HOLON, Israel, Feb. 23, 2022 /PRNewswire/ -- Sapiens
International Corporation, (NASDAQ and TASE: SPNS), a leading
global provider of software solutions for the insurance industry,
today announced its financial results for the fourth quarter and
full year ended December 31,
2021.
Summary Results for Fourth
Quarter 2021 (USD in millions, except per share
data)
|
|
GAAP
|
|
Non-GAAP
|
|
|
Q4
2021
|
Q4
2020
|
%
Change
|
Q4
2021
|
Q4
2020
|
%
Change
|
Revenue
|
$119.2
|
$101.7
|
17.3%
|
$119.9
|
$102.9
|
16.4%
|
Gross
Profit
|
$48.7
|
$41.4
|
17.6%
|
$53.9
|
$47.0
|
14.6%
|
Gross
Margin
|
40.8%
|
40.7%
|
10 bps
|
45.0%
|
45.7%
|
(70)
bps
|
Operating
Income
|
$15.7
|
$10.2
|
53.9%
|
$21.6
|
$18.7
|
15.7%
|
Operating
Margin
|
13.2%
|
10.1%
|
310 bps
|
18.0%
|
18.1%
|
(10) bps
|
Net Income
(*)
|
$13.7
|
$8.3
|
64.3%
|
$17.7
|
$14.5
|
22.3%
|
Diluted
EPS
|
$0.25
|
$0.15
|
66.7%
|
$0.32
|
$0.27
|
18.5%
|
Summary Results for Full
Year 2021 (USD in millions, except per share
data)
|
|
GAAP
|
%
Change
|
Non-GAAP
|
%
Change
|
|
2021
|
2020
|
|
2021
|
2020
|
|
Revenue
|
$461.0
|
$382.9
|
20.4%
|
$463.6
|
$384.5
|
20.6%
|
Gross
Profit
|
$187.8
|
$156.0
|
20.4%
|
$208.3
|
$172.9
|
20.4%
|
Gross
Margin
|
40.7%
|
40.7%
|
-
|
44.9%
|
45.0%
|
(10) bps
|
Operating
Income
|
$57.5
|
$45.0
|
27.7%
|
$81.4
|
$67.9
|
19.8%
|
Operating
Margin
|
12.5%
|
11.8%
|
70 bps
|
17.6%
|
17.7%
|
(10) bps
|
Net income
(*)
|
$47.2
|
$33.8
|
39.7%
|
$65.5
|
$52.0
|
26.1%
|
Diluted
EPS
|
$0.85
|
$0.65
|
30.8%
|
$1.18
|
$1.00
|
18.0%
|
(*) Attributable to Sapiens' shareholders
"Sapiens finished the year strong, with fourth quarter non-GAAP
revenue growing 16.4% to $119.9
million and non-GAAP operating profit margin of 18.0%,
reflecting our ability to maintain profitability despite the cost
increases that our industry and many sectors are facing," stated
Roni Al-Dor, President and CEO of
Sapiens. "Europe was the leading
growth region for Sapiens in 2021 with revenue growth organically
and with M&A of 38.5% year-over-year. We signed multiple new
logos across various segments and experienced a substantial
increase in average European deal size. In North America region we delivered mixed
results in '21, Life, DECISION, and Reinsurance continued growing
steadily, building a solid pipeline for '22. We are pursuing new
opportunities and developing a growing pipeline positioning Sapiens
to deliver improved total growth in North
America by the second half of '22."
"Today, the majority of our new wins are delivered on the
cloud," continued Mr. Al-Dor. "We have recently announced a new
Chief Technology and Information Officer, Ilan Buganim, who brings vast technology
experience from his numerous leadership positions. Ilan will lead
our cloud journey and is responsible for developing a coherent view
across all of our product offering. Sapiens' emphasis on product
innovation continues to earn industry analysts' awards and
recognition from the market."
"We are introducing 2022 guidance for non-GAAP revenue in a
range of $495 million to $500 million, and non-GAAP operating margin in a
range of 17.0% to 17.3%," which on constant currency base represent
organic growth of 9.1% and profitability level of 18.2% at the mid-
point range of our guidance concluded Mr. Al-Dor.
