– First Quarter 2013 Revenues of $40.6 million
–
– First Quarter 2013 GAAP and Non-GAAP EPS
($0.01) and $0.06, Respectively –
– First Quarter 2013 GAAP and Non-GAAP Gross
Margin 77% and 78%, Respectively –
Given Imaging Ltd. (Nasdaq:GIVN) today announced financial results
for the first quarter ended March 31, 2013.
Revenues were $40.6 million in the first quarter of 2013, a
decrease of 2.9 percent compared to $41.8 million in the first
quarter of 2012. Gross margin on a GAAP-basis in the first quarter
of 2013 was 77.1 percent, compared to 75.6 percent in the first
quarter of 2012. Gross margin on a non-GAAP-basis in the first
quarter of 2013 was 78.1 percent, compared to 76.2 percent in the
first quarter of 2012.
On a GAAP-basis, operating profit was $0.1 million in the first
quarter of 2013, compared to $0.4 million in the first quarter of
2012. Non-GAAP operating profit was $2.0 million in the first
quarter of 2013, compared to $2.1 million in the same period in
2012.
On a GAAP-basis, net loss for the first quarter of 2013 was $0.2
million, or ($0.01) per share, compared to net income of $0.2
million, or $0.01 per share, in the same period in 2012. On a
non-GAAP-basis, net income for the first quarter of 2013 was $1.5
million, or $0.05 per share on a fully diluted basis, compared to a
net income of $1.8 million, or $0.06 per share on a fully diluted
basis in the first quarter of 2012.
A reconciliation of GAAP results to non-GAAP results is
attached.
Cash used in operating activities in the first quarter was 2013
was $2.2 million. Cash and cash equivalents, short-term investments
and marketable securities on March 31, 2013 totaled $121.8
million.
"While we achieved record first quarter revenues in both the
EMEA and APAC regions, total revenues were below our expectations
due to a shortfall in sales execution in the Americas region. We
are encouraged by our second quarter strong revenues to date and we
remain on track to meet the full-year 2013 financial guidance that
we provided earlier this year. We are also encouraged by our
advanced discussions with both U.S. and Japanese regulatory
authorities regarding approvals for PillCam COLON 2" said Homi
Shamir, President and CEO, Given Imaging.
First Quarter 2013 Revenue Analysis
Revenues in the Americas region in the first quarter of 2013
decreased 11 percent to $23.9 million from $26.7 million in the
same period in 2012. The decrease is attributable to lower sales of
PillCam and functional GI diagnostics products. Revenues in the
EMEA region increased 8 percent to $11.6 million compared to $10.8
million in the same period in 2012. APAC revenues increased by 20
percent to $5.1 million, compared to $4.2 million in the same
period in 2012.
Worldwide PillCam SB sales decreased three percent to 54,600
capsules in the first quarter of 2013, compared to 56,500 capsules
in the same period in 2012. PillCam SB sales in the Americas region
decreased by eight percent to 30,800 capsules in the first quarter
of 2013, compared to 33,700 capsules in the first quarter of 2012.
PillCam SB sales in the EMEA region increased by three percent to
15,500 capsules, compared to 15,100 capsules in the first quarter
of 2012, while PillCam SB sales in the APAC region increased by
seven percent to 8,300 capsules, compared to 7,700 capsules in the
same period in 2012.
Worldwide sales of functional GI diagnostics products including
the Bravo pH Monitoring System, Digitrapper pH-Z, ManoScan and
SmartPill products decreased by 12 percent to $11.0 million in the
first quarter of 2013 compared to $12.6 million in the same period
in 2012. In the Americas region, functional GI diagnostics product
revenue decreased by 17 percent in the first quarter of 2013 to
$8.3 million compared to $10.0 million in the same period in 2012.
Functional GI diagnostics revenue in the EMEA region increased by
23 percent to $2.3 million, while revenue in the APAC region was
$0.4 million, a decrease of 38 percent compared to the same quarter
last year.
Supplemental first quarter data can be found at
www.givenimaging.com in the Investor Relations section.
Digestive Disease Week 2013
Over 120 studies will be presented at Digestive Disease Week
2013 featuring Given Imaging's complete product portfolio including
PillCam® SB, PillCam® COLON 2(*), PillCam® ESO, Bravo® pH
monitoring, Digitrapper® pH-z monitoring, ManoScan™ high resolution
manometry and the SmartPill® motility monitoring system. Digestive
Disease Week takes place in Orlando May 18-21, 2013.
