HERZLIA, Israel--(BUSINESS WIRE)--Feb. 4, 2004--BluePhoenix Solutions Ltd. (Nasdaq: BPHX):
-- Fourth Quarter Record Revenues, Operating Profit & Net Profit
-- EPS of $0.07 Versus Loss of $0.29
BluePhoenix Solutions Ltd. (Nasdaq: BPHX - News), the leader in Enterprise IT Modernization, today reported record revenues, operating profit and net profit for the fourth quarter and year ended December 31, 2003.
Revenues for the fourth quarter of 2003 were a three-year record quarter of $14.1 million, compared to $13.4 million in the third quarter, $13.5 million and $13.3 million in the second and first quarters, respectively, and $13.8 million in the fourth quarter of 2002.
BluePhoenix reported fourth quarter 2003 operating income of $885,000, continuing the increasing quarterly improvements from the third quarter of $669,000, and $359,000 and $34,000 in the second and first quarters of 2003, respectively. In the fourth quarter of 2002, operating loss was $(573,000).
Net income for the fourth quarter was $922,000, or $0.07 per fully diluted share, approximately equal to that of the combined previous three quarters, and continuing the sequential quarterly improvement of $615,000, or $0.05 per fully diluted share, in the third quarter, and $252,000, or $0.02 per fully diluted share, and $62,000, or $0.00 per fully diluted share, in the second and first quarters, respectively. In the fourth quarter of 2002, net loss was $(3.5 million) or $(0.29) per fully diluted share.
For the fiscal year that ended on December 31, 2003, BluePhoenix reported sales of $54.3 million, up 48% from $36.7 million in the previous year. The Company reported operating income of $1.9 million as compared to $344,000 in fiscal year 2002. Net income for fiscal year 2003 was $1.9 million, or $0.14 per share, compared with a net loss of $(3.6 million), or ($0.35) per share, last year.
"The operating results and business achievements during fiscal year 2003 are most gratifying to us and are a testament to the great efforts of our highly professional and motivated employees and management team," commented Arik Kilman, Chief Executive Officer of BluePhoenix. "During FY 2003, we have streamlined the Company's operations through the complete integration of the assets, workforce and infrastructure of some of our subsidiaries. In addition we have been diligently disposing of less efficient lines. These activities have directly contributed to our operating and net profits, and their visible results are expected to be demonstrated in our next year operating profits."
"The IT Modernization space is almost endless," added Mr. Kilman, "Since the beginning of the fourth quarter, we have witnessed a steadily growing adoption of our comprehensive suite of tools and services for Enterprise IT Modernization, resulting in more than ten new deals. Our current extensive backlog and pipeline provide us with improved visibility and give us confidence regarding our performance in 2004."
During the current FY 2004, we plan to further develop, strengthen and enrich our suite of unique modernization solutions. Through our subsidiary Mainsoft, we will announce at the prestigious DEMO 2004 conference on February 16th a new cross-platform product. Since 2001, Mainsoft has drawn upon its years of experience working with Microsoft developers, its deep expertise in bridging between Windows and UNIX(R) operating systems, its memberships in the European Computer Manufacturing Association (ECMA) and the MONO open-source project to create a unique development solution that bridges the .NET and J2EE platforms.
Mr. Kilman concluded, "We are implementing a long-term strategy that will result in BluePhoenix having the abilities to be an industry leader in all respects: an extensive suite of tools essential to legacy users, availability of highly professional and scalable delivery centers, a powerful marketing force that can both identify client needs and communicate our broad capabilities, a worldwide sales organization, and a global flexible operational infrastructure to support it."
Arik Kilman, BluePhoenix Chief Executive Officer, and Iris Yahal, Chief Financial Officer, will discuss 2003 fourth quarter and full year results, and will be available to answer questions in a conference call on Wednesday February 4th 2004 at 10:00 A.M. EST / 5:00 P.M. Israel time. Interested parties are invited to participate by calling the telephone numbers listed below, five to ten minutes prior to the start of the conference call. Callers should reference "BluePhoenix Fourth Quarter Results" to the AT&T conference call operator.
In the US call: 888-428-4479
Outside the US call: 612-338-9017
An automated replay of the conference call will be available from February 4th at 2:00 P.M. (EST) until February 6th at 11:59 P.M. (EST). To access the replay, please call:
(USA) 1-800-475-6701; (International) 1-320-365-3844 and enter BluePhoenix's access code 719285.
