SHL Telemedicine Reports Third Quarter and Nine Months 2014 Financial Results.
U.S. market entry of smartheart™ device and services to commence beginning of 2015
TEL AVIV, Israel and ZURICH, Nov. 19, 2014 /PRNewswire/ -- SHL Telemedicine Ltd. (SIX Swiss Exchange: SHLTN, OTCPK: SMDCY), a leading provider and developer of advanced personal telemedicine solutions, today announced results for the third quarter and nine months ended 30 September 2014.
Operating Highlights:
- Q3 revenue increased 35% to USD 10.0 million (USD 7.4 million in Q3 2013)
- EBITDA of USD 1.7 million (USD 0.7 million in Q3 2013) with EBIT of USD 0.2 million (LBIT of 0.6 million in Q3 2013)
- Net profit of USD 0.3 million (net loss of USD 1.2 million in Q3 2013)
- U.S. market entry to commence beginning of 2015 with revenues expected already in Q1 2015
- Revenues for the year to grow at over 35% year-over-year. Expecting revenues from international markets to reach 60% by 2016.
Erez Alroy, Co-CEO of SHL, commented: "During the third quarter we continued to benefit from a well established customer base and strong brand recognition in Israel. We also remain pleased with our continued growth in Germany where we are the largest provider of telemedicine services."
Alroy continued, "As part of our global expansion strategy we have been gradually increasing our investments in the U.S. market as we prepare to initiate sales activities there beginning of 2015. We have created a strong foundation for marketing and distributing our products, including establishing a nationwide network of physicians and full backend services. With over 700,000 heart attacks each year, the U.S. provides significant market opportunity for our smartheart devices and services, and therefore forms a major part of our vision for SHL's future."
"Our U.S. activity will initially be targeted at healthcare professionals and direct-to-consumers channels. Marketing of the smartheart™ to consumers is expected to commence in the first quarter of 2015. Our efforts to break into the healthcare professional market are already underway as we are in advanced negotiations with several large distributors and expect to sign agreements soon. Our global monitoring centers will be a key aspect of our telehealth offering to these healthcare professionals, enabling them to perform and interpret ECGs in real-time, creating revenue-generating opportunities for them. We are also exploring other relevant channels including distribution opportunities through pharmacies and clinic chains," concluded Alroy.
Business Review
In Germany, SHL continued to strengthen its position as a leading provider of telehealth services with another solid quarter.
In Israel, SHL has a loyal subscriber base generating long-term recurring revenues leading to another quarter of continued strong financial performance.
In Asia Pacific, SHL is continuing to invest in the commercial rollout of its telehealth services in India, while in Japan SHL is already providing services to dozens of clinics using the smartheart™ platform and providing telemedicine services through its global telemedicine call center in Tel-Aviv.
Financial Highlights
During the third quarter and the nine month periods, revenues increased considerably year over year primarily due to the growth in the Company's German business. Even with the increased investments in geographical expansion, SHL's financial performance has improved significantly with improved gross profit and operating results.
During the quarter the USD has appreciated over the NIS and the Euro by some 7% leading to lower reported USD revenues and expenses, as compared to the first two quarters of 2014.
Revenues for the quarter grew by 35.1% (33.8% at constant exchange rates*) and amounted to USD 10.0 million compared to USD 7.4 million in Q3 2013. In the nine months of 2014 revenues grew by 41.1% (36.1% at constant exchange rates*) and amounted to USD 30.9 million compared to USD 21.9 million in the first nine months of 2013.
Gross profit for the quarter amounted to USD 5.6 million (56.0% of revenues) compared to USD 4.0 million (54.1% of revenues) in Q3 2013. Gross profit for the nine months amounted to USD 17.3 million (56.0% of revenues) compared to a gross profit of USD 11.5 million (52.5% of revenues) in the nine months of 2013.
EBITDA for the quarter amounted to USD 1.7 million (17.0% of revenues) with EBIT for the quarter amounting to USD 0.2 million (2.0% of revenues) this compared with an EBITDA of USD 0.7 million (9.5% of revenues) and an Operating Loss of USD 0.6 million in Q3 2013. For the nine months of 2014 EBITDA amounted to USD 5.3 million (17.2% of revenues) with an EBIT of USD 0.7 million (2.3% of revenues), this compared with an EBITDA of USD 3.8 million (17.4% of revenues) and an EBIT of USD 0.0 million in the nine months of 2013.
