Magic Reports Record-Breaking Annual Results for 2011 with Revenues of $113 Million and Net Income of $15 Million, an Increase of 60% Year over Year

  • Or Yehuda, Israel
  • February 14, 2012
Magic Software Enterprises Ltd. (NASDAQ: MGIC), a global provider of mobile and cloud-enabled application and business integration platforms, announced today its financial results for the fourth quarter and full year ended December 31, 2011.
 
Financial Highlights for the Fourth Quarter, 2011
  • Fourth quarter revenues increased 22% year over year to $30.5 million from $25.0 million.
  • Operating income for the fourth quarter increased 40% to $4.2 million, compared to $3.0 million in the same period last year; Non-GAAP operating income increased 45% to $4.5 million, compared to $3.1 million in the same period last year.
  • Net income for the fourth quarter increased 42% to $4.4 million compared to $3.1 million in the same period last year; Non-GAAP net income increased 47% to $4.7 million, compared to $3.2 million in the same period last year.
     
Financial Highlights for the Full Year Ended December 31, 2011
  • Revenues for the year ended December 31, 2011, reached $113.3 million, an increase of 28%, compared to $88.6 million in 2010.
  • Operating income for the year ended December 31, 2011, increased 58% to $14.7 million compared to $9.3 million in the same period last year; Non-GAAP operating income for the year increased 45% to $14.5 million, compared to $10.0 million in the same period last year.
  • Net income for the year ended December 31, 2011, increased 60% to $15.0 million compared to $9.4 million in the same period last year; Non-GAAP net income for the year increased 48% to $14.8 million, compared to $10.0 million in the same period last year.
  • Total cash, cash equivalents and short-term investments as of December 31, 2011, amounted to $32.1 million (after full payment for the purchase of BluePhoenix’s AppBuilder activity).
 
Results
  • For the fourth quarter ended December 31, 2011, total revenues were $30.5 million, with net income of $4.4 million, or $0.12 per fully diluted share. This compares with revenues of $25 million and net income of $3.1 million, or $0.09 per fully diluted share for the same period last year.
  • For the fourth quarter of 2011, operating income was $4.2 million. This compares to operating income of $3 million for the same period a year ago.
  • For the year ended December 31, 2011, total revenues were $113.3 million, with net income of $15.0 million, or $0.41 per fully diluted share. This compares with revenues of $88.6 million and net income of $9.4 million, or $0.29 per fully diluted share, for the same period last year.
  • Operating income for the year ended December 31, 2011, was $14.7 million. This compares to operating income of $9.3 million for the same period a year ago.
 
Comments of Management
Commenting on the results, Guy Bernstein, Chief Executive Officer of Magic Software Enterprises, said: “I am pleased to report that 2011 was Magic’s most successful year ever. Our record-breaking financial results have been consistently impressive, with unprecedented double-digit growth for the ninth consecutive quarter, reflecting excellent growth in all our regional centers of activity.
2011 saw further enhancement of our product portfolio, including the launch of our new mobile offering and the addition of .NET development capabilities to our core application platform. As a result, we continue to be recognized throughout the industry for our quality and innovation.
In recognition of our outstanding business achievements and our long-term growth potential, in 2011, Magic was elevated to the NASDAQ Global Select Market top-tier listing and the prestigious TASE TA-100 Index of the Tel-Aviv Stock Exchange.
Moving forward, we plan to expand our product offering, especially our mobile and cloud-based solutions, to provide new and exciting opportunities for our company and greater added value for our customers,” concluded Mr. Bernstein.
 
Non-GAAP Financial Measures
This release includes non-GAAP operating income, net income, basic and diluted earnings per share and other non-GAAP financial measures. These non-GAAP measures exclude the following items:
  • Amortization of purchased intangible assets
  • In-process research and development capitalization and amortization and
  • Equity-based compensation expense
Magic Software’s management believes that the presentation of non-GAAP measures provides useful information to investors and management regarding financial and business trends relating to the Company’s financial condition and results of operations as well as the net amount of cash generated by its business operations after taking into account capital spending required to maintain or expand the business.
These non-GAAP financial measures are not in accordance with, or an alternative for, generally accepted accounting principles and may be different from non-GAAP financial measures used by other companies. In addition, these non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles. Magic Software believes that non-GAAP financial measures have limitations in that they do not reflect all of the amounts associated with Magic Software’s results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate Magic Software’s results of operations in conjunction with the corresponding GAAP measures.
Refer to the Reconciliation of Selected Financial Metrics from GAAP to Non-GAAP tables below.
 
About Magic Software

Magic Software Enterprises Ltd. (NASDAQ: MGIC), is a global provider of mobile and cloud-enabled application and business integration platforms.

For more information, visit www.magicsoftware.com


Except for any historical information contained herein, the matters discussed in this press release include forward-looking statements that might involve a number of risks and uncertainties. Actual results might 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 locally and abroad, release and sales of new products by strategic resellers and customers, and other risk factors detailed in Magic’s most recent annual report and other filings with the Securities and Exchange Commission.
Magic is a registered trademark of Magic Software Enterprises Ltd. All other product and company names mentioned herein are for identification purposes only and are the property of, and might be trademarks of, their respective owners.

 

Press Contact:

Tania Amar, VP Global Marketing

Magic Software Enterprises     
tania@magicsoftware.com