Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Top Image Systems Reports Third Quarter 2017 Results
Tel Aviv and Plano, Texas
–
Top Image Systems, Ltd.
(NASDAQ: TISA),
a global innovator of intelligent content processing solutions, today announced its financial results for the third quarter of 2017, ended on September 30, 2017.
Third Quarter Highlights:
|
|
·
|
Quarterly revenues were $7.1 million, compared to $7.4 million in the second quarter of 2017 and $7.7 million in the same period in 2016;
|
|
|
·
|
Quarterly operating loss was ($1.5) million, compared to ($1.3) million in the second quarter of 2017 and ($0.6) million in the same period in 2016;
|
|
|
·
|
Adjusted EBITDA was a loss of ($0.71) million, compared to a loss of ($0.47) million in the second quarter of 2017 and positive Adjusted EBITDA of $0.23 million during the same period in 2016;
|
|
|
·
|
Quarterly recurring revenues were $4.9 million, representing 70% of total revenue, compared to $4.8 million, representing 64% of total revenues, in the second quarter of 2017 and $4.9 million, representing 64% of total revenues in the same quarter of 2016;
|
|
|
·
|
Quarterly GAAP total expenses were $ 8.5 million, compared to $ 8.8 million in the second quarter of 2017 and $8.2 million in the same period last year.
|
|
|
·
|
In partnership with the SAP Business One organization and as showcased at the SAP Biz.ONE Conference we
announced the launch of our cloud-based eFLOW AP solution
, integrated with
SAP Business One
coupled with an aggressive marketing initiative to build the pipeline and accelerate sales of our solution in fiscal 2018.
|
|
|
·
|
One of the largest financial services group in Southeast Asia, with over 500 branches, has selected Top Image Systems to implement an automated Trade Finance document processing solution.
|
|
|
·
|
Concluded a multi-year seven figure contract renewal of our receivables automation solution with a large financial services provider which represents high margin recurring cloud-basedservices revenue stream.
|
|
|
·
|
Announced an Extended Support Program with 80% of our existing customers having upgraded to the most current version of eFLOW. This translates to continued high margin maintenance renewal revenue streams, lower support costs and increased opportunities for additional deployment revenues within our installed base of customers.
|
|
|
·
|
Negotiated a revolving credit line with a US-based Bank on substantially better terms than our previous facility. This will give us access to additional financial resources to manage working capital and to fund our growth.
|
Brendan Reidy, CEO of Top Image Systems, commented, “We continue to make progress on our path to achieve a balance between sustained profitability from our core capture business while we transition to the higher velocity cloud applications software market. While we are encouraged by the continued strengthening of our pipeline our third quarter top line revenue was lower than anticipated due to deferral of two significant transactions which we anticipate will be reflected in our fourth quarter revenues. We are particularly encouraged by the traction we are seeing within the banking sector. We completed a multi-year seven figure contract renewal for receivables automation solution which is deployed in a highly secure private cloud environment, generating high margin and predictable recurring revenue streams. We also secured the implementation of a Trade Finance solution by one of the largest financial services group in Southeast Asia that re-enforces our proposition for automating labor intensive business processes.”
Mr. Reidy added, “We are particularly pleased with the launch of our cloud-based accounts payable solution which will leverage the SAP Business One ERP ecosystem for mid-size companies. Our teams are working proactively with the SAP Business One organization to develop co-marketing programs with the SAP Business One channel organization to create the foundation for accelerated traction for our cloud-based solution in fiscal 2018. Our tight integration with SAP Business One as well as with SAP ECC on premise provides us with a unique value proposition to target SAP customers with flexible deployment options on premise and in the cloud.”
Third Quarter Financial Results
|
|
·
|
Quarterly revenues were $7.1 million, compared to $7.4 million in the second quarter of 2017 and $7.7 million in the same period in 2016;
|
|
|
·
|
Quarterly operating net loss was ($1.5) million, compared to ($1.3) million in the second quarter of 2017 and ($0.6) million in the same period in 2016;
|
|
|
·
|
Adjusted EBITDA was a loss of ($0.71) million, compared to a loss of ($0.47) million in the second quarter of 2017 and positive EBITDA of $0.23 million during the same period in 2016;
|
|
|
·
|
Quarterly recurring revenues were $4.9 million, representing 70% of total revenue, compared to $4.8 million, representing 64% of total revenues, in the second quarter of 2017 and $4.9 million, representing 64% of total revenues in the same quarter of 2016;
|
|
|
·
|
Quarterly GAAP total expenses were $ 8.5 million, compared to $ 8.8 million in the second quarter of 2017 and $8.2 million in the same period last year.
|
Conference Call
The Company will host a conference call and webcast later today, at 10:00 a.m. ET, during which the Company’s management will present and discuss the financial results and be available to answer questions from investors.
