HOLLYWOOD, Fla., Feb. 14, 2008 (PRIME NEWSWIRE) -- STARLIMS Technologies Ltd. (Nasdaq:LIMS), a leading provider of laboratory information management systems (LIMS), today announced that revenues for full year of 2007 were $23.8 million, up 20.3% from $19.8 million for the full year of 2006. Product revenues for the full year of 2007 were $13.9 million, up 24.9% from $11.1 million for the full year of 2006. Services revenues for the full year of 2007 were $9.9 million, up 14.4% from $8.6 million for the full year of 2006.
Revenues for the fourth quarter of 2007 were $6.7 million, a 4.9% decline from revenue of $7.0 million reported for the same period in 2006. Product revenues for the period were $4.0 million, down 5.3% from $4.3 million reported for the fourth quarter of 2006. Services revenues for the period were $2.7 million, down 4.4% from $2.8 million reported for the fourth quarter of 2006.
STARLIMS's business model is characterized by relatively large transactions, with a year-to-date average selling price on direct sales of approximately $600,000. Our management believes that a comparison of STARLIMS's results in a longer term perspective provides better insight into the underlying growth of our business.
"We are pleased with our growth in 2007 driven by our expansion in verticals such as Life Sciences and the return from investments made in geographic expansion such as in Asia Pacific," said Itschak Friedman, CEO of STARLIMS. "We have already closed two large transactions in Life Sciences early in 2008 and with the introduction of scientific data management solutions or SDMS, our ongoing investments in the clinical market and continued geographic expansion, we are positioned for solid growth in 2008."
GAAP operating income for the full year of 2007 was $3.8 million or 16.2% of revenues, compared to $4.9 million or 25.0% of revenues for the full year of 2006. GAAP net income for the full year of 2007 was $4.5 million, or $0.57 per diluted share, compared to GAAP net income of $3.8 million, or $0.58 per diluted share, for the full year of 2006. For the fourth quarter, GAAP operating income was $605,000 or 9.0% of revenues compared to $2.8 million or 39.4% of revenues for the same period in 2006. GAAP net income for the fourth quarter was $981,000, or $0.11 per diluted share, compared to GAAP net income of $1.9 million, or $0.29 per diluted share, for the fourth quarter of 2006.
Non-GAAP operating income for the full year of 2007 was $4.3 million or 17.9% of revenues, compared to $5.1 million or 25.9% of revenues for the full year of 2006. Non-GAAP net income for the full year of 2007 was $4.8 million, or $0.61 per diluted share, compared to non-GAAP net income of $3.9 million, or $0.60 per diluted share, for the full year of 2006. Non-GAAP operating income for the fourth quarter was $687,000 or 10.3% of revenues, compared to $2.8 million or 40.1% for the same period in 2006. Non-GAAP net income for the fourth quarter was $1.0 million, or $0.12 per diluted share, compared to $2.0 million, or $0.30 per diluted share, for the fourth quarter of 2006. The following tables include a reconciliation of GAAP to non-GAAP income from operations and net income for 2007 and 2006 and for the fourth quarter of said years.
Cash, cash equivalents and marketable securities amounted to $35.1 million on December 31, 2007, compared to $6.5 million on December 31, 2006. The increase in cash was primarily due to our initial public offering in the United States on May 23, 2007 and approximately $4.1 million cash generated from operating activities.
STARLIMS to Acquire UK Partner
STARLIMS today announced that it has reached an agreement to the terms to acquire its long-standing United Kingdom partner for an undisclosed amount. Management expects the acquisition to enhance the Company's service capabilities in the United Kingdom and assist in expanding its European operations. The acquisition is subject to customary closing conditions and is expected to be completed in the next several weeks.
Stock Repurchase Program
STARLIMS also announced that the Company's Board of Directors has authorized a stock repurchase program. The stock repurchase program authorizes the Company to repurchase shares of its common stock, in the open market at times and prices considered appropriate by the Company depending upon prevailing market conditions and other corporate considerations. The program limits the Company to an aggregate purchase of $2 million over a period of 18 months. As of February 13, 2008, STARLIMS had approximately 8.8 million shares outstanding.
"The stock repurchase program is a reflection of the Company's solid cash position and ongoing commitment to increasing shareholder value," said Chaim Friedman, STARLIMS Chief Financial Officer. "The program also demonstrates the confidence we have in our current operational strengths and prospects for the future."
Guidance
STARLIMS is providing financial guidance for fiscal year 2008. Our management expects total revenues of $27 to $29 million and GAAP EPS of $0.55 to $0.70, which includes approximately $0.05 of stock-based compensation expenses, amortization of intangibles related to acquisitions and other non-recurring expenses. The guidance assumes an annual tax rate of approximately 15% and estimated weighted average shares outstanding of 8.9 million during 2008.
