* Revised 2007 Revenue and EPS Guidance Exceeded * Full Year Revenues Increase 23.9% to EUR 624.3 Million * Full Year Pro Forma Diluted EPS of EUR 1.02, an increase of 26.2% * Record New Order Bookings of EUR 684.7 Million for the Year
MADRID, Spain, Feb. 26, 2008 (PRIME NEWSWIRE) -- Telvent GIT, S.A. (Nasdaq:TLVT), the IT company for a sustainable and secure world, today announced unaudited financial results for the fourth quarter and fiscal year ended December 31, 2007.
Revenues for the fourth quarter 2007 were EUR 217.7 million, an increase of 26.1% compared to EUR 172.7 million in the fourth quarter 2006. Revenues for the fiscal year 2007 totaled EUR 624.3 million, a 23.9% increase (of which 22.0% was organic) from the EUR 503.8 million reported for fiscal year 2006.
Net income for the fourth quarter 2007 was EUR 12.6 million, 11.1% more than the EUR 11.4 million reported in the fourth quarter 2006. Diluted EPS for the fourth quarter 2007 were EUR 0.43, compared to EUR 0.39 in the fourth quarter 2006. Net income for the fiscal year 2007 totaled EUR 24.9 million, 13.9% above EUR 21.8 million reported in the fiscal year 2006. Diluted EPS for fiscal year 2007 were EUR 0.85, compared to EUR 0.75 in 2006.
Pro forma net income for the fourth quarter 2007 was EUR 12.5 million, 30.7% above the EUR 9.6 million in the 2006's fourth quarter. Pro forma diluted EPS for the fourth quarter of 2007 were EUR 0.43, versus EUR 0.33 in the fourth quarter of 2006. Pro forma net income for the fiscal year 2007 was EUR 29.8 million, increasing 26.2% from EUR 23.6 million in fiscal year 2006. Pro forma diluted EPS for fiscal year 2007 were EUR 1.02, versus EUR 0.81 for fiscal year 2006.
New order bookings (or new contracts signed) during the fourth quarter of 2007 totaled EUR 237.7 million, a 74.9% increase from EUR 135.9 million recorded in the same period in 2006. Bookings for the full year amounted to EUR 684.7 million, or 23.9% above those recorded in the 2006 fiscal year.
Backlog (representing the portion of signed contracts for which performance is pending) was EUR 549.6 million as of December 31, 2007, which reflects a 23.5% growth over the EUR 445.2 million in backlog at the end of December 2006.
Pipeline, measured as management's estimates of real opportunities for the following six to twelve months, is approximately of EUR 2.0 billion.
Manuel Sanchez, Chairman and Chief Executive Officer, said, "Once again we have closed another year of strong and solid growth, most of which came from organic activities. In a very challenging market, we were able to once again exceed our revised guidance, both in revenues and EPS, and we have been able to establish a good foundation for future growth, as our backlog and pipeline figures show. During 2007, we have continued to strongly invest in R&D, building additional value for our customers in the future in the sustainability and security fields, while we continued to deliver services and solutions to different segments and geographies.
"2007 was a relevant year for Telvent's future as we have moved on with our business model expanding our IT consulting and service capabilities with Matchmind's acquisition last October. Telvent is now ready to better help and serve our customers in the task of managing the full integration of their operational and enterprise processes," he concluded.
Gross margin was 20.7% in the fourth quarter of 2007, compared to 21.6% in the fourth quarter of 2006. Gross margin for the fiscal year 2007 was 22.2%, slightly higher than 22.0% in 2006.
Operating expenses, as a percentage of revenues, were 12.0% in the fourth quarter of 2007, versus 13.5% in the same quarter of 2006. Operating expenses, as a percentage of revenues, were 15.6% in fiscal 2007, compared to 15.8% in 2006.
Pro forma operating margin for fiscal 2007 was 8.0%, showing an improvement from 7.8% in 2006. Pro forma operating margin was 10.2% in the fourth quarter of 2007, compared to 10.5% in the fourth quarter of 2006.
As of December 31, 2007, cash and cash equivalents were EUR 82.3 million and total debt (including net EUR 22.2 million credit line due from related parties) amounted to EUR 82.8 million, resulting in a net debt position of EUR 0.5 million. As of December 31, 2006, the Company's net cash position was EUR 46.7 million.
