increase in
deferred revenues 395 784 70 127
Increase (decrease)
in other current
liabilities 47 (1,132) 1,043 943
---------- ---------- ---------- ----------
Net cash provided by
(used in) operating
activities 4,131 2,210 1,192 1,428
---------- ---------- ---------- ----------
CASH FLOWS -
INVESTING
ACTIVITIES
Investments in
marketable
securities (740) (4,761) (33) (4,174)
Proceeds from sale
of marketable
securities 1,563 703 (576) 111
Investment in held-
to-maturity
marketable
securities (1,706) (428) (102) --
Proceeds from
redemption
of held-to-maturity
securities 1,685 466 1,685 466
Investments in
restricted
deposits, net (101) (1,245) (146) (1,286)
Loans to employees,
net (64) (281) 46 (159)
Purchase of fixed
assets (523) (374) (101) (91)
Proceeds from sale
of fixed assets 10 11 10 --
Acquisition of
subsidiary, net of
cash acquired -- (950) -- (32)
Acquisition of
activity, net of
cash acquired -- (75) -- (25)
---------- ---------- ---------- ----------
Net cash provided by
(used in) investing
activities 124 (6,934) 783 (5,190)
---------- ---------- ---------- ----------
CASH FLOWS -
FINANCING
ACTIVITIES
Proceeds from
issuing of shares,
net of issuance
expenses 26,785 (26) 146 --
Proceeds from sale
of treasury stock -- -- -- --
Purchase of treasury
stocks by the
company (93) (1,943) (13) (394)
Proceeds from sale of
treasury stock
against exercise of
options 17 49 8 --
Dividends paid (1,914) (2,918) -- --
---------- ---------- ---------- ----------
Net cash provided by
(used in) financing
activities 24,795 (4,838) 141 (394)
---------- ---------- ---------- ----------
THE EFFECT OF
EXCHANGE RATE
CHANGES ON CASH AND
CASH EQUIVALENTS 115 (200) 96 (134)
---------- ---------- ---------- ----------
Increase (decrease)
in cash and cash
equivalents 29,165 (9,762) 2,212 (4,290)
---------- ---------- ---------- ----------
Cash and cash
equivalents at the
beginning of the
period 2,539 31,704 29,492 26,232
---------- ---------- ---------- ----------
Cash and cash
equivalents at the
end of the period $ 31,704 $ 21,942 $ 31,704 $ 21,942
========== ========== ========== ==========
NOTE 1 - SEGMENTAL DISCLOSURE
Revenues by geographical areas
Year ended Three Months Ended
---------------------- ----------------------
December 31, December 31,
---------------------- ----------------------
2007 2008 2007 2008
---------- ---------- ---------- ----------
Audited Unaudited Audited Unaudited
North America $ 16,094 $ 17,203 $ 3,746 $ 3,863
Latin America 1,987 956 242 205
Europe 3,235 3,089 1,648 697
Asia 2,110 3,800 947 2,165
Israel 349 194 108 61
---------------------- ----------------------
$ 23,775 $ 25,242 $ 6,691 $ 6,991
====================== ======================
NOTE 2 - Treasury stock
In February 2008, the Company adopted a stock repurchase program,
allowing it to repurchase up to $2,000,000 worth of Company's
ordinary shares over a period of 18 months in the open market, at
times and prices that management considers appropriate, taking into
account prevailing market conditions and other corporate
considerations.
As of December 31, 2008, the Company had repurchased 326,308 of its
ordinary shares under the program at a total purchase price of
approximately $ 1,943,000, or an average price per share of $5.95.