This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
$1 buys you full access to ALL of TheStreet's Subscription Services! Learn More

Retalix Announces Second Quarter 2010 Results

* Note Regarding the Use of Non-GAAP Financial Information

In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, Retalix uses Non-GAAP measures of operating income, net income and earnings per share, which are adjustments from results based on GAAP to exclude non-cash equity based compensation, Indirect private placement costs, and amortization of intangibles related to acquisitions, as well as impairment of goodwill when applicable. Retalix's management believes the Non-GAAP financial information provided in this release is useful to investors' understanding and assessment of the Company's on-going core operations and prospects for the future. The presentation of this Non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. Management also uses both GAAP and Non-GAAP information in evaluating and operating business internally and as such deemed it important to provide this information to investors. Reconciliations between GAAP measures and Non-GAAP measures are contained following the GAAP financial statements in this press release.

The Retalix Ltd. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5937

Safe Harbor for Forward-Looking Statements:

Except for statements of historical fact, the information presented herein constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other U.S. federal securities laws. For example, the statements regarding our "Outlook for FY 2010" including our expected results, expected demand and opportunities, future expansion of product offering and services, and future strategic plans and positioning, all involve forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Retalix, including revenues, income and expenses, to be materially different from any future results, performance or achievements or other guidance or outlooks expressed or implied by such forward-looking statements. Such factors include risks relating to Retalix's anticipated future financial performance and growth, the performance of the US dollar relative to other currencies, continued roll-outs with existing customers, continued interest in Retalix's new platforms, the perception by leading retailers of Retalix's reputation, the potential benefits to food and fuel retailers and distributors, expansion into new geographic markets, and other factors over which Retalix may have little or no control. This list is intended to identify only certain of the principal factors that could cause actual results to differ. Readers are referred to the reports and documents filed by Retalix with the Securities and Exchange Commission, including Retalix's Annual Report on Form 20-F for the year ended December 31, 2009, for a discussion of these and other important risk factors. Except as required by law, Retalix undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof, or to reflect the occurrence of unanticipated events.

RETALIX LTD.  
   
CONSOLIDATED STATEMENTS OF INCOME  
   
  Six months ended June 30 Three months ended June 30 Year ended December 31  
  2010 2009 2010 2009 2009  
  (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Audited)  
  U.S. $ in thousands (except per share data)  
REVENUES:            
Product sales 27,009 26,399 13,322 13,587 58,145  
Services 73,681 69,460 38,697 35,340 134,248  
Total revenues 100,690 95,859 52,019 48,927 192,393  
COST OF REVENUES:            
Cost of product sales 16,281 16,469 7,717 9,209 39,560  
Cost of services 43,571 38,190 23,312 19,085 74,564  
Total cost of revenues 59,852 54,659 31,029 28,294 114,124  
GROSS PROFIT 40,838 41,200 20,990 20,633 78,269  
  OPERATING EXPENSES:            
Research and development – net 14,401 13,988 7,495 7,157 28,991  
Selling and marketing 8,383 9,878 4,264 5,109 18,776  
General and administrative 11,794 9,925 5,856 5,369 21,007  
Other (income) expenses – net (23) 12 (23) 36 (154)  
Indirect private placement costs  -- -- -- -- 1,823  
Total operating expenses 34,555 33,803 17,592 17,671 70,443  
INCOME FROM OPERATIONS 6,283 7,397 3,398 2,962 7,826  
FINANCIAL INCOME (EXPENSES), net (1,148) 80 (792) 3,699 1,757  
INCOME BEFORE TAXES ON INCOME 5,135 7,477 2,606 6,661 9,583  
TAX EXPENSES (1,367) (1,610) (911) (1,676) (3,494)  
INCOME AFTER TAXES ON INCOME 3,768 5,867 1,695 4,985 6,089  
SHARE IN INCOME OF AN ASSOCIATED COMPANY 2 2 2 -- 17  
NET INCOME 3,770 5,869 1,697 4,985 6,106  
NET INCOME ATTRIBUTABLE TO NON-CONTROLLING INTERESTS (280) (224) (138) (81) (310)  
NET INCOME ATTRIBUTABLE TO RETALIX LTD. 3,490 5,645 1,559 4,904 5,796  
EARNINGS PER SHARE – in U.S. $:            
Basic 0.14 0.28 0.06 0.24 0.28  
Diluted 0.14 0.28 0.06 0.24 0.28  
WEIGHTED AVERAGE NUMBER OF SHARES USED IN COMPUTATION OF EARNINGS PER SHARE – in thousands:            
Basic 24,090 20,394 24,092 20,399   20,824
Diluted 24,235 20,417 24,233 20,418   21,020
 
 
RETALIX LTD.
 
