Shamir Optical Industry Reports Fourth Quarter and Year-End 2009 Results
Fourth Quarter Revenue up 27.2% Year-Over-Year
Fourth Quarter Net Income up 132.8% Year-Over-Year
KIBBUTZ SHAMIR, Israel, March 11 /PRNewswire-FirstCall/ -- Shamir Optical Industry Ltd. (Nasdaq: SHMR) ("Shamir"), a leading provider of innovative products and technology to the ophthalmic lens market, today announced its unaudited financial results for the fourth quarter and year ended December 31, 2009.
For the quarter ended December 31, 2009, revenues increased 27.2% to $37.1 million, compared to $29.2 million for the fourth quarter of 2008. Gross profit for the quarter increased 27.2% to $20.4 million, or 55.0% of revenues, compared to a gross profit of $16.0 million, or 54.9% of revenues for the same period last year.
For the quarter ended December 31, 2009, operating income increased 55.6% to $4.5 million, or 12.3% of revenues, compared to operating income of $2.9 million, or 10.0% of revenues for the same period last year. Net income for the quarter increased 132.8% to $3.5 million compared to a net income of $1.5 million for the comparable period in 2008. Net income attributable to Shamir's shareholders was $0.20 per diluted share, compared to $0.08 per diluted share for the same period in 2008.
For the quarter ended December 31, 2009, excluding the effects of non-cash stock-based compensation expenses and amortization of intangible assets, non-GAAP operating income was $5.0 million, or 13.5% of revenues, compared to non-GAAP operating income of $3.3 million, or 11.4% of revenues for the same period in 2008.
Excluding the effect of non-cash stock-based compensation expenses, accretion of redeemable non controlling interest and amortization of intangible assets, net of tax, net income attributable to Shamir's shareholders for the quarter was $3.6 million, or $0.22 per diluted share, compared to net income of $1.7 million, or $0.10 per diluted share for the same period last year.
For the year ended December 31, 2009, revenues were $142.4 million, compared to $140.3 million for the same period in 2008. Gross profit for the year was $76.9 million, or 54.0% of revenues, compared to gross profit of $75.9 million, or 54.1% of revenues for the same period last year.
For the year ended December 31, 2009, operating income was $17.3 million, or 12.2% of revenues, compared to operating income of $13.4 million, or 9.5% of revenues for the same period last year. Net income for the year was $13.3 million, or $0.77 per diluted share, compared to net income of $9.1 million or $0.55 per diluted share for the comparable period in 2008.
Excluding the effects of non-cash stock-based compensation expenses, amortization of intangible assets and compensation to the Company's former chief executive officers, non-GAAP operating income for the year was $19.2 million, or 13.5% of revenues, compared to non-GAAP operating income of $15.8 million, or 11.3% of revenues, in 2008.
Excluding the effects of non-cash stock-based compensation expenses, amortization of intangible assets, net of tax, accretion of redeemable non controlling interest and compensation to the Company's former chief executive officers, net of tax, non-GAAP net income attributable to Shamir's shareholders for the year was $14.3 million or $0.86 per diluted share, compared to $11.2 million or $0.68 per diluted share for the comparable period in 2008.
The reconciliation of GAAP operating income and net income to non-GAAP operating income and non-GAAP net income is set forth below.
As of December 31, 2009, the Company had cash and cash equivalents, including short-term investments of $31.6 million.
Commenting on the results, Amos Netzer, Chief Executive Officer of Shamir, said, "Despite continued economic challenges throughout the world during the fourth quarter, and for that matter, the full year, Shamir's performance surpassed internal projections. During the year we increased penetration and acceptance of the Shamir brand as well as experienced the maturing of our investments in both manufacturing and distribution."
Mr. Netzer concluded, "The overall strength of our results in 2009 gives us reason to feel confident that we will achieve similar success in 2010. Our strategy remains intact, which includes continued operational excellence and penetration into new markets."
For the fiscal year ending on December 31, 2010, Shamir currently estimates its 2010 revenues growth in the range of 8%-12%, under the assumption of December 2009 exchange rates.
Conference Call:
Shamir has scheduled a conference call for 10:30 a.m. ET today to discuss fourth quarter and year-end 2009 results. To participate in the call, please dial (888) 562-3356 (U.S. and Canada) or (973) 582-2700 (International). The conference ID for this event is 57774730. For those unable to participate there will be replay available from 1:30 p.m. ET on March 11, 2010, through 11:59 p.m. EDT, March 18, 2010. Please call: (800) 642-1687 (U.S. and Canada) (706) 645-9291 (International). The ID code for the replay is 57774730.
