Second Qtr First Half Second Qtr First Half
2008 2008 2007 2007
---------- ---------- ---------- ----------
Stock based compensation
expenses (FAS123R) 1.7 3.2 1.2 2.3
InScope gain - (5.4) - -
IP litigation expenses 0.4 3.3 1.2 1.3
Settlement agreement
with Olympus Corporation (2.33) (2.33) - -
Increasing 2008 GAAP EPS Guidance
As a result of settling our patent litigation with Olympus Corporation, the
Company is increasing full year 2008 GAAP, fully diluted earnings per share
from $0.26 and $0.34 to $0.34 and $0.42.
Reimbursement Highlights
-- Medical Mutual of Ohio, serving more than 3.9 million individuals in
Ohio and South Carolina, recently updated its capsule endoscopy policy and
will allow physicians to use PillCam SB as a primary test for symptoms
indicative of small bowel tumors or Crohn's disease. In addition, Medical
Mutual will allow the use of PillCam ESO in the evaluation of esophageal
varices in patients who have esophageal varices or portal hypertension and
when EGD is contraindicated. The policy also includes the use of the Agile
patency capsule prior to the administration of the PillCam video capsule.
-- Australia's Minister of Health and Ageing approved Medicare funding of
PillCam SB in patients with Peutz-Jeghers syndrome (PJS). PJS is a genetic
condition that is characterized by the presence of gastrointestinal polyps
and a high risk of certain types of cancer including cancer of the small
intestine. It is estimated that up to 1 in 25,000 individuals have PJS.
Surveillance of these patients with capsule endoscopy has been recommended
at an interval of every two years.
Conference Call / Webcast Information
U.S. Call / Webcast
Given Imaging will host a conference call Thursday, August 7, 2008, at 9:00
a.m. Eastern time to discuss second quarter 2008 results. To participate in
the teleconference, please dial 1-888-778-9069 fifteen minutes before the
conference begins. International callers should dial 913-312-0849. 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 August
21, 2008 by dialing 1-888-203-1112. International callers should dial
719-457-0820. The replay participant code is 5010408.
Hebrew Call
The company will host a separate conference call in Hebrew on August 7 at
14:00 Israel time, (7:00 a.m. ET). To access this call, please dial
+972-3-9180650 ten minutes before the conference is scheduled to begin. A
replay of the call will be available from August 10-12 by dialing
+972-3-9255900.
About Given Imaging Ltd.
Given Imaging is redefining gastrointestinal diagnosis by developing,
producing and marketing innovative, patient-friendly products for detecting
gastrointestinal disorders. The company's technology platform is the
PillCam® Platform, featuring the PillCam video capsule, a disposable,
miniature video camera contained in a capsule, which is ingested by the
patient, a sensor array, data recorder and RAPID® software. Given Imaging
has a number of available capsules: the PillCam SB video capsule to
visualize the entire small intestine which is currently marketed in the
United States and in more than 60 other countries; the PillCam ESO video
capsule to visualize the esophagus; the Agile™ patency capsule to
determine the free passage of the PillCam capsule in the GI tract and the
PillCam COLON video capsule to visualize the colon that has been cleared
for marketing in the European Union. PillCam COLON has received a CE Mark,
but is not cleared for marketing or available for commercial distribution
in the USA. More than 750,000 patients worldwide have benefited from the
PillCam capsule endoscopy procedure. Given Imaging's headquarters,
manufacturing and R&D facilities are located in Yoqneam, Israel. It has
operating subsidiary companies in the United States, Germany, France,
Japan, Australia and Singapore. Given Imaging's largest shareholders
include Elron Electronic Industries (
Given Imaging Ltd. and its Consolidated Subsidiaries
Consolidated Balance Sheets
In thousands except share data
June 30, December 31,
------------ ------------
2008 2007
------------ ------------
(Unaudited) (Audited)
------------ ------------
Assets
Current assets
Cash and cash equivalents $ 43,584 $ 37,103
Short-term investments 14,001 23,191
Accounts receivable:
Trade (Net of provisions for doubtful debts of
$338 and of $329 as of June 30, 2008 and
December 31, 2007, respectively) 20,527 23,315
Other 5,802 10,385
