-- The Brazilian Medical Association recently issued a reimbursement code for PillCam SB capsule endoscopy. Approximately 9.1 million of Brazil's 44.3 million privately insured citizens are currently covered for the PillCam SB procedure and the company believes coverage for the remaining 35.2 million privately insured individuals will be fully implemented by the latter part of 2011. -- Germany's Ministry of Health recently announced its intent to create an outpatient reimbursement code for PillCam® SB capsule endoscopy for obscure gastrointestinal bleeding. The declaration begins a 12 to 15-month process for establishing a medical code, after which the 73 million Germans covered by the public health system, or about 90 percent of the entire German population, will have access to the PillCam SB procedure, with full reimbursement under the German statutory health insurance system.PillCam COLON 2
-- Germany's Institute for Reimbursement in Hospitals has published the 2011 update of the Diagnosis Related Group (DRG) Codes which includes an inpatient reimbursement pathway for PillCam COLON capsule endoscopy. This went into effect on January 1, 2011 and covers any publicly insured individual, or approximately 90 percent of the German population. -- In January, Given Imaging initiated a small study in the United States for PillCam COLON 2 to confirm the optimal procedures and logistics to be used in the pivotal trial to help support the Company's planned 510(k)submission to the U.S. Food and Drug Administration (FDA).Bravo
-- The FDA and the Canadian government cleared use of the Bravo pH Monitoring System in patients four years of age and older. The Bravo pH Monitoring System was previously indicated for individuals 18 years and older in both countries.Upcoming Events Given Imaging management will present at the following upcoming investor conferences:
-- February 23 - The Lazard Capital Markets Medical Device Conference taking place in Snowbird, Utah. -- March 3 - The RBC Healthcare Conference taking place in New York. Homi Shamir, President and CEO will present at 2:30pm ET.Conference Call / Webcast Information U.S. Call / Webcast The company will host a conference call in English at 9:00 am ET on Wednesday, February 16, 2011. To participate in this teleconference, please dial 888-631-3389 fifteen minutes before the conference is scheduled to begin. Callers outside of the U.S. should dial 913-312-1520. 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 March 2, 2011 by dialing 888-203-1112. Callers outside of the U.S. should dial 719-457-0820. The replay participant code is 5242909. Hebrew Call A separate conference call in Hebrew will take place on February 16, 2011 at 2:00 pm Israel time, 7:00 am ET. To access this call, please dial +972 3 918 0609 ten minutes before the conference is scheduled to begin. A replay of the call will be available from February 16 until February 18 by dialing +972 3 925 5901. About Given Imaging Ltd. Since 2001, Given Imaging has advanced gastrointestinal visualization by developing state-of-the art, patient-friendly tools based on its PillCam® Platform. PillCam® capsule endoscopy uses miniature video cameras in a capsule, wireless technology, and advanced software to provide physicians with clear images of the small intestine via PillCam® SB and the esophagus through PillCam® ESO. The PillCam® COLON video capsule, which is an investigational device in the U.S., is designed to visualize the colon. Given Imaging's other capsule products include the Agile™ patency capsule, to verify intestinal patency, and Bravo®, the only wireless, catheter-free, 48-hour pH test commercially available for pH testing to assess gastroesophageal reflux disease (GERD). In April 2010, Given Imaging acquired Sierra Scientific Instruments, the leading provider of specialty GI diagnostic solutions and pioneer of high-resolution manometry for assessing gastrointestinal motility. Sierra Scientific is now a wholly-owned subsidiary of Given Imaging. Given Imaging's headquarters, manufacturing and R&D facilities are located in Yoqneam, Israel, with operating subsidiaries in the United States, Germany, France, Japan, Australia, and Hong Kong. For more information, please visit www.givenimaging.com. 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. 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 "will," "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. 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 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) the availability of reimbursement or other forms of funding for our products 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, and (18) 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, 2009. 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 for the Company's ongoing obligations to disclose material information under the applicable securities laws, it undertakes no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events.