The Company will host a meeting with members of the financial
community with several key GI opinion leaders to review highlights
of the conference. The meeting will take place on Tuesday, May
21st, 2013 at 10:00am ET/5:00pm Israel time. A live audio webcast
will be available in the investor relations section of the
company's website, www.givenimaging.com.
Conference Call / Webcast Information
Given Imaging will host a conference call on Thursday, May 9,
2013 at 9:00am ET, 4:00pm Israel time to discuss first quarter 2013
financial results. To participate in the teleconference, please
dial the following numbers fifteen minutes before the call is
scheduled to begin: U.S. and Canada, 888-438-5491; Israel,
1-80-924-5906. Callers in other countries should dial 719-785-1753.
The call will also be webcast live at www.givenimaging.com.
A replay of the call will be available for two weeks on the
company's website, or until May 23, 2013, by dialing 888-203-1112.
Callers in Israel should dial 1-80-924-6038. Callers outside of the
U.S. and Israel should dial 719-457-0820. The replay participant
code is 3944471.
Use of Non-GAAP Measures
This press release provides financial measures for net income
and basic and diluted earnings per share that exclude certain items
and are therefore not calculated in accordance with generally
accepted accounting principles (GAAP). Management believes that
these non-GAAP financial measures provide meaningful supplemental
information regarding our performance that enhances management's
and investors' ability to evaluate the Company's net income and
earnings per share and to compare it with historical net income and
earnings per share.
The presentation of this non-GAAP 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 uses both GAAP and non-GAAP measures when
evaluating the business internally and therefore felt it is
important to make these non-GAAP adjustments available to
investors.
About Given Imaging Ltd.
Since pioneering the field of capsule endoscopy in 2001, Given
Imaging has become a world leader in GI medical devices, offering
health care providers a range of innovative options for
visualizing, diagnosing and monitoring the digestive system. The
company offers a broad product portfolio including PillCam® capsule
endoscope for the small bowel, esophagus and colon. The company
also offers industry-leading GI functional diagnostic solutions
including ManoScan™ high-resolution manometry, Bravo® capsule-based
pH monitoring, Digitrapper® pH-Z impedance, and the SmartPill® GI
monitoring systems. Given Imaging is committed to delivering
breakthrough innovations to the GI community and supporting its
ongoing clinical needs. Given Imaging's headquarters are located in
Yoqneam, Israel, with operating subsidiaries in the United States,
Germany, France, Japan, Australia, Vietnam, Hong Kong and Brazil.
For more information, please visit www.givenimaging.com.
(*) Pending 510(k), not available for sale within the United
States
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the "safe harbor" provisions of the U.S. Private
Securities Litigation Reform Act of 1995. These forward-looking
statements include, but are not limited to, projections about our
business and our future revenues, expenses and profitability.
Forward-looking statements may be, but are not necessarily,
identified by the use of forward-looking terminology such as "may,"
"anticipates," "estimates," "expects," "intends," "plans,"
"believes," and words and terms of similar substance.
Forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual events,
results, performance, circumstances or achievements of the Company
to be materially different from any future events, results,
performance, circumstances or achievements expressed or implied by
such forward-looking statements. Such forward-looking statements
include statements relating to the Company exploring strategic
alternatives and considering possible strategic transactions
involving the Company. Factors that could cause actual events,
results, performance, circumstances or achievements to differ from
such forward-looking statements include, but are not limited to,
the ability of the Company to reach agreement on any strategic
alternative and/or to complete any such alternative, as well as the
following: (1) our ability to develop and bring to market new
products, (2) our ability to successfully complete any necessary or
required clinical studies with our products, (3) our ability to
receive regulatory clearance or approval to market our products or
changes in regulatory environment, (4) our success in implementing
our sales, marketing and manufacturing plans, (5) the level of
adoption of our products by medical practitioners, (6) the
emergence of other products that may make our products obsolete,
(7) lack of an appropriate bowel preparation materials to be used
with our PillCam COLON capsule, (8) protection and validity of
patents and other intellectual property rights, (9) the impact of
currency exchange rates, (10) the effect of competition by other
companies, (11) the outcome of significant litigation, (12) our
ability to obtain reimbursement for our product from government and
commercial payors, (13) quarterly variations in operating results,
(14) the possibility of armed conflict or civil or military unrest
in Israel, (15) the impact of global economic conditions, (16) our
ability to successfully integrate acquired businesses, (17) changes
and reforms in applicable healthcare laws and regulations, (18)
quality issues and adverse events related to our products, such as
capsule retention, aspiration and failure to attach or detach,
bleeding or perforation that could require us to recall products
and impact our sales and net income, and (19) other risks and
factors disclosed in our filings with the U.S. Securities and
Exchange Commission, including, but not limited to, risks and
factors identified under such headings as "Risk Factors,"
"Cautionary Language Regarding Forward-Looking Statements" and
"Operating Results and Financial Review and Prospects" in the
Company's Annual Report on Form 20-F for the year ended December
31, 2012. You are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date of this
press release. Except to the extent expressly required under
applicable law, the Company undertakes no obligation to release
publicly any revisions to any forward-looking statements, to report
events or to report the occurrence of unanticipated events.