Net Income for the quarter was USD 0.3 million (USD 0.02 per share) compared to a net loss of USD 1.2 million (USD 0.11 per share) for the third quarter of 2013. For the nine months net income amounted to USD 0.3 million (USD 0.03 per share) compared to a net loss of USD 1.5 million (USD 0.14 per share) in the nine months of 2013.
Cash Flow improved in the quarter with positive operating cash flow of USD 0.1 million compared to a negative operating cash flow of USD 0.9 million in the previous quarter and compared to a negative operating cash flow of USD 0.4 million in Q3 2013. Cash used in operations during the nine months amounted to USD 3.2 million compared to USD 2.5 million, excluding one-time payment of USD 5.2 million received in the first quarter of 2013. Cash, cash equivalents and marketable securities amounted to USD 19.5 million at September 30, 2014.
Balance sheet. SHL's assets at 30 September 2014 totalled USD 96.4 million with shareholders' equity amounting to USD 63.9 million (66.3% of balance sheet) compared to assets of USD 108.5 million with shareholders' equity amounting to USD 68.9 million at 31 December 2013. The decrease in the reported shareholders' equity and total assets is mainly attributable to the appreciation of the USD against the NIS resulting in a corresponding decrease of the foreign currency translation reserve in the equity section in the amount of USD 4.9 million.
| SHL Telemedicine – consolidated key figures – Q3 2014 |
|||||
| in USD million (except per |
Q3 2014 |
Q3 2013 |
% change |
Q3 2014 |
% change |
| Revenues |
10.0 |
7.4 |
35.1% |
9.9 |
33.8% |
| Gross profit |
5.6 |
4.0 |
40.0% |
5.5 |
37.5% |
| % |
56.0% |
54.1% |
54.5% |
||
| EBIT/(LBIT) |
0.2 |
(0.6) |
n.a. |
0.1 |
n.a. |
| % |
2.0% |
n.a. |
n.a. |
1.0% |
|
| EBITDA |
1.7 |
0.7 |
142.9% |
1.7 |
128.6% |
| % |
18.0% |
9.5% |
16.2% |
||
| Net Income (Loss) |
0.3 |
(1.1) |
n.a. |
0.3 |
n.a. |
| Basic EPS (LPS) |
0.02 |
(0.11) |
n.a. |
0.02 |
n.a. |
| SHL Telemedicine – consolidated key figures 9M 2014 |
|||||
| in USD million (except per |
9M 2014 |
9M 2013 |
% change |
9M 2014 |
% change |
| Revenues |
30.9 |
21.9 |
41.1% |
29.8 |
36.1% |
| Gross profit |
17.3 |
11.5 |
50.4% |
16.7 |
45.2% |
| % |
56.0% |
52.5% |
56.0% |
||
| EBIT |
0.7 |
0.0 |
n.a |
0.7 |
n.a |
| % |
2.3% |
n.a |
n.a |
2.3% |
|
| EBITDA |
5.3 |
3.8 |
39.5% |
5.1 |
34.2% |
| % |
17.2% |
17.4% |
17.8% |
||
| Net Income (Loss) |
0.3 |
(1.4) |
n.a |
0.2 |
n.a |
| Basic EPS (LPS) |
0.03 |
(0.14) |
n.a |
0.02 |
n.a |
| * Constant currency - In order to enable meaningful comparison between the results, they are also presented at constant currency exchange rates. These are calculated by translating the 2014 results using the average 2013 exchange rates instead of the current period exchange rates. Management believes that this presentation enables a more meaningful comparison between the periods due to the significant fluctuations in NIS/USD/EUR exchange rates. |
|||||
| Revenues by geographic distribution – Q3 14 |
||||
| Israel |
Germany |
|||
| USD m |
% of total |
USD m |
% of total |
|
| Q3 2014 |
6.0 |
60.0% |
4.0 |
40.% |
| Q3 2013 |
6.0 |
81.1% |
1.4 |
18.9% |
| Q3 2014 (in constant currency) |
6.0 |
60.6% |
3.9 |
39.4% |
| % change in constant currency |
0.0% |
178.6% |
||
| Revenues by geographic distribution – 9M 14 |
||||
| Israel |
Germany |
|||
| USD m |
% of total |
USD m |
% of total |
|
| 9M 2014 |
18.2 |
58.9% |
12.7 |
41.1% |
| 9M 2013 |
17.5 |
79.9% |
4.4 |
20.1% |
| 9M 2014 (in constant currency) |
17.5 |
58.7% |
