TEL AVIV, Israel and PLANO, Texas, May 19, 2015 (GLOBE NEWSWIRE) -- Top Image Systems, Ltd. (Nasdaq:TISA), a global innovator of intelligent content processing solutions, today announced its financial results for the first quarter ended March 31, 2015.
First Quarter 2015 Highlights include:
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Revenues of $8.3 million, a 3% increase over Q1 2014;
- As expected, Q1 was a seasonably slow quarter impacted by the significant strengthening of the dollar, but the Company reiterates its expectation to achieve organic revenue growth on a constant currency basis of 15% and overall revenue growth of 20% for the full year. The Company expects strong sequential and year over year revenue growth in Q2;
- Recurring revenues of $4.8 million, an increase of 84% year over year;
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Positive adjusted EBITDA*;
- The Company reiterates its expectation to achieve 10-12% adjusted EBITDA* margins for the year. Top Image Systems anticipates adjusted EBITDA* margin expansion in Q2, as increased revenue leverages fixed costs;
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Mobile revenues for Q1 2015 alone amount to over 50% of total 2014 mobile revenues. Mobile progress during Q1 includes:
- Signed a six-figure mobile identity document capture project for a financial provider in India;
- Signed a MobiCHECK deal in the U.S. via a major partner;
- Developed a strong North American mobile pipeline and sales in progress are promising;
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Steady progress with SaaS solutions, including:
- Selection of and progression to final negotiations for CloudDocs implementation at a top 10 U.S. bank;
- Performance of Proof of Concept (POC) for eFLOW in the cloud at a multimillion dollar U.S.-based financial services vendor;
- Both are expected to impact recurring revenue run rate in 2015;
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Successful launch and deployment of first consolidated intelligent process application: eFLOW Lending
- Integrates eFLOW, TIS Mobile and CloudDocs technologies;
- Launch synched with successful eFLOW deployment at leading U.S. mortgage services provider Titan Lenders Corp.;
- Appointment of accomplished industry innovator Carsten Nelk to position of CTO.
Michael Schrader, Chief Executive Officer of Top Image Systems, commented, "This has been a quarter of strategic progress against our multiple publicly stated goals and targets for 2015, and this progress reinforces our optimism for 2015. First, our mobile solutions are off to a great start this year. Increased customer adoption and expansion of use cases offered by our mobile partners validates the ripening of the market from early adopters to broad uptake by the early majority. We have a robust North American pipeline and are actively working on numerous significant opportunities in the region, as well as worldwide, for all the applications in our mobile imaging portfolio."
"In terms of our SaaS business, we are in advanced negotiations on several fronts and are cautiously confident that we will be able to close deals in the coming months that will have a strong positive impact on the company's recurring revenue run rate, while also contributing to revenue stability and visibility."
"Our pipeline for eFLOW AP and DMR solutions in North America is very strong. We plan to leverage our recent successful eFLOW solution implementations in the U.S. energy sector and in the U.S. mortgage industry as reference accounts that will aid us in anchoring our brand and spreading our solutions in North America."
"Despite the expected seasonally slow revenue start to the year, we believe we are on track to achieve the goals we set out to achieve for 2015," Mr. Schrader added. "Consolidation in the market has created some large, interesting new and time-sensitive global partnership opportunities for Top Image Systems, and through the quarter we have been aggressively pursuing these alliances. Two large projects we targeted for close with partners this quarter were delayed because of the complexities intrinsic to the partner model. Nevertheless, these deals remain in our pipeline and we expect to close them in the coming months."
"In summary, we see positive mobile capture results, steady growth in SaaS and promising prospects for our new eFLOW Lending solution for mortgage and loan processing," concluded Mr. Schrader. "eFLOW Lending is the first in a series of intelligent process applications we plan to launch, each of which will leverage the combined values of eFLOW and CloudDocs technologies in one exceptional end-to-end digital business solution that simultaneously optimizes both operations and customer experience."
First Quarter 2015 Year over Year Results
Revenues: Total revenues for the first quarter were $8.3 million, a 3% growth over the $8.1 million achieved in the first quarter of 2014. License and SaaS revenues for the first quarter were $4.8 million, compared to $3.8 million for the first quarter last year. Recurring revenues for the first quarter were $4.8 million, an increase of 84% year-over-year.