Quarterly Results Conference Call
Management will host a conference call and webcast today,
February 23, 2022 at 9:30 am. Eastern Time (4:30 pm. in Israel) to review and discuss Sapiens'
results.
Please call the following numbers (at least 10 minutes before the
scheduled time) to participate:
North America (toll-free): +
1-888-642-5032; International: +972-3-918-0609; UK:
0-800-917-5108
The live webcast of the call can be viewed on Sapiens' website at:
https://www.sapiens.com/investor-relations/ir-events-presentations.
A replay of the call will be available one business day following
the completion of the event, at the same link for 90 days.
Non-GAAP Financial Measures
This press release contains the following non-GAAP financial
measures: non-GAAP revenue, non-GAAP gross profit, non-GAAP gross
margin, non-GAAP operating income, non-GAAP operating margin,
non-GAAP net income attributed to Sapiens shareholders, non-GAAP
basic and diluted earnings per share, Adjusted EBITDA and Adjusted
Free Cash-Flow.
Sapiens believes that these non-GAAP measures of financial
results provide useful information to management and investors
regarding certain financial and business trends relating to
Sapiens' financial condition and results of operations. The
Company's management uses these non-GAAP measures to compare the
Company's performance to that of prior periods for trend analyses,
for purposes of determining executive and senior management
incentive compensation and for budgeting and planning purposes.
These measures are used in financial reports prepared for
management and in quarterly financial reports presented to the
Company's board of directors. The Company believes that the use of
these non-GAAP financial measures provides an additional tool for
investors to use in evaluating ongoing operating results and
trends, and in comparing the Company's financial measures with
other software companies, many of which present similar non-GAAP
financial measures to investors.
Non-GAAP financial measures consist of GAAP financial measures
adjusted to exclude: Valuation adjustment on acquired deferred
revenue, amortization of capitalized software development and other
intangible assets, capitalization of software development,
stock-based compensation, compensation related to acquisition and
acquisition-related costs, restructuring and cost reduction costs,
and tax adjustments related to non-GAAP adjustments.
Management of the Company does not consider these non-GAAP
measures in isolation, or as an alternative to financial measures
determined in accordance with GAAP. The principal limitation of
these non-GAAP financial measures is that they exclude significant
expenses and income that are required by GAAP to be recorded in the
Company's financial statements. In addition, they are subject to
inherent limitations, as they reflect the exercise of judgment by
management about which expenses and income are excluded or included
in determining these non-GAAP financial measures.
To compensate for these limitations, management presents
non-GAAP financial measures in connection with GAAP results.
Sapiens urges investors to review the reconciliation of its
non-GAAP financial measures to the comparable GAAP financial
measures, which it includes in press releases announcing quarterly
financial results, including this press release, and not to rely on
any single financial measure to evaluate the Company's
business.
Reconciliation tables of the most comparable GAAP financial
measures to the non-GAAP financial measures used in this press
release are included with the financial tables of this release.
The Company defines Adjusted EBITDA as net profit, adjusted for
valuation adjustment on acquired deferred revenue, stock-based
compensation expense, depreciation and amortization, capitalized of
software development costs, compensation expenses related to
acquisition and acquisition-related costs, restructuring and cost
reduction costs, financial expense (income), provision for income
taxes and other income (expenses). These amounts are often excluded
by other companies to help investors understand the operational
performance of their business.
The Company uses Adjusted EBITDA as a measurement of its
operating performance, because it assists in comparing the
operating performance on a consistent basis by removing the impact
of certain non-cash and non-operating items. Adjusted EBITDA
reflects an additional way of viewing aspects of the operations
that the Company believes, when viewed with the GAAP results and
the accompanying reconciliations to corresponding GAAP financial
measures, provide a more complete understanding of factors and
trends affecting its business. The Company uses Adjusted Free
Cash-Flow as a measurement of its operating performance, and
reconciles cash-flow from operating activities to Adjusted Free
Cash-Flow, while reducing the amounts for capitalization of
software development costs and capital expenditures. The Company
adds back cash payments made for former acquisitions in
respect of future performance targets and retention criteria as
determined upon acquisition date of the respective acquired
company, which were included in the cash-flow from operating
activities. We believe that Adjusted Free Cash-Flow is useful in
evaluating our business, because Adjusted Free Cash-Flow reflects
the cash surplus available to fund the expansion of our
business.