To join the conference call, please dial in to one of the following teleconference phone lines using the numbers listed below. Please begin placing your calls at least 5 minutes before the conference call commences. If you are unable to connect using the toll-free number, please try the U.S. Toll/International dial-in number.
US Toll-Free Dial-in Number:
1-877-407-0784
US Toll/INTERNATIONAL Dial-in Number:
1-201-689-8560
Israel Toll-Free Dial-in Number:
1-809-406-247
The conference call is scheduled to begin at:
7:00 a.m. Pacific Time / 10:00 a.m. Eastern Time / 5:00 p.m. Israel Time
To join the live webcast, please click on the following link:
http://public.viavid.com/index.php?id=125746
.
For those unable to attend the live call or webcast, from the following day an audio recording of the call will be made available for download from the Investors section of the Top Image Systems’ website
www.topimagesystems.com
; during the next three months the recorded webcast can be viewed by clicking on the same link as for the live webcast:
http://public.viavid.com/index.php?id=125746
For those unable to attend the live call or webcast, from the following day an audio recording of the call will be made available for download from the Investors section of the Top Image Systems website www.topimagesystems.com; during the next three months the recorded webcast can be viewed by clicking on the same link as for the live webcast:
http://public.viavid.com/index.php?id=125746
* GAAP and Non-GAAP Financial Measures
This release includes GAAP and non-GAAP financial measures, including, without limitation, Adjusted EBITDA (which eliminates the impact of interest, taxes, amortization and depreciation expenses, as well as non-cash stock-based compensation expenses and other non-recurring items not part of regular business), Non-GAAP Net Income (Loss) (which eliminates the impact of amortization expenses as well as non-cash stock-based compensation expenses and other non-recurring items not part of TIS’ ongoing business operations) and Non-GAAP Income (Loss) per share. Non-GAAP measures are reconciled to comparable GAAP measures in the tables below.
The presentation of these non-GAAP financial measures should be considered in addition to TIS’ GAAP results provided in the attached financial statements for the second quarter ended September 30, 2017, and the other periods presented, and is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. The tables below reconcile each non-GAAP financial measure to its most directly comparable GAAP financial measure. TIS’ management believes that these non-GAAP financial measures provide meaningful supplemental information regarding TIS’ performance by excluding the impact of certain items that may not be indicative of TIS’ core business operating results. TIS’ management believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing TIS’ performance in addition to the GAAP results. These non-GAAP financial measures also facilitate comparisons to TIS’ historical performance and its competitors’ operating results. TIS includes these non-GAAP financial measures because management believes they are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision-making.
TIS Investors Contact:
James Carbonara
Partner, Hayden IR
james@haydenir.com (646) 755-7412
About Top Image Systems
Top Image Systems™ (TIS™) Ltd.
is a global innovator of on-premise and cloud-based applications that optimize
content-driven business processes
such as
procure to pay operations
,
remittance processing
, integrated receivables,
customer response management
and more. Whether originating from
mobile
, electronic, paper or other sources, TIS solutions automatically capture, process and deliver content across enterprise applications, transforming information entering an organization into useful and accessible electronic data, delivering it directly and efficiently to the relevant business system or person for action with as little manual handling as possible. TIS’ solutions are marketed in more than 40 countries through a multi-tier network of distributors, system integrators, value-added resellers and strategic partners. Visit the company's website at
https://www.topimagesystems.com/
for more information.
Top Image Systems Caution Concerning Forward-Looking Statements
Certain matters discussed in this news release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results to be materially different from any future results expressed or implied in those forward looking statements. Words such as "will," "expects,", "anticipates," "estimates," and words and terms of similar substance in connection with any discussion of future operating or financial performance identify forward-looking statements. These statements are based on management's current expectations or beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially including, but not limited to, risks in product development, approval and introduction plans and schedules, rapid technological change, customer acceptance of new products, the impact of competitive products and pricing, the lengthy sales cycle, proprietary rights of TIS and its competitors, risk of operations in Israel, government regulation, litigation, general economic conditions and other risk factors detailed in the Company's most recent annual report on Form 20-F and other subsequent filings with the United States Securities and Exchange Commission. We are under no obligation to, and expressly disclaim any obligation to, update or alter our forward-looking statements, whether as a result of new information, future events or otherwise.