Inventories 18,577 15,960
Prepaid expenses 1,207 1,289
Deferred tax assets 1,175 1,350
Advances to suppliers 215 190
------------ ------------
Total current assets 105,088 112,783
------------ ------------
Deposits 1,122 892
Assets held for employee severance payments 3,963 3,007
Marketable Securities 48,605 41,629
Fixed assets, at cost, less accumulated
depreciation 15,511 15,422
Other assets, at cost, less accumulated
amortization 4,614 3,583
------------ ------------
Total Assets $ 178,903 $ 177,316
============ ============
Given Imaging Ltd. and its Consolidated Subsidiaries
Consolidated Balance Sheets
In thousands except share data
June 30, December 31,
----------- -----------
2008 2007
----------- -----------
(Unaudited) (Audited)
----------- -----------
Liabilities and shareholders' equity
Current liabilities
Current installments of obligation under capital
lease $ 128 $ 121
Accounts payable
Trade 9,215 7,275
Other 17,560 21,012
Deferred income 2,866 9,379
----------- -----------
Total current liabilities 29,769 37,787
----------- -----------
Long-term liabilities
Obligation under capital lease, net 508 448
Liability in respect of employees’ severance
payments 4,560 3,490
----------- -----------
Total long-term liabilities 5,068 3,938
----------- -----------
Total liabilities 34,837 41,725
----------- -----------
Minority interest 3,162 1,996
----------- -----------
Shareholders’ equity
Share capital:
Ordinary Shares, NIS 0.05 par value each
(90,000,000 shares authorized; 29,252,785 and
29,241,875 shares issued and fully paid as of
June 30, 2008 and December 31, 2007, respectively) 343 343
Additional paid-in capital 170,265 166,813
Capital reserve 2,166 2,166
Accumulated other comprehensive loss (103) -
Accumulated deficit (31,767) (35,727)
----------- -----------
Total shareholders' equity 140,904 133,595
----------- -----------
Total liabilities and shareholders' equity $ 178,903 $ 177,316
=========== ===========
Given Imaging Ltd. and its Consolidated Subsidiaries
Consolidated Statements of Operations
In thousands except share and per share data
Six month Three month
period ended period ended
June 30, June 30, Year ended
---------------------- ---------------------- December 31,
2008 2007 2008 2007 2007
---------- ---------- ---------- ---------- ----------
(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Audited)
---------- ---------- ---------- ---------- ----------
Revenues $ 60,196 $ 50,896 $ 33,072 $ 27,844 $ 112,868
Cost of
revenues (15,943) (12,846) (8,108) (6,824) (29,721)
Early repayment
of royalty
bearing
government
grants - - - - (4,843)
---------- ---------- ---------- ---------- ----------
Gross profit 44,253 38,050 24,964 21,020 78,304
---------- ---------- ---------- ---------- ----------
Operating expenses
Research and
development,
gross (7,689) (5,988) (3,893) (3,205) (12,847)
Royalty and
non-royalty
bearing grants 790 693 370 600 1,242
---------- ---------- ---------- ---------- ----------
Research and
development,
net (6,899) (5,295) (3,523) (2,605) (11,605)
Sales and
marketing (31,922) (25,412) (16,960) (13,906) (55,446)
General and
administrative (10,173) (9,021) (2,894) (5,078) (20,981)
Termination of
marketing
agreement 5,443 - - - 22,860
Other - - - - (422)
---------- ---------- ---------- ---------- ----------
Total operating
expenses (43,551) (39,728) (23,377) (21,589) (65,594)
---------- ---------- ---------- ---------- ----------
Operating
profit (loss) 702 (1,678) 1,587 (569) 12,710
Financing
income, net 2,466 1,929 870 727 5,520
---------- ---------- ---------- ---------- ----------
Profit before taxes
on income and
minority share 3,168 251 2,457 158 18,230
Income tax
benefit (expense) (126) (244) 33 3 (4,548)
---------- ---------- ---------- ---------- ----------
Profit before
minority
Share 3,042 7 2,490 161 13,682
Minority share
in losses of
subsidiary 918 687 394 462 1,503
---------- ---------- ---------- ---------- ----------
Net profit $ 3,960 $ 694 $ 2,884 $ 623 $ 15,185
========== ========== ========== ========== ==========
Earnings per share
Basic
Earnings per
Ordinary Share $ 0.14 $ 0.02 $ 0.10 $ 0.02 $ 0.52
========== ========== ========== ========== ==========
Diluted
Earnings per
Ordinary Share $ 0.13 $ 0.02 $ 0.09 $ 0.02 $ 0.49
========== ========== ========== ========== ==========
Weighted average
number of
Ordinary Shares
used to compute
basic Earnings
