– First Quarter 2013 Revenues of $40.6 million –
– First Quarter 2013 GAAP and Non-GAAP EPS ($0.01) and $0.05, Respectively –
– First Quarter 2013 GAAP and Non-GAAP Gross Margin 77% and 78%, Respectively –
YOQNEAM, Israel, May 8, 2013 (GLOBE NEWSWIRE) -- Given Imaging Ltd. (Nasdaq:GIVN) today announced financial results for the first quarter ended March 31, 2013.
Revenues were $40.6 million in the first quarter of 2013, a decrease of 2.9 percent compared to $41.8 million in the first quarter of 2012. Gross margin on a GAAP-basis in the first quarter of 2013 was 77.1 percent, compared to 75.6 percent in the first quarter of 2012. Gross margin on a non-GAAP-basis in the first quarter of 2013 was 78.1 percent, compared to 76.2 percent in the first quarter of 2012.
On a GAAP-basis, operating profit was $0.1 million in the first quarter of 2013, compared to $0.4 million in the first quarter of 2012. Non-GAAP operating profit was $2.0 million in the first quarter of 2013, compared to $2.1 million in the same period in 2012.
On a GAAP-basis, net loss for the first quarter of 2013 was $0.2 million, or ($0.01) per share, compared to net income of $0.2 million, or $0.01 per share, in the same period in 2012. On a non-GAAP-basis, net income for the first quarter of 2013 was $1.5 million, or $0.05 per share on a fully diluted basis, compared to a net income of $1.8 million, or $0.06 per share on a fully diluted basis in the first quarter of 2012.
A reconciliation of GAAP results to non-GAAP results is attached.
Cash used in operating activities in the first quarter was 2013 was $2.2 million. Cash and cash equivalents, short-term investments and marketable securities on March 31, 2013 totaled $121.8 million.
"While we achieved record first quarter revenues in both the EMEA and APAC regions, total revenues were below our expectations due to a shortfall in sales execution in the Americas region. We are encouraged by our second quarter strong revenues to date and we remain on track to meet the full-year 2013 financial guidance that we provided earlier this year. We are also encouraged by our advanced discussions with both U.S. and Japanese regulatory authorities regarding approvals for PillCam COLON 2" said Homi Shamir, President and CEO, Given Imaging.
First Quarter 2013 Revenue Analysis
Revenues in the Americas region in the first quarter of 2013 decreased 11 percent to $23.9 million from $26.7 million in the same period in 2012. The decrease is attributable to lower sales of PillCam and functional GI diagnostics products. Revenues in the EMEA region increased 8 percent to $11.6 million compared to $10.8 million in the same period in 2012. APAC revenues increased by 20 percent to $5.1 million, compared to $4.2 million in the same period in 2012.
Worldwide PillCam SB sales decreased three percent to 54,600 capsules in the first quarter of 2013, compared to 56,500 capsules in the same period in 2012. PillCam SB sales in the Americas region decreased by eight percent to 30,800 capsules in the first quarter of 2013, compared to 33,700 capsules in the first quarter of 2012. PillCam SB sales in the EMEA region increased by three percent to 15,500 capsules, compared to 15,100 capsules in the first quarter of 2012, while PillCam SB sales in the APAC region increased by seven percent to 8,300 capsules, compared to 7,700 capsules in the same period in 2012.
Worldwide sales of functional GI diagnostics products including the Bravo pH Monitoring System, Digitrapper pH-Z, ManoScan and SmartPill products decreased by 12 percent to $11.0 million in the first quarter of 2013 compared to $12.6 million in the same period in 2012. In the Americas region, functional GI diagnostics product revenue decreased by 17 percent in the first quarter of 2013 to $8.3 million compared to $10.0 million in the same period in 2012. Functional GI diagnostics revenue in the EMEA region increased by 23 percent to $2.3 million, while revenue in the APAC region was $0.4 million, a decrease of 38 percent compared to the same quarter last year.
Supplemental first quarter data can be found at www.givenimaging.com in the Investor Relations section.
