NICE Systems Continues Sequential Revenue Growth in Third Quarter 2001; Gross Margins Improve; Net Loss Narrows Substantially; Positive Net Operating Cash Flow Achieved.Business EditorsRA'ANANA Ra'anana (Hebrew רַעֲנָנָה; Standard Hebrew Ra'anana) is a city in the southern Sharon Plain in the Center District of Israel, Israel, 19 km north of Tel Aviv. , Israel--(BUSINESS WIRE)--Oct. 30, 2001 NICE Systems (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : NICE), a worldwide leader of multimedia digital recording solutions, applications and related professional services (job) professional services - A department of a supplier providing consultancy and programming manpower for the supplier's products. , today announced its third quarter and nine months results for the period ending September September: see month. 30, 2001. Revenue for the third quarter of 2001 rose 11% from the previous quarter to $33.8 million, which was within management's original guidance. Revenue for the third quarter of 2000 was $44.7 million. The Company continued to narrow its operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. . The Q3 2001 operating loss was $4.2 million compared with an operating loss in the previous quarter of $7.9 million and an operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. of $5.0 million in Q3 2000, excluding amortization of acquired intangibles. The adjusted loss, which excludes amortization of acquired intangibles, for the third quarter was $3.3 million, or $0.26 per share, compared with adjusted earnings of $6.4 million, or $0.45 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, in the third quarter of 2000. Including the amortization of acquired intangibles, the Company reported a net loss of $4.1 million, or $0.32 per share, for the third quarter of 2001. Commenting on the financial results, Haim Haim is the surname of:
adj. Being between 10 and 99 percent: double-digit inflation. sequential growth. We added over a hundred new customers this quarter, despite a more cautious IT spending environment. These results clearly demonstrate the value of our solutions to our customers and their confidence in NICE." "By streamlining our operations, improving our management structure, reducing our costs, and improving our working capital management we have achieved positive net operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. this quarter." Mr. Shani continued. "We now have a strong operation, with clear focus on our core competencies A core competency is something that a firm can do well and that meets the following three conditions specified by Hamel and Prahalad (1990):
A measurement of the degree to which a firm or project relies on fixed rather than variable costs. Notes: The higher the degree of operating leverage, the greater the potential danger from forecasting risk. as demand improves, and a strong balance sheet affording us adequate financial flexibility to pursue strategic growth opportunities." Cash and equivalents, including long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has , totaled $86.1 million at the end of the third quarter of 2001. Receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed were at about the same level as Q2 and inventory was reduced significantly to $13.8 million. During the quarter, NICE introduced a number of exciting new products including: - NICE CEM 8.7 platform - the industry's first comprehensive and fully-integrated suite of contact center solutions designed for a multi-media environment. - NiceVision(R) Pro - an enhanced high-performance digital video and audio recording solution for demanding applications such as gaming and transportation security - NiceVision(R) Harmony - a mid-range digital video and audio recording solution to better serve customers with small location requirements - NiceGuard(TM) - a highly reliable recording system for smaller emergency response (911) centers and other public safety applications Nice management will host a conference call at 8:30 (EST EST electroshock therapy. EST abbr. electroshock therapy ) 15:30 Israel Israel, in the Bible Israel (ĭz`rēəl, ĭz`rāəl) [as understood by Hebrews,=he strives with God], according to the book of Genesis, name given to Jacob as eponymous ancestor of the Hebrews, the chosen people of God. time to discuss the results and answer questions from the investment community. To participate, please call: Dial in number USA: Toll-free: 1-877-370-1460 International: +972-3-925-5910 Dial in number Israel: 03-925-5910 A replay of the conference call will be available for playback Playback could mean:
Replay numbers: In the U.S.: 1-888-269-0005 In Israel: 03-925-5950 International: +972-3-925-5950 No access code is needed for the replay. This call will be broadcast live at http://www.nice.com. An online replay will also be available approximately one hour after the call. About NICE NICE Systems (NASDAQ: NICE) headquartered in Ra'anana, Israel, is a worldwide leader of multimedia digital recording solutions, applications and related professional services for business interaction management. NICE products and solutions are used in contact centers, trading floors, air traffic control (ATC ATC Air Traffic Control ATC Average Total Cost ATC Certified Athletic Trainer ATC At the Center (Hartford, Maine retreat center) ATC Applied Technology Council ATC All Things Considered ) sites, CCTV CCTV abbr. closed-circuit television CCTV closed-circuit television security installations and government markets. NICE's synergistic synergistic /syn·er·gis·tic/ (sin?er-jis´tik) 1. acting together. 2. enhancing the effect of another force or agent. syn·er·gis·tic adj. 1. technology platform enables customers to capture, evaluate and analyze business interactions in order to improve business processes and gain competitive advantage. NICE's subsidiaries and local offices are based in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of , Germany Germany (jûr`mənē), Ger. Deutschland, officially Federal Republic of Germany, republic (2005 est. pop. 82,431,000), 137,699 sq mi (356,733 sq km). , United Kingdom, France and Hong Kong Hong Kong (hŏng kŏng), Mandarin Xianggang, special administrative region of China, formerly a British crown colony (2005 est. pop. 6,899,000), land area 422 sq mi (1,092 sq km), adjacent to Guangdong prov. . The company operates in more than 70 countries through a network of partners and distributors. (NICE Web Site: www.nice.com) Trademark note: 3600 View, Agent@home, Executive Connect, Experience Your Customer, Lasting Loyalty, Listen Learn Lead, LogIt, LogItAll, NICE, NiceAdvantage, NICE Analyzer analyzer /ana·ly·zer/ (an´ah-li?zer) 1. a Nicol prism attached to a polarizing apparatus which extinguishes the ray of light polarized by the polarizer. 2. , NiceCall, NiceCLS, NiceCMS, NICE Feedback, NiceFix, NiceGuard, NICE Learning, NICE Link, NiceLog, NiceSoft, NiceUniverse, NiceUniverse LIVE, NiceVision, NiceVision Mobile, NiceVision Pro, NiceVision Virtual, NiceWatch, Secure Your Vision, and other product names and services mentioned herein are trademarks and registered trademarks of NICE Systems Ltd. All other registered and unregistered trademarks are the property of their respective owners. For more information, contact: Rachela Kassif NICE Systems 972-9-775-3899 investor.relations@nice.com 877-685-6552 Claudia Gatlin CMG CMG Coastal & Marine Geology (USGS) CMG Chipotle Mexican Grill, Inc. (stock symbol) CMG Companion (of the Order Of) St Michael and St George CMG Computer Measurement Group International 973-316-9409 cmginternational@msn.com This press release contains 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. as that term is defined in the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Such statements are based on the current expectations of the management of NICE Systems Ltd. (the Company) only, and are subject to a number of risk factors and uncertainties, including but not limited to changes in technology and market requirements, decline in demand for the company's products, inability to timely develop and introduce new technologies, products and applications, loss of market share, pressure on pricing resulting from competition, inability to maintain certain marketing and distribution arrangements, which could cause the actual results or performance of the company to differ materially from those described therein. For a more detailed description of the risk factors and uncertainties affecting the company, refer to the Company's reports filed from time to time with the Securities and Exchange Commission.
NICE SYSTEMS LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except per share amounts)
Three months ended Nine months ended
September 30 September 30
-------------------------------------------------
2000 2001 2000 2001
Unaudited Unaudited Unaudited Unaudited
------------------------ ------------------------
Revenues $ 44,741 $ 33,808 $116,859 $ 89,409
Cost of revenues 19,197 18,264 49,517 54,402
------------------------ ------------------------
Gross Profit 25,544 15,544 67,342 35,007
Operating Expenses:
Research and
development, net 5,110 4,597 14,216 14,751
Selling and
marketing 9,118 8,596 24,734 25,747
General and
administrative 6,292 6,583 18,664 21,150
Amortization of
acquired
intangibles 211 812 544 2,600
Restructuring and
other special
charges - - 6,786 14,554
------------------------ ------------------------
Total operating
expenses 20,731 20,588 64,944 78,802
Operating
income (loss) 4,813 (5,044) 2,398 (43,795)
Financial
income, net 1,417 1,187 4,409 3,347
Other income
(expense), net 11 (276) 30 (366)
------------------------ ------------------------
Income (loss) before
taxes on income 6,241 (4,133) 6,837 (40,814)
Taxes on income 72 9 195 52
------------------------ ------------------------
Net income (loss) $ 6,169 $ (4,142) $ 6,642 $ (40,866)
======================== ========================
Basic earnings
(loss) per share $ 0.50 $ (0.32) $ 0.54 $ (3.14)
======================== ========================
Diluted earnings
(loss) per share $ 0.44 $ (0.32) $ 0.48 $ (3.14)
======================== ========================
Weighted average
number of shares
outstanding used
to compute:
Basic earnings
(loss) per share 12,443 13,042 12,205 12,997
Diluted earnings
(loss) per share 14,149 13,042 13,877 12,997
Note: Certain prior period amounts have been reclassified to
conform to current year presentation.
