TEL AVIV, Israel, Nov. 7, 2012 (GLOBE NEWSWIRE) -- Top Image Systems, Ltd. (TIS) (Nasdaq:TISA), a leading ECM (Enterprise Content Management) intelligent content capture and delivery solutions provider, today announced record financial results for the third quarter ended September 30, 2012.
Third Quarter Year-over-Year Highlights include:
- Revenues increased 16% to a record $8.3 million
- Non-GAAP operating income increased 65% to $1.4 million
- Non-GAAP operating margin grew 43% to 17% of revenue
- Non-GAAP diluted EPS increased 100% to $0.10 per diluted share
- Recurring revenue from maintenance was 24% of revenues or $2.0 million
- Q3 2012 marks the 15th consecutive quarter of positive operating income
- Top Image ended the quarter with $3 million in cash and no debt compared to $2.6 million as of December 31, 2011
- In addition to the Financial Highlights of the Third Quarter, Top Image:
- Filed a patent for full-page (A4) capture using a mobile device, in preparation for the next generation of mobile capture requirements
- Signed Jack Henry & Associates as resellers to accelerate adoption of its mobile capture solutions
- Partnered with Datamark to grow US sales of non-mobile eFLOW software solutions, expecting this market to expand significantly before year-end
- Extended cooperation with ECM leader Saperion, and won first deal with Océ, a Canon company, both illustrating another effective partner channel by which Top Image is growing its market presence
- Together with Océ closed $3.5 million deal with UK arm of leading European financial institution
- Ranked as 1 of 5 "Leaders" by Forrester Research in Multichannel Capture, Q3 2012: Kofax, EMC, IBM, OpenText, and Top Image Systems
Dr. Ido Schechter, CEO of Top Image Systems (TISA), commented, "We focus on a Triangle of Success to continually grow revenues, profits and margins. In the first three quarters of 2012 we consistently met these goals. In Q4 we expect added contributions from a maturing pipeline of several sales force hires we made in late 2011. Concentrating on our core sales proposition has resulted in a profitable, fast-growing business. At the same time, we are now investing in US sales efforts, which we deem in the long-term to be an exponential growth opportunity, to diversify and expand our market exposure without sacrificing strong growth in revenue, margins or profit."
"Our US strategy targets the newly developing mobile capture market and in parallel offers our mature, proven, eFLOW® solutions, including our Banking Platform, Digital Mailroom (DMR) and Invoice Reader to financial institutions and other enterprises. To achieve these ends, we are signing with great partners to introduce our solutions to their US customers. In 2013, we will add direct sales staff to our US office to fortify these efforts. We reiterate that we expect to begin to penetrate both the US enterprise capture and mobile capture markets by closing deals in 2013. We continue in our traditional markets to execute on our Triangle of Success, with 24% recurring revenue. The increase in staff in the US is planned as part and parcel of a major growth effort that we foresee in the coming years. Any investment will be contingent upon and in direct proportion to our actual growth in the US, thus ensuring that we continue to increase profitability. Considering our present business activities, going forward, the US is definitely going to be a major geography for TIS."
Dr. Schechter concluded, "Taking all of these factors into account, for 2012 TISA reiterates that it expects annual revenue growth of between 17% and 23%, to a range of $33.5 million to $35.3 million, and Non-GAAP operating income growth of between 21% and 29%, to a range of $4.4 million to $4.7 million."
Third Quarter 2012 Year over Year Results
Revenues for the third quarter of 2012 increased 16% to $8.3 million, from $7.2 million for the same period in 2011. Non-GAAP operating income for the third quarter of 2012 increased 65% to $1.4 million, from $0.8 million for the same period in 2011. Non-GAAP net income in the third quarter of 2012 increased 137% to $1.3 million, from $0.5 million for the same period in 2011. Non-GAAP diluted EPS for the third quarter of 2012 increased 100% to $0.10, from $0.05 for the same period in 2011.
Nine Month 2012 Results
Revenues for the nine months ended September 30, 2012 increased 12% to $24.0 million, from $21.4 million for the same period in 2011. Non-GAAP operating income for the nine months ended September 30, 2012 increased 26% to $3.6 million, from $2.8 million for the same period in 2011. Non-GAAP net income for the nine months ended September 30, 2012 increased 32%, to $3.5 million, from $2.6 million for the same period in 2011. Non-GAAP diluted EPS for the nine months ended September 30, 2012 increased 17% to $0.28, from $0.24 for the same period in 2011.
Conference Call
The Company will be holding a conference call today, Wednesday, November 7th at 10 a.m. Eastern Time (7 a.m. Pacific Time, 5 p.m. Israel Time) to review the third quarter 2012 results.