Digestive Disease Week 2013
Over 120 studies will be presented at Digestive Disease Week 2013 featuring Given Imaging's complete product portfolio including PillCam® SB, PillCam® COLON 2(*), PillCam® ESO, Bravo® pH monitoring, Digitrapper® pH-z monitoring, ManoScan™ high resolution manometry and the SmartPill® motility monitoring system. Digestive Disease Week takes place in Orlando May 18-21, 2013.
The Company will host a meeting with members of the financial community with several key GI opinion leaders to review highlights of the conference. The meeting will take place on Tuesday, May 21st, 2013 at 10:00am ET/5:00pm Israel time. A live audio webcast will be available in the investor relations section of the company's website, www.givenimaging.com.
Conference Call / Webcast Information
Given Imaging will host a conference call on Thursday, May 9, 2013 at 9:00am ET, 4:00pm Israel time to discuss first quarter 2013 financial results. To participate in the teleconference, please dial the following numbers fifteen minutes before the call is scheduled to begin: U.S. and Canada, 888-438-5491; Israel, 1-80-924-5906. Callers in other countries should dial 719-785-1753. The call will also be webcast live at www.givenimaging.com.
A replay of the call will be available for two weeks on the company's website, or until May 23, 2013, by dialing 888-203-1112. Callers in Israel should dial 1-80-924-6038. Callers outside of the U.S. and Israel should dial 719-457-0820. The replay participant code is 3944471.
Use of Non-GAAP Measures
This press release provides financial measures for net income and basic and diluted earnings per share that exclude certain items and are therefore not calculated in accordance with generally accepted accounting principles (GAAP). Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance that enhances management's and investors' ability to evaluate the Company's net income and earnings per share and to compare it with historical net income and earnings per share.
The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management uses both GAAP and non-GAAP measures when evaluating the business internally and therefore felt it is important to make these non-GAAP adjustments available to investors.
About Given Imaging Ltd.
Since pioneering the field of capsule endoscopy in 2001, Given Imaging has become a world leader in GI medical devices, offering health care providers a range of innovative options for visualizing, diagnosing and monitoring the digestive system. The company offers a broad product portfolio including PillCam® capsule endoscope for the small bowel, esophagus and colon. The company also offers industry-leading GI functional diagnostic solutions including ManoScan™ high-resolution manometry, Bravo® capsule-based pH monitoring, Digitrapper® pH-Z impedance, and the SmartPill® GI monitoring systems. Given Imaging is committed to delivering breakthrough innovations to the GI community and supporting its ongoing clinical needs. Given Imaging's headquarters are located in Yoqneam, Israel, with operating subsidiaries in the United States, Germany, France, Japan, Australia, Vietnam, Hong Kong and Brazil. For more information, please visit www.givenimaging.com.
(*) Pending 510(k), not available for sale within the United States
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, projections about our business and our future revenues, expenses and profitability. Forward-looking statements may be, but are not necessarily, identified by the use of forward-looking terminology such as "may," "anticipates," "estimates," "expects," "intends," "plans," "believes," and words and terms of similar substance. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual events, results, performance, circumstances or achievements of the Company to be materially different from any future events, results, performance, circumstances or achievements expressed or implied by such forward-looking statements. Such forward-looking statements include statements relating to the Company exploring strategic alternatives and considering possible strategic transactions involving the Company. Factors that could cause actual events, results, performance, circumstances or achievements to differ from such forward-looking statements include, but are not limited to, the ability of the Company to reach agreement on any strategic alternative and/or to complete any such alternative, as well as the following: (1) our ability to develop and bring to market new products, (2) our ability to successfully complete any necessary or required clinical studies with our products, (3) our ability to receive regulatory clearance or approval to market our products or changes in regulatory environment, (4) our success in implementing our sales, marketing and manufacturing plans, (5) the level of adoption of our products by medical practitioners, (6) the emergence of other products that may make our products obsolete, (7) lack of an appropriate bowel preparation materials to be used with our PillCam COLON capsule, (8) protection and validity of patents and other intellectual property rights, (9) the impact of currency exchange rates, (10) the effect of competition by other companies, (11) the outcome of significant litigation, (12) our ability to obtain reimbursement for our product from government and commercial payors, (13) quarterly variations in operating results, (14) the possibility of armed conflict or civil or military unrest in Israel, (15) the impact of global economic conditions, (16) our ability to successfully integrate acquired businesses, (17) changes and reforms in applicable healthcare laws and regulations, (18) quality issues and adverse events related to our products, such as capsule retention, aspiration and failure to attach or detach, bleeding or perforation that could require us to recall products and impact our sales and net income, and (19) other risks and factors disclosed in our filings with the U.S. Securities and Exchange Commission, including, but not limited to, risks and factors identified under such headings as "Risk Factors," "Cautionary Language Regarding Forward-Looking Statements" and "Operating Results and Financial Review and Prospects" in the Company's Annual Report on Form 20-F for the year ended December 31, 2012. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Except to the extent expressly required under applicable law, the Company undertakes no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events.
