BSD.L Regulatory News (BSD)

29 Aug 2007 13:27

Emblaze Ltd29 August 2007 Emblaze Reports Record Second Quarter Results of Formula Systems 320% GROWTH IN NET PROFIT FROM CONTINUOUS OPERATIONS REACHING $4.6M FOR THE QUARTER (Q2 2007: $1.4 million) Ra'anana, Israel - August 29, 2007 - Emblaze Ltd ("Emblaze" or "the Group"))(LSE: BLZ) announces that its group company, Formula Systems (1985) Ltd.("Formula" or "the Company") (NASDAQ: FORTY) a provider of informationtechnology products, solutions and services, announced its results for the sixmonths and second quarter of 2007. Second quarter 2007 highlights: • Revenues increased 19% to $124.7 million (Q2 2006: $104.6 million) • Operating profit increased 45% to $6.7 million (Q2 2006: $2.7 million) • Net profit was $22.3 million (Q2 2006: $0.5 million) and includes capital gain of approx. $17.7 million from the sale of entire stake in BluePhoenix (NASDAQ: BPHX) • Net income from continued operations rose to $4.6 million (Q2 2007: $1.4 million) Guy Bernstein, CEO of Emblaze said: "We are delighted that Formula has reportedrecord second quarter results. These results validate our strategy ofimplementing reorganization and efficiency measures to improve the Company. Werealized the BluePhoenix holding with a significant profit and completed animportant $20M private fund raising for Sapiens. Matirx, which continues itsgrowth momentum, recently raised financial resources of approximately $60m thatare aimed to facilitate its M&A strategy and efforts to enter internationalmarkets. We still have much work to do going forward but the continued successof Formula since the acquisition by Emblaze is rewarded for the hard work withthe managements of all the Formula subsidiaries in order to create a strongerand better group." OverviewFormula continues to improve its financial results ending the second quarter of2007 with net income of $22.3 million compared to $0.5 million in Q2 2006. TheCompany's net income included capital gain of approximately $17.7 million as aresult of the sale of controlling stake in BluePhoenix Solutions Ltd. (NASDAQ:BPHX) in June 2007. Nevertheless, even by neutralizing the capital gain from theBluePhoenix sale, the Company records significant improvement in its net incomefrom continued operations in the amount of $4.6 million compared to $1.4 millionin Q2 2006. The Company's revenues reached $124.5 million, an increase of 19.2% overrevenues in the amount of $104.6 million in Q2 2006. The reorganization measuresled by the Group in the Company's subsidiaries, Sapiens and Magic, resulted inincrease of the Company's operational profit to $6.7 million vs. $2.7 million inthe second quarter of 2006. In the first half of 2007, Formula presents a significant increase in net incomereaching $25.2 million vs. $4.6 million in the first half of 2006. The netincome from continued operations amounted to $7.1 million compared to $1.0million in the first half of 2006 and revenues for first half of 2007 increasedby 19.2% to $240.8 million. Formula has a strong balance sheet with equityamounting to $178.8 million while its current market value is approximately $165million. The Company's cash position at the end of second quarter of 2007increased by $64 million as a result of the sale of BluePhoenix. The Company's increase in revenues and net income is a result of the improvementin operation across all the Company's subsidiaries. Matrix IT Ltd., (TASE: MTRX), one of Israel's leading integration andinformation technology services companies, recorded an increase of 7% inrevenues and net profit of $4.7m compared to $4.0m in Q2 2006. With theintention to expand into international markets, Matrix recently completed itsfirst acquisition in Bulgaria and has completed, despite the difficultworld-wide markets condition, a successful private fund raising in an amount ofapproximately $US60 through the issuance of unlisted bonds to institutionalinvestors in the Tel-Aviv stock exchange. The bonds were rated AA3 by Midroog, aModdy's affiliate, which is the highest ever credit rating received by an ITcompany in Israel. In parallel to the support