Magic Software Enterprises Announces Fourth Quarter and Full Year 2000 Results.Business Editors & High-Tech high-tech also hi-tech adj. Informal Of, relating to, or resembling high technology. high-tech Adjective same as hi-tech Adj. 1. Writers OR YEHUDA Or Yehuda (אור יהודה) is a city in the Tel Aviv District in Israel. According to the Israel Central Bureau of Statistics (CBS), at the end of 2004 the city had a total population of 30,100. , Israel--(BUSINESS WIRE)--Feb. 14, 2001 Magic Software Enterprises Ltd. (Nasdaq:MGIC MGIC Mortgage Guaranty Insurance Company MGIC Montana Geographic Information Council ), a leading provider of state-of-the-art application development technology and business solutions, announced today results for the fourth quarter 2000 that were in line with the guidance issued by the company in December December: see month. . Fourth Quarter Results Revenues for the fourth quarter ended Dec. 31, 2000, were $23.1 million, up 24% from the $18.6 million recorded by Magic for the comparable quarter of 1999. This figure reflected marked increases in both application sales, and consultancy and other service fees from one year ago. Magic posted a net loss for the quarter of $6.2 million, or $0.21 loss per share, which included a one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. corporate restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. of $2.5 million and a $0.6 million capital loss. The company attributed the restructuring charge to employee termination expenses, management changes and the consolidation of certain job responsibilities companywide. Net income for the fourth quarter of 1999 was $3.8 million, or $0.15 income per share. "The loss in earnings compared to the same quarter last year is a result of our ongoing strategic evolution from a traditional tools vendor into a total business solutions provider. It is a path that I believe is critical to our future success," said Dan Goldstein Gold·stein , Joseph Leonard Born 1940. American biochemist. He shared a 1985 Nobel Prize for discoveries related to cholesterol metabolism. , chairman of Magic. "I am very encouraged by the restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). that is taking place in all our offices, the rebuilding of our sales and professional services (job) professional services - A department of a supplier providing consultancy and programming manpower for the supplier's products. organizations and the more aggressive approach we are taking to sales opportunities. In the long run, I believe it will stand us in good stead stead n. 1. The place, position, or function properly or customarily occupied by another. 2. Advantage; service; purpose: "His personal relationship with the electorate stands in good stead" ." Software sales during the fourth quarter, which include application sales, were $9.7 million compared with the $10.9 million recorded in the same period of 1999. However, application sales for the quarter, at $4.1 million, were up more than 112% over the corresponding period of 1999 and up more than 12% over the third quarter of 2000. Consulting and training revenue, at $10.4 million, was up 94% over the same quarter last year, while maintenance and support increased more than 26% compared with the same period of 1999. The dramatic increase in consulting and training revenue reflects the continued increase in sales of the company's applications, as well as the consolidation of revenues from CoreTech Consulting Group Inc. "Overall, fourth quarter results reflect some of the same challenges that all technology companies have been facing recently -- highly volatile capital markets, the potential slowing of IT spending and the threat of a downturn Downturn The transition point between a rising, expanding economy to a falling, contracting one. downturn A decline in security prices or economic activity following a period of rising or stable prices or activity. in the economy," added Goldstein. "However, I am extremely encouraged by the progress we are making with our solutions business and by the management transitions taking place in all our branches. As we move forward, we will focus on completing our transition plan, growing our software license and applications revenues, expanding our business development and increasing our ability to execute." Fiscal Year 2000 Results For the year ended Dec. 31, 2000, Magic reported revenue of $90.3 million, up 41% from the $64.0 million posted in the previous year. Net income for the year was $0.9 million, or $0.03 income per share, as compared with the $10.9 million, or $0.45 income per share, reported in 1999. Application sales for the year ending Dec. 31, 2000 were $14.4 million as compared with the $4.4 million posted for 1999, an increase of more than 225%, while consultancy and other services in 2000 rose to $37.6 million from the $17.8 million recorded the previous year. Accomplishments While current market and economic conditions may have taken their toll, Magic did experience a number of bright spots in its year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. results. Strategic Partnerships During the quarter, Magic signed a deal with Indecom, Germany's largest application service provider, to include Magic eService(TM) among its product offerings. Indecom offers an extensive portfolio of software products to primarily medium-sized Me´di`um-sized` a. 1. Having a medium size; as, a medium-sized man s>. Adj. 1. medium-sized - intermediate in size medium-size, moderate-size, moderate-sized companies wishing to take advantage of the latest software solutions without incurring in·cur tr.v. in·curred, in·cur·ring, in·curs 1. To acquire or come into (something usually undesirable); sustain: incurred substantial losses during the stock market crash. 