HOLLYWOOD, Fla., Nov. 17, 2009 (GLOBE NEWSWIRE) -- STARLIMS Technologies Ltd. (Nasdaq:LIMS), a leading provider of laboratory information management systems (LIMS), today announced financial results for the third quarter of fiscal 2009 ended September 30, 2009.
Total revenue for the third quarter of 2009 was $7.7 million, an increase of 49.5% from the $5.1 million reported in the third quarter of 2008. Product revenue for the third quarter of 2009 was $4.7 million, an increase of 60.1% from $3.0 million reported in the same period a year ago. Services revenue for the third quarter of 2009 was $2.9 million, up 35.0% from the $2.2 million reported in the same period a year ago.
Revenue for the first nine months of 2009 was $22.0 million, an increase of 20.3% compared to $18.3 million for the first nine months of 2008. Product revenues for the first nine months of 2009 were $13.1 million, an increase of 15.6% compared to $11.3 million in the first nine months of 2008. Services revenue for the first nine months of 2009 was $8.9 million, an increase of 28.1% compared to $6.9 million for the first nine months of 2008.
"This was a solid quarter for STARLIMS, and we saw ongoing stabilization in business conditions. Our forensic offerings, including our appliance, are gaining traction and expanding our market opportunity. We also had several customers return to expand their licensing agreements having completed initial projects," said Itschak Friedman, CEO of STARLIMS.
GAAP operating income for the third quarter of 2009 was $1.5 million, or 19.6% of revenue, compared to GAAP operating loss of $79 thousand for the third quarter of 2008. GAAP net income for the third quarter of 2009 was $1.8 million, or $0.21 per diluted share, compared to $39 thousand and breakeven, respectively, in the third quarter of 2008. GAAP operating income for the first nine months of 2009 was $4.2 million or 19% of revenues, compared to $1.7 million or 9.1% of revenues for the first nine months of 2008. GAAP net income for the first nine months of 2009 was $4.8 million, or $0.56 per diluted share, compared to GAAP net income of $2.2 million, or $0.25 per diluted share, for the first nine months of 2008.
Non-GAAP operating income for the third quarter of 2009 was $1.7 million, or 21.7% of revenue, compared to $44 thousand, or 0.9% of revenue, for the third quarter of 2008. Non-GAAP net income for the third quarter of 2009 was $1.9 million, or $0.22 per diluted share, an increase from $0.1 million and $0.01, respectively, in the third quarter of 2008. Non-GAAP operating income for the first nine months of 2009 was $4.7 million or 21.2% of revenues, compared to $2.0 million or 11.2% of revenues for the first nine months of 2008. Non-GAAP net income for the first nine months of 2009 was $5.1 million, or $0.60 per diluted share, compared to non-GAAP net income of $2.5 million, or $0.28 per diluted share, for the first nine months of 2008.
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 third quarter and first nine months of fiscal years 2009 and 2008.
Cash, cash equivalents, deposits and marketable securities amounted to $33.1 million on September 30, 2009, compared to $30.8 million on June 30, 2009. The Company generated $1.9 million in cash flow from operations for the third quarter of 2009.
"The strength of our revenues, combined with ongoing operational efficiencies, resulted in continued strong operating margins for the third quarter. We believe we can expand Non-GAAP operating margins for the full year to the high teens as a percentage of revenue," said Chaim Friedman, chief financial officer of STARLIMS. "Given the strength in our revenue year to date, we expect to significantly outgrow our market and return to double digit top line growth for the full year."
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 third quarter fiscal year 2009 financial results conference call on Tuesday, November 17, 2009 at 8:30 a.m. Eastern Time (15:30 Israeli Time). The listen-only webcast can be accessed from the Investor Relations page of the company's website at http://www.starlims.com. Those interested in participating in the call and the question and answer session should dial 480-629-9722, or if calling from Israel should dial 1-809-34-4019.
