Copyright 2010 PR Newswire. All Rights Reserved
2009-11-17
Strong Balance Sheet Amid Challenging Economic Environment
GIVAT SHMUEL, Israel, November 17 /PRNewswire-FirstCall/ -- Cimatron Limited
(NASDAQ: CIMT), a leading provider of integrated CAD/CAM solutions for the
toolmaking and manufacturing industries, today announced financial results for
the third quarter and first nine months of 2009.
Danny Haran, President and Chief Executive Officer of Cimatron, said, "The third
quarter is typically the weakest quarter of each year, mostly because of the
summer vacation in Europe, and 2009 was no exception. The overall picture is
little changed from previous quarters, where maintenance revenues hold up well,
while product revenues are significantly below last year's numbers. In spite of
lower revenues, our balance sheet remains solid, with $7.5 million in cash and
cash equivalents. We expect an increase in product revenues in the coming
quarter, though it is still too early to say if this is a true recovery in our
market or just a reflection of usual end-of-year seasonality", concluded Mr.
Haran.
The following provides details on Cimatron's GAAP and non-GAAP figures in the
third quarter and first nine months of 2009:
There is no difference between GAAP and non-GAAP revenues in 2009. Revenues on a
non-GAAP basis in 2008 excluded the effect of business combination accounting
rules on the acquired deferred maintenance revenue balance of Gibbs System Inc.
that was merged into Cimatron in early 2008. Expenses on a non-GAAP basis in
2009 and 2008 exclude the non-cash amortization of acquired intangible assets of
Microsystem and Gibbs, and the effect of deferred taxes.
GAAP:
Revenues for the third quarter of 2009 were $7.2 million, compared to $9.9
million recorded in the third quarter of 2008. For the first nine months of
2009, revenues were $23.2 million, compared to $30.6 million in the same period
of 2008.
Gross Profit for the third quarter of 2009 was $5.8 million as compared to $8.2
million in the same period in 2008. Gross margin in the third quarter of 2009
was 80% of revenues, compared to a gross margin of 83% in the third quarter of
2008. For the first nine months of 2009, gross profit was $18.7 million,
compared to $24.9 million in the same period of 2008. Gross margin for the nine
months ended on September 30th, 2009 was 81% of revenues, compared to a gross
margin of 82% in the same period of 2008.
Operating loss in the third quarter of 2009 was $(901) thousand, compared to an
operating profit of $19 thousand in the third quarter of 2008. In the first nine
months of 2009, Cimatron recorded an operating loss of $(1.7) million, compared
to an operating loss of $(126) thousand in the first nine months of 2008.
Net Loss for the third quarter of 2009 was $(731) thousand, or $(0.08) per
diluted share, compared to a net profit of $111 thousand, or $0.01 per diluted
share recorded in the same quarter of 2008. In the first nine months of 2009 net
loss was $(1.4) million, or $(0.15) per diluted share, compared to a net profit
of $18 thousand, or $(0.00) per diluted share, in the first nine months of 2008.
Non-GAAP:
Revenues on a non-GAAP basis for the third quarter of 2009 were $7.2 million,
compared to $10.1 million recorded in the third quarter of 2008. For the first
nine months of 2009, revenues were $23.2 million, compared to $31.3 million in
the same period of 2008.
Gross Profit on a non-GAAP basis for the third quarter of 2009 was $6.0 million
as compared to $8.5 million in the same period in 2008. Gross margin in the
third quarter of 2009 was 82% of revenues, compared to 85% in the third quarter
of 2008. In the first nine months of 2009, gross profit on a non-GAAP basis was
$19.2 million, compared to $26.1 million in the first nine months of 2008. Gross
margin on a non-GAAP basis for the nine months ended on September 30th, 2009 was
83% of revenues, same as in the first nine months of 2008.
Operating Loss on a non-GAAP basis in the third quarter of 2009 was $(654)
thousand, compared to an operating profit of $514 thousand in the third quarter
of 2008. In the first nine months of 2009, Cimatron reports an operating loss of
$(989) thousand, compared to operating profit of $1.4 million in the first nine
months of 2008.
Net loss on a non-GAAP basis for the third quarter of 2009 was $(575) thousand,
or $(0.06) per diluted share, compared to a net profit of $646 thousand, or
$0.07 per diluted share recorded in the same quarter of 2008. In the first nine
months of 2009, net loss was $(907) thousand, or $(0.10) per diluted share,
compared to a net profit of $1.6 million, or $0.17 per diluted share, in the
first nine months of 2008.
