Top Image Systems Ltd.
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Date: March 8, 2015
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By: |
/s/Izhak Nakar
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Izhak Nakar
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Active Executive Chairman
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Announced signing strategic global partnership with Xerox to substantially expand channel sales;
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Revenues for FY2015 totaled $33.8 million, or $37.3 million in constant currencies, compared to $35.9 million or $36.6 million in constant currencies in the previous financial year;
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Fourth quarter non-GAAP and one-time expenses of $3.3 million and FY2015 non-GAAP and one-time expenses of $5.4 million;
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Returned in Q4 to being cash flow positive; put new controls in place to monitor and manage working capital going forward;
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New management team driving revisions to product portfolio, organizational structure and growth strategy are expected to return Company to revenue growth and profitability;
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Investments in Financial Process Automation (FPA) solutions to be launched in Q1 2016 are expected to drive high-margin, shorter sales cycle repeatable sales and to build market share in U.S.;
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Finalizing a plan to increase profitability and operational efficiency and substantially reduce costs.
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Revenues of $6.6 million, compared to $10.0 million in Q4 2014; adjusted for changes in foreign currency exchange rates, revenues would have been approximately $7.1 million in constant currency in the current quarter;
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Fourth quarter non-GAAP and one-time expenses totaling $3.3 million derived mainly from deferred tax amortization of $1.5 million, purchase price amortization of $0.3 million related to the acquisition of eGistics, and an Accounts Receivable write-off of $1.5 million;
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Recurring revenues represented 71% of total revenues;
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Generated $1.3 million in positive cash flow, compared to cash flow break even in Q4 last year;
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Adjusted EBITDA* loss of $2.5 million contributed by reduced revenues, AR write-offs of $1.5 million and deferred tax assets amortization of $1.5 million compared to positive adjusted EBITDA of $1.3 million in Q4 2014;
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Recognized initial revenues from multiyear contract with BNY Mellon Bank for enhanced remittance services, demonstrating viability of our banking process automation operations in the U.S.;
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Several eFLOW deals for upgrades, eFLOW INVOICE and Digital Mailroom projects brought revenues during transition while TIS develops next generation FPA solutions to launch in 2016.
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Total revenues for FY 2015 totaled $33.8 million, or $37.3 million in constant currencies, compared to $35.9 million or $36.6 million in constant currencies in the previous financial year ;
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FY2015 non-GAAP and one-time expenses totaling $5.4 million derived mainly from an impact of $1.0 million due to other financial expenses , deferred tax amortization of $ 1.5 million, purchase price amortization of $1.3 million related to the acquisition of eGistics, and an Accounts Receivable write-off of $1.6 million;
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Revenues in the Americas in FY2015 totaled $13.6 million, compared to $9.5 million in the previous year, a growth rate of 43%;
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Formed new Executive Management Team including experienced, talented new hires – CFO Yossi Dagan, CTO Carsten Nelk, CMO Andrew Pery and President TIS Americas Bob Fresneda;
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Invested in high potential new soon-to-launch FPA products through R&D hires and opening office in Frankfurt;
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Expanded U.S. activities by opening office in New Orleans, achieving key wins at BNY Mellon, a leading provider in the utilities sector, mortgage provider Titan Lenders and automotive components supplier Mahle.
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After quarter end, signed strategic global partnership with Xerox, an example of our program for strong proactive cooperation with partners to expand channel sales;
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Plans to supplement unpredictable core platform market with Q1 initial launch of end-to-end on premise, cloud and hybrid FPA solutions that leverage existing capture, cloud and mobile capabilities combined with extended processing functionality. Well-documented industry research shows high demand for these solutions in underserved mid-market. As these solutions don’t require third party involvement, they are characterized by flexible pricing, shorter sales cycles, repeatable sales, lower costs, faster implementations and earlier revenue recognition;
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Reinforced digital marketing program to grow lead generation spearheaded by launch of rebranded website.
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Top Image Systems Ltd.