NICE SYSTEMS LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except per share amounts)
EXCLUDING RESTRUCTURING AND OTHER SPECIAL CHARGES AND AMORTIZATION OF
ACQUIRED INTANGIBLES
Three months ended Nine months ended
September 30 September 30
--------------------------------------------------
2000 2001 2000 2001
Unaudited Unaudited Unaudited Unaudited
--------------------------------------------------
Revenues $ 44,741 $ 33,808 $ 116,859 $ 89,409
Cost of revenues 19,197 18,264 49,517 54,402
--------------------------------------------------
Gross Profit 25,544 15,544 67,342 35,007
Operating Expenses:
Research and
development, net
5,110 4,597 14,216 14,751
Selling and
marketing
9,118 8,596 24,734 25,747
General and
administrative
6,292 6,583 18,664 21,150
--------------------------------------------------
Total operating
expenses 20,520 19,776 57,614 61,648
Operating
income (loss) 5,024 (4,232) 9,728 (26,641)
Financial
income, net 1,417 1,187 4,409 3,347
Other income
(expense), net
11 (276) 30 (366)
--------------------------------------------------
Income (loss) before
taxes on income
6,452 (3,321) 14,167 (23,660)
Taxes on income 72 9 195 52
--------------------------------------------------
Net income (loss) $ 6,380 $ (3,330) $ 13,972 $ (23,712)
==================================================
Basic earnings
(loss) per share $ 0.51 $ (0.26) $ 1.14 $ (1.82)
==================================================
Diluted earnings
(loss) per share $ 0.45 $(0.26) $ 1.01 $ (1.82)
==================================================
Weighted average
number of shares
outstanding used
to compute:
Basic earnings
(loss) per share 12,443 13,042 12,205 12,997
Diluted earnings
(loss) per share 14,149 13,042 13,877 12,997
Note: Certain prior period amounts have been reclassified to
conform to current year presentation.
NICE SYSTEMS LTD. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands
December 31, September 30,
2000 2001
------------------ ------------------
Audited Unaudited
ASSETS
CURRENT ASSETS:
Cash and cash
equivalents $ 18,640 $ 14,220
Short-term deposits 24,371 287
Marketable
securities 29,089 40,876
Trade and unbilled
receivables 48,183 34,996
Other receivables
and prepaid
expenses 11,994 12,380
Inventory 21,159 13,797
------------------ ------------------
Total current assets 153,436 116,556
LONG-TERM
INVESTMENTS
Long term marketable
securities 25,916 30,670
Other long term
investments 6,460 6,928
------------------ ------------------
Total long term
investments 32,376 37,598
FIXED ASSETS, NET 25,896 23,508
OTHER ASSETS, NET 39,781 36,856
------------------ ------------------
Total assets $ 251,489 $ 214,518
================== ==================
LIABILITIES AND
SHAREHOLDERS'
EQUITY
CURRENT LIABILITIES:
Trade payables $ 12,650 $ 9,192
Accrued expenses and
other liabilities 23,467 29,213
------------------ ------------------
Total current
liabilities 36,117 38,405
LONG-TERM
LIABILITIES 6,795 6,608
SHAREHOLDERS' EQUITY
Share capital 4,313 4,344
Additional paid-in
capital 187,632 189,395
Retained earnings
(accumulated
deficit) 16,632 (24,234)
------------------ ------------------
Total shareholders'
equity 208,577 169,505
----------------- ------------------
Total liabilities
and shareholders'
equity $ 251,489 $ 214,518
================== ==================
Note: Certain prior period amounts have been reclassified to
conform to current year presentation.
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