Mr. Izhak Nakar, Active Chairman of TISA, and Ms. Gili Shalita, CFO will be on-line to discuss these results and to take part in a Question and Answer session.
| US Toll-Free Dial-in Number: | 1-877-941-8416 |
| US Toll/ INTERNATIONAL Dial-in Number: | 1-480-629-9808 |
| Israel Toll-Free Dial-in Number: | 1-809-21-4368 |
| Conference ID: 4571637 | |
| The conference call is scheduled to begin at: | |
| 10 a.m. Eastern Time | |
| 7 a.m. Pacific Time | |
| 5 p.m. Israel Time |
To join the live webcast, please click on the following link: http://public.viavid.com/index.php?id=102193
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 following three months the recorded webcast can be accessed by clicking on the same link as for the live webcast: http://public.viavid.com/index.php?id=102193
Non-GAAP Financial Measures
This release includes non-GAAP financial measures, including, without limitation, Non-GAAP Operating Income (which details amortization expenses and non-cash stock-based compensation expenses), and Non-GAAP Net Income (which details the impact of amortization expenses, non- cash stock-based compensation expenses and changes in fair value of convertible debentures). 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's GAAP results provided in the attached financial statements for the third quarter ended September 30, 2012, 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's management believes that these non-GAAP financial measures provide meaningful supplemental information regarding TIS's performance by excluding the impact of certain charges and gains that may not be indicative of TIS's core business operating results. TIS management believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing TIS's performance. These non-GAAP financial measures also facilitate comparisons to TIS's 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.
About Top Image Systems
Top Image Systems (TIS) is a leading innovator of enterprise solutions for managing and validating content entering organizations from various sources. Whether originating from mobile, electronic, paper or other sources, TIS solutions deliver the content to applications that drive the organization. TIS's eFLOW™ Platform is a common platform for the company's solutions. TIS markets its platform in more than 40 countries through a multi-tier network of distributors, system integrators, value-added resellers as well as strategic partners. Visit the company's website http://www.TopImageSystems.com for more information.
The Top Image Systems logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4212
Caution Concerning Forward-Looking Statements
Certain matters discussed in this news release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results to be materially different from any future results expressed or implied in those forward looking statements. Words such as "will," "expects," "anticipates," "estimates," and words and terms of similar substance in connection with any discussion of future operating or financial performance identify forward-looking statements. These statements are based on management's current expectations or beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially including, but not limited to, risks in product development, approval and introduction plans and schedules, rapid technological change, customer acceptance of new products, the impact of competitive products and pricing, the lengthy sales cycle, proprietary rights of TIS and its competitors, risk of operations in Europe and Israel, government regulation, litigation, general economic conditions and other risk factors detailed in the Company's most recent annual report on Form 20-F and other subsequent filings with the United States Securities and Exchange Commission. We are under no obligation to, and expressly disclaim any obligation to, update or alter our forward-looking statements, whether as a result of new information, future events or otherwise.
| Top Image Systems Ltd. | ||
| Consolidated Balance Sheet as of | ||
| September 30, | December 31, | |
| 2012 | 2011 | |
| In thousands | ||
| Unaudited | Audited | |
| Assets | ||
| Current assets: | ||
| Cash and cash equivalents | $2,461 | $2,090 |
| Restricted cash | 210 | 20 |
| Trade receivables, net | 8,108 | 4,631 |
| Unbilled customers | 453 | -- |
| Other accounts receivable and prepaid expenses | 933 | 637 |
| Total current assets | 12,165 | 7,378 |
| Long-term assets: | ||
| Severance pay funds | 1,420 | 1,299 |
| Restricted cash | 317 | 499 |
| Long-term deposits and long-term assets | 81 | 84 |
| Property and equipment, net | 401 | 485 |
| Intangible assets, net | -- | 11 |
| Goodwill | 6,130 | 5,842 |
| Total long-term assets | 8,349 | 8,220 |
| Total assets | $20,514 | $15,598 |
| Liabilities and Shareholders' Equity | ||