The call will be available as a live, listen-only webcast at www.kcsa.com. Please go to the KCSA website at least 15 minutes prior to the scheduled start time to register, download and install any necessary audio software. A 30-day archive of the webcast will be available approximately 2 hours after the conclusion of the live call.
About non – GAAP financial measures
This press release includes non-GAAP financial measures - non-GAAP operating income and non-GAAP net income – that exclude certain charges. The presentation of this financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management of Shamir believes that non-GAAP operating income and non-GAAP net income provides meaningful supplemental information because these numbers reflect our core operational results and are used by management internally to review Shamir's financial results.
About Shamir
Shamir is a leading provider of innovative products and technology to the spectacle lens market. Utilizing its proprietary technology, the company develops, designs, manufactures, and markets progressive lenses to sell to the ophthalmic market. In addition, Shamir utilizes its technology to provide design services to optical lens manufacturers under service and royalty agreements. Progressive lenses are used to treat presbyopia, a vision condition where the eye loses its ability to focus on close objects. Progressive lenses combine several optical strengths into a single lens to provide a gradual and seamless transition from near to intermediate, to distant vision. Shamir differentiates its products from its competitors' primarily through lens design. Shamir's leading lenses are marketed under a variety of trade names, including Shamir Genesis(TM), Shamir Piccolo(TM), Shamir Office(TM), Shamir Autograph(TM) and Shamir Smart(TM). Shamir believes that it has one of the world's preeminent research and development teams for progressive lenses, molds, and complementary technologies and tools. Shamir developed software dedicated to the design of progressive lenses. This software is based on Shamir's proprietary mathematical algorithms that optimize designs of progressive lenses for a variety of activities and environments. Shamir also has created software tools specifically designed for research and development and production requirements, including Eye Point Technology software, which simulates human vision.
Safe Harbor Statement
Statements concerning Shamir's business outlook or future economic performance; product introductions and plans and objectives related thereto; and assumptions made or expectations as to any future events, conditions, performance or other matters, are "forward-looking statements" as that term is defined under U.S. federal securities laws. Forward-looking statements are subject to various risks, uncertainties and other factors that could cause actual results to differ materially from those stated in such statements. These risks, uncertainties and factors include, but are not limited to: The conflicts in the region; the effects of competition in our industry, and changes in our relationships with optical laboratories, distributors, research and development partners and other third parties; the effects of the international expansion of our operations and our ability to manage our growth, including our ability to manage potential future acquisitions; the effect of global economic conditions in general and conditions in Shamir's industry and target markets in particular; shifts in supply and demand; market acceptance of new products and continuing products' demand; the impact of competitive products and pricing on Shamir's and its customers' products and markets; timely product and technology development/upgrades and the ability to manage changes in market conditions as needed; interest rate fluctuations; and other factors detailed in Shamir's filings with the Securities and Exchange Commission. Shamir assumes no obligation to update the information in this release.
(Tables to follow)
SHAMIR OPTICAL INDUSTRY LTD.
Consolidated Balance Sheets
(US dollars in thousands, except share and per share data)
As of December 31, As of December 31,
2008 2009
---- ----
(Unaudited)
CURRENT ASSETS:
Cash and cash equivalents $18,276 $19,929
Short-term investment 7,187 11,679
Trade receivables (1) 30,331 33,648
Other receivables and
prepaid expenses 8,469 7,918
Inventory 26,063 26,946
------ ------
TOTAL CURRENT ASSETS 90,326 100,120
LONG-TERM INVESTMENTS:
Severance pay fund 2,584 2,909
Long-term receivables 813 427
Investments in affiliates 2,085 1,306
----- -----
TOTAL LONG-TERM INVESTMENTS 5,482 4,642
PROPERTY, PLANT AND
EQUIPMENT, NET 38,617 38,568
OTHER ASSETS 5,902 7,439
GOODWILL 9,169 12,945
----- ------
TOTAL ASSETS $149,496 $163,714
======== ========
CURRENT LIABILITIES:
Short-term bank credit
and loans $11,597 $11,033
Current maturities of
long-term loans 10,403 6,879
Trade payables 8,876 11,680
Accrued expenses and other
liabilities 11,680 15,447
------ ------
TOTAL CURRENT LIABILITIES 42,556 45,039
LONG-TERM LIABILITIES:
Long-term loans 9,800 12,599
Capital leases 3,393 2,367
Accrued severance pay 3,172 3,270
Other long-term
liabilities 634 2,763
Deferred income taxes 1,922 2,224
----- -----
TOTAL LONG-TERM LIABILITIES 18,921 23,223
Redeemable non-
controlling interest 690
---
EQUITY:
Share capital
Common shares of NIS 0.01
par value
Authorized: 100,000,000
shares at December 31,
2008 and 2009; Issued and
outstanding: 16,423,740
and 16,592,345 shares at
December 31, 2008 and
2009, respectively 37 37
Additional paid-in capital 67,362 68,230
Accumulated other
comprehensive income (2,637) (1,122)
Retained earnings 22,007 24,795
------ ------
Total Shamir Optical
Industry Ltd.
