SIM.L Regulatory News (SIM)

14 Aug 2009 07:00



Interim Results for the six months ended 30 June 2009 

SimiGon Ltd (together with its subsidiaries "SimiGon" or the "Company"), a global leader in providing simulation solutions, announces its interim results for the six months to 30 June 2009. 

Financial Highlights

Revenue increased by 0.5% to $1.82 million (H1 2008: $1.81 million).

Net loss decreased by 33.7% to $1.30 million (H1 2008: $1.96 million).

Cash, cash equivalents and short term bank deposits of $2.52 million at 30 June 2009, and current maturities of a long term bank loan of $0.58 million. 

Basic and diluted loss per share of $0.03 (H1 2008: Basic and diluted loss per share of $0.05).

Operational Highlights

SimiGon continues its growth in the F16 world, and won an additional F16 training program in the European market.

SimiGon continues its F-35 Lightning II Joint Strike Fighter (JSF) training program with Lockheed Martin. The Company expects this project to positively impact the revenues in the second half of 2009 and into 2010. 

SimiGon SIMbox product continues to expand into new markets, and was recently selected as the training platform and LMS for a lucrative Unmanned Aerial Vehicle program. 

The recently released version of SimiGon's SIMbox application continues to focus on creating a quintessential solution for organizations seeking to improve their training, training-management and increase operational readiness. The new version includes a new powerful physics engine with improved capabilities and performance for ground simulation. It also significantly enhances the scheduling capabilities of SIMbox.

Ami Vizer, President & Chief Executive Officer of SimiGon stated: "Our business results for the six months ended 30 June 2009 are similar to our expectations given the challenging economic conditions and the period's normal seasonality.

We were able to successfully plan ahead and focus on growing our main markets and primary partners. We are encouraged by the increased level of customer activity in this period. Moreover, existing programs such as the F-35 Lightning II Joint Strike Fighter (JSF) as well as the UK's Military Flying Training System are expected to positively impact SimiGon's revenue in the near future. SimiGon continues to make significant progress in the development of our next generation products while having an effective expense control. 

Looking forward to the second half of 2009 and particularly to 2010, the Company expects to increase revenues as a result of our existing programs and other contracts we believe will be awarded shortly and will provide a stronger platform for future growth."

Overview

As a preferred supplier of training and simulation technologies for the world's largest military flight training programmes, SimiGon has established a leading position in the market of PC-based training and simulation solutions. The Company's reconfigurable SIMbox technology platform can be used for all types of training, across all domains. The Company expects to leverage its core product SIMbox to increase market share in its existing markets and create solid foundations in new markets.

Lockheed Martin has selected the SIMbox Learning Management System for the F-35 Lightning II Joint Strike Fighter (JSF) training program. Added to this success, Lockheed Martin has chosen SimiGon to provide simulation training for the UK's Military Flying Training System. These programs are helping SimiGon's development and provide further affirmation of the viability of SimiGon's training solutions. Lockheed Martin continues to expand its cooperation with SimiGon, and the use of its SIMbox technology, leveraging the foundations of the long-term productive relationship between the companies.

SimiGon is leveraging its success with existing blue cheap customers to effectively attract new partners and customers. In the past few months SimiGon have been approached by leading organizations from the training and simulation market worldwide seeking to use SimiGon's technology.

Financial Performance 

Revenue for the six months ended 30 June 2009 was $1.82 million (H1 2008: $1.81 million), an increase of 0.5%. Gross profit for the six months ended 30 June 2009 was $1.32 million (H1 2008: $1.43 million).

Total operating expenses for the six months ended 30 June 2009 decreased by 22.3% to $2.65 million (H1 2008: $3.41 million). This decrease is primarily due to the positive impact of the currency exchange rate of the Israeli Shekel on salary expenses and reduction of salary expenses. Research and development expenses decreased to $0.97 million (H1 2008: $1.49 million), marketing expenses decreased to $0.69 million (H1 2008: $1 million) and general and administration expenses increased to $0.99 million (H1 2008: $0.91 million) mainly due to provision for a bad debt. 

The operating loss for the six months ended 30 June 2009 has decreased to $1.32 million (H1 2008: $1.98 million loss). The net loss for the period has decreased from $1.96 million in H1 2008 to $1.30 million in H1 2009. This resulted in a net basic and diluted loss per share of $0.03 (H1 2008: $0.05 basic and diluted loss per share). 

As of 30 June 2009, SimiGon had cash, cash equivalents and short term deposits in the amount of $2.52 million, and current maturities of a long term bank loan of $0.58 million. 

As of 30 June 2009, the Company had 47 employees, compared to 52 employees at 30 June 2008.

Outlook

The Company's outlook is positive due to the increased level of new and existing customers' interest and existing programs such as the F-35 Lightning II Joint Strike Fighter (JSF) as well as the UK's Military Flying Training System. These factors are expected to improve SimiGon's revenue in the near future. The Company is making significant progress in its next generation of products. SimiGon reduced its expenses in order to support an expected positive cash flow in the near future. 

Notwithstanding the current challenging economic conditions, the Board is confident in the Company's outlook as it is well positioned for long term growth, following its success in providing PC-based training and simulation systems in various large scale military pilot training programmes. 

SIMIGON LTD. AND ITS SUBSIDIARIES

INTERIM CONSOLIDATED BALANCE SHEETS

  SIMIGON LTD. AND ITS SUBSIDIARIES

INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

  SIMIGON LTD. AND ITS SUBSIDIARIES

INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

*) Represents an amount lower than $ 1,000.

  SIMIGON LTD. AND ITS SUBSIDIARIES

INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS

SIMIGON LTD. AND ITS SUBSIDIARIES

INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS

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