| Current liabilities: | ||
| Trade payables | $427 | $351 |
| Deferred revenues | 2,456 | 2,084 |
| Accrued expenses and other accounts payable | 2,620 | 2,480 |
| Total current liabilities | 5,503 | 4,915 |
| Long-term liabilities: | ||
| Accrued severance pay | 1,670 | 1,543 |
| Total long-term liabilities | 1,670 | 1,543 |
| Total liabilities | $7,173 | $6,458 |
| Shareholders' equity | 13,341 | 9,140 |
| Total liabilities and shareholders' equity | $20,514 | $15,598 |
| Top Image Systems Ltd. | ||||||
| GAAP and Non-GAAP Statements of Operations for the: | ||||||
| U.S. dollars in thousands (except per share data) | ||||||
| Three months ended | Three months ended | |||||
| September 30, 2012 | September 30, 2011 | |||||
| GAAP | Adjustments (1) | Non-GAAP | GAAP | Adjustments (1) | Non-GAAP | |
| Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | |
| Revenues | $8,272 | $ -- | $8,272 | $7,158 | $ -- | $7,158 |
| Cost of revenues | 3,105 | (16) | 3,089 | 2,765 | -- | 2,765 |
| Gross profit | 5,167 | 16 | 5,183 | 4,393 | -- | 4,393 |
| Research and development | 521 | (6) | 515 | 527 | -- | 527 |
| Selling & marketing | 2,124 | (14) | 2,110 | 2,030 | (12) | 2,018 |
| General and administrative | 1,357 | (174) | 1,183 | 1,016 | -- | 1,016 |
| 4,002 | (194) | 3,808 | 3,573 | (12) | 3,561 | |
| Operating income | 1,165 | 210 | 1,375 | 820 | 12 | 832 |
| Financial expenses, net | (38) | -- | (38) | (244) | (42) | (286) |
| Income before taxes on income | 1,127 | 210 | 1,337 | 576 | (30) | 546 |
| Income tax expense | 43 | -- | 43 | -- | -- | -- |
| Net income | $1,084 | $210 | $1,294 | $576 | ($30) | $546 |
| Basic earnings per share | $0.09 | $0.11 | $0.05 | $0.05 | ||
| Weighted average number of shares used in computing basic net earnings per share | 11,555 | 11,555 | 10,855 | 10,855 | ||
| Diluted earnings per share | $0.09 | $0.10 | $0.05 | $0.05 | ||
| Weighted average number of shares used in computing diluted net earnings per share | 12,347 | 12,347 | 11,474 | 11,474 | ||
| (1) Adjustments reflect the effect of (i) non-cash stock options expenses as per SFAS 123R (ii) amortization of intangible assets related to acquisition transactions and (iii) changes in fair value of convertible debentures: | ||||||
| Three months ended | Three months ended | |||||
| September 30, 2012 | September 30, 2011 | |||||
| Adjustments (1) | Adjustments (1) | |||||
| Unaudited | Unaudited | |||||
| Stock-based compensation expenses | 210 | -- | ||||
| Amortization of intangible assets related to acquisition | -- | 12 | ||||
| Change In Fair Value of Convertible Debentures | -- | (42) | ||||
| $210 | ($30) | |||||
| Top Image Systems Ltd. | ||||||
| GAAP and Non-GAAP Statements of Operations for the: | ||||||
| U.S. dollars in thousands (except per share data) | ||||||
| Nine months ended | Nine months ended | |||||
| September 30, 2012 | September 30, 2011 | |||||
| GAAP | Adjustments (1) | Non-GAAP | GAAP | Adjustments (1) | Non-GAAP | |
| Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | |
| Revenues | $23,980 | $ -- | $23,980 | $21,378 | $ -- | $21,378 |
| Cost of revenues | 9,013 | (48) | 8,965 | 8,333 | -- | 8,333 |
| Gross Profit | 14,967 | 48 | 15,015 | 13,045 | -- | 13,045 |
| Research and development | 1,858 | (18) | 1,840 | 1,508 | -- | 1,508 |
| Selling & marketing | 6,364 | (53) | 6,311 | 5,507 | (34) | 5,473 |
| General and administrative | 4,241 | (958) | 3,283 | 3,229 | -- | 3,229 |
| 12,463 | (1,029) | 11,434 | 10,244 | (34) | 10,210 | |
| Operating income | 2,504 | 1,077 | 3,581 | 2,801 | 34 | 2,835 |
| Financial expenses, net | (55) | -- | (55) | (928) | 741 | (187) |
| Income before taxes on income | 2,449 | 1,077 | 3,526 | 1,873 | 775 | 2,648 |
| Income tax expense | 27 | -- | 27 | 3 | -- | 3 |
| Net income | $2,422 | $1,077 | $3,499 | $1,870 | $775 | $2,645 |
| Basic earnings per share | $0.21 | $0.31 | $0.19 | $0.26 | ||
| Weighted average number of shares used in computing basic net earnings per share | 11,323 | 11,323 | 9,987 | 9,987 | ||
| Diluted earnings per share | $0.20 | $0.28 | $0.17 | $0.24 | ||
| Weighted average number of shares used in computing diluted net earnings per share | 12,338 | 12,338 | 10,993 | 10,993 | ||
| (1) Adjustments reflect the effect of (i) non-cash stock options expenses as per SFAS 123R (ii) amortization of intangible assets related to acquisition transactions and (iii) changes in fair value of convertible debentures: | ||||||
| Nine months ended | Nine months ended | |||||
| September 30, 2012 | September 30, 2011 | |||||
| Adjustments (1) | Adjustments (1) | |||||
| Unaudited | Unaudited | |||||
| Stock-based compensation expenses | 1,066 | -- | ||||
| Amortization of intangible assets related to acquisition | 11 | 34 | ||||
| Change In Fair Value of Convertible Debentures | -- | 741 | ||||
| $1,077 | $775 | |||||