The webcast will be archived for a limited time on the STARLIMS Technologies Investor Relations page of the company's website at http://www.starlims.com starting at 11:00 a.m. Eastern Time (18:00 Israeli Time) on Tuesday, November 17, 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 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)
December 31, September 30,
--------------------------
2008 2009
------------ -------------
ASSETS Audited Unaudited
Current Assets
Cash and cash equivalents 21,942 16,784
Short-term deposits 1,191 1,220
Restricted short-term deposits 338 37
Marketable securities 5,686 13,208
Accounts receivable (net of allowance
for doubtful accounts of $238 and $236,
respectively) 10,341 11,527
Other current assets 2,891 2,874
------------ -------------
Total current assets 42,389 45,650
------------ -------------
Long-Term Assets
Marketable securities - held-to-maturity 1,608 1,802
Other long-term assets 949 725
Fixed assets, net 1,416 1,288
Goodwill 2,227 2,264
Other intangible assets, net 213 142
------------ -------------
Total long-term assets 6,413 6,221
------------ -------------
------------ -------------
Total assets 48,802 51,871
------------ -------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Trade accounts payable 934 647
Deferred revenues 2,876 3,848
Other current liabilities and accrued
expenses 2,228 2,648
------------ -------------
Total current liabilities 6,038 7,143
------------ -------------
Long-Term Liabilities
Long-term deferred revenues 251 65
Accrued severance pay 19 48
Deferred taxes 483 136
------------ -------------
Total long-term liabilities 753 249
------------ -------------
Shareholders' Equity
Ordinary shares, NIS 1.00 par value;
authorized 15,000,000 shares; issued
9,997,919 and 10,019,169 shares,
respectively; outstanding 8,407,742 and
8,437,492 shares, respectively 3,152 3,157
Additional paid-in capital 31,355 31,788
Accumulated other comprehensive income (27) (92)
Retained earnings 12,198 14,238
Treasury stock, at cost - 1,590,177 and
1,581,677 ordinary shares, respectively (4,667) (4,612)
------------ -------------
Total shareholders' equity 42,011 44,479
------------ -------------
------------ -------------
Total liabilities and shareholders' equity 48,802 51,871
------------ -------------
STARLIMS TECHNOLOGIES LTD.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(U.S. dollars in thousands, except share data and per share data)
(Unaudited)
Nine Months Ended Three Months Ended
---------------------- ----------------------
September 30, September 30,
---------------------- ----------------------
2008 2009 2008 2009
---------- ---------- ---------- ----------
Revenues
Software licensing $ 7,566 $ 8,442 $ 1,518 $ 3,129
Maintenance 3,768 4,655 1,445 1,614
---------- ---------- ---------- ----------
Total product
revenues 11,334 13,097 2,963 4,743
Services 6,917 8,859 2,173 2,933
---------- ---------- ---------- ----------
Total revenues 18,251 21,956 5,136 7,676
---------- ---------- ---------- ----------
Cost of revenues
Cost of products 291 127 79 29
Cost of services 6,689 7,219 2,237 2,450
---------- ---------- ---------- ----------
Total cost of
revenues 6,980 7,346 2,316 2,479
---------- ---------- ---------- ----------
Gross profit 11,271 14,610 2,820 5,197
---------- ---------- ---------- ----------
Operating expenses
Research and
development 2,590 2,846 901 1,031
Selling and marketing 4,494 4,775 1,215 1,687
General and
administrative 2,519 2,811 783 975
---------- ---------- ---------- ----------
Total operating
expenses 9,603 10,432 2,899 3,693
---------- ---------- ---------- ----------
Operating income (loss) 1,668 4,178 (79) 1,504
Financial income, net 988 1,632 122 649
---------- ---------- ---------- ----------
Income before income
taxes 2,656 5,810 43 2,153
Income tax expense 452 992 4 330
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Net income $ 2,204 $ 4,818 $ 39 $ 1,823
========== ========== ========== ==========
---------- ---------- ---------- ----------
Basic earnings per
share $ 0.25 $ 0.57 $ 0.00 $ 0.22
========== ========== ========== ==========
Weighted average
number of ordinary
shares used in
computing basic
earnings per share
---------- ---------- ---------- ----------
8,654,746 8,424,835 8,540,744 8,436,888
========== ========== ========== ==========
---------- ---------- ---------- ----------
Diluted earnings per
share $ 0.25 $ 0.56 $ 0.00 $ 0.21
========== ========== ========== ==========
Weighted average
number of ordinary
shares used in
computing diluted
earnings per share
---------- ---------- ---------- ----------
8,731,612 8,602,225 8,643,104 8,638,531
========== ========== ========== ==========
STARLIMS TECHNOLOGIES LTD.