About Sapiens
Sapiens International Corporation (NASDAQ and TASE: SPNS)
empowers the financial sector, with a focus on insurance, to
transform and become digital, innovative and agile. Backed by more
than 35 years of industry expertise, Sapiens offers a complete
insurance platform, with pre-integrated, low-code solutions and a
cloud-first approach that accelerates customers' digital
transformation. Serving over 600 customers in 30 countries, Sapiens
offers insurers across property and casualty, workers compensation
and life markets the most comprehensive set of solutions, from core
to complementary, including Reinsurance, Financial &
Compliance, Data & Analytics, Digital, and Decision
Management. For more information
visit www.sapiens.com or follow us on LinkedIn.
Media
Contact
|
Investors
Contact
|
Shay
Assaraf
|
Brett Maas
|
Chief Marketing
Officer, Sapiens
|
Managing Partner,
Hayden IR
|
Shay.assaraf@sapiens.com
|
+1
646-536-7331
|
|
Brett.Maas@HaydenIR.com
|
|
|
|
Kimberly
Rogers
|
|
Managing Director,
Hayden IR
|
|
+1
541-904-5075
|
|
kim@HaydenIR.com
|
Forward Looking Statements
Certain matters discussed in this press release that are
incorporated herein by reference are forward-looking statements
within the meaning of Section 27A of the Securities Act, Section
21E of the Exchange Act and the safe harbor provisions of the U.S.
Private Securities Litigation Reform Act of 1995, that are based on
our beliefs, assumptions and expectations, as well as information
currently available to us. Such forward-looking statements may be
identified by the use of the words "anticipate," "believe,"
"estimate," "expect," "may," "will," "plan" and similar
expressions. Such statements reflect our current views with respect
to future events and are subject to certain risks and
uncertainties. There are important factors that could cause our
actual results, levels of activity, performance or achievements to
differ materially from the results, levels of activity, performance
or achievements expressed or implied by the forward-looking
statements, including, but not limited to: the degree of our
success in our plans to leverage our global footprint to grow our
sales; the degree of our success in integrating the companies that
we have acquired through the implementation of our M&A growth
strategy; the lengthy development cycles for our solutions, which
may frustrate our ability to realize revenues and/or profits from
our potential new solutions; our lengthy and complex sales cycles,
which do not always result in the realization of revenues; the
degree of our success in retaining our existing customers or
competing effectively for greater market share; difficulties in
successfully planning and managing changes in the size of our
operations; the frequency of the long-term, large, complex projects
that we perform that involve complex estimates of project costs and
profit margins, which sometimes change mid-stream; the challenges
and potential liability that heightened privacy laws and
regulations pose to our business; occasional disputes with clients,
which may adversely impact our results of operations and our
reputation; various intellectual property issues related to our
business; potential unanticipated product vulnerabilities or
cybersecurity breaches of our or our customers' systems; risks
related to the insurance industry in which our clients operate;
risks associated with our global sales and operations, such as
changes in regulatory requirements, wide-spread viruses and
epidemics like the recent novel coronavirus pandemic, which
adversely affected our results of operations, or fluctuations in
currency exchange rates; and risks related to our principal
location in Israel and our status
as a Cayman Islands company. While
we believe such forward-looking statements are based on reasonable
assumptions, should one or more of the underlying assumptions prove
incorrect, or these risks or uncertainties materialize, our actual
results may differ materially from those expressed or implied by
the forward-looking statements. Please read the risks discussed
under the heading "Risk Factors" in our most recent Annual Report
on Form 20-F, in order to review conditions that we believe could
cause actual results to differ materially from those contemplated
by the forward-looking statements. You should not rely upon
forward-looking statements as predictions of future events.
Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee that
future results, levels of activity, performance and events and
circumstances reflected in the forward-looking statements will be
achieved or will occur. Except as required by law, we undertake no
obligation to update publicly any forward-looking statements for
any reason, to conform these statements to actual results or to
changes in our expectations.