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Consolidated Balance Sheet as of
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December 31,
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December 31,
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2015
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2014
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In thousands
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Audited
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Audited
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Assets
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Current Assets:
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Cash and Cash Equivalents
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$ | 2,404 | $ | 4,386 | ||||
Restricted Cash
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262 | 132 | ||||||
Trade Receivables, net
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9,348 | 12,034 | ||||||
Other Accounts Receivable and Prepaid Expenses
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932 | 787 | ||||||
Deferred Tax Assets
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- | 749 | ||||||
Total Current Assets
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12,946 | 18,088 | ||||||
Long-Term Assets:
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Severance Pay Funds
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1,327 | 1,235 | ||||||
Restricted Cash
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147 | 366 | ||||||
Non-current Deferred Tax Assets
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- | 522 | ||||||
Long-term Deposits and Long-term Assets
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204 | 245 | ||||||
Property and Equipment, net
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1,444 | 1,180 | ||||||
Intangible Assets, net
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5,058 | 6,293 | ||||||
Goodwill
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19,091 | 19,377 | ||||||
Total Long-term Assets
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27,271 | 29,218 | ||||||
Total Assets
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$ | 40,217 | $ | 47,306 | ||||
Liabilities and Shareholders' Equity
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Current Liabilities:
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Short-term Bank Loans
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$ | 77 | - | |||||
Trade Payables
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1,541 | 1,593 | ||||||
Deferred Revenues
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2,966 | 3,573 | ||||||
Deferred Tax Liabilities
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- | 133 | ||||||
Accrued Expenses and Other Accounts Payable
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4,421 | 3,815 | ||||||
Total Current Liabilities
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9,005 | 9,114 | ||||||
Long-Term Liabilities:
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Accrued Severance Pay
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$ | 1,533 | $ | 1,378 | ||||
Non-current Deferred Revenues
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3,280 | 2,212 | ||||||
Deferred Tax Liabilities
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- | 318 | ||||||
Other Long-term Liabilities
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407 | 447 | ||||||
Total Long-term Liabilities
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5,220 | 4,355 | ||||||
Total Liabilities
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$ | 14,225 | $ | 13,469 | ||||
Total Parent Shareholders' Equity
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$ | 25,967 | $ | 33,831 | ||||
Non-controlling Interest
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25 | 6 | ||||||
Shareholders' Equity
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25,992 | 33,837 | ||||||
Total Liabilities and Shareholders' Equity
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$ | 40,217 | $ | 47,306 |
Top Image Systems Ltd.
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Statement of Operations for the
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Three months ended
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Three months ended
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Year ended
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Year ended
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December 31,
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December 31,
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December 31,
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December 31,
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2015
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2014
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2015
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2014
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In thousands, except per share data
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Audited
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Revenues
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$ | 6,632 | $ | 10,044 | $ | 33,791 | $ | 35,855 | ||||||||
Cost of Revenues
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4,257 | 3,896 | 16,138 | 14,322 | ||||||||||||
Gross Profit
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2,375 | 6,148 | 17,653 | 21,533 | ||||||||||||
Expenses
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Research & Development
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1,370 | 1,406 | 4,797 | 4,914 | ||||||||||||
Sales & Marketing
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2,550 | 2,713 | 10,894 | 12,967 | ||||||||||||
General & Administrative
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3,283 | 1,356 | 7,492 | 6,819 | ||||||||||||
Acquisition Related Costs
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- | - | - | 1,170 | ||||||||||||
Amortization Costs
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168 | 119 | 390 | 239 | ||||||||||||
7,371 | 5,594 | 23,573 | 26,109 | |||||||||||||
Operating Income
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(4,996 | ) | 554 | (5,920 | ) | (4,576 | ) | |||||||||