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 this conference call on Thursday, February 14, 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://ir.starlims.com. Those interested in participating in the question and answer session should dial (303) 262-2130.
The webcast will be archived on the STARLIMS Technologies Investor Relations page of the Company's website, at http://ir.starlims.com starting at 12 p.m. on Thursday, February 14, 2008. Alternatively, the conference call replay can be accessed by dialing (800) 405-2236, access code 11106495#.
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.
CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands, except share data and per share data)
December 31, December 31,
------------ ------------
2006 2007
---- ----
Audited Unaudited
------- ---------
ASSETS
Current Assets
Cash and cash equivalents $ 2,539 $ 31,704
Restricted short-term deposits 196 195
Marketable securities -- available-for-sale 2,334 1,012
Accounts receivable (net of allowance for
doubtful accounts of $291 and $192
respectively) 8,966 9,215
Other current assets 949 2,096
------------ ------------
Total current assets 14,984 44,222
------------ ------------
Long-Term Assets
Marketable securities -- held-to-maturity 1,435 2,206
Other long-term assets 422 643
Fixed assets, net 1,481 1,601
Goodwill 1,137 1,326
Other assets, net 202 37
------------ ------------
Total long-term assets 4,677 5,813
------------ ------------
------------ ------------
Total assets $ 19,661 $ 50,035
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Trade accounts payable $ 356 $ 201
Deferred revenues 1,821 2,276
Other current liabilities and accrued
expenses 2,570 2,978
------------ ------------
Total current liabilities 4,747 5,455
------------ ------------
Long-Term Liabilities
Long-term deferred revenues 99 68
Accrued severance pay 32 52
Deferred taxes 814 662
------------ ------------
Total long-term liabilities 945 782
------------ ------------
Shareholders' Equity
Ordinary shares, NIS 1.00 par value;
authorized 15,000,000 shares; issued
7,764,869 and 9,991,169 shares,
respectively; outstanding 6,490,500 and
8,724,675 shares, respectively 2,600 3,151
Additional paid-in capital 4,325 30,893
Accumulated other comprehensive income 104 260
Retained earnings 9,672 12,267
Treasury stock, at cost - 1,274,369 and
1,266,494 ordinary shares, respectively (2732) (2773)
------------ ------------
Total shareholders' equity 13,969 43,798
------------ ------------
------------ ------------
Total liabilities and shareholders' equity $ 19,661 $ 50,035
============ ============
STARLIMS TECHNOLOGIES LTD.
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,
-------------------- --------------------
2006 2007 2006 2007
--------- --------- --------- ---------
Audited Unaudited Audited Unaudited
------- --------- ------- ---------
Revenues
Software licensing $ 8,286 $ 10,656 $ 3,500 $ 3,129
Maintenance 2,841 3,241 765 910
--------- --------- --------- ---------
Total product revenues 11,127 13,897 4,265 4,039
Services 8,638 9,878 2,773 2,652
--------- --------- --------- ---------
Total revenues 19,765 23,775 7,038 6,691
--------- --------- --------- ---------
Cost of revenues
Cost of products 31 374 11 348
Cost of services 5,557 8,095 1,770 2,304
--------- --------- --------- ---------
Total cost of revenues 5,588 8,469 1,781 2,652
--------- --------- --------- ---------
Gross profit 14,177 15,306 5,257 4,039
--------- --------- --------- ---------
Operating expenses
Research and development 1,866 2,872 578 822
Selling and marketing 4,741 5,792 1,107 1,814
General and administrative 2,634 2,799 798 798
--------- --------- --------- ---------
Total operating expenses 9,241 11,463 2,483 3,434
--------- --------- --------- ---------
Operating income 4,936 3,843 2,774 605
Financial income, net 610 1,551 132 629
--------- --------- --------- ---------
Income before income taxes 5,546 5,394 2,906 1,234
Income tax expense 1,762 885 976 253
--------- --------- --------- ---------
--------- --------- --------- ---------
Net income $ 3,784 $ 4,509 $ 1,930 $ 981
========= ========= ========= =========
--------- --------- --------- ---------
Basic earnings per share $ 0.59 $ 0.58 $ 0.30 $ 0.11
========= ========= ========= =========
Weighted average number of
ordinary shares used in
computing basic earnings --------- --------- --------- ---------
per share 6,459,030 7,799,583 6,466,125 8,723,574
========= ========= ========= =========
--------- --------- --------- ---------
Diluted earnings per share $ 0.58 $ 0.57 $ 0.29 $ 0.11
========= ========= ========= =========
Weighted average number of
ordinary shares used in
computing diluted --------- --------- --------- ---------
earnings per share 6,559,985 7,897,036 6,568,030 8,827,487
========= ========= ========= =========
STARLIMS TECHNOLOGIES LTD.