SAPIENS
INTERNATIONAL CORPORATION N.V. AND ITS SUBSIDIARIES
|
|
CONDENSED
CONSOLIDATED STATEMENT OF INCOME
U.S. dollars in thousands (except per share amounts)
|
|
|
|
|
Three
months ended
|
|
Year
ended
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
119,225
|
|
101,661
|
|
461,035
|
|
382,903
|
Cost of
revenue
|
|
70,561
|
|
60,288
|
|
273,191
|
|
226,929
|
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
48,664
|
|
41,373
|
|
187,844
|
|
155,974
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Research and
development, net
|
|
13,891
|
|
11,129
|
|
54,013
|
|
41,358
|
|
Selling,
marketing, general and administrative
|
|
19,041
|
|
20,019
|
|
76,343
|
|
69,613
|
Total operating
expenses
|
|
32,932
|
|
31,148
|
|
130,356
|
|
110,971
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
15,732
|
|
10,225
|
|
57,488
|
|
45,003
|
|
|
|
|
|
|
|
|
|
|
Financial and
other expenses (income), net
|
|
(311)
|
|
1,212
|
|
202
|
|
3,805
|
Taxes on
income
|
|
2,404
|
|
611
|
|
9,964
|
|
7,041
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
13,639
|
|
8,402
|
|
47,322
|
|
34,157
|
|
|
|
|
|
|
|
|
|
|
Attributable to
non-controlling interest
|
|
(26)
|
|
83
|
|
151
|
|
382
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to Sapiens' shareholders
|
|
13,665
|
|
8,319
|
|
47,171
|
|
33,775
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings
per share
|
|
0.25
|
|
0.16
|
|
0.86
|
|
0.67
|
|
|
|
|
|
|
|
|
|
|
Diluted
earnings per share
|
|
0.25
|
|
0.15
|
|
0.85
|
|
0.65
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares outstanding used
to compute basic earnings per share (in thousands)
|
|
54,902
|
|
53,715
|
|
54,785
|
|
51,208
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares outstanding used
to compute diluted earnings per share (in thousands)
|
|
55,626
|
|
54,541
|
|
55,561
|
|
52,159
|
SAPIENS
INTERNATIONAL CORPORATION N.V. AND SUBSIDIARIES
|
|
RECONCILIATION OF
GAAP TO NON-GAAP RESULTS U.S. dollars in thousands (except
per share amounts)
|
|
|
|
Three months
ended
|
|
Year
ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
GAAP
revenue
|
|
119,225
|
|
101,661
|
|
461,035
|
|
382,903
|
Valuation adjustment
on acquired deferred revenue
|
|
629
|
|
1,275
|
|
2,519
|
|
1,598
|
Non-GAAP
revenue
|
|
119,854
|
|
102,936
|
|
463,554
|
|
384,501
|
|
|
|
|
|
|
|
|
|
GAAP gross
profit
|
|
48,664
|
|
41,373
|
|
187,844
|
|
155,974
|
Revenue
adjustment
|
|
629
|
|
1,275
|
|
2,519
|
|
1,598
|
Amortization of
capitalized software
|
|
2,084
|
|
1,931
|
|
7,679
|
|
6,558
|
Amortization of other
intangible assets
|
|
2,556
|
|
2,465
|
|
10,253
|
|
8,811
|
Non-GAAP gross
profit
|
|
53,933
|
|
47,044
|
|
208,295
|
|
172,941
|
|
|
|
|
|
|
|
|
|
GAAP operating
income
|
|
15,732
|
|
10,225
|
|
57,488
|
|
45,003
|
Gross profit
adjustments
|
|
5,269
|
|
5,671
|
|
20,451
|
|
16,967
|
Capitalization of
software development
|
|
(2,256)
|
|
(1,604)
|
|
(7,911)
|
|
(5,798)
|
Amortization of other
intangible assets
|
|
1,311
|
|
1,204
|
|
5,377
|
|
3,316
|
Stock-based
compensation
|
|
1,274
|
|
1,240
|
|
4,801
|
|
3,987
|
Acquisition-related
costs (*)
|
|
260
|
|
1,930
|
|
1,198
|
|
4,447
|
Non-GAAP operating
income
|
|
21,590
|
|
18,666
|
|
81,404
|
|
67,922
|
|
|
|
|
|
|
|
|
|
GAAP net
income attributable to
Sapiens' shareholders
|
|
13,665
|
|
8,319
|
|
47,171
|
|
33,775
|
Operating
income adjustments
|
|
5,858
|
|
8,441
|
|
23,916
|
|
22,919
|
Tax effect on
NON-GAAP adjustment
|
|
(1,842)
|
|
(2,299)
|
|
(5,550)
|
|
(4,735)
|
Non-GAAP net
income attributable to
Sapiens' shareholders
|
|
17,681
|
|
14,461
|
|
65,537
|
|
51,959
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share
|
|
0.32
|
|
0.27
|
|
1.18
|
|
1.00
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares
outstanding used to
compute diluted earnings
per share (in
thousands)
|
|
55,626
|
|
54,541
|
|
55,561
|
|
52,159
|
|
|
|
|
|
|
|
|
|
(*) Acquisition-related costs pertain to
charges on behalf of M&A agreements related to future
performance targets and retention criteria, as well as third-party
services, such as tax, accounting and legal rendered until the
acquisition date.