2. the associated overhead costs overhead costs see fixed costs. . New Deals In a new deal valued at more than $1 million, Magic signed an agreement with the Athlon A family of Pentium-compatible CPU chips from AMD. The first 32-bit models were introduced as Pentium III-class CPUs in 1999 with a 200 MHz system bus and CPU speeds up to 650 MHz. Groep (Athlon) to license its RentPro(TM) car rental management system. Athlon operates auto leasing and rental agencies, car dealerships This article is about car dealerships. For the indie pop band, see Dealership (band). A car dealership or vehicle local distribution is a business that sells new cars and/or used cars at the retail level, based on a dealership contract with an automaker or and body shops in several European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. countries. Other fourth quarter deals included: -- DAECSSA, the French Army's pharmacy, for a production and stock management solution, and INA, France's National Institute of Broadcasting, for a training and planning management solution -- Inverclyde Council (U.K.), a municipal authority that provides services to the general public, for a financial and property management information system -- Ministry of the Interior (Hungary) for a complete police investigation system -- Rai DataCentrum (the Netherlands), the information and communications center for the Dutch automotive industry, for an intranet parts distribution and logistics solution -- DekaSwiss Privatbank AG (Germany) for a financial tax system In addition, Magic closed several new Magic eContact(TM) and Magic eService(TM) deals during the quarter. Included among the larger Magic eContact deals were De Ondernemer (the Netherlands Netherlands (nĕth`ərləndz), Du. Nederland or Koninkrijk der Nederlanden, officially Kingdom of the Netherlands, constitutional monarchy (2005 est. pop. 16,407,000), 15,963 sq mi (41,344 sq km), NW Europe. ), Universal Communications Group (Australia) and Axel Springer Axel Springer (May 2, 1912, Altona, Hamburg - September 22, 1985, West Berlin), was a German journalist and the founder and owner of the Axel Springer AG publishing company. Springer was born as Axel Cäsar Springer in Hamburg, where his father worked as publisher. Kft (Hungary). Magic eService deals included Baltimore Baltimore, city (1990 pop. 736,014), N central Md., surrounded by but politically independent of Baltimore co., on the Patapsco River estuary, an arm of Chesapeake Bay; inc. 1745. County Schools (U.S.), Morrison Construction (U.K.), Mind CTI  This article or section is written like an .Please help [ rewrite this article] from a neutral point of view. Mark blatant advertising for , using . (Israel), Commonwealth Fleet Lease Pty Ltd PTY LTD Propriety Limited (company structure in Australia) . (Australia). About Magic Software Enterprises Magic Software Enterprises, a member of the Formula Group (Nasdaq:FORTY), develops, markets and supports software development and deployment technology that enables enterprises to accelerate the process of building and deploying applications that can be rapidly customized and integrated with existing systems. Magic technology, applications and professional services are available through a global network of subsidiaries, distributors and Magic solutions partners in approximately 50 countries. The company's North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. subsidiary is located at 1642 Kaiser Ave AVE Avenue AVE Average AVE Alta Velocidad Espanola (train between Madrid and Seville) AVE Alta Velocidad Española (Spanish: High Speed Train) AVE Audio Video Entertainment AVE Advertising Value Equivalent ., Irvine, Calif., 92614, telephone: 949/250-1718, fax: 949/250-7404, http://www.magicsoftware.com. The Formula Group is an international information technology company principally engaged, through its subsidiaries and affiliates, in providing software consulting services Noun 1. consulting service - service provided by a professional advisor (e.g., a lawyer or doctor or CPA etc.) service - work done by one person or group that benefits another; "budget separately for goods and services" , developing proprietary software products and producing computer-based solutions. Except for the historical information contained herein, the matters discussed in this news release include forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that may involve a number of risks and uncertainties. Actual results may vary significantly based upon a number of factors including, but not limited to, risks in product and technology development, market acceptance of new products and continuing product conditions, both here and abroad, release and sales of new products by strategic resellers and customers, and other risk factors detailed in the company's most recent annual report and other filings with the Securities and Exchange Commission.