NON-GAAP CONSOLIDATED
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,
-------------------- --------------------
2006 2007 2006 2007
--------- --------- --------- ---------
Audited Unaudited Audited Unaudited
------- --------- ------- ---------
Revenues
Software licensing $ 8,286 $ 10,656 $ 3,500 $ 3,129
Maintenance 2,841 3,241 765 910
--------- --------- --------- ---------
Total product revenues 11,127 13,897 4,265 4,039
Services 8,638 9,878 2,773 2,652
--------- --------- --------- ---------
Total revenues 19,765 23,775 7,038 6,691
--------- --------- --------- ---------
Cost of revenues
Cost of products 31 374 11 348
Cost of services 5,544 8,066 1,766 2,283
--------- --------- --------- ---------
Total cost of revenues 5,575 8,440 1,777 2,631
--------- --------- --------- ---------
Gross profit 14,190 15,335 5,261 4,060
--------- --------- --------- ---------
Operating expenses
Research and development 1,855 2,849 575 807
Selling and marketing 4,630 5,569 1,076 1,771
General and administrative 2,576 2,660 787 795
--------- --------- --------- ---------
Total operating expenses 9,061 11,078 2,438 3,373
--------- --------- --------- ---------
Operating income 5,129 4,257 2,823 687
Financial income, net 610 1,551 132 629
--------- --------- --------- ---------
Income before income taxes 5,739 5,808 2,955 1,316
Income tax expense 1,829 976 992 282
--------- --------- --------- ---------
--------- --------- --------- ---------
Net income $ 3,910 $ 4,832 $ 1,963 $ 1,034
========= ========= ========= =========
--------- --------- --------- ---------
Basic earnings per share $ 0.61 $ 0.62 $ 0.30 $ 0.12
========= ========= ========= =========
Weighted average number of
ordinary shares used in
computing basic earnings --------- --------- --------- ---------
per share 6,459,030 7,799,583 6,466,125 8,723,574
========= ========= ========= =========
--------- --------- --------- ---------
Diluted earnings per share $ 0.60 $ 0.61 $ 0.30 $ 0.12
========= ========= ========= =========
Weighted average number of
ordinary shares used in
computing diluted --------- --------- --------- ---------
earnings per share 6,559,985 7,897,036 6,568,030 8,827,487
========= ========= ========= =========
STARLIMS TECHNOLOGIES LTD.
RECONCILIATION BETWEEN GAAP AND NON-GAAP CONSOLIDATED
STATEMENTS OF INCOME
Year ended Three months ended
December 31, December 31,
------------------ ------------------
2006 2007 2006 2007
------- --------- ------- ---------
Audited Unaudited Audited Unaudited
------- --------- ------- ---------
GAAP total cost of revenues 5,588 8,469 1,781 2,652
Stock based compensation
expenses (13) (29) (4) (21)
------- ------- ------- -------
NON-GAAP total cost of
revenues 5,575 8,440 1,777 2,631
======= ======= ======= =======
GAAP Research and development
expenses 1,866 2,872 578 822
Stock based compensation
expenses (11) (23) (3) (15)
------- ------- ------- -------
NON-GAAP Research and
development expenses 1,855 2,849 575 807
======= ======= ======= =======
GAAP Selling and marketing
expenses 4,741 5,792 1,107 1,814
Stock based compensation
expenses (111) (123) (31) (43)
Issuance related expenses -- (100) -- --
------- ------- ------- -------
NON-GAAP Selling and marketing
expenses 4,630 5,569 1,076 1,771
======= ======= ======= =======
GAAP General and administrative
expenses 2,634 2,799 798 798
Stock based compensation
expenses (13) (9) (3) 1
Issuance related expenses -- (99) -- --
Amortization of purchased
intangible assets (45) (31) (8) (4)
------- ------- ------- -------
NON-GAAP General and
administrative expenses 2,576 2,660 787 795
======= ======= ======= =======
GAAP total tax expenses 1,762 885 976 253
Taxes 67 91 16 29
------- ------- ------- -------
NON-GAAP total tax expenses 1,829 976 992 282
======= ======= ======= =======
STARLIMS TECHNOLOGIES LTD.