Adjusted EBITDA
Calculation
U.S. dollars in thousands
|
|
|
|
|
Three months
ended
|
|
Year
ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
|
|
|
|
|
|
|
|
GAAP operating
profit
|
|
15,732
|
|
10,225
|
|
57,488
|
|
45,003
|
|
|
|
|
|
|
|
|
|
Non-GAAP
adjustments:
|
|
|
|
|
|
|
|
|
Valuation adjustment
on acquired deferred
revenue
|
|
629
|
|
1,275
|
|
2,519
|
|
1,598
|
Amortization of
capitalized software
|
|
2,084
|
|
1,931
|
|
7,679
|
|
6,558
|
Amortization of other
intangible assets
|
|
3,867
|
|
3,669
|
|
15,630
|
|
12,127
|
Capitalization of
software development
|
|
(2,256)
|
|
(1,604)
|
|
(7,911)
|
|
(5,798)
|
Stock-based
compensation
|
|
1,274
|
|
1,240
|
|
4,801
|
|
3,987
|
Compensation related
to acquisition and
acquisition-related costs
|
|
260
|
|
1,930
|
|
1,198
|
|
4,447
|
|
|
|
|
|
|
|
|
|
Non-GAAP operating
profit
|
|
21,590
|
|
18,666
|
|
81,404
|
|
67,922
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
1,989
|
|
1,366
|
|
5,360
|
|
4,698
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
23,579
|
|
20,032
|
|
86,764
|
|
72,620
|
|
|
|
|
|
|
|
|
|
Summary of
NON-GAAP Financial Information
U.S. dollars in thousands (except per share amounts)
|
|
|
|
Q4
2021
|
|
Q3
2021
|
|
Q2
2021
|
|
Q1
2021
|
|
Q4
2020
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
119,854
|
|
118,442
|
|
115,036
|
|
110,222
|
|
102,936
|
Gross
profit
|
53,933
|
|
53,413
|
|
51,720
|
|
49,229
|
|
47,044
|
Operating
income
|
21,590
|
|
21,019
|
|
19,795
|
|
19,000
|
|
18,666
|
Adjusted
EBITDA
|
23,579
|
|
22,144
|
|
20,920
|
|
20,120
|
|
20,032
|
Net income to
Sapiens' shareholders
|
17,681
|
|
16,976
|
|
15,975
|
|
14,908
|
|
14,461
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share
|
0.32
|
|
0.31
|
|
0.29
|
|
0.27
|
|
0.27
|
Non-GAAP Revenues
by Geographic Breakdown
U.S. dollars in thousands
|
|
|
Q4
2021
|
|
Q3
2021
|
|
Q2
2021
|
|
Q1
2021
|
|
Q4
2020
|
|
|
|
|
|
|
|
|
|
|
North
America
|
48,872
|
|
48,952
|
|
46,767
|
|
44,754
|
|
47,303
|
Europe
|
62,416
|
|
59,707
|
|
59,718
|
|
57,642
|
|
49,225
|
Rest of the
World
|
8,566
|
|
9,783
|
|
8,551
|
|
7,826
|
|
6,408
|
|
|
|
|
|
|
|
|
|
|
Total
|
119,854
|
|
118,442
|
|
115,036
|
|
110,222
|
|
102,936
|
Adjusted Free
Cash-Flow
U.S. dollars in thousands
|
|
|
Q4
2021
|
|
Q3
2021
|
|
Q2
2021
|
|
Q1
2021
|
|
Q4
2020
|
|
|
|
|
|
|
|
|
|
|
Cash-flow from
operating activities
|
27,386
|
|
14,556
|
|
26,845
|
|
11,755
|
|
21,030
|
Increase in
capitalized software development costs
|
(2,256)
|
|
(2,064)
|
|
(1,959)
|
|
(1,632)
|
|
(1,604)
|
Capital
expenditures
|
(801)
|
|
(1,082)
|
|
(1,082)
|
|
(821)
|
|
(725)
|
Free
cash-flow
|
24,329
|
|
11,410
|
|
23,804
|
|
9,302
|
|
18,701
|
|
|
|
|
|
|
|
|
|
|
Cash payments
attributed to acquisition-related
costs(*) (**)
|
407
|
|
477
|
|
-
|
|
1,280
|
|
2,363
|
|
|
|
|
|
|
|
|
|
|
Adjusted free
cash-flow
|
24,736
|
|
11,887
|
|
23,804
|
|
10,582
|
|
21,064
|
(*) Included in cash-flow from operating
activities
(**) Acquisition-related payments pertain to