per Ordinary
share 29,251,868 28,760,450 29,252,785 28,861,380 28,961,968
========== ========== ========== ========== ==========
Weighted average
number of
Ordinary Shares
used to compute
diluted Earnings
per Ordinary
share 30,886,460 30,747,285 30,678,341 30,990,699 31,030,458
========== ========== ========== ========== ==========
Given Imaging Ltd. and its Consolidated Subsidiaries
Consolidated Statements of Cash Flows
In thousands
Six month Three month
period ended period ended
June 30, June 30, Year ended
-------------------- --------------------December 31,
2008 2007 2008 2007 2007
--------- --------- --------- --------- ---------
(Unaudited)(Unaudited)(Unaudited)(Unaudited) (Audited)
--------- --------- --------- --------- ---------
Cash flows from
operating
activities:
Net profit $ 3,960 $ 694 $ 2,884 $ 623 $ 15,185
Adjustments required
to reconcile net
loss to net cash
used in operating
activities:
Minority share in
losses of
subsidiary (918) (687) (394) (462) (1,503)
Depreciation and
amortization 2,541 2,280 1,276 1,130 4,771
Deferred tax assets 175 (443) 13 (204) 24
Stock based
compensation 3,256 2,337 1,745 1,228 5,651
Excess tax benefits
related to stock
based compensation - - - - (693)
Other 9 (111) (80) (184) 380
Net decrease
(increase) in
trading securities - 3,478 - 400 5,092
Decrease (increase)
in accounts
receivable - trade 2,788 1,346 (2,163) (793) (4,428)
Decrease (increase)
in accounts
receivable - other 4,583 (1,488) (2,967) (743) (8,922)
Decrease (increase)
in prepaid expenses 82 (381) (1) 45 51
Decrease (increase)
in advances to
to suppliers (25) (133) 38 (90) (108)
Decrease (increase)
in inventories (2,617) (192) (2,017) (973) 2,208
Increase (decrease)
in accounts payable (1,785) 2,133 303 5,734 8,570
Decrease in deferred
income (6,513) (530) (21) (572) (14,903)
Net cash provided by
(used in) operating --------- --------- --------- --------- ---------
activities $ 5,536 $ 8,303 $ (1,384) $ 5,139 $ 11,375
--------- --------- --------- --------- ---------
Cash flows from
investing
activities:
Excess of cash
investment over
equity share in
subsidiary 965 - 965 -
Purchase of fixed
assets and
intangible assets (3,597) (2,005) (2,350) (1,313) (5,772)
Deposits (244) 22 (219) 33 (355)
Proceeds from sales
of marketable
securities 34,714 9,132 16,274 9,132 18,753
Proceeds from sales
of fixed assets 30 - 5 - -
Purchase of
marketable
securities (32,514) (26,797) (12,887) (9,439) (36,584)
--------- --------- --------- --------- ---------
Net cash (used in)
provided by
investing
activities $ (646) $ (19,648) $ 1,788 $ (1,587) $ (23,958)
--------- --------- --------- --------- ---------
Given Imaging Ltd. and its Consolidated Subsidiaries
Consolidated Statements of Cash Flows
In thousands
Six month Three month
period ended period ended
June 30, June 30, Year ended
-------------------- --------------------December 31,
2008 2007 2008 2007 2007
--------- --------- --------- --------- ---------
(Unaudited)(Unaudited)(Unaudited)(Unaudited) (Audited)
--------- --------- --------- --------- ---------
Cash flows from
financing activities:
Principal payments
on capital
lease obligation $ (85) $ (6) $ (35) $ (3) $ (37)
Proceeds from the
issuance of
Ordinary Shares 196 2,892 - 2,540 4,280
Issuance of shares
to a minority
shareholder in a
consolidated
company 1,207 - - - -
Excess tax benefits
related to stock
based compensation - - - 693
--------- --------- --------- --------- ---------
Net cash provided by
(used in) financing
activities $ 1,318 $ 2,886 $ (35) $ 2,537 $ 4,936
--------- --------- --------- --------- ---------
Effect of exchange
rate changes on cash 273 (17) 98 (66) 240
--------- --------- --------- --------- ---------
Increase (decrease)
in cash and cash
equivalents 6,481 (8,476) 467 6,023 (7,407)
Cash and cash
equivalents at
beginning of period 37,103 44,510 43,117 30,011 44,510
--------- --------- --------- --------- ---------
Cash and cash
equivalents at
end of period $ 43,584 $ 36,034 $ 43,584 $ 36,034 $ 37,103
========= ========= ========= ========= =========
Supplementary cash
flow Information
Income taxes paid $ 122 $ 153 $ 47 $ 78 $ 1,098
========= ========= ========= ========= =========
Assets acquired
under capital
Lease $ 109 $ - $ - $ - $ 569
========= ========= ========= ========= =========
Contact Information: For further information contact: Fern Lazar David Carey Lazar Partners Ltd. 1-212-867-1768