12.3 |
41.3% |
| % change in constant currency |
0.0% |
179.5% |
||
Conference Call, today, 16.00 CET / 10.00am ET
SHL will hold a call to discuss the Q3 results today at 16.00 CET / 10:00am ET. Erez Alroy, Co-CEO, and Eran Antebi, CFO, will host the call. Dial-in numbers are as follows:
| From Europe |
+41 (0)58 310 50 00 |
| From UK |
+44 (0)203 059 58 62 |
| From Israel |
Toll free: 1 80 921 44 27 |
| Local: +972 3763 1173 |
|
| From US |
Toll free: +1 866 291 41 66 |
Slides are available at
http://www.shl-telemedicine.com/investors-relations/financial-reports/
IR Agenda
March 25, 2015 FY results 2014 announcement and publication of annual report
About SHL Telemedicine
SHL Telemedicine is engaged in developing and marketing personal telemedicine systems and the provision of medical call center services, with a focus on cardiovascular and related diseases, to end users and to the healthcare community. SHL Telemedicine offers its services and personal telemedicine devices to subscribers utilizing telephonic and Internet communication technology. The Company operates in Israel, Germany, India and the United States in one business segment, Telemedicine services. SHL is listed on the SIX Swiss Exchange (SHLTN, ISIN: IL0010855885, Security No.: 1128957) and has an ADR program listed over-the counter; Symbol: SMDCY. For more information please visit our web site at www.shl-telemedicine.com.
For further information please contact:
- Erez Alroy, Co-CEO, Phone: +972 3561 22 12, [email protected]
- Martin Meier-Pfister, IRF Communications, Phone: +41 43 244 81 40, [email protected]
- Garth Russell / Elizabeth Barker, U.S.A., Phone : +1 212-682-6300, [email protected] / [email protected]
Some of the information contained in this press release contains forward-looking statements. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those in the forward-looking statements as a result of various factors. SHL Telemedicine undertakes no obligation to publicly update or revise any forward-looking statements.
| Balance-Sheets (USD thousands) |
30.9.2014 |
30.9.2013 |
31.12.2013 |
| Unaudited |
Unaudited |
Audited |
|
| Cash and cash equivalents |
3,988 |
9,021 |
8,732 |
| Short term investments |
15,506 |
17,958 |
19,661 |
| Trade receivables |
13,592 |
13,664 |
10,479 |
| Inventory |
1,920 |
547 |
869 |
| Other current assets |
6,620 |
6,680 |
8,014 |
| Current Assets |
41,626 |
47,870 |
47,755 |
| Non-Current Assets |
10,397 |
12,479 |
11,632 |
| Property and equipment, net |
14,335 |
15,587 |
15,982 |
| Intangible assets, net |
30,023 |
23,769 |
33,146 |
| Total Assets |
96,381 |
99,705 |
108,515 |
| Credit from banks and current maturities |
9,537 |
10,251 |
10,477 |
| Deferred revenues |
449 |
114 |
330 |
| Trade payables |
1,164 |
1,225 |
1,433 |
| Other accounts payable |
3,990 |
3,763 |
4,568 |
| Other liabilities |
915 |
- |
2,504 |
| Current liabilities |
16,055 |
15,353 |
19,312 |
| Long-term loans |
14,519 |
18,770 |
18,205 |
| Deferred revenues |
1,117 |
1,278 |
1,283 |
| Employee benefit liabilities |
800 |
1,054 |
805 |
| Non-current liabilities |
16,436 |
21,102 |
20,293 |
| Total liabilities |
32,491 |
36,455 |
39,605 |
| Equity: |
|||
| Issued capital |
31 |
31 |
31 |
| Additional paid-in capital |
95,112 |
94,802 |
95,014 |
| Treasury shares |
(2,558) |
(2,956) |
(2,774) |
| Foreign currency translation reserve |
1,236 |
5,176 |
6,148 |
| Capital reserve for available-for-sale |
871 |
1,066 |
1,633 |
| Accumulated deficit |
(30,802) |
(34,869) |
(31,142) |
| Total equity |
63,890 |
63,250 |