Shareholders' equity 86,769 91,940
Non-controlling interests 1,250 2,822
----- -----
TOTAL EQUITY 88,019 94,762
------ ------
TOTAL LIABILITIES AND
EQUITY $149,496 $163,714
======== ========
(1)Net of allowance for doubtful accounts of $2,066 and $3,076 as of
December 31, 2008 and 2009, respectively
SHAMIR OPTICAL INDUSTRY LTD.
Consolidated Statements of Income
(US dollars in thousands, except per share data)
Three Months Ended Year Ended
December 31, December 31,
------------ ------------
2008(1) 2009 2008(1) 2009
------- ---- ------- ----
(Unaudited) (Unaudited) (Unaudited)
Revenues, net $29,155 $37,073 $140,326 $142,384
Cost of revenues 13,143 16,700 64,415 65,448
------ ------ ------ ------
Gross profit 16,012 20,373 75,911 76,936
Operating Expenses:
Research and
development costs 761 907 3,368 3,239
Selling and
marketing expenses 8,847 10,537 42,374 40,959
General and
administrative
expenses 3,485 4,387 16,793 15,410
----- ----- ------ ------
Total operating
expenses 13,093 15,831 62,535 59,608
------ ------ ------ ------
Operating income 2,919 4,542 13,376 17,328
Financial expenses
and other, net 1,273 158 2,142 395
----- --- ----- ---
Income before
taxes on income 1,646 4,384 11,234 16,933
Taxes on income 153 822 2,216 3,699
--- --- ----- -----
Income after
taxes on income 1,493 3,562 9,018 13,234
Equity in losses
(earnings) of
affiliates, net (30) 17 (44) (31)
--- --- --- ---
Net income 1,523 3,545 9,062 13,265
Net income (loss)
attributable to
non-controlling
interests 164 201 (16) 477
--- --- --- ---
Net income
attributable to
Shamir Optical
Industry Ltd.
Shareholders $1,359 $3,344 $9,078 $12,788
====== ====== ====== =======
Net earnings per share:
Basic $0.08 $0.20 $0.55 $0.78
===== ===== ===== =====
Diluted $0.08 $0.20 $0.55 $0.77
===== ===== ===== =====
Number of shares:
Basic 16,424 16,480 16,424 16,438
Dilutive 16,492 16,623 16,522 16,530
(1) Amounts have been reclassified to reflect the implementation of SFAS No. 160, Non-controlling Interests in Consolidated Financial Statements, an amendment of ARB No. 51.
SHAMIR OPTICAL INDUSTRY LTD.
Reconciliation of Non-GAAP Operating Income and Net Income
(US dollars in thousands, except per share data)
Three Months Ended Year Ended
December 31, December 31,
------------ ------------
2008 2009 2008 2009
---- ---- ---- ----
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Operating income $2,919 $4,542 $13,376 $17,328
Non-GAAP adjustment:
Stock based
compensation 140 79 733 451
Amortization of
intangible assets 257 385 1,292 1,148
Compensation to
former Chief
Executive Officers - - 434 303
--- --- --- ---
Non-GAAP operating
income $3,316 $5,006 $15,835 $19,230
====== ====== ======= =======
Net income
attributable to
Shamir Optical
Industry Ltd.
Shareholders $1,359 $3,344 $9,078 $12,788
Non-GAAP adjustment:
Stock based
compensation 140 79 733 451
Amortization of
intangible assets,
net 202 284 1,022 863
Accretion of
redeemable non
controlling
interest - (64) - (64)
Compensation to
former Chief
Executive Officers,
net - - 378 227
--- --- --- ---
Non-GAAP net income
attributable to
Shamir Optical
Industry Ltd.
Shareholders $1,701 $3,643 $11,211 $14,265
====== ====== ======= =======
Net earnings per share:
Basic $0.10 $0.22 $0.68 $0.87
===== ===== ===== =====
Diluted $0.10 $0.22 $0.68 $0.86
===== ===== ===== =====
Number of shares:
Basic 16,424 16,480 16,424 16,438
Dilutive 16,492 16,623 16,522 16,530
SOURCE Shamir Optical Industries Ltd.
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