payments on behalf of M&A agreements related to future
performance targets and retention criteria, as well as third-party
services, such as, tax, accounting and legal rendered until the
acquisition date.
SAPIENS
INTERNATIONAL CORPORATION N.V. AND ITS SUBSIDIARIES
|
|
CONDENSED
CONSOLIDATED BALANCE SHEET U.S. dollars in
thousands
|
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
2021
|
|
2020
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
|
Cash and cash
equivalents
|
|
190,243
|
|
152,561
|
|
Short-term bank
deposit
|
|
20,000
|
|
30,000
|
|
Trade receivables,
net and unbilled receivables
|
|
76,261
|
|
65,409
|
|
Other receivables and
prepaid expenses
|
|
13,841
|
|
19,388
|
|
|
|
|
|
|
|
Total current
assets
|
|
300,345
|
|
267,358
|
|
|
|
|
|
|
LONG-TERM
ASSETS
|
|
|
|
|
|
Property and
equipment, net
|
|
14,458
|
|
16,970
|
|
Severance pay
fund
|
|
5,954
|
|
6,582
|
|
Goodwill and
intangible assets, net
|
|
343,283
|
|
363,597
|
|
Operating lease
right-of-use assets
|
|
43,665
|
|
54,390
|
|
Other long-term
assets
|
|
7,288
|
|
5,264
|
|
|
|
|
|
|
|
Total long-term
assets
|
|
414,648
|
|
446,803
|
|
|
|
|
|
|
TOTAL
ASSETS
|
|
714,993
|
|
714,161
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
|
Trade
payables
|
|
5,008
|
|
5,389
|
|
Current maturities of
Series B Debentures
|
|
19,796
|
|
19,796
|
|
Accrued expenses and
other liabilities
|
|
76,450
|
|
75,119
|
|
Current maturities of
operating lease liabilities
|
|
10,827
|
|
9,924
|
|
Deferred
revenue
|
|
39,614
|
|
34,548
|
|
|
|
|
|
|
|
Total current
liabilities
|
|
151,695
|
|
144,776
|
|
|
|
|
|
|
LONG-TERM
LIABILITIES
|
|
|
|
|
|
Series B Debentures,
net of current maturities
|
|
78,986
|
|
98,676
|
|
Deferred tax
liabilities
|
|
15,360
|
|
16,010
|
|
Other long-term
liabilities
|
|
12,144
|
|
12,129
|
|
Long-term operating
lease liabilities
|
|
38,751
|
|
48,773
|
|
Redeemable
non-controlling interest
|
|
101
|
|
517
|
|
Accrued severance
pay
|
|
9,236
|
|
9,586
|
|
|
|
|
|
|
|
Total long-term
liabilities
|
|
154,578
|
|
185,691
|
|
|
|
|
|
|
EQUITY
|
|
|
408,720
|
|
383,694
|
|
|
|
|
|
|
TOTAL LIABILITIES
AND EQUITY
|
|
714,993
|
|
714,161
|
SAPIENS
INTERNATIONAL CORPORATION N.V. AND ITS SUBSIDIARIES
|
|
CONSOLIDATED
STATEMENT OF CASH FLOW U.S. dollars in thousands
|
|
|
For the twelve
months ended December 31,
|
|
2021
|
|
2020
|
|
(unaudited)
|
|
(unaudited)
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
47,322
|
|
34,157
|
Reconciliation of net
income to net cash provided by operating activities:
|
|
|
|
Impairment of right of
use asset
|
1,439
|
|
351
|
Depreciation and
amortization
|
28,669
|
|
23,383
|
Accretion of discount
on Series B Debentures
|
106
|
|
134
|
Capital loss from sale
of property and equipment
|
(60)
|
|
44
|
Stock-based
compensation related to options issued to employees
|
4,801
|
|
3,987
|
|
|
|
|
Net changes in
operating assets and liabilities, net of amount
acquired:
|
|
|
|
Trade receivables, net
and unbilled receivables
|
(13,937)
|
|
(5,168)
|
Deferred tax
liabilities, net
|
(1,902)
|
|
(16)
|
Other operating
assets
|
17,743
|
|
(2,049)
|
Trade
payables
|
(529)
|
|
(1,344)
|
Other operating
liabilities
|
(8,415)
|
|
1,435
|
Deferred
revenues
|
4,930
|
|
2,992
|
Accrued severance pay,
net
|
375
|
|
349
|
|
|
|
|
Net cash provided by
operating activities
|
80,542
|
|
58,255
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
Purchase of property
and equipment
|
(3,786)
|
|
(2,633)
|
Proceeds from
(Investment in) deposits
|
10,031
|
|
(30,397)
|
Proceeds from sale of
property and equipment
|
1,111
|
|
12
|
Proceeds from
restricted deposit used for completed acquisition
|
-
|
|
22,890
|
Net cash paid for
acquisitions
|
831
|
|
(109,052)
|
Capitalized software
development costs
|
(7,911)
|
|
(5,798)
|
Acquisition of
intellectual property
|
(151)
|
|
(2,810)
|
|
|
|
|
Net cash provided by
(used in) investing activities
|
125
|
|
(127,788)
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
Proceeds from employee
stock options exercised
|
2,038
|
|
5,050
|
Distribution of
dividend
|
(20,255)
|
|
(7,044)
|
Repayment of Series B
Debenture
|
(19,796)
|
|
(9,898)
|
Issuance of Series B
Debentures, net of issuance expenses
|
-
|
|
60,346
|
Receipt of short-term
loan
|
-
|
|
20,000
|
Repayment of
loan
|
-
|
|
(20,000)
|
Payment of contingent
considerations
|
(926)
|
|
(538)
|
Acquisition of
non-controlling interests
|
(990)
|
|
(147)
|
Dividend to
non-controlling interest
|
(31)
|
|
-
|
Proceeds from issuance
of ordinary shares, net of issuance expenses
|
-
|
|
108,737
|
|
|
|
|
Net cash provided by
(used in) financing activities
|
(39,960)
|
|
156,506
|
|
|
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
(3,025)
|
|
(707)
|
|
|
|
|
Increase in cash and
cash equivalents
|
37,682
|
|
86,266
|
Cash and cash
equivalents at the beginning of period
|
152,561
|
|
66,295
|
|
|
|
|
Cash and cash
equivalents at the end of period
|
190,243
|
|
152,561
|
Debentures Covenants
As of December 31, 2021, Sapiens
was in compliance with all of its financial covenants under the
indenture for the Series B Debentures, based on having achieved the
following in its consolidated financial results:
Covenant 1
- Target shareholders' equity (excluding non-controlling
interest): above $120 million.
- Actual shareholders' equity (excluding non-controlling
interest) equal to $406.5
million.
Covenant 2
- Target ratio of net financial indebtedness to net
capitalization (in each case, as defined under the indenture for
the Company's Series B Debentures) below 65%.
- Actual ratio of net financial indebtedness to net
capitalization equal to (36.78)%.
Covenant 3
- Target ratio of net financial indebtedness to EBITDA
(accumulated calculation for the four last quarters) is below
5.5.
- Actual ratio of net financial indebtedness to EBITDA
(accumulated calculation for the four last quarters) is equal to
(1.27).
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SOURCE Sapiens International Corporation