CONDENSED CONSOLIDATED BALANCE SHEET
 
  June 30 December 31
  2010 2009 2009
  (Unaudited) (Audited)
  U.S. $ in thousands
A s s e t s      
CURRENT ASSETS:      
Cash and cash equivalents 73,014 65,211 103,675
Short-term deposits 32,000 -- --
Marketable securities 2,031 263 226
Accounts receivable:      
Trade 58,018 55,694 54,814
Other 9,862 11,284 8,891
Prepaid expenses 3,672 3,729 4,967
Inventories 1,326 1,050 1,496
Deferred income taxes 5,509 6,705 4,957
Total current assets 185,432 143,936 179,026
NON-CURRENT ASSETS :      
Long-term receivables 993 2,257 1,386
Long-term prepaid expenses 640 393 406
Long term investments 493 861 682
Amounts funded in respect of employee rights upon retirement 10,978 8,772 10,621
Deferred income taxes 10,615 11,152 12,150
Other 269 429 269
Total non - current assets 23,988 23,864 25,514
PROPERTY, PLANT AND EQUIPMENT, net 14,927 15,341 15,233
GOODWILL 50,803 50,730 50,803
OTHER INTANGIBLE ASSETS, net of accumulated amortization      
Customer base 11,290 14,000 12,544
Other 1,327 1,814 1,889
  12,617 15,814 14,433
Total assets 287,767 249,685 285,009
 
 
RETALIX LTD.
 
CONDENSED CONSOLIDATED BALANCE SHEET
 
  June 30 December 31
  2010 2009 2009
  (Unaudited) (Audited)
  U.S. $ in thousands
Liabilities and equity      
CURRENT LIABILITIES:      
Short-term loan 55 -- 170
Current maturities of long-term bank loans 369 255 263
Accounts payable and accruals:      
Trade 6,431 4,608 7,071
Employees and employee institutions 10,100 9,506 10,114
Accrued expenses 9,483 9,642 10,908
Other 1,277 2,208 1,804
Deferred revenues 17,875 17,015 17,450
Total current liabilities 45,590 43,234 47,780
LONG-TERM LIABILITIES :      
Long-term bank loans, net of current maturities -- 401 275
Long-term deferred revenues 2,537 2,829 2,336
Employee rights upon retirement 14,165 13,659 14,243
Deferred income tax 263 258 269
Institutions 477 3,265 476
Total long-term liabilities 17,442 20,412 17,599
Total liabilities 63,032 63,646 65,379
EQUITY:      
Share capital -Ordinary shares of NIS 1.00 par value (authorized: June 30, 2010 (unaudited), December 31, 2009 (audited) 50,000,000 shares; June 30, 2009 (unaudited) 30,000,000 shares;      
issued and outstanding: - June 30, 2010 (unaudited) 24,099,829 Shares; December 31, 2009 (audited) -24,082,582 shares; June 30, 2009 (unaudited) -20,406,363 shares 6,358 5,384 6,353
Additional paid in capital 210,520 176,603 208,574
Retained earnings  3,865 224 375
Accumulated other comprehensive income  124 343 642
Total Retalix shareholders' equity 220,867 182,554 215,944
Non-controlling interest 3,868 3,485 3,686
Total equity 224,735 186,039 219,630
       
Total liabilities and equity 287,767 249,685 285,009
 
 
(Continued) - 1
RETALIX LTD.
 