of the continuous growth of Matrix, the Group has leda comprehensive restructuring plan in two of the Company' subsidiaries, Sapiensand Magic, which is well reflected in these companies' recent achievements. Magic Software Enterprises Ltd. (NASDAQ & TASE: MGIC) provider of compositeapplication development and deployment platforms with a service-orientedarchitecture (SOA), including application integration and business processmanagement (BPM), with existing and legacy systems, has moved from net loss ofapproximately $1.3 million in second quarter of 2006 to a net profit of $0.8million in the second quarter of 2007. Magic ended the second half of 2007 withnet profit of $1.8 million compared with a net loss of $1.5 million in the firsthalf of 2006. The net income also reflects in the company's cash flow fromcontinuing operation which amounted in $0.6 million for the quarter. Magic'srevenue for the second quarter of 2007 increased by 11% to $16.8 million and ithas a solid balance sheet with total assets amounting to $17 million. Sapiens International Corporation N.V. (NASDAQ & TASE: SPNS), a global providerof IT solutions that modernize business processes to enable insurance and othercompanies to quickly adapt to changes, is undergoing a reorganization andoperation efficiency program which already provided improved operational profitfor the second half of 2007 of $0.3 million compared to operational loss of $1.1million in the second half of 2006. The company maintained its revenue levelwith approximately $21.7 million and significantly improved its cash position bysuccessfully completing a $20 million private placement earlier this year andrepaying a large portion of its debt to certain Israeli institutional investorsthrough the repurchase of the company's convertible debentures. Enquiries: Emblaze Ltd-------------Hadas Gazit, Hagit Gal +972 9 7699302/ 339 Corfin Communications - IR & PR (UK)--------------------------------------Harry Chathli, Neil Thapar +44 (0)20 7929 8989 Eisenberg-Eliash LTD. - IR & PR (Israel)------------------------------------------Amir Eisenberg +972 3 7538828 / +972 52 8260285 NOTES TO EDITOR About FormulaFormula Systems Ltd (NASDAQ:FORTY) is a global information technology companyprincipally engaged, through its subsidiaries and affiliates, in providingsoftware consulting services, developing proprietary software products andproviding computer-based business solutions. The Formula Systems companies'shares are traded on NASDAQ: Magic Software Enterprises (MGIC), SapiensInternational Corporation N.V. (SPNS). The following companies are duallytrading also on the Tel Aviv Stock Exchange (TASE): Formula Systems, Magic,Sapiens and Matrix. About EmblazeEmblaze Ltd is a group of technology companies addressing both growth andinnovation activities thus combining the stability of "bread and butter" maturetechnology enterprises with "high-risk / high-reward" investments in innovation. Growth activitiesFormula Systems, which includes: • Magic Software Enterprises Ltd. (NASDAQ & TASE: MGIC) develops, markets and supports composite application development and deployment platforms with a service-oriented architecture (SOA), including application integration and business process management (BPM), with existing and legacy systems; • Matrix IT Ltd. (TASE: MTRX) is one of Israel's leading integration and information technology services companies, active in four principal areas: software solutions and services, software products, infrastructure solutions and hardware products, and training and assimilation. • Sapiens International Corporation N.V. (NASDAQ & TASE: SPNS) is a provider of IT solutions that modernize business processes to enable insurance and other companies to quickly adapt to changes. • nextSource Inc., designs, develops and implements web-based, high quality, innovative human capital management solutions. Innovation activities • Emblaze Mobile, an designer of advanced mobile devices; • emoze, a free global Push Email technology for mobile devices • ZONE-IP (Emblaze V CON), a provider of wireless video communications technologies and conferencing