Consolidated Statement of Operations
(U.S. Dollars in Thousands)
Three Months Ended Year Ended
Dec. 31, Dec. 31,
2000 1999 2000 1999
Revenues
Software sales $5,582 $8,962 $26,904 $32,596
Applications 4,164 1,958 14,416 4,428
Maintenance 2,955 2,348 11,347 9,218
Consultancy & other services 10,385 5,361 37,589 17,750
Total Revenues 23,086 18,629 90,256 63,992
Cost of Revenues
Software sales 873 802 3,635 3,231
Applications 547 287 2,007 741
Maintenance 994 880 4,200 3,450
Consultancy & other services 7,557 3,283 24,653 11,365
Total Cost of Revenues 9,971 5,252 34,495 18,787
Gross Profit 13,115 13,377 55,761 45,205
Research & development, net 1,787 822 5,947 2,953
Sales, marketing, and general 12,484 8,246 41,975 28,713
& administrative expenses
Depreciation 558 424 1,736 1,497
Amortization 1,249 340 3,290 966
Restructuring costs &
non-recurring expenses 2,466 0 2,466 0
Operating Income (Loss) (5,429) 3,545 347 11,076
Financial (Income) expenses, net (493) (183) (2,598) (175)
Capital loss 623 0 623 0
Income (Loss) before taxes (5,559) 3,728 2,322 11,251
Taxes on income 244 (129) 520 2
Income (Loss) before minority
interest (5,803) 3,857 1,802 11,249
Minority interest in losses
(income) of subsidiaries (355) 23 (825) (394)
Equity in earnings (losses) of
affiliate 0 (75) (57) 52
Net Income (Loss) ($6,158) $3,805 $920 $10,907
Basic Earnings per Share ($0.21) $0.15 $0.03 $0.45
Diluted Earnings per Share ($0.21) $0.14 $0.03 $0.43
Weighted Average Number
of Shares Outstanding (000) 29,409 25,600 29,084 24,281
Diluted Weighted Average Number of
Shares Outstanding (000) 30,003 27,051 30,232 25,391
Consolidated Balance Sheets (U.S. Dollars in Thousands)
Dec. 31 Dec. 31
2000 1999
Assets
Current Assets
Cash and cash equivalents $42,546 $8,298
Accounts receivable:
Trade receivables 22,782 16,111
Related parties 278 45
Other receivables and prepaid
expenses 6,298 4,958
Inventory 402 188
Total Current Assets $72,306 $29,600
Severance pay fund $2,042 $1,507
Investments in affiliated companies 250 376
Fixed assets, net 11,050 8,649
Other assets, net 52,179 16,762
Total Assets $137,827 $56,894
Liabilities
Current Liabilities
Short-term bank debt $1,381 $628
Trade payables 5,232 4,518
Accrued expenses and other
liabilities 12,557 14,787
Restructuring accrual 3,160 0
Total Current Liabilities $22,330 $19,933
Long-term loans $1,671 $295
Accrued severance pay 3,511 1,899
Minority interests 251 973
Shareholders' Equity
Share capital 803 684
Capital surplus 115,096 34,441
Treasury stock (5,424) -
Retained earnings (411) (1,331)
Total Shareholders' Equity $110,064 $33,794
$137,827 $56,894
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