Financial Expenses, net
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(115 | ) | (164 | ) | (1,145 | ) | (352 | ) | ||||||||
Other Income, net
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- | 15 | 4 | 7 | ||||||||||||
Income (Loss) Before Taxes on Income
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(5,111 | ) | 405 | (7,061 | ) | (4,921 | ) | |||||||||
Tax Expenses
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984 | 204 | 1,215 | 552 | ||||||||||||
Net Income (Loss)
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(6,095 | ) | 201 | (8,276 | ) | (5,473 | ) | |||||||||
Net Income Attributable to Noncontrolling Interest
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(5 | ) | (1 | ) | (19 | ) | (6 | ) | ||||||||
Net Income (Loss)
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$ | (6,100 | ) | $ | 200 | $ | (8,295 | ) | $ | (5,479 | ) | |||||
Earnings per Share
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Basic Earnings (Loss) per Share
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$ | (0.34 | ) | $ | 0.01 | $ | (0.46 | ) | $ | (0.34 | ) | |||||
Weighted Average Number of Shares Used in Computation of Basic Net Income (Loss) per Share
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17,915 | 17,817 | 17,871 | 16,072 | ||||||||||||
Diluted Earnings (Loss) per Share
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$ | (0.34 | ) | $ | 0.01 | $ | (0.46 | ) | $ | (0.34 | ) | |||||
Weighted Average Number of Shares Used in Calculation of Diluted Net (Loss) Earnings per Share
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17,915 | 18,170 | 17,871 | 16,072 |
Adjusted EBITDA Results:
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Three months ended
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Three months ended
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Year ended
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Year ended
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December 31,
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December 31,
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December 31,
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December 31,
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2015
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2014
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2015
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2014
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In thousands, except per share data
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Adjusted EBITDA:
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Net Income (Loss)
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$ | (6,100 | ) | $ | 200 | $ | (8,295 | ) | $ | (5,479 | ) | |||||
Interest
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37 | 16 | 107 | 35 | ||||||||||||
Other Financial Expenses
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78 | 148 | 1,038 | 317 | ||||||||||||
Taxes
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984 | 204 | 1,215 | 552 | ||||||||||||
Depreciation
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176 | 107 | 661 | 277 | ||||||||||||
Amortization
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336 | 381 | 1,344 | 763 | ||||||||||||
Stock-based Compensation Expenses
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410 | 200 | 808 | 670 | ||||||||||||
Acquisition Related Costs
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- | - | (178 | ) | 1,170 | |||||||||||
Post-Merger Integration Costs
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- | - | - | 303 | ||||||||||||
Legal Costs Related to Lawsuit Settlement
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- | - | - | 444 | ||||||||||||
Debt Reserve Adjustment
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1,492 | - | 1,566 | 601 | ||||||||||||
Other
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95 | - | 260 | - | ||||||||||||
Total Adjusted EBITDA
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$ | (2,492 | ) | $ | 1,256 | $ | (1,474 | ) | $ | (347 | ) | |||||
Reconciliation of GAAP to Non-GAAP Results:
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Net Income (Loss)
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$ | (6,100 | ) | $ | 200 | $ | (8,295 | ) | $ | (5,479 | ) | |||||
Amortization
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336 | 381 | 1,344 | 763 | ||||||||||||
Stock-based Compensation Expenses
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410 | 200 | 808 | 670 | ||||||||||||
Acquisition-related Costs
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- | - | (178 | ) | 1,170 | |||||||||||
Post-merger Integration Costs
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- | - | - | 303 | ||||||||||||
Legal Costs Related to Lawsuit Settlement
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- | - | - | 444 | ||||||||||||
Deferred Tax Assets Amortization
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1,472 | - | 1,472 | - | ||||||||||||
Debt Reserve Adjustment
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1,492 | - | 1,566 | 601 | ||||||||||||
Non-GAAP Net Income (Loss)
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$ | (2,390 | ) | $ | 781 | $ | (3,283 | ) | $ | (1,528 | ) | |||||
Non-GAAP Net income (loss) used for basic earnings per share
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$ | (2,390 | ) | $ | 781 | $ | (3,283 | ) | $ | (1,528 | ) | |||||
Shares Used in Basic Earnings per Share Calculation
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17,915 | 17,817 | 17,871 | 16,072 | ||||||||||||
Non-GAAP Basic Earnings (Loss) per Share
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$ | (0.13 | ) | $ | 0.04 | $ | (0.18 | ) | $ | (0.10 | ) | |||||
Non-GAAP Net Income (Loss) Used for Diluted Earnings per Share
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$ | (2,390 | ) | $ | 781 | $ | (3,283 | ) | $ | (1,528 | ) | |||||
Shares Used in Diluted Earnings per Share Calculation
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17,915 | 18,170 | 17,871 | 16,072 | ||||||||||||
Non-GAAP Diluted Earnings (Loss) per Share
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$ | (0.13 | ) | $ | 0.04 | $ | (0.18 | ) | $ | (0.10 | ) |