NON-GAAP CONSOLIDATED
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(U.S. dollars in thousands, except share data and per share data)
(Unaudited)
Nine Months Ended Three Months Ended
---------------------- ----------------------
September 30, September 30,
---------------------- ----------------------
2008 2009 2008 2009
---------- ---------- ---------- ----------
Revenues
Software licensing $ 7,566 $ 8,442 $ 1,518 $ 3,129
Maintenance 3,768 4,655 1,445 1,614
---------- ---------- ---------- ----------
Total product
revenues 11,334 13,097 2,963 4,743
Services 6,917 8,859 2,173 2,933
---------- ---------- ---------- ----------
Total revenues 18,251 21,956 5,136 7,676
---------- ---------- ---------- ----------
Cost of revenues
Cost of products 291 127 79 29
Cost of services 6,582 7,109 2,201 2,413
---------- ---------- ---------- ----------
Total cost of
revenues 6,873 7,236 2,280 2,442
---------- ---------- ---------- ----------
Gross profit 11,378 14,720 2,856 5,234
---------- ---------- ---------- ----------
Operating expenses
Research and
development 2,550 2,787 887 1,012
Selling and
marketing 4,311 4,550 1,157 1,613
General and
administrative 2,469 2,722 768 947
---------- ---------- ---------- ----------
Total operating
expenses 9,330 10,059 2,812 3,572
---------- ---------- ---------- ----------
Operating income 2,048 4,661 44 1,662
Financial income,
net 988 1,632 122 649
---------- ---------- ---------- ----------
Income before income
taxes 3,036 6,293 166 2,311
Income tax expense 581 1,152 46 382
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Net income $ 2,455 $ 5,141 $ 120 $ 1,929
========== ========== ========== ==========
---------- ---------- ---------- ----------
Basic earnings per
share $ 0.28 $ 0.61 $ 0.01 $ 0.23
========== ========== ========== ==========
Weighted average
number of ordinary
shares used in
computing basic
earnings per share 8,654,746 8,424,835 8,540,744 8,436,888
========== ========== ========== ==========
---------- ---------- ---------- ----------
Diluted earnings per
share $ 0.28 $ 0.60 $ 0.01 $ 0.22
========== ========== ========== ==========
Weighted average
number of ordinary
shares used in
computing diluted
earnings per share 8,731,612 8,602,225 8,643,104 8,638,531
========== ========== ========== ==========
STARLIMS TECHNOLOGIES LTD.
RECONCILIATION BETWEEN GAAP AND NON-GAAP CONSOLIDATED
STATEMENT OF INCOME
(Unaudited)
Nine Months Ended Three Months Ended
------------------ ------------------
September 30, September 30,
------------------ ------------------
2008 2009 2008 2009
-------- -------- -------- --------
GAAP total Cost of revenues 6,980 7,346 2,316 2,479
Stock based compensation
expenses (107) (110) (36) (37)
-------- -------- -------- --------
NON-GAAP total cost of
revenues 6,873 7,236 2,280 2,442
======== ======== ======== ========
GAAP Research and Development
expenses 2,590 2,846 901 1,031
Stock based compensation
expenses (40) (59) (14) (19)
-------- -------- -------- --------
NON-GAAP Research and
Development expenses 2,550 2,787 887 1,012
======== ======== ======== ========
GAAP Selling and marketing
expenses 4,494 4,775 1,215 1,687
Stock based compensation
expenses (183) (225) (58) (74)
-------- -------- -------- --------
NON-GAAP Selling and
marketing expenses 4,311 4,550 1,157 1,613
======== ======== ======== ========
GAAP General and
administrative expenses 2,519 2,811 783 975
Stock based compensation
expenses (20) (18) (7) (6)
Amortization of purchased
intangible assets (30) (71) (8) (22)
-------- -------- -------- --------
NON-GAAP General and
administrative expenses 2,469 2,722 768 947
======== ======== ======== ========
GAAP total tax expenses 452 992 4 330
Stock based compensation