Financial Tables Follow
| Given Imaging Ltd. and
its Consolidated Subsidiaries |
| Specified
Items |
| For the Three Months
Ended March 31, 2013 and 2012 |
| (Unaudited, dollars in
thousands) |
| |
|
|
|
|
|
|
| |
Gross Profit |
Research And Development |
Selling And Marketing |
General And Admin |
Tax Expense (Benefit) |
Total |
| |
|
|
|
|
|
|
| Three month period ended March 31,
2013 |
|
|
|
|
|
|
| |
|
|
|
|
|
|
| Compensation expenses |
$ -- |
$ 196 |
$ 418 |
$ 782 |
$ -- |
$ 1,396 |
| Sierra and SmartPill PPA |
399 |
-- |
93 |
-- |
$ (171) |
321 |
| Total |
$ 399 |
$ 196 |
$ 511 |
$ 782 |
$ (171) |
$ 1,717 |
| |
|
|
|
|
|
|
| Three month period ended March 31,
2012 |
|
|
|
|
|
|
| |
|
|
|
|
|
|
| Compensation expenses |
$ -- |
$ 158 |
$ 229 |
$ 1,042 |
$ -- |
$ 1,429 |
| Sierra PPA |
237 |
-- |
81 |
-- |
$ (171) |
147 |
| Total |
$ 237 |
$ 158 |
$ 310 |
$ 1,042 |
$ (171) |
$ 1,576 |
| |
| Given Imaging Ltd. And
its Consolidated Subsidiaries |
| Reconciliation of GAAP
results to non-GAAP results |
| For the three months
ended March 31, 2013 and 2012 |
| Condensed, in thousands
except share and per share data |
| |
|
|
|
| Three months ended March 31, 2013 |
GAAP |
Specified Items (*) |
Non GAAP |
| |
|
|
|
| Gross profit |
$31,310 |
$ 399 |
$31,709 |
| Research and Development, net |
5,971 |
(196) |
5,775 |
| Sales and Marketing |
19,631 |
(511) |
19,120 |
| General and administrative |
5,561 |
(782) |
4,779 |
| Income tax expense |
312 |
171 |
483 |
| Net income (loss) attributable to
shareholders |
$ (221) |
$ 1,717 |
$1,496 |
| |
|
|
|
| |
|
|
|
| Three months ended March 31, 2012 |
GAAP |
Specified Items (*) |
Non GAAP |
| |
|
|
|
| Gross profit |
$31,646 |
$237 |
$31,883 |
| Research and Development, net |
6,744 |
(158) |
6,586 |
| Sales and Marketing |
18,763 |
(310) |
18,453 |
| General and administrative |
5,637 |
(1,042) |
4,595 |
| Income tax expense |
624 |
127 |
751 |
| Net income attributable to shareholders |
$201 |
$1,620 |
$1,821 |
| |
| Given Imaging Ltd. and
its Consolidated Subsidiaries |
| Interim Consolidated
Balance Sheets |
| In thousands except
share data |
|
(Unaudited) |
| |
|
|
| |
March 31, 2013 |
December 31,
2012 |
| |
|
|
| Assets |
|
|
| |
|
|
| Current assets |
|
|
| Cash and cash equivalents |
$ 31,711 |
$ 35,442 |
| Short-term investments |
59,836 |
58,446 |
| Accounts receivable: |
|
|
| Trade |
27,245 |
31,279 |
| Other |
4,852 |
4,654 |
| Inventories |
23,585 |
22,591 |
| Advances to suppliers |
1,140 |
1,349 |
| Deferred tax assets |
2,791 |
2,646 |
| Other current assets |
2,769 |
2,689 |
| |
|
|
| Total current assets |
153,929 |
159,096 |
| |
|
|
| Deposits |
881 |
924 |
| |
|
|
| Assets held for employees' severance
payments |
8,386 |
7,974 |
| |
|
|
| Long-term
investments |
30,262 |
30,188 |
| |
|
|
| Non-current Inventory |
5,773 |
6,150 |
| |
|
|
| Fixed assets, less accumulated
depreciation |
11,982 |
12,335 |
| |
|
|
| |
|
|
| Intangible assets, less accumulated
amortization |
29,747 |
30,705 |
| |
|
|
| Goodwill |
26,942 |
26,942 |
| |
|
|
| Total Assets |
$267,902 |
$274,314 |
| |
| Given Imaging Ltd. and
its Consolidated Subsidiaries |
| Interim Consolidated
Balance Sheets |
| In thousands except
share data |
|
(Unaudited) |
| |
|
|
| |
March 31, 2013 |
December 31,