Conference Call
Cimatron's management will host a conference call tomorrow, November 18th, 2009
at 9:00 EST, 16:00 Israel time. On the call, management will review and discuss
the results, and will answer questions by investors.
To participate, please call one of the following teleconferencing numbers.
Please begin placing your call at least 5 minutes before the conference call
commences.
USA: +1-888-668-9141
International: +972-3-9180610
Israel: 03-9180610
For those unable to listen to the live call, a replay of the call will be
available from the day after the call under the investor relations section of
Cimatron's website, at: www.cimatron.com
Reconciliation between results on a GAAP and Non-GAAP basis is provided in a
table immediately following the Consolidated Statements of Operation (Non-GAAP
basis). Non-GAAP financial measures consist of GAAP financial measures adjusted
to include recognition of deferred revenues of acquired companies and to exclude
amortization of acquired intangible assets and deferred income tax, as well as
certain business combination accounting entries. The purpose of such adjustments
is to give an indication of our performance exclusive of non-GAAP charges and
other items that are considered by management to be outside our core operating
results. Our non-GAAP financial measures are not meant to be considered in
isolation or as a substitute for comparable GAAP measures, and should be read in
conjunction with our consolidated financial statements prepared in accordance
with GAAP.
Our management regularly uses our supplemental non-GAAP financial measures
internally to understand, manage and evaluate our business and make operating
decisions. We believe that these non-GAAP measures help investors to understand
our current and future operating performance, especially as our two most recent
acquisitions have resulted in amortization and non-cash items that have had a
material impact on our GAAP results. These non-GAAP financial measures may
differ materially from the non-GAAP financial measures used by other companies.
About Cimatron
With over 25 years of experience and more than 40,000 installations worldwide,
Cimatron is a leading provider of integrated, CAD/CAM solutions for mold, tool
and die makers, as well as manufacturers of discrete parts. Cimatron is
committed to providing comprehensive, cost-effective solutions that streamline
manufacturing cycles, enable collaboration with outside vendors, and ultimately
shorten product delivery time.
The Cimatron product line includes the CimatronE and GibbsCAM brands with
solutions for mold design, die design, electrodes design, 2.5 to 5 axes milling,
wire EDM, turn, Mill-turn, rotary milling, multi-task machining, and tombstone
machining. Cimatron's subsidiaries and extensive distribution network serve and
support customers in the automotive, aerospace, medical, consumer plastics,
electronics, and other industries in over 40 countries worldwide.
Cimatron is publicly traded on the NASDAQ exchange under the symbol CIMT. For
more information, please visit the company web site at: http://www.cimatron.com.
Safe Harbor Statement
This press release includes forward looking statements, within the meaning of
the Private Securities Litigation Reform Act Of 1995, which are subject to risk
and uncertainties that could cause actual results to differ materially from
those anticipated. Such statements may relate to the company's plans, objectives
and expected financial and operating results. The words "may," "could," "would,"
"will," "believe," "anticipate," "estimate," "expect," "intend," "plan," and
similar expressions or variations thereof are intended to identify
forward-looking statements. Investors are cautioned that any such
forward-looking statements are not guarantees of the future performance and
involve risks and uncertainties, many of which are beyond the company's ability
to control. The risks and uncertainties that may affect forward looking
statements include, but are not limited to: currency fluctuations, global
economic and political conditions, marketing demand for Cimatron products and
services, long sales cycle, new product development, assimilating future
acquisitions, maintaining relationships with customers and partners, and
increased competition. For more details about the risks and uncertainties of the
business, refer to the Company's filings with the Securities and Exchanges
Commission. The company cannot assess the impact of or the extent to which any
single factor or risk, or combination of them, may cause. Cimatron undertakes no
obligation to publicly update or revise any forward looking statements, whether
as a result of new information, future events or otherwise.