The Company's revenues and expenses were affected by the significant devaluation of the Euro, as well as of the British Pound and other leading Asia Pacific and Latin American currencies. Based on our analysis, the TIS currency basket was lower by 14.4% in the first quarter this year compared to the first quarter of 2014.
Gross Profit: Gross profit for the first quarter was $4.5 million, compared to $5.2 million for the first quarter of 2014, a decrease of 13%. Gross margin for the quarter was 54%, compared to a gross margin of 64% in Q1 2014. Cash gross margin excluding depreciation, options and amortization related to the eGistics acquisition was 59%
Adjusted EBITDA and Earnings: Adjusted EBITDA was $8 thousand, compared to Adjusted EBITDA of $0.4 million for the first quarter of 2014. Non-GAAP diluted loss per share was $0.03 compared to earnings of $0.02 for the first quarter of 2014. GAAP net loss was $1.0 million compared to a GAAP net gain of $0.1 million for the first quarter of 2014. GAAP diluted loss per share was $0.06 compared to a $0.01 gain per share for the first quarter of 2014. 2015 results include the contributions from the eGistics acquisition closed in 2014.
Q2 2015 Expectations
We expect Q2 2015 revenues to grow sequentially over Q1 2015 by double digits. We continue to expect in the upcoming quarters of 2015 to grow revenues and profitability sequentially throughout the year.
Conference Call
The Company will host a conference call and webcast today at 10:00 am ET, during which TIS management will present and discuss the financial results and be available to answer any questions from investors.
To join the conference call, please dial in to one of the following teleconference phone lines using the numbers listed below. Please begin placing your calls at least 5 minutes before the conference call commences. If you are unable to connect using the toll-free number, please try the U.S. Toll/International dial-in number.
| US Toll-Free Dial-in Number: | 1-877-407-0784 |
| US Toll/INTERNATIONAL Dial-in Number: | 1-201-689-8560 |
| Israel Toll-Free Dial-in Number: | 1-809-406-247 |
| The conference call is scheduled to begin at: | |
| 10:00 am Eastern Time | |
| 7:00 am Pacific Time | |
| 5:00 pm Israel Time |
To join the live webcast, please click on the following link: http://public.viavid.com/index.php?id=114165. For those unable to attend the live call or webcast, from the following day a recording of the call will be made available for download from the Investors section of the Top Image Systems' website www.topimagesystems.com; during the next three months the recorded webcast can be viewed by clicking on the same link as for the live webcast: http://public.viavid.com/index.php?id=114165
*Non-GAAP Financial Measures
This release includes non-GAAP financial measures, including, without limitation, adjusted EBITDA (which eliminates the impact of interest, taxes, amortization and depreciation expenses, as well as non-cash stock-based compensation expenses and other non-recurring items not part of regular business), Adjusted EBITDA margin, Non-GAAP Net Income (Loss) (which eliminates the impact of amortization expenses as well as non-cash stock-based compensation expenses and other non-recurring items not part of regular business) and Non-GAAP Income (Loss) per share. Non-GAAP measures are reconciled to comparable GAAP measures in the tables entitled "GAAP and Non-GAAP Statements of Operations".
The presentation of these non-GAAP financial measures should be considered as an addition to TIS' GAAP results provided in the attached financial statements for the first quarter ended March 31, 2015, and is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. The attached tables reconcile each non-GAAP financial measure to its most directly comparable GAAP financial measure. TIS' management believes that these non-GAAP financial measures provide meaningful supplemental information regarding TIS' performance by excluding the impact of certain charges and gains that may not be indicative of TIS' core business operating results. TIS' management believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing TIS' performance. These non-GAAP financial measures also facilitate comparisons to TIS' historical performance and its competitors' operating results. TIS includes these non-GAAP financial measures because management believes they are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision-making.