About BluePhoenix Solutions
BluePhoenix Solutions leads the IT Modernization market by developing unique solutions that enable companies to automate the process of modernizing and upgrading their mainframe and distributed IT infrastructure, thus quickly and cost-effectively extending the ROI of their existing IT systems. The company's comprehensive suite of tools and services (including technology for Understanding, Migration, Transformation and Redevelopment) reduces the cost of renovation and speeds up the renewal process. BluePhoenix has 11 offices throughout the world, including locations in the US, UK, Denmark, Germany, Italy, The Netherlands, and Israel.
The company's major shareholder is the Formula Group (Nasdaq:FORTY), an international Information Technology company principally engaged in providing software products, solutions, and services in various vertical markets.
For more information, please visit our web site at www.bphx.com.
(Tables to Follow)
SAFE HARBOR: Certain statements contained in this release may be deemed forward-looking statements, with respect to plans, projections, or future performance of the Company, the occurrence of which involves certain risks and uncertainties that could cause actual plans to differ materially from these statements. These risks and uncertainties include but are not limited to: market demand for the Company's tools, successful implementation of the Company's tools, competitive factors, the ability to manage the Company's growth, the ability to recruit and retrain additional software personnel, and the ability to develop new business lines.
All names and trademarks are their owners' property.
BLUEPHOENIX SOLUTIONS LTD.
(AN ISRAELI CORPORATION)
CONSOLIDATED BALANCE SHEETS
(In thousands)
December 31 December 31
2003 2002
------------ -----------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $11,105 $15,306
Marketable securities 406 640
Accounts receivable:
Trade 12,617 10,811
Other 1,899 2,924
------- -------
Total current assets 26,027 29,681
------- -------
INVESTMENTS 3,794 3,475
------- -------
FIXED ASSETS
Cost 8,920 11,173
Less - accumulated depreciation 6,121 7,601
------- -------
Total fixed assets 2,799 3,572
------- -------
OTHER ASSETS 48,200 50,753
------- -------
Total assets $80,820 $87,481
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term bank credit $ 8,342 $ 7,473
Accounts payable and accruals:
Trade 3,425 3,738
Deferred revenue 3,034 3,094
Other 10,980 14,066
------- -------
Total current liabilities 25,781 28,371
------- -------
LONG-TERM LIABILITIES:
Accrued severance pay, net 915 931
Provision for losses in formerly-consolidated
subsidiary 1,971 2,512
Loans from banks and others 2,065 2,652
------- -------
Total long-term liabilities 4,951 6,095
------- -------
MINORITY INTEREST 4,690 6,294
------- -------
SHAREHOLDERS' EQUITY
(net of cost of 1,870,565 shares held by
subsidiaries) 45,398 46,721
------- -------
Total liabilities and shareholders' equity $80,820 $87,481
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BLUEPHOENIX SOLUTIONS LTD.
(AN ISRAELI CORPORATION)
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
Year ended Three months ended
December 31, December 31,
------------------ ------------------
2003 2002 2003 2002
-------- --------- -------- ---------
Revenues $54,340 $36,668 $14,081 $13,800
Cost of revenues 24,115 15,220 6,026 6,370
-------- -------- -------- --------
Gross profit 30,225 21,448 8,055 7,430
Software development costs, net 8,138 7,387 2,061 2,001
Selling, general and
administrative expenses 18,847 11,994 4,802 5,125
-------- -------- -------- --------
3,240 2,067 1,192 304
Depreciation 1,293 1,251 307 405
Restructuring costs &
non-recurring expenses - 472 - 472
-------- -------- -------- --------
Operating income (loss) 1,947 344 885 (573)
Financial income (expense), net 165 (195) 67 (253)
Other income (expense), net 943 (1,581) 315 (1,684)
-------- -------- -------- --------
Income (loss) before taxes 3,055 (1,432) 1,267 (2,510)
Taxes on income 152 160 5 104
-------- -------- -------- --------
2,903 (1,592) 1,262 (2,614)
Minority interest (154) (702) (70) (285)
Equity in losses of affiliated
companies (898) (1,336) (270) (551)
-------- -------- -------- --------
Net income (loss) 1,851 (3,630) 922 (3,450)
======== ======== ======== ========
Basic earnings (loss) per share 0.14 (0.35) 0.07 (0.29)
======== ======== ======== ========
Diluted earnings (loss) per
share 0.14 (0.35) 0.07 (0.29)
======== ======== ======== ========
Common shares outstanding 13,451 10,517 13,458 11,869
======== ======== ======== ========
Common shares assuming dilution 13,644 10,517 13,949 11,869
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For more information, please visit our web site at www.bphx.com.
Contact: BluePhoenix
Iris Yahal
+972-9-9526110