CIMATRON LIMITED
CONSOLIDATED STATEMENTS OF INCOME
(US Dollars in thousands, except for per share data)
Three months ended Nine months ended
September 30, September 30,
2009 2008 2009 2008
Total revenue 7,229 9,864 23,195 30,571
Total cost of revenue 1,420 1,711 4,467 5,627
Gross profit 5,809 8,153 18,728 24,944
Research and development
expenses, net 1,497 1,683 4,389 5,273
Selling, general and
administrative expenses 5,213 6,451 16,069 19,797
Operating income (loss) (901) 19 (1,730) (126)
Financial income (expenses), net (8) 92 (17) 127
Taxes on Income 144 (33) 310 (26)
Other (3) - - (4)
Net income (loss) $ (768) $ 78 $ (1,437) $ (29)
Less: Net loss attributable
to the noncontrolling interest $ 37 (*)$ 33 $ 60 (*)$ 47
Net income (loss) attributable
to Cimatron's shareholders $ (731) $ 111 $ (1,377) $ 18
Net income (loss) per
share - basic and diluted $ (0.08) $ 0.01 $ (0.15) $ 0.00
Weighted average number of
shares outstanding
Basic EPS
(in thousands) 9,131 9,329 9,178 9,357
Diluted EPS
(in thousands) 9,131 9,385 9,178 9,362
(*) Reclassification due to the adoption of SFAS 160
CIMATRON LIMITED
RECONCILIATION BETWEEN GAAP AND NON-GAAP INFORMATION
(US Dollars in thousands, except for per share data)
Three months ended
September 30,
2009 2008
GAAP Adj. NON-GAAP GAAP Adj. NON-GAAP
Total revenue
(1) 7,229 7,229 9,864 248 10,112
Total cost
of revenue (2) 1,420 (147) 1,273 1,711 (147) 1,564
Gross profit 5,809 147 5,956 8,153 395 8,548
Research and
Development
expenses, net 1,497 1,497 1,683 - 1,683
Selling,
general and
administrative
expenses (2) 5,213 (100) 5,113 6,451 (100) 6,351
Operating
income (loss) (901) 247 (654) 19 495 514
Financial
Income
(expenses), net. (8) - (8) 92 - 92
Taxes on Income
(3) 144 (91) 53 (33) 40 7
Other (3) - (3) - - -
Net income
(loss) (*) $(768) $ 156 (612) $ 78 $ 535 $ 613
Less: Net Loss
Attributable
to the
noncontrolling
interest $37 - $37 (*)$33 - (*)$33
Net income
(loss)
attributable to
Cimatron's
Shareholders $(731) $ 156 $(575) $ 111 $ 535 $ 646
Net income
(loss) per
share - basic
and diluted $(0.08) (0.06) 0.01 $ 0.07
Weighted
average number
of shares
outstanding
Basic EPS
(in
thousands) 9,131 9,131 9,329 9,329
Diluted EPS
(in
thousands) 9,131 9,131 9,385 9,385
- TABLE CONTINUED -
Nine months ended
September 30,
2009 2008
GAAP Adj. NON-GAAP GAAP Adj. NON-GAAP
Total revenue
(1) 23,195 23,195 30,571 743 31,314
Total cost
of revenue (2) 4,467 (441) 4,026 5,627 (441) 5,186
Gross profit 18,728 441 19,169 24,944 1,184 26,128
Research and
Development
expenses, net 4,389 4,389 5,273 5,273
Selling,
general and
administrative
expenses (2) 16,069 (300) 15,769 19,797 (300) 19,497
Operating
income (loss) (1,730) 741 (989) (126) 1,484 1,358
Financial
Income
(expenses), net (17) (17) 127 127
Taxes on
Income (3) 310 (271) 39 (26) 118 92
Other - - (4) (4)
Net income
(loss) (*) $(1,437) $ 470 $(967) $ (29) $1,602 $1,573
Less: Net
Loss
Attributable
to the
noncontrolling
interest $60 - $60 (*)$47 - (*)$47
Net income (loss)
attributable to
Cimatron's
shareholders $(1,377) $470 $(907) $ 18 $1,602 $1,620
Net income
(loss) per
share - basic
and diluted $(0.15) $(0.10) $ 0.00 $ 0.17
Weighted
average number
of shares
outstanding
Basic EPS
(in thousands) 9,178 9,178 9,357 9,357
Diluted EPS
(in thousands) 9,178 9,178 9,362 9,362
(*) Reclassification due to the adoption of SFAS 160
(1) Non-GAAP adjustment related to Gibbs' assumed support contracts that
were not recognized on a GAAP basis in fiscal 2008 or thereafter
due to business combination accounting rules.
(2) Non-GAAP adjustment to exclude non-cash amortization of acquired
intangible assets.
(3) Non-GAAP adjustment to exclude the effect of deferred taxes.