expenses 129 160 42 52
-------- -------- -------- --------
NON-GAAP total tax expenses 581 1,152 46 382
======== ======== ======== ========
STARLIMS TECHNOLOGIES LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in thousands)
Nine Months Ended Three Months Ended
------------------ ------------------
September 30, September 30,
------------------ ------------------
2008 2009 2008 2009
-------- -------- -------- --------
CASH FLOWS - OPERATING
ACTIVITIES
Net income $ 2,204 $ 4,818 $ 39 $ 1,823
Adjustments to reconcile net
income to cash provided by
(used in) operating
activities:
Depreciation and
amortization 419 408 137 136
Stock-based compensation 349 411 113 135
Loses (gains) related to
marketable securities (157) (1,065) 77 (379)
Increase in accrued
severance pay 26 29 16 16
Deferred income taxes (362) (105) (164) (78)
Capital loss from sales of
fixed assets 2 -- 2 --
The effect of exchange rate
changes (149) (103) 23 19
Changes in assets and
liabilities:
Decrease (increase) in
trade receivables 155 (1,181) 1,551 (874)
Increase (decrease) in
allowance for doubtful
accounts 16 (2) (27) 20
Decrease (increase) in
other current assets (608) 197 (588) 458
Increase (decrease) in
trade accounts payable 305 32 (135) 211
Increase (decrease) in
deferred revenues 657 786 (164) 348
Increase (decrease) in other
current liabilities (2,075) (29) (94) 111
-------- -------- -------- --------
Net cash provided by
operating activities 782 4,196 786 1,946
-------- -------- -------- --------
CASH FLOWS - INVESTING
ACTIVITIES
Investments in marketable
securities (587) (9,185) (414) (1,189)
Proceeds from sale of
marketable securities 592 2,534 -- 402
Investment in held-to-
maturity marketable
securities (428) -- -- --
Investments in deposits, net 41 269 (3) (2)
Loans to employees, net (122) 106 (52) (26)
Purchase of fixed assets (283) (190) (40) (97)
Proceeds from sale of fixed
assets 11 -- 11 --
Acquisition of
subsidiaries, net of cash
acquired, and business
operation (918) (251) -- --
Purchase of other intangible
assets (50) (25) (25) --
-------- -------- -------- --------
Net cash used in investing
activities (1,744) (6,742) (523) (912)
-------- -------- -------- --------
CASH FLOWS - FINANCING
ACTIVITIES
Purchase of treasury stocks
by the Company (1,549) -- (241) --
Proceeds from issuing of
shares against exercise
of options 8 51 -- --
Proceeds from sale of
treasury stock against
exercise of options 15 31 15 18
Dividends paid (2,918) (2,681) -- --
-------- -------- -------- --------
Net cash provided by (used
in) financing activities (4,444) (2,599) (226) 18
-------- -------- -------- --------
THE EFFECT OF EXCHANGE RATE
CHANGES ON CASH AND CASH
EQUIVALENTS (66) (13) (18) 53
-------- -------- -------- --------
Increase (decrease) in
cash and cash equivalents (5,472) (5,158) 19 1,105
-------- -------- -------- --------
Cash and cash equivalents at
the beginning of the period 31,704 21,942 26,213 15,679
-------- -------- -------- --------
Cash and cash equivalents
at the end of the period $ 26,232 $ 16,784 $ 26,232 $ 16,784
======== ======== ======== ========
NOTE 1 - SEGMENTAL DISCLOSURE
Revenues by geographical areas
Nine Months Ended Three Months Ended
----------------------- -----------------------
September 30, September 30,
----------------------- -----------------------
2008 2009 2008 2009
----------- ----------- ----------- -----------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
North America $ 13,340 $ 14,472 $ 3,748 $ 4,498
Latin America 751 539 230 211
Europe 2,392 3,560 760 870
Asia 1,635 3,272 365 2,068
Israel 133 113 33 29
----------- ----------- ----------- -----------
$ 18,251 $ 21,956 $ 5,136 $ 7,676
=========== =========== =========== ===========