68,910 |
| Total liabilities and equity |
96,381 |
99,705 |
108,515 |
| Statements of Income |
Q3 14 |
Q3 13 |
9M 14 |
9M 13 |
2013 |
| Unaudited |
Unaudited |
Unaudited |
Unaudited |
Audited |
|
| Revenues |
10,011 |
7,393 |
30,928 |
21,941 |
29,674 |
| Depreciation and amortization |
619 |
566 |
1,785 |
1,688 |
2,127 |
| Cost of revenues |
3,813 |
2,856 |
11,820 |
8,715 |
11,607 |
| Gross Profit |
5,579 |
3,971 |
17,323 |
11,538 |
15,940 |
| Research and development costs, net |
640 |
577 |
1,882 |
1,590 |
2,206 |
| Selling and marketing expenses |
2,849 |
2,095 |
8,568 |
6,482 |
8,787 |
| General and administrative expenses |
1,926 |
1,935 |
6,273 |
3,518 |
10,341 |
| Gain from almeda acquisition |
- |
- |
(137) |
- |
(8,492) |
| Operating income (loss) |
164 |
(636) |
737 |
(52) |
3,098 |
| Financial income |
810 |
256 |
1,514 |
730 |
1,072 |
| Financial expenses |
(381) |
(789) |
(995) |
(1,841) |
(2,631) |
| Income (loss) before taxes on income |
593 |
(1,169) |
1,256 |
(1,163) |
1,539 |
| Taxes on income (Tax benefit) |
335 |
39 |
916 |
332 |
(693) |
| Net income (loss) |
258 |
(1,208) |
340 |
(1,495) |
2,232 |
| Basic and diluted income (loss) per share |
0.02 |
(0.11) |
0.03 |
(0.14) |
0.22 |
| Other Comprehensive income not to be |
|||||
| Foreign currency translation reserve |
(4,977) |
1,554 |
(4,912) |
3,116 |
4,088 |
| Actuarial gain |
- |
- |
- |
- |
233 |
| (4,977) |
1,554 |
(4,912) |
3,116 |
4,321 |
|
| Other Comprehensive income to be reclassified |
|||||
| Transfer to the statement of income in respect of |
(234) |
122 |
(779) |
103 |
146 |
| Gain (loss) on available-for-sale investments |
(70) |
52 |
17 |
115 |
406 |
| (304) |
174 |
(762) |
218 |
552 |
|
| Total comprehensive income (loss) |
(5,023) |
520 |
(5,334) |
1,839 |
7,105 |
| Statements of Cash Flows (USD thousands) |
Q3 2014 |
Q3 2013 |
9M 2014 |
9M 2013 |
2013 |
| Unaudited |
Unaudited |
Unaudited |
Unaudited |
Audited |
|
| Net income (loss) |
258 |
(1,208) |
340 |
(1,495) |
2,232 |
| Adjustment required to reconcile net income |
(177) |
783 |
(3,517) |
4,242 |
400 |
| Net Cash provided by (used in) Operating |
81 |
(425) |
(3,177) |
2,747 |
2,632 |
| Purchase of property and equipment |
(942) |
(430) |
(1,805) |
(1,348) |
(2,200) |
| Investment in intangible assets |
(366) |
(516) |
(1,144) |
(1,502) |
(1,878) |
| Restricted cash |
1,367 |
- |
- |
- |
- |
| Acquisition of almeda |
1,149 |
- |
1,149 |
- |
2,920 |
| Proceeds from sale of property and |
- |
10 |
- |
24 |
29 |
| Purchase of short-term investments |
(8,481) |
(2,147) |
(13,537) |
(5,260) |
(8,511) |
| Proceeds from sale of short-term investments |
4,613 |
2,841 |
17,142 |
4,495 |
6,402 |
| Net Cash provided by (used in) Investing |
(2,660) |
(242) |
1,805 |
(3,591) |
(3,238) |
| Proceeds from exercise of options |
5 |
24 |
70 |
165 |
486 |
| Short-term bank credit, net |
(429) |
826 |
(429) |
1,044 |
1,053 |
| Payment of long-term loans |
(912) |
(831) |
(2,779) |
(2,411) |
(3,267) |
| Treasury shares purchased |
- |
- |
- |
(36) |
(36) |
| Net Cash provided by (used in) Financing |
(1,336) |
19 |
(3,138) |
(1,238) |
(1,764) |
| Effect of exchange rate changes on cash and |
(251) |
212 |
(234) |
490 |
489 |
| Decrease in cash and cash equivalents |
(4,166) |
(436) |
(4,744) |
(1,592) |
(1,881) |
| Cash and cash equivalents at the beginning of |
8,154 |
9,457 |
8,732 |
10,613 |
10,613 |
| Cash and Cash equivalents at the end of the |
3,988 |
9,021 |
3,988 |
9,021 |
8,732 |
SOURCE SHL Telemedicine Ltd.
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