Ra’anana, Israel, November 20, 2007 - Retalix® Ltd. (NasdaqGS: RTLX), a global provider of software solutions for retailers and distributors, today announced results for the third quarter ended September 30, 2007. Barry Shaked, President and Chief Executive Officer of Retalix, said, “We are very pleased with the results of the third quarter, as we achieved record revenues and improved earnings."
Summarized financial highlights of the 2007 third quarter results:
* Total Revenues for the period reached a Company record of $58.1
million, compared to $50.4 million in the third quarter of 2006.
* GAAP Net Income for the period was $3.1 million, or $0.15 per diluted
share, compared to net loss of $(1.1) million, or $(0.06) per diluted
share in the third quarter of 2006.
* Adjusted Net Income (Non-GAAP)* for the period was $4.6 million, or
$0.23 per diluted share, compared to $0.7 million, or $0.03 per diluted
share, in the third quarter of 2006.
Summarized financial highlights of the first nine months of 2007:
* Total Revenues for the period reached a Company record of $166.2
million, compared to $147.3 million in the first nine months of 2006.
* GAAP Net Income for the period was $1.2 million, or $0.06 per diluted
share, compared to net loss of $(2.3) million, or $(0.12) per diluted
share in the first nine months of 2006.
* Adjusted Net Income (Non-GAAP)* for the period was $7.1 million, or
$0.35 per diluted share, compared to $2.7 million, or $0.14 per diluted
share, in the first nine months of 2006.
Barry Shaked said, “Our product revenues in the third quarter include a number of significant new contracts. In the U.S., Love’s Travel Centers contracted with Retalix to provide an integrated point-of-sale and headquarters system to serve more than 200 retail and fuel sites. Save Mart Supermarkets, a tier-1 grocery chain based in California, has licensed multiple components of our supply chain management application suite for implementation in their three distribution centers. Our customer loyalty and promotions system was selected by several retailers, including Big Y, a grocery retailer that has been a longtime user of our point-of-sale system and decided to expand the relationship with us to include our Loyalty system as well. In the distribution segment, the Odom Corporation, a leading distributor of beverages in the Pacific Northwest, signed a deal to install the Retalix Power Enterprise suite. In Europe, our point-of-sale solution has been selected by a major grocery retail chain in the Baltic states, further enhancing our presence in these emerging markets.”
Hugo Goldman, the Company’s Chief Financial Officer, said, “Following the Company’s decision to reduce financing expenses by decreasing the factoring of receivables, Retalix used $3.9 million in cash flow from operating activities during the third quarter, compared to $1.8 million used in the third quarter of 2006. In addition, we invested $2.5 million in the purchase of additional property in our corporate headquarters building. As of September 30, 2007, our balance sheet had $43.3 million in cash and marketable securities, net of short-term bank credit. Long term debt was $0.9 million, and shareholders’ equity was $220.9 million.”
Goldman continued, “During 2007, our gross and operating margins were impacted by the unexpected fluctuations of the U.S. Dollar. The depreciation of the dollar during the third quarter had a negative impact on our non-Dollar wage costs, primarily in Israel, amounting to $0.7 million. This impact is expected to continue and effect even more the fourth quarter, by $1.4 million. Overall, for the full year 2007 we estimate the weak dollar will add $3.3 million dollars to our wage costs.”
2007 Outlook
Barry Shaked concluded, “We are having a record year in sales, and for FY 2007 we expect our total revenues to be above the midpoint of the range of our guidance. We feel that we can still achieve net income at the low end of the range through a few deals that we are working on. The unchanged business fundamentals, the strong demand for our products and our long-term customer relationships support our estimates. Although there can be no assurance, we are optimistic about closing these deals by the end of the year.”
Conference Call and Webcast Information
The Company will be holding a conference call to discuss results for the third quarter 2007 on Tuesday, November 20, 2007 at 9:00am Eastern Time (4:00pm Israeli Time). This conference can be accessed by all interested parties through the Company’s web site at http://www.retalix.com/conference-call.cfm. To listen to the live call, please go to the Web site at least fifteen minutes prior to the start of the call to register, download, and install any necessary audio software. For those unable to participate during the live broadcast, a replay will be available shortly after the call on the Retalix site.
About Retalix
Retalix is an independent provider of enterprise-wide software solutions to retailers and distributors worldwide. Retalix solutions serve the needs of multi‑national grocery chains, convenience and fuel retailers, food service operators, food and consumer goods distributors and independent grocers. The Company offers a full portfolio of software applications that automate and synchronize essential retailing, distribution and supply chain operations, encompassing stores, headquarters and warehouses. Retalix develops and supports its software through more than 1,500 employees in its various subsidiaries and offices worldwide. The company’s International headquarters are located in Ra’anana, Israel, and its American headquarters are located in Dallas, Texas.
In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, Retalix uses non-GAAP measures of gross margin, net income and earnings per share, which are adjustments from results based on GAAP to exclude non-cash equity based compensation in accordance with SFAS 123(R), amortization of intangibles related to acquisitions, and charges in connection with expenses relating to acquisitions that did not materialize. Retalix’s management believes the non-GAAP financial information provided in this release is useful to investors’ understanding and assessment of the Company’s on-going core operations and prospects for the future. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. Management also uses both GAAP and non-GAAP information in evaluating and operating business internally and as such deemed it important to provide all this information to investors. Reconciliation between GAAP to non-GAAP statement of income is provided in the table below.
Safe Harbor for Forward-Looking Statements: Except for statements of historical fact, the information presented herein constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other U.S. federal securities laws. For example, statements regarding our pipeline and getting deals signed, guidance for fiscal year 2007 and the impact of the weak U.S. Dollar on wage costs all involve forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Retalix, including revenues, income and expenses, to be materially different from any future results, performance or achievements or other guidance or outlooks expressed or implied by such forward-looking statements. Factors that could impact these forward-looking statements include risks relating to Retalix’s anticipated future financial performance and growth, continued roll-outs with existing customers, continued interest in Retalix’s products, the perception by leading retailers of Retalix’s reputation, the potential benefits to retailers and distributors, expansion into new geographic markets, and other factors over which Retalix may have little or no control. This list is intended to identify only certain of the principal factors that could cause actual results to differ from the forward-looking statements. Readers are referred to the reports and documents filed by Retalix with the Securities and Exchange Commission, including Retalix’s Annual Report on Form 20-F for the year ended December 31, 2006, for a discussion of these and other important risk factors. Except as required by applicable law, Retalix undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof, or to reflect the occurrence of unanticipated events.
Home| Company| Industries| Products| News & Events| Investors| Services| Customers| Careers| Contact Us