2012 |
| |
|
|
| Liabilities and equity |
|
|
| |
|
|
| Current liabilities |
|
|
| |
|
|
| Current installments of obligation under
capital lease |
$ -- |
$ 38 |
| Accounts payable: |
|
|
| Trade |
6,956 |
8,756 |
| Other |
19,997 |
27,091 |
| Deferred income |
979 |
929 |
| Total current
liabilities |
27,932 |
36,814 |
| |
|
|
| Long-term liabilities |
|
|
| Obligation under capital lease,
net |
71 |
78 |
| Liability in respect of employees' severance
payments |
9,171 |
8,761 |
| Contingent consideration in respect of
business combination |
1,113 |
1,038 |
| Deferred tax liabilities |
4,504 |
4,675 |
| Total long-term
liabilities |
14,859 |
14,552 |
| Total liabilities |
42,791 |
51,366 |
| |
|
|
| Equity |
|
|
| |
|
|
| Ordinary Shares, NIS 0.05 par value each
(90,000,000 shares authorized; 31,371,861 and 31,080,876
shares issued and fully paid as of March 31, 2013 and December 31,
2012, respectively) |
369 |
367 |
| Additional paid-in capital |
221,480 |
219,103 |
| Capital reserve |
1,591 |
1,591 |
| Accumulated other comprehensive income |
271 |
266 |
| Retained earnings |
1,400 |
1,621 |
| Total Equity |
225,111 |
222,948 |
| |
|
|
| |
|
|
| Total liabilities and
equity |
$267,902 |
$274,314 |
| |
| Given Imaging Ltd. and
its Consolidated Subsidiaries |
| Interim Consolidated
Statements of Income and Comprehensive Income |
| In thousands except
share data |
|
(Unaudited) |
| |
|
|
|
| |
Three month period
ended |
Year ended |
| |
March
31, |
December 31, |
| |
2013 |
2012 |
2012 |
| |
|
|
|
| |
|
|
|
| Revenues |
$ 40,620 |
$ 41,839 |
$ 180,501 |
| Cost of revenues |
(9,310) |
(10,193) |
(42,971) |
| |
|
|
|
| Gross profit |
31,310 |
31,646 |
137,530 |
| |
|
|
|
| Operating expenses |
|
|
|
| Research and development, gross |
(6,101) |
(7,156) |
(25,627) |
| Government grants |
130 |
412 |
1,439 |
| Research and development, net |
(5,971) |
(6,744) |
(24,188) |
| |
|
|
|
| Sales and marketing |
(19,631) |
(18,763) |
(76,272) |
| General and administrative |
(5,561) |
(5,637) |
(22,746) |
| Other, net |
(48) |
(101) |
(455) |
| |
|
|
|
| Total operating
expenses |
(31,211) |
(31,245) |
(123,661) |
| |
|
|
|
| Operating profit |
99 |
401 |
13,869 |
| Financing income (expenses), net |
(8) |
331 |
847 |
| |
|
|
|
| Profit before taxes on
income |
91 |
732 |
14,716 |
| Income tax expense |
(312) |
(624) |
(459) |
| |
|
|
|
| Net profit (loss) |
(221) |
108 |
14,257 |
| |
|
|
|
| Net loss attributable to non-controlling
interest |
-- |
93 |
93 |
| Net profit (loss) attributable to
shareholders |
$ (221) |
$ 201 |
$ 14,350 |
| |
|
|
|
| Net change in respect of available for sale
securities |
5 |
430 |
1,151 |
| Total comprehensive profit (loss)
attributable to shareholders |
$ (216) |
$ 631 |
$ 15,501 |
| |
|
|
|
| Total comprehensive loss attributable to
non-controlling interest |
-- |
(93) |
(93) |
| Total comprehensive profit
(loss) |
$ (216) |
$ 538 |
$ 15,408 |
| |
|
|
|
| Earnings per share |
|
|
|
| |
|
|
|
| Basic Earnings (loss) attributable to
shareholders per Ordinary Share |
$ (0.01) |
$ 0.01 |
$ 0.47 |
| |
|
|
|
| Diluted Earnings (loss) attributable to
shareholders per Ordinary Share |
$ (0.01) |
$ 0.01 |
$ 0.45 |
| |
|
|
|
| Weighted average number of Ordinary Shares
used to compute basic Earnings (loss) per Ordinary share |