FINANCIAL REPORTS
FOR THE QUARTER ENDED
September 30, 2017
|
Top Image Systems Ltd.
|
|
|
|
|
Consolidated Balance Sheet as of
|
|
|
|
|
|
|
September 30,
|
|
|
December 31,
|
|
|
|
|
2017
|
|
|
2016
|
|
|
|
|
In thousands
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Assets:
|
|
|
|
|
|
|
|
Cash and Cash Equivalents
|
|
$
|
1,594
|
|
|
$
|
7,636
|
|
|
Restricted Cash
|
|
|
175
|
|
|
|
119
|
|
|
Trade Receivables, net
|
|
|
5,450
|
|
|
|
6,717
|
|
|
Other Accounts Receivable and Prepaid Expenses
|
|
|
1,170
|
|
|
|
829
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Current Assets
|
|
|
8,389
|
|
|
|
15,301
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-Term Assets:
|
|
|
|
|
|
|
|
|
|
Severance Pay Funds
|
|
|
1,112
|
|
|
|
1,029
|
|
|
Restricted Cash
|
|
|
160
|
|
|
|
145
|
|
|
Long-term Deposits and Long-term Assets
|
|
|
77
|
|
|
|
136
|
|
|
Property and Equipment, net
|
|
|
933
|
|
|
|
1,000
|
|
|
Intangible Assets, net
|
|
|
2,506
|
|
|
|
3,623
|
|
|
Goodwill
|
|
|
18,773
|
|
|
|
18,405
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Long-term Assets
|
|
|
23,561
|
|
|
|
24,338
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Assets
|
|
$
|
31,950
|
|
|
$
|
39,639
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Short-term Bank Loans
|
|
$
|
-
|
|
|
$
|
3,017
|
|
|
Trade Payables
|
|
|
1,543
|
|
|
|
1,237
|
|
|
Deferred Revenues
|
|
|
2,939
|
|
|
|
3,594
|
|
|
Accrued Expenses and Other Accounts Payable
|
|
|
3,791
|
|
|
|
3,430
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Current Liabilities
|
|
|
8,273
|
|
|
|
11,278
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-Term Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accrued Severance Pay
|
|
$
|
1,250
|
|
|
$
|
1,214
|
|
|
Non-current Deferred Revenues
|
|
|
2,059
|
|
|
|
2,626
|
|
|
Other Long-term Liabilities
|
|
|
4,756
|
|
|
|
4,528
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Long-term Liabilities
|
|
|
8,065
|
|
|
|
8,368
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities
|
|
$
|
16,338
|
|
|
$
|
19,646
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Parent Shareholders' Equity
|
|
$
|
15,565
|
|
|
$
|
19,955
|
|
|
Non-controlling Interest
|
|
|
47
|
|
|
|
38
|
|
|
Shareholders' Equity
|
|
|
15,612
|
|
|
|
19,993
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities and Shareholders' Equity
|
|
$
|
31,950
|
|
|
$
|
39,639
|
|
|
Top Image Systems Ltd.
|
|
|
|
|
|
|
|
|
Statement of Operations for the
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
Three months
ended
|
|
|
Nine months
ended
|
|
|
Nine months
ended
|
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
|
|
|
|
In thousands, except per share data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
License Revenues
|
|
|
653
|
|
|
|
1,266
|
|
|
|
3,624
|
|
|
|
4,741
|
|
|
Services Revenues
|
|
|
6,407
|
|
|
|
6,415
|
|
|
|
18,169
|
|
|
|
19,883
|
|
|
Revenues
|
|
$
|
7,060
|
|
|
$
|
7,681
|
|
|
$
|
21,793
|
|
|
$
|
24,624
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of License Revenues
|
|
|
135
|
|
|
|
383
|
|
|
|
419
|
|
|
|
1,276
|
|
|
Cost of Services Revenues
|
|
|
4,039
|
|
|
|
3,676
|
|
|
|
12,109
|
|
|
|
11,245
|
|
|
Cost of Revenues
|
|
|
4,174
|
|
|
|
4,059
|
|
|
|
12,528
|
|
|
|
12,521
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Profit
|
|
|
2,886
|
|
|
|
3,622
|
|
|
|
9,265
|
|
|
|
12,103
|
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research & Development
|
|
|
1,292
|
|
|
|
1,241
|
|
|
|
3,737
|
|
|
|
3,556
|
|
|