CONSOLIDATED STATEMENT OF CASH FLOWS
(U.S. dollars in thousands)
Year Ended Three months ended
December 31, December 31,
------------------ ------------------
2006 2007 2006 2007
-------- -------- -------- --------
Audited Unaudited Audited Unaudited
------- --------- ------- ---------
CASH FLOWS - OPERATING
ACTIVITIES
Net income $ 3,784 $ 4,509 $ 1,930 $ 981
Adjustments to reconcile net
income to cash provided by
(used in) operating
activities:
Depreciation and amortization 378 510 106 141
Stock-based compensation 141 177 34 80
Gains related to marketable
securities (192) (326) (230) (286)
Capital loss from sales of
fixed assets 0 8 0 8
Increase in accrued severance
pay 0 20 (13) (3)
Deferred income taxes 174 (732) 54 (142)
The effect of exchange rate
changes (164) (241) 128 (441)
Changes in assets and
liabilities:
increase in accounts
receivable (1,406) (30) (1,662) 30
Increase (decrease) in
allowance for doubtful
accounts 80 (99) 80 (49)
Decrease (Increase) in other
current assets (460) 75 302 41
Increase (decrease) in trade
accounts payable (15) (182) (539) (281)
Increase in deferred revenues 408 395 376 70
Increase (decrease) in other
current liabilities (587) 45 863 1,043
-------- -------- -------- --------
Net cash provided by
operating activities 2,141 4,129 1,429 1,192
-------- -------- -------- --------
CASH FLOWS - INVESTING
ACTIVITIES
Investments in
available-for-sale
marketable securities (1,982) (740) (1,100) (33)
Proceeds from sale of
available-for-sale marketable
securities 2,380 1,563 1,450 (576)
Investment in held-to-maturity
marketable securities 0 (1,706) 0 (102)
Proceeds from sale of
held-to-maturity securities 0 1,685 0 1,685
Investments in restricted
deposits, net (235) (101) (27) (146)
Loans to employees,net (164) (64) 72 46
Proceeds from sale of property
and equipment 0 10 (3) 10
Purchase of fixed assets (640) (523) (216) (101)
Acquisition of subsidiary, net
of cash acquired, and business
operation (Appendix A) (1,049) 0 0 0
-------- -------- -------- --------
Net cash used in investing
activities (1,690) 124 176 783
-------- -------- -------- --------
CASH FLOWS - FINANCING
ACTIVITIES
Proceeds from issuing of
shares, net of issuance
expenses 0 26,785 0 146
Deferred share issuance
expenses (133) 0 (133) 0
Proceeds from sale of treasury
stock against exercise of
options 216 19 57 8
Purchase of treasury stock by
the Company 0 (93) 0 (13)
Dividends paid (1,389) (1,914) 0 0
-------- -------- -------- --------
Net cash provided by (used in)
financing activities (1,306) 24,797 (76) 141
-------- -------- -------- --------
THE EFFECT OF EXCHANGE RATE
CHANGES ON CASH AND CASH
EQUIVALENTS (3) 115 11 96
-------- -------- -------- --------
Increase (decrease) in cash
and cash equivalents (858) 29,165 1,540 2,212
-------- -------- -------- --------
Cash and cash equivalents at
the beginning of the period 3,397 2,539 999 29,492
-------- -------- -------- --------
Cash and cash equivalents at
the end of the period $ 2,539 $ 31,704 $ 2,539 $ 31,704
======== ======== ======== ========
APPENDIX A - ACQUISITION OF SUBSIDIARY AND BUSINESS OPERATION
Year Ended December 31,
-----------------------
2006 2007
---------- ----------
Audited Unaudited
------- ---------
Current assets (excluding cash and cash
equivalents) (844) --
Fixed assets, net (120) --
Current liabilities 1,164 --
Goodwill and other intangible assets (1,249) --
---------- ----------
(1,049) --
The accompanying notes form an integral part of the consolidated
financial statements.
STARLIMS TECHNOLOGIES LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(U.S. dollars in thousands)
NOTE 1 - SEGMENTAL DISCLOSURE
A. Revenues by geographical areas
Year Ended December 31,
-----------------------
2006 2007
-----------------------
Audited Unaudited
------- ---------
North America 14,689 16,094
Latin America 1,690 1,987
Europe 2,682 3,235
Asia 516 2,110
Israel 188 349
-------- --------
19,765 23,775
======== ========
B. Issuance of shares
* The Company issued 2,100,000 shares on May 23, 2007 in its initial
public offering in the United States.
* On June 27, 2007, the underwriters, Oppenheimer & Co. and JMP
Securities LLC, exercised part of their over allotment and
purchased an additional 126,300 ordinary shares from the Company.
* STARLIMS sold a total of 2,226,300 ordinary share (including the
over allotment option shares) at a price to the public of $13.50
per share resulting in net proceeds from the offering of
approximately $27 million.
* On November 11, 2007, the Board of Directors of the Company
approved the award of an aggregate 177,300 restricted stock units
to employees of the Company and its subsidiaries, subject to the
terms and conditions of the STARLIMS Technologies Ltd. 2007
Restricted Stock Unit Plan.
* On February 13, 2008, the Board of Directors of the Company
authorized a stock repurchase program. The stock repurchase program
authorizes the Company to repurchase shares of its common stock, in
the open market or privately negotiated transactions, at times and
prices considered appropriate by the company depending upon
prevailing market conditions and other corporate considerations.
The program limits the Company to an aggregate purchase of
$2 million over a period of 18 months.