CONSOLIDATED STATEMENTS OF CASH FLOWS
 
  Six months ended June 30 Three months ended June 30 Year ended December 31
  2010 2009 2010 2009 2009
  Unaudited Unaudited Unaudited Unaudited Audited
  U.S. $ in thousands
CASH FLOWS FROM OPERATING ACTIVITIES:          
Net income 3,770 5,869 1,697 4,985 6,106
Adjustments required to reconcile net income to net cash provided by operating activities:          
Depreciation and amortization 3,063 3,091 1,485 1,460 6,475
Losses from sale of property, plant and equipment -- 21 -- 40 44
Share in income of an associated company (2) (2) (2) -- (17)
Stock based compensation expenses 1,933 1,162 996 576 2,624
Changes in accrued liability for employee rights upon retirement 222 (208) (299) 1,083 311
Losses (gains) on amounts funded in respect of employee rights upon retirement 147 283 396 (631) (1,023)
Deferred income taxes -- net 951 2,401 648 2,215 3,209
Net decrease in marketable securities 64 146 62 1 162
Other 172 28 145 (154) 13
Changes in operating assets and liabilities:          
Decrease (increase) in accounts receivable:          
Trade (including the non-current portion) (3,485) 15,409 (1,516) (1,126) 17,339
Other (including the non-current portion) (32) 678 1,847 1,932 2,190
Increase (decrease) in accounts payable and accruals:          
Trade (495) (4,083) 284 (2,321) (1,653)
Employees, employee institutions and other (1,810) 2,496 (1,027) 1,662 4,102
Decrease (increase) in inventories 159 (13) 196 655 (456)
Increase (decrease) in long-term institutions 1 2,153 8 39 (636)
Increase (decrease) in deferred revenues 698 709 (960) (732) 625
           
Net cash provided by operating activities - forward 5,356 30,140 3,960 9,684 39,415
 
(Continued) - 2
RETALIX LTD.
 
CONSOLIDATED STATEMENTS OF CASH FLOWS
 
  Six months ended June 30 Three months ended June 30 Year ended December 31
  2010 2009 2010 2009 2009
  Unaudited Unaudited Unaudited Unaudited Audited
  U.S. $ in thousands
   
Net cash provided by operating activities - brought forward 5,356 30,140 3,960 9,684 39,415
CASH FLOWS FROM INVESTING ACTIVITIES:          
Maturity of marketable debt securities held to maturity -- 290 -- -- 490
Sales of marketable trading debt securities -- 2,535 -- -- 2,535
Investment in Short term deposits (32,000) -- (7,000) -- --
Investment in Available-for-sale marketable securities (1,679) -- -- -- --
Additional investments in subsidiaries -- -- -- -- (22)
Purchase of property, plant, equipment and other assets (1,037) (960) (505) (310) (2,985)
Proceeds from sale of property, plant and equipment -- 70 -- 34 120
Amounts funded in respect of employee rights upon retirement, net (586) (396) (333) (287) (913)
Changes in restricted deposits 70 -- 70 -- (184)
Long-term loans collected from employees -- 14 -- 12 14
Net cash provided by (used in) investing activities (35,232) 1,553 (7,768) (551) (945)
CASH FLOWS FROM FINANCING ACTIVITIES:          
Repayment of long-term bank loans (123) (119) (123) (119) (249)
Issuance of share capital and warrants to shareholders -- -- -- -- 31,468
Issuance of share capital to employees and non-employees resulting from exercise of options 7 4 3 -- 20
short-term loan - net (113) -- (58) -- 170
Net cash provided by (used in) financing activities (229) (115) (178) (119) 31,409
EFFECT OF EXCHANGE RATE CHANGES ON CASH (556) 87 (428) 417 250
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (30,661) 31,665 (4,414) 9,431 70,129
BALANCE OF CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 103,675 33,546 77,428 55,780 33,546
BALANCE OF CASH AND CASH EQUIVALENTS AT END OF PERIOD 73,014 65,211 73,014 65,211 103,675
 
Supplemental information on investing activities not involving cash flows:
 
1) During 2009 the Company purchased equipment in the amount of $842,000 in credit. An amount of $652,000 was paid and included in investing activities during the six month period ended on June 30, 2010 and the remaining will be presented as investing activity when actual payment is made.
 
2) During the six month period ended on June 30, 2010, the company purchased equipment in the amount of $607,000 in credit. This amount will be presented as investing activity when actual payment is made.
 