| Top Image Systems Ltd. | ||
| Consolidated Balance Sheet as of | ||
| March 31, | December 31, | |
| 2015 | 2014 | |
| In thousands | ||
| Unaudited | Audited | |
| Assets | ||
| Current Assets: | ||
| Cash and cash equivalents | $ 5,038 | $ 4,386 |
| Restricted cash | 68 | 132 |
| Trade receivables, net | 11,112 | 12,034 |
| Other accounts receivable and prepaid expenses | 1,687 | 787 |
| Deferred tax asset | 748 | 749 |
| Total current assets | 18,653 | 18,088 |
| Long-Term Assets: | ||
| Severance pay funds | 1,321 | 1,235 |
| Restricted cash | 307 | 366 |
| Non-current deferred tax assets | 522 | 522 |
| Long-term deposits and long-term assets | 229 | 245 |
| Property and equipment, net | 1,538 | 1,180 |
| Intangibles assets, net | 5,984 | 6,293 |
| Goodwill | 19,116 | 19,377 |
| Total long-term assets | 29,017 | 29,218 |
| Total Assets | $ 47,670 | $ 47,306 |
| Liabilities and Shareholders' Equity | ||
| Current Liabilities: | ||
| Trade payables | $ 1,942 | $ 1,593 |
| Deferred revenues | 6,876 | 3,573 |
| Deferred tax liability | 152 | 133 |
| Accrued expenses and other accounts payable | 3,138 | 3,815 |
| Total current liabilities | 12,108 | 9,114 |
| Long-Term Liabilities: | ||
| Accrued severance pay | $ 1,455 | $ 1,378 |
| Non-current deferred revenues | 846 | 2,212 |
| Deferred tax liability | 266 | 318 |
| Other long-term liabilities | 726 | 447 |
| Total long-term liabilities | 3,293 | 4,355 |
| Total Liabilities | $ 15,401 | $ 13,469 |
| Total parent shareholders' equity | $ 32,259 | $ 33,831 |
| Non-controlling interest | 10 | 6 |
| Shareholders' Equity | 32,269 | 33,837 |
| Total Liabilities and Shareholders' Equity | $ 47,670 | $ 47,306 |
| Top Image Systems Ltd. | ||
| Statements of Operations for the | ||
| Three months ended | Three months ended | |
| March 31, | March 31, | |
| 2015 | 2014 | |
| In thousands, except per share data | ||
| Unaudited | ||
| Revenues | $8,261 | $8,054 |
| Cost of revenues | 3,777 | 2,885 |
| Gross profit | 4,484 | 5,169 |
| Expenses | ||
| Research and development | 1,112 | 1,012 |
| Selling and marketing | 2,672 | 2,811 |
| General and administrative | 1,187 | 1,110 |
| Amortization costs | 74 | -- |
| 5,045 | 4,933 | |
| Operating income (loss) | (561) | 236 |
| Financing income (expenses), net | (356) | 8 |
| Other income, net | 3 | 8 |
| Income (loss) before taxes on income | (914) | 252 |
| Tax expenses | 77 | 122 |
| Net income (loss) | (991) | 130 |
| Net income attributable to noncontrolling interest | (4) | -- |
| Net income (loss) | ($995) | $130 |
| Earnings per Share | ||
| Basic earning (loss) per share | ($0.06) | $0.01 |
| Weighted average number of shares used in computation of basic net income (loss) per share | 17,829 | 14,110 |
| Diluted earning (loss) per share | ($0.06) | $0.01 |
| Weighted average number of shares used in computation of diluted net (loss) earnings per share | 17,829 | 14,672 |
| Adjusted EBITDA results: | ||
| Three months ended | Three months ended | |
| March 31, | March 31, | |
| 2015 | 2014 | |
| In thousands, except per share data | ||
| Adjusted EBITDA: | ||
| Net income (loss) | ($995) | $130 |
| Interest | 31 | -- |
| Exchange rate differences | 284 | (27) |
| Taxes | 77 | 122 |
| Depreciation | 146 | 43 |
| Amortization | 336 | -- |
| Stock-based compensation expenses | 129 | 149 |
| Total Adjusted EBITDA | $8 | $417 |
| Reconciliation of GAAP to Non-GAAP results: | ||
| Net income (loss) | ($995) | $130 |
| Amortization | 336 | -- |
| Stock-based compensation expenses | 129 | 149 |
| Non-GAAP Net income (loss) | ($530) | $279 |
| Non-GAAP Net income (loss) used for basic earnings per share | ($530) | $279 |
| Shares used in basic earnings per share calculation | 17,829 | 14,110 |
| Non-GAAP basic earnings (loss) per share | ($0.03) | $0.02 |
| Non-GAAP Net income (loss) used for diluted earnings per share | ($530) | $279 |
| Shares used in diluted earnings per share calculation | 17,829 | 14,672 |
| Non-GAAP diluted earnings (loss) per share | ($0.03) | $0.02 |