CIMATRON LIMITED
CONSOLIDATED BALANCE SHEETS
(US Dollars in thousands)
September 30, December 31,
2009 2008
ASSETS
CURRENT ASSETS:
Total cash, cash equivalents and
short-term investments $ 7,514 $ 5,727
Trade receivables 4,952 7,108
Other current assets 2,853 2,697
Total current assets 15,319 15,532
Deposits with insurance companies
and severance pay fund 2,960 2,719
Net property and equipment 1,162 1,312
Total other assets 13,541 14,307
Total assets $ 32,982 $ 33,870
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term bank credit $ 122 $ 155
Trade payables 1,759 1,865
Accrued expenses and other liabilities 6,484 7,348
Deferred revenues 3,896 2,348
Total current liabilities 12,261 11,716
LONG-TERM LIABILITIES:
Accrued severance pay 4,234 3,933
Long-term loan 256 293
Deferred tax liability 1,456 1,729
Total long-term liabilities 5,946 5,955
Total shareholders' equity 14,775 (*)16,199
Total liabilities and
shareholders' equity $ 32,982 $ 33,870
(*) Reclassification due to the adoption of SFAS 160
CIMATRON LIMITED
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(US Dollars in thousands)
Accumulated
Additional other
Noncontrolling Share paid-in comprehensive
Interest capital capital income (loss)
Balance at December
31, 2008 $ (4) $ 304 $ 18,131 $ 65
Changes during the
nine months
ended September 30, 2009:
Net loss (60)
Unrealized loss on
derivative instruments (71)
Vesting of employee
stock options 54
Investment in treasury stock
Foreign currency translation
adjustment 158
Total comprehensive loss
Balance at September
30, 2009 $ (64) $ 304 $ 18,185 $ 152
- TABLE CONTINUED -
Retained
earnings Total
(accumulated Treasury Comprehensive shareholders'
deficit) stock income (loss) equity
Balance at
December 31,
2008 $(1,908) $ (389) $ 16,199
Changes during
the nine months
ended September
30, 2009:
Net loss (1,377) (1,437) (1,437)
Unrealized loss
on derivative
instruments (71) (71)
Vesting of
employee stock
options 54
Investment in
treasury stock (128) (128)
Foreign currency
translation
adjustment 158 158
Total comprehensive
loss (1,350)
Balance at September
30, 2009 $(3,285) $ (517) $ 14,775
CIMATRON LIMITED
STATEMENTS OF CASH FLOWS
(US Dollars in thousands)
Nine months ended
September 30,
2009 2008
Cash flows from operating activities:
Net loss $ (1,437) (*)$ (29)
Adjustments to reconcile net loss
to net cash provided by operating
activities:
Depreciation and amortization 1,224 1,193
Increase (decrease) in accrued
severance pay 301 470
Vesting of employee stock options 54 92
Deferred taxes, net (259) 46
Changes in assets and liabilities:
Decrease (increase) in accounts
receivable and prepaid expenses 2,245 2,626
Decrease (increase) in inventory (20) 24
Decrease (increase) in deposits with
insurance companies and severance pay fund (241) (418)
Increase (decrease) in trade payables,
accrued expenses and other liabilities 457 (482)
Net cash provided by operating activities 2,324 3,522
Cash flows from investing activities:
Proceeds from sale of property and equipment - 2
Proceeds from sale and redemption of bonds - 1,245
Purchase of property and equipment (264) (359)
Additional payment for acquisition of subsidiary - (1,250)
Acquisition of newly-consolidated
subsidiaries (Appendix A) - (4,761)
Net cash used in investing activities (264) (5,123)
Cash flows from financing activities:
Short-term bank credit (33) (674)
Long-term bank credit (4) (39)
Proceeds from issuance of shares
upon exercise of options - 14
Investment in treasury stock (128) (153)
Net cash used in financing activities (165) (852)
Net increase (decrease) in cash
and cash equivalents 1,895 (2,453)
Effect of exchange rate changes on cash (108) 50
Cash and cash equivalents at
beginning of period 5,727 9,026
Cash and cash equivalents at end of period $7,514 $6,623
Appendix A - Acquisition of subsidiary,
net of cash acquired
Working capital - excluding cash (879)
Goodwill 4,035
Other intangible assets 5,432
Property and equipment 158
Tax Asset 302
9,048
Issuance of shares (4,287)
$4,761
Appendix B - Non-cash transactions
Purchase of property on credit $ 20 $ 43
(*) Reclassification due to the adoption of SFAS 160
Contact:
Ilan Erez, Chief Financial Officer
Cimatron Ltd.
Tel: +972-3-531-2121
E-mail: ilane@cimatron.com
SOURCE Cimatron Ltd