 
RETALIX LTD.
UNAUDITED RECONCILIATION OF NON-GAAP ADJUSTMENTS
 
The following tables reflect selected Retalix' non-GAAP results reconciled to GAAP results:
 
  Six months ended June 30, Three months ended June 30, Year ended December 31
  2010 2009 2010 2009 2009
  Unaudited Unaudited Unaudited Unaudited Unaudited
  U.S. $ in thousands (except share and per share data)
OPERATING INCOME          
GAAP Operating income 6,283 7,397 3,398 2,962 7,826
GAAP Operating Margin 6.2% 7.7% 6.5% 6.1% 4.1%
Plus:          
Amortization of acquisition-related intangible assets 1,749 1,883 871 941 3,731
Stock based compensation expenses 1,933 1,162 996 576 2,165
Indirect private placement costs* -- -- -- -- 1,823
Non-GAAP Operating income** 9,965 10,442 5,265 4,479 15,545
           
NET INCOME 3,490 5,645 1,559 4,904 5,796
GAAP Net income          
Plus:          
Amortization of acquisition-related intangible assets 1,749 1,883 871 941 3,731
Stock based compensation expenses 1,933 1,162 996 576 2,165
Indirect private placement costs* -- -- -- -- 1,823
Less:          
Income tax effect of amortization of acquisition-related intangible assets (567) (735) (216) (367) (1,029)
Tax expenses (income) effect of stock based compensation expenses 19 (91) 113 62 (96)
Income tax effect of Indirect private placement costs -- -- -- -- (343)
Non-GAAP Net income 6,624 7,864 3,323 6,116 12,047
           
NET INCOME PER DILUTED SHARE          
GAAP Net income per diluted share 0.14 0.28 0.06 0.24 0.28
Plus:          
Amortization of acquisition-related intangible assets 0.07 0.09 0.04 0.05 0.18
Stock based compensation expenses 0.08 0.06 0.04 0.03 0.10
Indirect private placement costs -- -- -- -- 0.09
Less:          
Income tax effect of amortization of acquisition-related intangible assets (0.02) (0.04) (0.01) (0.02) (0.05)
Income tax effect of stock based compensation expenses 0.00 (0.00) 0.01 (0.00) (0.01)
Income tax effect of Indirect private placement costs -- -- -- -- (0.02)
           
Non-GAAP Net income per diluted share 0.27 0.39 0.14 0.30 0.57
           
Shares used in computing diluted net income per share (in thousands) 24,235 20,417 24,233 20,418 21,020
 
* Indirect private placement costs include $459 of stock based compensation expenses.
** We calculate Non-GAAP Operating Margin by dividing Non-GAAP Operating income (reconciled to GAAP operating income above) by revenues. For the quarter ended June 30, 2010, this resulted in a Non-GAAP Operating Margin of 10.1%, calculated as follows: $5,265/$52,019 = 10.1%.
 
 
RETALIX LTD.
UNAUDITED RECONCILIATION OF NON-GAAP ADJUSTMENTS
 
The following table shows the classification of stock-based compensation expense:
 
  Six months ended June 30 Three months ended June 30 Year ended December 31
  2010 2009 2010 2009 2009
  Unaudited Unaudited Unaudited Unaudited Unaudited
  U.S. $ in thousands
Cost of product sales 13 53 2 25 105
Cost of services 130 535 25 260 1,060
Research and development 54 266 44 131 381
Selling and marketing 259 104 258 52 126
General and administrative 1,477 204 667 108 493
Total 1,933 1,162 996 576 2,165
 
The following table shows the classification of amortization of acquisition-related intangible assets:
 
  Six months ended June 30 Three months ended June 30 Year ended December 31
  2010 2009 2010 2009 2009
  Unaudited Unaudited Unaudited Unaudited Unaudited
  U.S. $ in thousands
Cost of product sales 1,256 1,246 628 623 2,490
Cost of services 441 438 220 219 876
General and administrative 52 199 23 99 365
Total 1,749 1,883 871 941 3,731

Indirect private placement costs relate to a Private Placement completed in November 2009 as part of the agreement with the Alpha Group that generated $32.9 million of gross proceeds and $1.8 million in expenses for Retalix. 

CONTACT:  Retalix Ltd.  
          Hugo Goldman
          +972-9-776-6696 
          investors@retalix.com

Retalix Ltd. Logo

3 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,828.24 +0.49 0.00%
S&P 500 2,067.56 -5.27 -0.25%
NASDAQ 4,791.63 +4.3130 0.09%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs