Monday May 15, 7:58 am
ForSoft Ltd. Reports Record First Quarter Revenues of $18.7 Million, Increase of 31% Compared to First Quarter, 1999
HERZLIYA, Israel - ForSoft, Ltd. (Nasdaq: FORS - news), a
leading provider of large-scale Information Technology (IT) solutions and
services for vertical markets, announced today its financial results for the
three month period ended March 31, 2000.
Revenues for the three months ended March 31, 2000 increased by 31% to a
record $18.7 million, compared to $14.3 million in the same period of 1999.
Net income for the three months ended March 31, 2000 was $2.02 million,
compared to $1.97 million in the same period last year.
Earnings per share (EPS) were $0.15 (diluted $0.14) for the three months
ended March 31, 2000, compared to EPS of $0.15 for the three months ended
March 31, 1999 (diluted $0.14).
ForSoft's shareholders' equity at the period ended March 31, 2000 was
$62.8 million.
Cash and cash equivalents, marketable securities and deposits
at the period ended March 31, 2000 were $39.9 million.
Emanuel Cohen, CEO of ForSoft Ltd. said, "We are pleased with our first
quarter, 2000 results.
In the first quarter, we achieved our goal of
accelerating our penetration of international markets with solutions geared
specifically to reflect greater emphasis on international opportunities.
In
streamlining operations, we created six divisions including:
ForSoft
Solutions and Services, ForSoft Telecom Solutions, ForSoft Insurance
Solutions, ForSoft Retail Solutions, ForSoft Travel Solutions and ForSoft USA.
This new corporate structure, which simplified operations, gives our
management team the flexibility to adjust to fast-changing market conditions
with swift and decisive responses.
In keeping with our desire to stay in
front of breaking market opportunities, this new structure allows our
management team to change direction if required to promptly plan for other
potential investments to acquire new solutions.
We look forward to achieving
our goals throughout 2000 and increasing value for our shareholders."
Issac Eldar, Vice President of Marketing of ForSoft Ltd. said, "During the
first quarter of 2000, our management team significantly strengthened
operations with the implementation of a worldwide, E-business marketing
strategy to provide vertical solutions in different niche markets.
We are
particularly pleased with our consultingdirect.com division and its on-line
vendor agreement with DoubleClick Inc. announced early in March, 2000 to be
followed by several other major contracts which are now in progressive stages
in our massive pipeline."
Mr. Cohen said, "The second quarter will be dedicated to establishing our
new strategy based on solutions, rather than services, and implementing our
e-business model in connection with the different software solutions developed
and acquired by us.
We know that keeping our growth rate, while going through
a major change, will be a tremendous challenge.
We feel we can cope with this
challenge.
Through the second quarter, our profits might suffer from the
restructuring process, as well as from the processes of absorbing our new
acquisitions.
Moreover, our very aggressive target to radically change the
Company from the leading domestic player in the Israeli market, into an
international solutions provider with more than 50% of revenues derived from
the worldwide arena, is going faster than anticipated.
There is a high
probability we will complete the metamorphosis in less than two years from our
starting point in 1999."
Conference Call:
ForSoft Ltd. will host a conference call on its earnings on Monday,
May 15, 2000 at 12:00 PM (EST).
To participate, interested parties should
call the appropriate telephone number listed below, five to ten minutes prior
to the start of the conference call:
In the US call 1-800-288-8961
Internationally call 1-612-332-0634
Callers should reference "ForSoft Ltd. Conference Call," with the
conference call operator and use reservation number 518045 to enter the call.
ForSoft, a member of the Formula Group (Nasdaq: FORTY - news), designs, develops
and implements high quality, innovative, business-critical information systems
and software solutions for large organizations.
The Formula Group is an international information technology company
principally engaged, through its subsidiaries and affiliates, in providing
software and consulting services, developing proprietary software products,
and providing computer-based business solutions.
For further information on ForSoft Ltd, ForSoft Inc. and
Consultingdirect.com, please visit the following web sites:
http://www.forsoft.co.il
http://www.forsoftinc.com
http://www.consultingdirect.com
http://www.formula.co.il
ForSoft maintains its accounts in New Israeli Shekels ("NIS").
All U.S.
dollar figures represent an exchange rate of NIS 4.026 to $1.00 at March 31,
2000.
This press release contains forward-looking statements.
Such statements
involve various risks that may cause actual results to differ materially.
These risks and uncertainties include, but are not limited to, the company's
ability to recruit and retain IT personnel, dependence on large projects,
successful implementation of the company's services and competitive factors.
FORSOFT LTD.
CONSOLIDATED BALANCE SHEETS
March 31, December 31,
2000 1999
US$ US$
(In thousands)
(unaudited)
Current assets
Cash and cash equivalents 24,811 26,404
Short-term investments:
Marketable securities 7,440 4,201
Deposits 7,691 7,750
Accounts receivable:
Trade 24,373 20,934
Related parties 812 772
Other and prepaid expenses 6,512 2,693
Work in progress, net of customer advances 14 504
------ ------
71,653 63,258
------ ------
Investments and loans in companies: 2,657 2,414
------ ------
Property and equipment 7,431 7,129
------ ------
Other asset, net 10,186 9,801
------ ------
------ ------
91,927 82,602
====== ======
Current liabilities
Short-term credits 4,545 3,696
Accounts payable:
Trade 5,984 6,377
Related parties 4,787 3,033
Other and accrued liabilities 10,775 8,395
------ ------
26,091 21,501
------ ------
Long-term debt:
Banks 259 298
Related parties 600 611
------ ------
859 909
------ ------
Accrued severance pay, net 646 182
------ ------
Minority interest 1,496 1,359
------ ------
Shareholders' equity
Share capital 623 614
Additional paid-in capital 51,375 49,221
Retained earnings 12,468 10,447
------ ------
64,466 60,282
------ ------
Cost of Company's shares held by subsidiary
(226,100 shares) (1,631) (1,631)
------ ------
62,835 58,651
------ ------
------ ------
91,927 82,602
====== ======
FORSOFT LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
Three months ended Year ended
March 31, December 31,
2000 1999 1999
US$ US$ US$
(unaudited) (unaudited)
Revenues 18,735 14,307 65,696
Costs 12,592 9,665 43,990
----- ----- -----
Gross profit 6,143 4,642 21,706
Research and development
expenses -- 110 110
Selling, general and
administrative expenses 4,114 2,294 12,381
----- ----- -----
Operating income 2,029 2,238 9,215
Financial income (expenses), net 567 (190) 2,555
Other income (expenses), net (311) 372 (376)
----- ----- -----
Income before taxes on income 2,285 2,420 11,394
Taxes on income 75 486 2,406
----- ----- -----
2,210 1,934 8,988
Minority interest, net 189 (37) 428
----- ----- -----
Net income 2,021 1,971 8,560
===== ===== =====
Earnings per share:
Basic 0.15 0.15 0.66
===== ===== =====
Diluted 0.14 0.14 0.61
===== ===== =====
Weighted average of
shares outstanding:
Basic 13,043 13,020 13,013
======== ======== ========
Diluted 13,956 14,149 14,062
======== ======== ========