solutions for operators and enterprise markets over IP networks • Orca Interactive (LSE: ORCA), provider of Interactive Television IPTV middleware for Video On Demand (VOD) and broadcast services ; and • Visual Defence (LSE: VDI), (minority stake) a wireless and IP video solutions provider for military and homeland security markets. Emblaze Group is traded on the London Stock Exchange (LSE: BLZ) since 1996.www.Emblaze.com FORMULA SYSTEMS (1985) LTD. (An Israeli corporation) CONSOLIDATED BALANCE SHEETS --------- --------- June 30, December 31, 2007 2006 (Unaudited) --------- --------- U.S. $ ----------------- (in thousands)CURRENT ASSETS:Cash and cash equivalents 141,127 104,775Short-term investments 9,403 11,385Marketable securities available for sale 4,029 3,646Trade receivables 128,896 120,939Other accounts receivable 20,405 17,998Inventories 3,090 3,080 -------- -------- 306,950 261,823 -------- --------LONG-TERM INVESTMENTS, LOANS ANDRECEIVABLES:Loans and other investments 4,697 3,915Investments in affiliates 3,614 720 -------- -------- 8,311 4,635 -------- --------SEVERANCE PAY FUND 30,791 29,962 -------- --------FIXED ASSETS, NET 15,635 16,311 -------- --------OTHER ASSETS, NET 154,350 147,753 -------- --------TOTAL ASSETS ATTRIBUTED TO DISCONTINUEDOPERATIONS - 135,021 -------- -------- 516,037 595,504 ======== ========CURRENT LIABILITIES:Liabilities to banks and others 28,401 40,414Trade payables 52,593 50,157Other accounts payable 71,512 59,056Debentures 3,671 4,450 -------- -------- 156,177 154,077 -------- --------LONG-TERM LIABILITIES:Debentures 8,697 10,802Unrealized Gain 77 -Deferred taxes 117 457Customer advances 1,356 449Liabilities to banks and others 42,283 59,268Liability in respect of the acquisition ofactivities 1,417 1,489Accrued severance pay 36,576 35,340 -------- -------- 90,523 107,805 -------- --------TOTAL LIABILITIES ATTRIBUTED TODISCONTINUED OPERATIONS - 104,951 -------- -------- MINORITY INTEREST 90,557 85,066 -------- --------SHAREHOLDERS' EQUITY 178,780 153,290 -------- -------- 516,037 595,504 ======== ======== FORMULA SYSTEMS (1985) LTD. (An Israeli corporation) UNAUDITED CONSOLIDATED STATEMENTS OF INCOME -------------- -------------- Six months ended Three months ended June 30, June 30, -------------- -------------- 2007 2006 2007 2006 ------- ------- ------- ------- U.S.$ U.S.$ -------------- -------------- (in thousands, except per share data) Revenues 240,809 201,986 124,738 104,618Cost of revenues 179,256 147,398 93,618 77,450 ------- ------- ------- -------Gross profit 61,553 54,588 31,120 27,168Research and developmentcosts, net 3,265 3,382 1,613 1,607Selling, general andadministrative expenses 42,888 43,249 21,860 21,788Depreciation and amortization 1,689 2,071 835 1,007Restructuring andnon-recurring costs 210 656 81 21 ------- ------- ------- -------Operating income 13,501 5,230 6,731 2745Financial income(expenses), net (384) (1,570) 196 (687) ------- ------- ------- ------- 13,117 3,660 6,927 2,058Gain on realization ofinvestments 1,200 2,189 1,136 2,308Other income (expenses), net (435) (730) (194) (680) ------- ------- ------- -------Income before taxes on income 13,882 5,119 7,869 3,686Taxes on income 1,062 2,040 306 1,151 ------- ------- ------- ------- 12,820 3,079 7,563 2,535Equity in profits (losses) ofaffiliated companies, net (364) 99 (213) 12Minority interest in losses(profits), net (5,354) (2,168) (2,734) (1,132) ------- ------- ------- -------Income from continuingoperation 7,102 1,010 4,616 1,415Income (loss) fromdiscontinued operations 18,102 3,629 17,733 (913) ------- ------- ------- -------Net income 25,204 4,639 22,349 502 ======= ======= ======= =======Earnings per share generatedfrom continued operation :Basic 0.55 0.09 0.36 0.13Diluted 0.54 0.08 0.35 0.12 Earnings per share generatedfrom discontinuing operation :Basic 1.37 0.25 1.34 (0.09)Diluted 1.37 0.23 1.34 (0.09) Weighted average number ofshares outstanding:Basic 13,200 13,200 13,200 13,200Diluted 13,200 13,200 13,200 13,200 ______ ______ ______ ______ This information is provided by RNS The company news service from the London Stock Exchange