For fiscal year 2007, cash provided by operating activities was EUR 13.9 million compared to EUR 36.7 million of 2006. Cash used in investing activities in fiscal 2007 amounted to EUR 52.8 million versus EUR 44.9 million in 2006.
Business Highlights
Energy Some of the most relevant projects signed during the fourth quarter of 2007 were as follows: * Contract with Colonial Pipeline Company in the United States. Telvent completed the Site Acceptance Testing in the Colonial Pipeline OASyS DNA upgrade project. Based on Alpharetta, Georgia, Colonial Pipeline delivers a daily average of 100 million gallons of gasoline, home heating oil, aviation fuel and other refined petroleum products to communities and businesses throughout the south and eastern regions of the United States. * Contract with TransCanada Pipeline in Canada for a large 'green field' project to transport crude oil from Canada to United States refineries, known as the TCPL Keystone Project. This project is an initial contract that allows Telvent to provide a co-engineering effort for the overall SCADA and Liquid Applications supply, as well as to provide the Transient Model and a new Line Pressure Control Module (LPCM). Transportation During the fourth quarter some of the significant contracts signed were: * The contract signed with Dallah Trans Arabia Company that will ultimately benefit the Saudi Interior Ministry. This is an integral project that includes the implementation and management of a varied range of technological solutions focused on optimizing urban traffic control and increasing road safety in Jeddah, La Meca and Medina, in Saudi Arabia. Telvent's intelligent adaptative urban traffic management system, ITACA, will be implemented in these cities to improve traffic flow, reduce drivers' time at the wheel and, consequently, reduce the amount of CO2 emissions released into the atmosphere. * The contract for the development of an Enforcement Automatized Management Center awarded by the General Direction of Traffic (DGT) in Spain. The project's goal is to enhance and optimize current services offered to citizens by providing a quick and efficient response system that meets their traffic violation needs. The center will manage traffic violation reports nationwide and issue the corresponding fines. * Telvent was selected by the New York State Department of Transportation (NYSDOT) to implement and manage the 511-Travel Information System. Telvent will lead the project and develop it with five other companies. The project includes the creation of a publicly accessible website, a customized transportation alert system, coordination with telecommunications suppliers, and the system operation and maintenance. Environment During the fourth quarter, significant contracts signed were: * The contract awarded by the Swedish Defence Administration, FMV, to supply and maintain its new Meteorological Observation System (METOS), which will provide up-to-date and real time information on weather conditions to the Swedish Armed Forces. The main objective of this project is to replace the existing Swedish Air Force's weather observation system with new hardware and software using proven and safe technology. * Contract with the Chennai Desalination Plant (a joint venture between Codesa and Befesa CTA), in Chennai, India, for the supply of its control system. Under this contract, Telvent will supply all the field control equipment (PLCs) and the SCADA OASyS based control center for the Chennai plant, which has a production capacity of 105,000 cubic meters to be operated over the next thirty years by the joint venture. Public Administration Significant contracts signed in the fourth quarter 2007, among others, were: * Contract with the Andalusia Health Service in Spain for the supply of physical and logic equipment for enlargement and securing of its information technology and communications infrastructures. This contract aims to assure the security of the two large information technology centers (ITCs) that the Andalusia Health Service has in the cities of Malaga and Seville. * Contract with the Marques de Valdecilla University Hospital in Santander (Spain) to provide a software solution for the new outpatient clinic building. This contract will complete, through the hardware involved, the project to implement a global solution for the hospital's outpatient clinic. Global Services Significant contracts signed in the fourth quarter 2007, among others, were: * Contract signed with Yoigo, the cellular phone operator, to manage all of its corporate IT systems. The new contract gives Telvent the mandate to handle Yoigo's global outsourcing and management systems. Thus, the contract benefits the mobile phone company and its clients. * Contract with the Spanish Radio and Television Corporation to create and manage a multimedia information website. With this project, Telvent shows its technological capability for designing and managing one of the most innovative multimedia websites, which gives us the opportunity to grow in the audiovisual sector.
Business Outlook
For fiscal 2008, Telvent expects revenues to grow organically (excluding any contributions from acquisitions) within the range of 12% to 14%, versus fiscal year 2007. Telvent forecasts full-year 2008 pro forma diluted earnings per share within the range of EUR 1.15 to EUR 1.20. (Pro forma earnings per share were determined by using a weighted average number of shares issued and outstanding in the period of 29,247,100 shares.)
Use of Non-GAAP Financial Information
To supplement our consolidated financial statements presented in accordance with U.S. GAAP, we use certain non-GAAP measures, including pro forma net income and EPS. Pro forma net income and EPS are adjusted from GAAP-based results to exclude certain costs and expenses that we believe are not indicative of our core operating results. Pro forma results are one of the primary indicators management uses for evaluating historical results and for planning and forecasting future periods. We believe pro forma results provide consistency in our financial reporting which enhances our investors' understanding of our current financial performance as well as our future prospects. Pro forma results should be viewed in addition to, and not in lieu of, GAAP results.
Pro forma net income excludes the amortization of intangible assets from the purchase price allocations in our acquisitions, stock compensation plan expenses and mark to market hedging, that Telvent believes are not indicative of its core performance or results. Reconciliation between GAAP, pro forma net income and EPS is provided in this release in a table immediately following the condensed consolidated financial statements.
Conference Call Details
Manuel Sanchez, Chairman and Chief Executive Officer and Ana Plaza, Chief Financial Officer and Head of Investor Relations, will conduct a conference call to discuss the fourth quarter and fiscal 2007 results, which will be simultaneously webcast at 9:00 A.M. Eastern Time / 3:00 P.M. Madrid Time on Wednesday, February 27, 2008.
To access the conference call, participants in North America should dial (800) 374-0724 and international participants +1 (706) 634-1387. A live webcast of the conference call will be available at the Investor Relations page of Telvent's corporate website at www.telvent.com. Please visit the website at least 15 minutes prior to the start of the call to register for the teleconference webcast and download any necessary audio software. A replay of the call will be available approximately two hours after the conference call is completed.
About Telvent
Telvent (Nasdaq:TLVT), the IT company for a sustainable and secure world, specializes in high value-added products, services and integrated solutions for the Energy, Transportation, Environment and Public Administration industry segments, as well as Global Services. Its innovative technology and client-proven expertise enable the efficient and secure real-time management of operational and business processes for industry-leading companies worldwide. (www.telvent.com)
The Telvent GIT S.A. logo is available at http://www.primenewswire.com/newsroom/prs/?pkgid=3116
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements often are proceeded by words such as "believes," "expects," "may," "anticipates," "plans," "intends," "assumes," "will" or similar expressions. Forward-looking statements reflect management's current expectations, as of the date of this press release, and involve certain risks and uncertainties. Telvent's actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors. Some of the factors that could cause future results to materially differ from the recent results or those projected in forward-looking statements include the "Risk Factors" described in Telvent's Annual Report on Form 20-F for the year ended December 31, 2006, filed with the Securities and Exchange Commission on March 30, 2007, and updated, if applicable, in Telvent's Quarterly Report on Form 6-K for the quarters ended March 31, 2007, June 30, 2007 and September 30, 2007, filed with the Securities and Exchange Commission on May 24, 2007, August 30, 2007 and November 27, 2007, respectively.
Unaudited Consolidated Balance Sheets
(In thousands of Euros, except share and per share amounts)
As of As of
December 31, December 31,
2007 2006
(Unaudited) (Audited)
------------ ------------
Assets:
Current assets:
Cash and cash equivalents 73,755 69,232
Restricted cash 8,590 8,045
Other short-term investments 461 386
Derivative contracts 3,544 2,814
Accounts receivable (net of allowances of
EUR 639 as of December 31, 2007 and
EUR 2,719 as of December 31, 2006) 143,261 144,763
Unbilled revenues 196,307 101,317
Due from related parties 38,773 47,958
Inventory 21,194 19,274
Other taxes receivable 9,309 13,258
Deferred tax assets 2,399 3,692
Other current assets 3,476 7,016
------------ ------------
Total current assets 501,069 417,755
Deposits and other investments 7,103 1,795
Investments carried under the equity method 219 --
Property, plant and equipment, net 52,975 51,215
Long-term receivables and other assets 8,605 11,236
Deferred tax assets 16,529 14,954
Other intangible assets, net 22,381 21,260
Goodwill 64,638 37,416
------------ ------------
Total assets 673,519 555,631
============ ============
Liabilities and shareholders' equity:
Accounts payable 252,624 216,614
Billings in excess of costs and estimated
earnings 35,501 26,568
Accrued and other liabilities 13,668 10,389
Income and other taxes payable 21,452 26,901
Deferred tax liabilities 2,546 5,347
Due to related parties 25,315 23,512
Current portion of long-term debt 3,488 1,514
Short-term debt 63,998 32,295
Short-term leasing obligations 7,075 2,562
Derivative contracts 3,686 3,269
------------ ------------
Total current liabilities 429,353 348,971
Long-term debt less current portion 12,230 15,188
Long-term leasing obligations 22,959 1,834
Other long term liabilities 8,198 5,716
Deferred tax liabilities 6,361 6,276
Unearned income 409 131
------------ ------------
Total liabilities 479,510 378,116
------------ ------------
Unaudited Consolidated Balance Sheets
(In thousands of Euros, except share and per share amounts)
As of As of
December 31, December 31,
2007 2006
(Unaudited) (Audited)
------------ ------------
Minority interest 3,889 794
Commitments and contingencies
Shareholders' equity:
Common stock, EUR 3.005 par value,
29,247,100 shares authorized, issued and
outstanding, same class and series 87,889 87,889
Additional paid-in-capital 42,072 40,338
Deferred compensation --
Accumulated other comprehensive income (5,294) (2,142)
Retained earnings 65,453 50,636
------------ ------------
Total shareholders' equity 190,120 176,721
------------ ------------
Total liabilities and shareholders'
equity 673,519 555,631
============ ============
Unaudited Consolidated Statements of Operations
(In thousands of Euros, except share and per share amounts)
Three Months ended Year ended
December 31, December 31,
2007 2006 2007 2006
---------- ---------- ---------- ----------
Revenues 217,715 172,674 624,317 503,844
Cost of revenues 172,755 135,447 485,612 393,219
---------- ---------- ---------- ----------
Gross profit 44,960 37,227 138,705 110,625
---------- ---------- ---------- ----------
General and
administrative 16,954 13,025 53,900 39,850
Sales and marketing 852 1,395 13,668 13,730
Research and
development 5,242 4,812 19,106 16,465
Depreciation and
amortization 3,100 4,021 10,623 9,562
---------- ---------- ---------- ----------
Total operating
expenses 26,148 23,253 97,297 79,607
---------- ---------- ---------- ----------
Income from operations 18,812 13,974 41,408 31,018
Financial (expense),
net (766) (1,814) (9,882) (6,643)
Income from companies
under equity method 324 0 324
Other income, net (2,025) (388) (2,025) (387)
---------- ---------- ---------- ----------
Total other income
(expense) (2,467) (2,202) (11,583) (7,030)
---------- ---------- ---------- ----------
Income before income
taxes 16,345 11,772 29,825 23,988
Income tax expense
(benefit) 3,414 (247) 4,680 2,080
---------- ---------- ---------- ----------
Net income before
minority interest 12,931 12,019 25,145 21,908
---------- ---------- ---------- ----------
Loss/(Profit)
attributable to
minority interests (318) (662) (268) (70)
---------- ---------- ---------- ----------
Net income 12,613 11,357 24,877 21,838
========== ========== ========== ==========
Earnings per share
Basic and diluted
net income per share 0.43 0.39 0.85 0.75
========== ========== ========== ==========
Weighted average number
of shares outstanding
Basic and diluted 29,247,100 29,247,100 29,247,100 29,247,100
========== ========== ========== ==========
Unaudited Condensed Consolidated Statements of Cash Flows
(In thousands of Euros, except share and per share amounts)
Year Ended December 31,
---------------------------
2007 2006 2005
------- ------- -------
Cash flows from operating activities:
Net income 24,877 21,838 14,366
Adjustments to reconcile net income to
net cash provided by operating
activities:
Depreciation and amortization 10,902 9,986 10,625
Net foreign exchange (gains) losses 1,324 (903) 849
Allowance for doubtful accounts (411) 278 485
Deferred income taxes (4,848) (2,769) 1,602
Minority interests 268 70 373
Compensation related to stock
compensation plans 1,735 1,910 1,413
Loss (gains) on sale of investments -- 387 --
Change in operating assets and
liabilities, net of amounts acquired:
Accounts and other long-term receivable 693 (44,333) (16,019)
Inventory (3,102) (8,149) (1,136)
Unbilled revenues (89,534) (26,743) (36,917)
Related parties trade receivables and
other assets 18,642 (8,484) (5,614)
Billings in excess of costs and
estimated earnings 9,626 8,248 3,951
Accounts payable, accrued and other
liabilities, related parties trade
payable 46,556 87,443 43,736
Due to temporary joint ventures (2,817) (2,060) (11,515)
------- ------- -------
Net cash provided by (used in)
operating activities 13,911 36,719 6,199
------- ------- -------
Cash flows from investing activities:
Restricted cash -- guaranteed deposit of
long term investments and commercial
transactions (545) (4,862) 4,845
Due from related parties (11,632) 4,552 (5,018)
Purchase of property, plant & equipment (2,948) (2,313) (3,894)
Acquisition of subsidiaries, net of cash
acquired (32,414) (43,208) (4,957)
Disposal / (acquisitions) of investments (5,281) 942 789
------- ------- -------
Net cash provided by (used in)
investing activities (52,820) (44,890) (8,235)
------- ------- -------
Cash flows from financing activities:
Proceeds from long-term debt 371 1,084 9,196
Proceeds from sale and lease-back
transaction 25,315 -- --
Repayment of long-term debt (4,284) (11,576) (15,128)
Proceeds of short-term debt 40,134 16,095 7,157
Repayment of short-term debt (15,737) (5,758) (1,947)
Proceeds from issuance of common stock,
net -- -- --
Dividends paid (8,774) -- --
Proceeds (repayments) of government loans (844) (1,094) (1,735)
Due to related parties 7,770 (218) 3,099
------- ------- -------
Net cash provided by (used in)
financing activities 43,951 (1,467) 642
------- ------- -------
Net (decrease) increase in cash and
cash equivalents 5,042 (9,638) (1,394)
Net effect of foreign exchange in cash
and cash equivalents (519) (1,140) 889
Cash and cash equivalents at the beginning
of period 60,997 67,796 69,582
Joint venture cash and cash equivalents
at the beginning of period 8,235 12,214 10,933
------- ------- -------
Cash and cash equivalents at the end of
period 73,755 69,232 80,010
======= ======= =======
Supplemental disclosure of cash
information:
Cash paid for the period:
Income taxes 5,853 2,507 1,153
Interest 12,068 8,275 5,802
======= ======= =======
Non-cash transactions:
Capital leases 2,780 1,796 2,622
Reconciliation between GAAP and Proforma Income and EPS
(In thousands of Euros, except share and per share amounts)
Three months ended Year ended
December 31, December 31,
2007 2006 2007 2006
---------------------- ----------------------
GAAP basis income
before income taxes 16,345 11,772 29,825 23,986
Adjustments to Net
Income
Amortization of
intangibles 1,249 1,707 3,564 3,453
Stock compensation
plan expenses 710 477 2,782 1,910
Mark to market
derivatives (2,142) (1,245) 535 (465)
---------- ---------- ---------- ----------
Total Adjustments (183) 939 6,881 4,898
Adjusted income before ---------- ---------- ---------- ----------
income taxes 16,162 12,711 36,706 28,884
---------- ---------- ---------- ----------
Income tax provision (3,444) (2,451) (6,718) (5,192)
Profit attributable to
minority interests (176) (662) (170) (70)
---------- ---------- ---------- ----------
Pro forma Net Income 12,542 9,598 29,818 23,622
========== ========== ========== ==========
Earnings per share
Basic and diluted net
income per share 0.43 0.33 1.02 0.81
========== ========== ========== ==========
Weighted average number
of shares outstanding
Basic and diluted 29,247,100 29,247,100 29,247,100 29,247,100
========== ========== ========== ==========
Segment Information
(In thousands of Euros, except share and per share amounts)
Three months ended Year ended
December 31, December 31,
2007 2006 2007 2006
---------------- ----------------
Revenues
Energy 63,251 61,592 228,093 203,556
Transportation 91,620 79,271 246,794 200,419
Environment 11,866 15,301 38,320 43,473
Public Administration 20,902 7,037 50,185 23,366
Global Services 30,076 9,473 60,925 33,030
------- ------- ------- -------
217,715 172,674 624,317 503,844
------- ------- ------- -------
Gross Margin
Energy 21.3% 25.1% 21.5% 22.7%
Transportation 16.2 16.2 19.8 18.6
Environment 29.2 19.7 26.9 21.7
Public Administration 15.9 33.0 16.2 21.2
Global Services 32.7 38.2 36.7 39.0
------- ------- ------- -------
20.7% 21.6% 22.2% 22.0%
------- ------- ------- -------