Given Imaging Ltd. and its Consolidated Subsidiaries Excluded Items For the Three Months Ended December 31, 2009 and 2010 (Unaudited, dollars in thousands) Research Selling And And General Tax Gross Develop- Market- And Other Expense Profit ment ing Admin Expenses (Benefit) Total -------- ------- -------- -------- -------- ------- ------- Three month period ended December 31, 2010 Compensation expenses $ - $ 124 $ 564 $ 1,324 $ - $ - $ 2,012 Sierra PPA 237 - 81 395 - (127) 586 -------- ------- -------- -------- -------- ------- ------- Total $ 237 $ 124 $ 645 $ 1,719 $ 0 $ (127) $ 2,598 ======== ======= ======== ======== ======== ======= ======= Three month period ended December 31, 2009 Compensation expenses $ - $ (29) $ 110 $ 1,309 $ - $ - $ 1,390 Impairment of Goodwill - - - - 483 - 483 Tax benefit - - - - - (857) (857) -------- ------- -------- -------- -------- ------- ------- Total $ 0 $ (29) $ 110 $ 1,309 $ 483 $ (857) $ 1,016 ======== ======= ======== ======== ======== ======= ======= Given Imaging Ltd. and its Consolidated Subsidiaries Excluded Items For the Twelve Months Ended December 31, 2009 and 2010 (Unaudited, dollars in thousands) Research Selling And And General Tax Gross Develop- Market- And Other Expense Profit ment ing Admin Expenses (Benefit) Total -------- ------- -------- -------- -------- ------- ------- Twelve month period ended December 31, 2010 Compensation expenses $ - $ 428 $ 1,557 $ 6,497 $ - $ - $ 8,482 Sierra acquisition expenses - - - 686 - - 686 Sierra PPA 1,982 - 245 645 - (888) 1,984 -------- -------- -------- -------- -------- ------- ------- Total $ 1,982 $ 428 $ 1,802 $ 7,828 $ 0 $ (888) $11,152 ======== ======== ======== ======== ======== ======= ======= Twelve month period ended December 31, 2009 Compensation expenses $ - $ 257 $ 1,619 $ 5,392 $ - $ - $ 7,268 Impairment of Goodwill - - - - 483 - 483 Tax (benefit) - - - - - (2,608) (2,608) -------- -------- -------- -------- -------- ------- ------- Total $ 0 $ 257 $ 1,619 $ 5,392 $ 483 $(2,608) $ 5,143 ======== ======== ======== ======== ======== ======= ======= Given Imaging Ltd. and its Consolidated Subsidiaries Reconciliation of GAAP results to non-GAAP results For the Three months ended December 31, 2010 and 2009 Condensed, in thousands except share and per share data Q4 2010 Q4 2009 Specified Non Specified Non GAAP Items (*) GAAP GAAP Items (*) GAAP -------- -------- -------- -------- -------- -------- Revenues $ 44,920 - $ 44,920 $ 40,040 - $ 40,040 Cost of revenues (10,232) 237 (9,995) (9,379) - (9,379) Gross profit 34,688 237 34,925 30,661 - 30,661 Gross profit as a % of revenues 77.2% - 77.7% 76.6% - 76.6% Operating expenses Research and development, net (5,643) 124 (5,519) (4,211) (29) (4,240) Sales and marketing (18,696) 645 (18,051) (16,171) 110 (16,061) General and administrative (7,002) 1,719 (5,283) (4,898) 1,309 (3,589) Other, net (299) - (299) (889) 483 (406) Total operating expenses (31,640) 2,488 (29,152) (26,169) 1,873 (24,296) Operating profit 3,048 2,725 5,773 4,492 1,873 6,365 Operating profit as a % of revenues 6.8% - 12.9% 11.2% - 15.9% Financing income, net 909 - 909 308 - 308 Profit before taxes on income 3,957 2,725 6,682 4,800 1,873 6,673 Income tax benefit (expense) (799) (127) (926) 382 (857) (475) Net Profit 3,158 2,598 5,756 5,182 1,016 6,198 Net loss attributable to non-controlling interest 45 - 45 187 - 187 Net profit attributable to shareholders $ 3,203 $ 2,598 $ 5,801 $ 5,369 $ 1,016 $ 6,385 Net profit attributable to share- holders as a % of revenues 7.1% - 12.9% 13.4% - 15.9% Earnings per share Basic Earnings attributable to shareholders per Ordinary Share $ 0.11 $ 0.08 $ 0.19 $ 0.18 $ 0.04 $ 0.22 Diluted Earnings attributable to shareholders per Ordinary Share $ 0.11 $ 0.08 $ 0.19 $ 0.17 $ 0.03 $ 0.21 Given Imaging Ltd. and its Consolidated Subsidiaries Reconciliation of GAAP results to non-GAAP results For the nine months ended September 30, 2010 and 2009 Condensed, in thousands except share and per share data YTD 2010 YTD 2009 Specified Non Specified Non GAAP Items (*) GAAP GAAP Items (*) GAAP -------- -------- -------- -------- -------- -------- Revenues $157,809 - $157,809 $141,763 - $141,763 Cost of revenues (37,629) 1,982 (35,647) (33,145) - (33,145) Gross profit 120,180 1,982 122,162 108,618 - 108,618 Gross profit as a % of revenues 76.2% - 77.4% 76.6% - 76.6% Operating expenses Research and development, net (20,218) 428 (19,790) (16,733) 257 (16,476) Sales and marketing (67,114) 1,802 (65,312) (61,428) 1,619 (59,809) General and administrative (25,138) 7,828 (17,310) (18,919) 5,392 (13,527) Other, net (759) - (759) (1,220) 483 (737) Total operating expenses (113,229) 10,058 (103,171) (98,300) 7,751 (90,549) Operating profit 6,951 12,040 18,991 10,318 7,751 18,069 Operating profit as a % of revenues 4.4% - 12.0% 7.3% - 12.7% Financing income, net 2,599 - 2,599 1,584 - 1,584 Profit before taxes on income 9,550 12,040 21,590 11,902 7,751 19,653 Income tax benefit (expense) (1,362) (888) (2,250) 1,542 (2,608) (1,066) Net Profit 8,188 11,152 19,340 13,444 5,143 18,587 Net loss attributable to non-controlling interest 290 - 290 891 - 891 Net profit attributable to shareholders $ 8,478 $ 11,152 $ 19,630 $ 14,335 $ 5,143 $ 19,478 Net profit attributable to share- holders as a % of revenues 5.4% - 12.4% 10.1% - 13.7% Earnings per share Basic Earnings attributable to shareholders per Ordinary Share $ 0.29 $ 0.37 $ 0.66 $ 0.49 $ 0.18 $ 0.67 Diluted Earnings attributable to shareholders per Ordinary Share $ 0.28 $ 0.36 $ 0.64 $ 0.47 $ 0.17 $ 0.64 Given Imaging Ltd. and its Subsidiaries Consolidated Balance Sheets (In thousands except share data) December 31, ---------- ---------- 2010 2009 Assets Current assets Cash and cash equivalents $ 34,619 $ 46,458 Short-term investments 51,973 31,736 Accounts receivable: Trade, net 27,862 24,742 Other 4,291 3,799 Inventories 19,076 17,302 Advances to suppliers 441 534 Deferred tax assets 1,638 2,207 Prepaid expenses 1,585 1,036 ---------- ---------- Total current assets 141,485 127,814 Deposits 1,212 1,062 Assets held for employees' severance payments 6,393 4,968 Marketable securities 3,873 16,956 Long-term inventory 5,626 6,015 Fixed assets, less accumulated depreciation 13,709 13,843 Deferred tax assets - 192 Intangible assets less accumulated amortization 25,813 11,284 Goodwill 24,089 3,586 ---------- ---------- Total Assets $ 222,200 $ 185,720 ========== ========== Given Imaging Ltd. and its Subsidiaries Consolidated Balance Sheets (In thousands except share data) December 31, -------------------- 2010 2009 Liabilities and equity Current liabilities Current installments of obligation under capital lease $ 168 $ 145 Accounts payable: Trade 9,125 6,789 Other 26,065 20,060 Deferred revenue 788 234 --------- --------- Total current liabilities 36,146 27,228 --------- --------- Long-term liabilities Obligation under capital lease 244 356 Liability in respect of employees' severance payments 7,151 5,530 Deferred tax liabilities 5,871 - --------- --------- Total long-term liabilities 13,266 5,886 --------- --------- Total liabilities 49,412 33,114 --------- --------- Commitments and contingencies Equity Shareholders` equity: Ordinary Shares, NIS 0.05 par value each (90,000,000 shares authorized as of December 31, 2010 and 2009, 29,829,277 and 29,370,972 shares issued and fully paid as of December 31, 2010 and 2009, respectively) 350 345 Additional paid-in capital 194,899 182,203 Capital reserve 2,051 2,166 Accumulated other comprehensive income 95 399 Accumulated deficit (24,707) (33,185) --------- --------- Shareholders` equity 172,688 151,928 --------- --------- Non-controlling interests 100 678 --------- --------- Total equity 172,788 152,606 --------- --------- Total liabilities, shareholders' equity and non-controlling interests $ 222,200 $ 185,720 ========= ========= Given Imaging Ltd. and its Subsidiaries Consolidated Statements of Operations (In thousands except share and per share data) Year ended December 31, ---------------------------------- 2010 2009 2008 ---------- ---------- ---------- Revenues $ 157,809 $ 141,763 $ 125,108 Cost of revenues (37,629) (33,145) (33,001) ---------- ---------- ---------- Gross profit 120,180 108,618 92,107 ---------- ---------- ---------- Operating expenses Research and development, gross (21,695) (17,842) (15,126) In-process research and development acquired in a business combination - - (4,700) ---------- ---------- ---------- (21,695) (17,842) (19,826) Government grants 1,477 1,109 1,530 ---------- ---------- ---------- Research and development, net (20,218) (16,733) (18,296) Sales and marketing (67,114) (61,428) (60,902) General and administrative (25,138) (18,919) (19,320) Termination of marketing agreement - - 5,443 Other, net (759) (1,220) (867) ---------- ---------- ---------- Total operating expenses (113,229) (98,300) (93,942) ---------- ---------- ---------- Operating profit (loss) 6,951 10,318 (1,835) Financial income, net 2,599 1,584 4,004 ---------- ---------- ---------- Profit before taxes on income 9,550 11,902 2,169 Income tax benefit (expense) (1,362) 1,542 (250) ---------- ---------- ---------- Net Profit 8,188 13,444 1,919 Net loss attributable to non-controlling interest 290 891 2,087 ---------- ---------- ---------- Net profit attributable to shareholders $ 8,478 $ 14,335 $ 4,006 ========== ========== ========== Earnings per share: Basic Earnings per Ordinary Share $ 0.29 $ 0.49 $ 0.14 ========== ========== ========== Diluted Earnings per Ordinary Share $ 0.28 $ 0.47 $ 0.13 ========== ========== ========== Weighted average number of Ordinary Shares used to compute basic Earnings per Ordinary Share 29,670,842 29,281,897 29,254,035 ========== ========== ========== Weighted average number of Ordinary Shares used to compute diluted Earnings per Ordinary Share 30,525,654 30,423,162 30,798,360 ========== ========== ========== Given Imaging Ltd. and its Subsidiaries Consolidated Statements of Cash Flows (In thousands) Year ended December 31, ---------------------------------- 2010 2009 2008 ---------- ---------- ---------- Cash flows from operating activities: Net profit $ 8,188 $ 13,444 $ 1,919 Adjustments required to reconcile net profit to net cash provided by operating activities: Depreciation and amortization 7,662 6,096 5,183 In-process research and development - - 4,700 Goodwill impairment 20 483 406 Deferred tax assets 761 (1,221) 172 Deferred tax liabilities (888) - - Stock based compensation 8,482 7,268 6,918 Loss from disposal of long term assets 739 714 473 Other 304 (144) 148 Decrease (increase) in accounts receivable - trade 560 (3,069) 1,642 Decrease (increase) in other accounts receivable (488) 863 5,723 Decrease (increase) in prepaid expenses (23) 595 (342) Decrease (increase) in advances to suppliers 93 3,006 (3,350) Decrease (increase) in inventories 2,331 (4,386) (2,971) Increase (decrease) in accounts payable 3,389 1,819 (3,287) Increase (decrease) in deferred revenue 554 (1,289) (7,856) ---------- ---------- ---------- Net cash provided by operating activities 31,684 24,179 9,478 ---------- ---------- ---------- Cash flows from investing activities: Purchase of fixed assets and intangible assets (5,056) (4,794) (6,300) Purchase of fixed assets, intangible assets, and goodwill in a business combination - - (16,660) Deposits, net (6) 34 (192) Acquisition of Sierra, net of cash acquired (1) (34,709) Proceeds from sale and maturity of marketable securities and short term investments 29,352 38,085 67,743 Proceeds from sales of fixed assets - - 61 Investments in marketable securities (36,968) (27,410) (61,986) ---------- ---------- ---------- Net cash provided by (used in) investing activities (47,387) 5,915 (17,334) ---------- ---------- ---------- Cash flows from financing activities: Principal payments on capital lease obligation (143) (131) (120) Proceeds from the issuance of Ordinary Shares 4,219 954 252 Dividend distribution - (15,799) - Purchase of shares from a non-controlling shareholder in a subsidiary (403) (382) - Issuance of shares by a consolidated company - - 2,288 ---------- ---------- ---------- Net cash provided by (used in) financing activities 3,673 (15,358) 2,420 ---------- ---------- ---------- Effect of exchange rate changes on cash and cash equivalents 191 25 30 ---------- ---------- ---------- Increase (decrease) in cash and cash equivalents (11,839) 14,761 (5,406) Cash and cash equivalents at beginning of year 46,458 31,697 37,103 ---------- ---------- ---------- Cash and cash equivalents at end of year $ 34,619 $ 46,458 $ 31,697 ========== ========== ========== Supplementary cash flow information: Income taxes paid $ 234 $ 877 $ 259 ========== ========== ==========
Contact Information: For further information contact: Fern Lazar/David Carey Lazar Partners Ltd. 1-212-867-1768 /