31,227,150 |
30,579,090 |
30,853,581 |
| |
|
|
|
| Weighted average number of Ordinary Shares
used to compute diluted Earnings (loss) per Ordinary share |
31,227,150 |
31,477,929 |
31,563,208 |
| |
| Given Imaging Ltd. and
its Consolidated Subsidiaries |
| Interim Consolidated
Statements of Cash Flows |
| In thousands except
share data |
|
(Unaudited) |
| |
|
|
|
| |
Three month period
ended |
Year ended |
| |
March
31, |
December 31, |
| |
2013 |
2012 |
2012 |
| |
|
|
|
| |
|
|
|
| Cash flows from operating
activities: |
|
|
|
| Net profit (loss) |
$ (221) |
$ 108 |
$ 14,257 |
| |
|
|
|
| Adjustments required to reconcile net
profit to net cash provided by (used in) operating
activities: |
|
|
|
| |
|
|
|
| Depreciation and amortization |
2,198 |
1,996 |
8,597 |
| Change in deferred taxes |
(316) |
(1,007) |
(1,795) |
| Stock based compensation |
1,396 |
1,429 |
6,158 |
| Loss from disposal of fixed assets and
intangible assets |
87 |
102 |
484 |
| Unrealized interest on contingent
consideration |
75 |
-- |
-- |
| Decrease in accounts receivable –
trade |
4,034 |
2,820 |
977 |
| Decrease (increase) in accounts receivable –
other |
(186) |
1,355 |
1,252 |
| Increase in other current assets |
(80) |
(852) |
(1,316) |
| Decrease (increase) in advances to
suppliers |
209 |
(172) |
(142) |
| Increase in inventories |
(617) |
(472) |
(299) |
| Decrease in accounts payable |
(8,960) |
(4,595) |
(691) |
| Increase in deferred income |
50 |
12 |
408 |
| Other |
109 |
(50) |
(62) |
| Net cash provided by (used
in) operating activities |
(2,222) |
674 |
27,828 |
| |
|
|
|
| Cash flows from investing
activities: |
|
|
|
| Purchase of fixed assets and intangible
assets |
(1,012) |
(1,480) |
(7,005) |
| Other long term assets |
1 |
(599) |
(538) |
| Acquisition of business, net of cash
acquired |
-- |
-- |
(6,000) |
| Change in short-term deposit, net |
7,500 |
20,617 |
4,968 |
| Proceeds from sales and maturity of
marketable securities |
246 |
2,000 |
13,343 |
| Investments in marketable securities |
(9,293) |
(12,322) |
(24,827) |
| Net cash provided by (used in)
investing activities |
(2,558) |
8,216 |
(20,059) |
| |
|
|
|
| Cash flows from financing
activities: |
|
|
|
| Principal payments on capital lease
obligation |
-- |
(41) |
(129) |
| Proceeds from the issuance of Ordinary
Shares |
983 |
1,337 |
4,115 |
| Purchase of shares from a non-controlling
shareholder in a subsidiary |
-- |
(658) |
(658) |
| Net cash provided by financing
activities |
983 |
638 |
3,328 |
| |
|
|
|
| Effect of exchange rate changes on
cash and cash equivalents |
66 |
46 |
60 |
| |
|
|
|
| Increase (decrease) in cash and cash
equivalents |
(3,731) |
9,574 |
11,157 |
| Cash and cash equivalents at
beginning of period |
35,442 |
24,285 |
24,285 |
| |
|
|
|
| Cash and cash equivalents at end of
period |
$ 31,711 |
$ 33,859 |
$ 35,442 |
| |
|
|
|
| Supplementary cash flow
information |
|
|
|
| Income taxes paid |
$ 1,240 |
$ 122 |
$ 2,883 |
CONTACT: For further information contact:
Fern Lazar/David Carey
Lazar Partners Ltd.
1-212-867-1768
flazar@lazarpartners.com
dcarey@lazarpartners.com
Israel Investor Contact:
Nava Ladin
Gelbart Kahana Investor Relations
+972-3-6074717
nava@gk-biz.com
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