Financial Tables Follow
| Given Imaging Ltd. and its Consolidated Subsidiaries | ||||||
| Specified Items | ||||||
| For the Three Months Ended March 31, 2013 and 2012 | ||||||
| (Unaudited, dollars in thousands) | ||||||
|
Gross Profit |
Research And Development |
Selling And Marketing |
General And Admin |
Tax Expense (Benefit) |
Total | |
| Three month period ended March 31, 2013 | ||||||
| Compensation expenses | $ -- | $ 196 | $ 418 | $ 782 | $ -- | $ 1,396 |
| Sierra and SmartPill PPA | 399 | -- | 93 | -- | $ (171) | 321 |
| Total | $ 399 | $ 196 | $ 511 | $ 782 | $ (171) | $ 1,717 |
| Three month period ended March 31, 2012 | ||||||
| Compensation expenses | $ -- | $ 158 | $ 229 | $ 1,042 | $ -- | $ 1,429 |
| Sierra PPA | 237 | -- | 81 | -- | $ (171) | 147 |
| Total | $ 237 | $ 158 | $ 310 | $ 1,042 | $ (171) | $ 1,576 |
| Given Imaging Ltd. And its Consolidated Subsidiaries | |||||
| Reconciliation of GAAP results to non-GAAP results | |||||
| For the three months ended March 31, 2013 and 2012 | |||||
| Condensed, in thousands except share and per share data | |||||
| Three months ended March 31, 2013 | GAAP |
Specified Items (*) |
Non GAAP |
||
| Gross profit | $31,310 | $ 399 | $31,709 | ||
| Research and Development, net | 5,971 | (196) | 5,775 | ||
| Sales and Marketing | 19,631 | (511) | 19,120 | ||
| General and administrative | 5,561 | (782) | 4,779 | ||
| Income tax expense | 312 | 171 | 483 | ||
| Net income (loss) attributable to shareholders | $ (221) | $ 1,717 | $1,496 | ||
| Three months ended March 31, 2012 | GAAP |
Specified Items (*) |
Non GAAP |
||
| Gross profit | $31,646 | $237 | $31,883 | ||
| Research and Development, net | 6,744 | (158) | 6,586 | ||
| Sales and Marketing | 18,763 | (310) | 18,453 | ||
| General and administrative | 5,637 | (1,042) | 4,595 | ||
| Income tax expense | 624 | 127 | 751 | ||
| Net income attributable to shareholders | $201 | $1,620 | $1,821 | ||
| Given Imaging Ltd. and its Consolidated Subsidiaries | ||
| Interim Consolidated Balance Sheets | ||
| In thousands except share data | ||
| (Unaudited) | ||
|
March 31, 2013 |
December 31, 2012 |
|
| Assets | ||
| Current assets | ||
| Cash and cash equivalents | $ 31,711 | $ 35,442 |
| Short-term investments | 59,836 | 58,446 |
| Accounts receivable: | ||
| Trade | 27,245 | 31,279 |
| Other | 4,852 | 4,654 |
| Inventories | 23,585 | 22,591 |
| Advances to suppliers | 1,140 | 1,349 |
| Deferred tax assets | 2,791 | 2,646 |
| Other current assets | 2,769 | 2,689 |
| Total current assets | 153,929 | 159,096 |
| Deposits | 881 | 924 |
| Assets held for employees' severance payments | 8,386 | 7,974 |
| Long-term investments | 30,262 | 30,188 |
| Non-current Inventory | 5,773 | 6,150 |
| Fixed assets, less accumulated depreciation | 11,982 | 12,335 |
| Intangible assets, less accumulated amortization | 29,747 | 30,705 |
| Goodwill | 26,942 | 26,942 |
| Total Assets | $267,902 | $274,314 |
| Given Imaging Ltd. and its Consolidated Subsidiaries | ||
| Interim Consolidated Balance Sheets | ||
| In thousands except share data | ||
| (Unaudited) | ||
|
March 31, 2013 |
December 31, 2012 |
|
| Liabilities and equity | ||
| Current liabilities | ||
| Current installments of obligation under capital lease | $ -- | $ 38 |
| Accounts payable: | ||
| Trade | 6,956 | 8,756 |
| Other | 19,997 | 27,091 |
| Deferred income | 979 | 929 |
| Total current liabilities | 27,932 | 36,814 |
| Long-term liabilities | ||
| Obligation under capital lease, net | 71 | 78 |
| Liability in respect of employees' severance payments | 9,171 | 8,761 |
| Contingent consideration in respect of business combination | 1,113 | 1,038 |
| Deferred tax liabilities | 4,504 | 4,675 |
| Total long-term liabilities | 14,859 | 14,552 |
| Total liabilities | 42,791 | 51,366 |
| Equity | ||
| Ordinary Shares, NIS 0.05 par value each (90,000,000 shares authorized; 31,371,861 and 31,080,876 shares issued and fully paid as of March 31, 2013 and December 31, 2012, respectively) | 369 | 367 |
| Additional paid-in capital | 221,480 | 219,103 |
| Capital reserve | 1,591 | 1,591 |
| Accumulated other comprehensive income | 271 | 266 |
| Retained earnings | 1,400 | 1,621 |
| Total Equity | 225,111 | 222,948 |
| Total liabilities and equity | $267,902 | $274,314 |
| Given Imaging Ltd. and its Consolidated Subsidiaries | |||
| Interim Consolidated Statements of Income and Comprehensive Income | |||
| In thousands except share data | |||
| (Unaudited) | |||
| Three month period ended | Year ended | ||
| March 31, | December 31, | ||
| 2013 | 2012 | 2012 | |
| Revenues | $ 40,620 | $ 41,839 | $ 180,501 |
| Cost of revenues | (9,310) | (10,193) | (42,971) |
| Gross profit | 31,310 | 31,646 | 137,530 |
| Operating expenses | |||
| Research and development, gross | (6,101) | (7,156) | (25,627) |
| Government grants | 130 | 412 | 1,439 |
| Research and development, net | (5,971) | (6,744) | (24,188) |
| Sales and marketing | (19,631) | (18,763) | (76,272) |
| General and administrative | (5,561) | (5,637) | (22,746) |
| Other, net | (48) | (101) | (455) |
| Total operating expenses | (31,211) | (31,245) | (123,661) |
| Operating profit | 99 | 401 | 13,869 |
| Financing income (expenses), net | (8) | 331 | 847 |
| Profit before taxes on income | 91 | 732 | 14,716 |
| Income tax expense | (312) | (624) | (459) |
| Net profit (loss) | (221) | 108 | 14,257 |
| Net loss attributable to non-controlling interest | -- | 93 | 93 |
| Net profit (loss) attributable to shareholders | $ (221) | $ 201 | $ 14,350 |
| Net change in respect of available for sale securities | 5 | 430 | 1,151 |
| Total comprehensive profit (loss) attributable to shareholders | $ (216) | $ 631 | $ 15,501 |
| Total comprehensive loss attributable to non-controlling interest | -- | (93) | (93) |
| Total comprehensive profit (loss) | $ (216) | $ 538 | $ 15,408 |
| Earnings per share | |||
| Basic Earnings (loss) attributable to shareholders per Ordinary Share | $ (0.01) | $ 0.01 | $ 0.47 |
| Diluted Earnings (loss) attributable to shareholders per Ordinary Share | $ (0.01) | $ 0.01 | $ 0.45 |
| Weighted average number of Ordinary Shares used to compute basic Earnings (loss) per Ordinary share | 31,227,150 | 30,579,090 | 30,853,581 |
| Weighted average number of Ordinary Shares used to compute diluted Earnings (loss) per Ordinary share | 31,227,150 | 31,477,929 | 31,563,208 |
| Given Imaging Ltd. and its Consolidated Subsidiaries | |||
| Interim Consolidated Statements of Cash Flows | |||
| In thousands except share data | |||
| (Unaudited) | |||
| Three month period ended | Year ended | ||
| March 31, | December 31, | ||
| 2013 | 2012 | 2012 | |
| Cash flows from operating activities: | |||
| Net profit (loss) | $ (221) | $ 108 | $ 14,257 |
| Adjustments required to reconcile net profit to net cash provided by (used in) operating activities: | |||
| Depreciation and amortization | 2,198 | 1,996 | 8,597 |
| Change in deferred taxes | (316) | (1,007) | (1,795) |
| Stock based compensation | 1,396 | 1,429 | 6,158 |
| Loss from disposal of fixed assets and intangible assets | 87 | 102 | 484 |
| Unrealized interest on contingent consideration | 75 | -- | -- |
| Decrease in accounts receivable – trade | 4,034 | 2,820 | 977 |
| Decrease (increase) in accounts receivable – other | (186) | 1,355 | 1,252 |
| Increase in other current assets | (80) | (852) | (1,316) |
| Decrease (increase) in advances to suppliers | 209 | (172) | (142) |
| Increase in inventories | (617) | (472) | (299) |
| Decrease in accounts payable | (8,960) | (4,595) | (691) |
| Increase in deferred income | 50 | 12 | 408 |
| Other | 109 | (50) | (62) |
| Net cash provided by (used in) operating activities | (2,222) | 674 | 27,828 |
| Cash flows from investing activities: | |||
| Purchase of fixed assets and intangible assets | (1,012) | (1,480) | (7,005) |
| Other long term assets | 1 | (599) | (538) |
| Acquisition of business, net of cash acquired | -- | -- | (6,000) |
| Change in short-term deposit, net | 7,500 | 20,617 | 4,968 |
| Proceeds from sales and maturity of marketable securities | 246 | 2,000 | 13,343 |
| Investments in marketable securities | (9,293) | (12,322) | (24,827) |
| Net cash provided by (used in) investing activities | (2,558) | 8,216 | (20,059) |
| Cash flows from financing activities: | |||
| Principal payments on capital lease obligation | -- | (41) | (129) |
| Proceeds from the issuance of Ordinary Shares | 983 | 1,337 | 4,115 |
| Purchase of shares from a non-controlling shareholder in a subsidiary | -- | (658) | (658) |
| Net cash provided by financing activities | 983 | 638 | 3,328 |
| Effect of exchange rate changes on cash and cash equivalents | 66 | 46 | 60 |
| Increase (decrease) in cash and cash equivalents | (3,731) | 9,574 | 11,157 |
| Cash and cash equivalents at beginning of period | 35,442 | 24,285 | 24,285 |
| Cash and cash equivalents at end of period | $ 31,711 | $ 33,859 | $ 35,442 |
| Supplementary cash flow information | |||
| Income taxes paid | $ 1,240 | $ 122 | $ 2,883 |