Sales & Marketing
|
|
|
1,391
|
|
|
|
1,650
|
|
|
|
4,659
|
|
|
|
5,746
|
|
|
General & Administrative
|
|
|
1,514
|
|
|
|
1,161
|
|
|
|
4,936
|
|
|
|
3,806
|
|
|
Amortization Costs
|
|
|
154
|
|
|
|
124
|
|
|
|
460
|
|
|
|
378
|
|
|
Restructuring Charges
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1,186
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,351
|
|
|
|
4,176
|
|
|
|
13,792
|
|
|
|
14,672
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating (Loss) Profit
|
|
|
(1,465
|
)
|
|
|
(554
|
)
|
|
|
(4,527
|
)
|
|
|
(2,569
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Expenses, net
|
|
|
49
|
|
|
|
(169
|
)
|
|
|
(315
|
)
|
|
|
(443
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (loss), net
|
|
|
1
|
|
|
|
-
|
|
|
|
7
|
|
|
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) profit Before Taxes on Income
|
|
|
(1,415
|
)
|
|
|
(723
|
)
|
|
|
(4,835
|
)
|
|
|
(3,006
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax Expenses (income)
|
|
|
98
|
|
|
|
(427
|
)
|
|
|
244
|
|
|
|
(421
|
)
|
|
Net (Loss) Profit
|
|
|
(1,513
|
)
|
|
|
(296
|
)
|
|
|
(5,079
|
)
|
|
|
(2,585
|
)
|
|
Net Income Attributable to Noncontrolling Interest
|
|
|
(2
|
)
|
|
|
(3
|
)
|
|
|
(9
|
)
|
|
|
(11
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (Loss) Profit
|
|
$
|
(1,515
|
)
|
|
$
|
(299
|
)
|
|
$
|
(5,088
|
)
|
|
$
|
(2,596
|
)
|
|
Earnings per Share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic (Loss) Earnings per Share
|
|
$
|
(0.08
|
)
|
|
$
|
(0.02
|
)
|
|
$
|
(0.28
|
)
|
|
$
|
(0.14
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Number of Shares Used in Computation of Basic Net (Loss) Income per Share
|
|
|
18,010
|
|
|
|
17,932
|
|
|
|
17,958
|
|
|
|
17,923
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted (Loss) Earnings per Share
|
|
$
|
(0.08
|
)
|
|
$
|
(0.02
|
)
|
|
$
|
(0.28
|
)
|
|
$
|
(0.14
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Number of Shares Used in Calculation of Diluted Net (Loss) Earnings per Share
|
|
|
18,010
|
|
|
|
17,955
|
|
|
|
17,958
|
|
|
|
17,949
|
|
|
|
|
Three months
ended
|
|
|
Three months
ended
|
|
|
Nine months
ended
|
|
|
Nine months
ended
|
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
|
|
|
|
In thousands, except per share data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (Loss) Profit
|
|
$
|
(1,515
|
)
|
|
$
|
(299
|
)
|
|
$
|
(5,088
|
)
|
|
$
|
(2,596
|
)
|
|
Interest
|
|
|
165
|
|
|
|
38
|
|
|
|
520
|
|
|
|
74
|
|
|
Other Financial Expenses
|
|
|
(214
|
)
|
|
|
131
|
|
|
|
(205
|
)
|
|
|
369
|
|
|
Taxes
|
|
|
98
|
|
|
|
(427
|
)
|
|
|
244
|
|
|
|
(421
|
)
|
|
Depreciation
|
|
|
179
|
|
|
|
167
|
|
|
|
526
|
|
|
|
510
|
|
|
Amortization
|
|
|
348
|
|
|
|
359
|
|
|
|
1,135
|
|
|
|
1,082
|
|
|
Stock-based Compensation Expenses
|
|
|
239
|
|
|
|
265
|
|
|
|
675
|
|
|
|
719
|
|
|
Restructuring Charge
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1,186
|
|
|
Debt Reserve Adjustment
|
|
|
(16
|
)
|
|
|
-
|
|
|
|
55
|
|
|
|
-
|
|
|
Total Adjusted EBITDA
|
|
$
|
(717
|
)
|
|
$
|
234
|
|
|
$
|
(2,139
|
)
|
|
$
|
923
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP Results:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (Loss) Profit
|
|
$
|
(1,515
|
)
|
|
$
|
(299
|
)
|
|
$
|
(5,088
|
)
|
|
$
|
(2,596
|
)
|
|
Amortization
|
|
|
348
|
|
|
|
359
|
|
|
|
1,135
|
|
|
|
1,082
|
|
|
Stock-based Compensation Expenses
|
|
|
239
|
|
|
|
265
|
|
|
|
675
|
|
|
|
719
|
|
|
Debt Reserve Adjustment
|
|
|
(16
|
)
|
|
|
-
|
|
|
|
55
|
|
|
|
-
|
|
|
Restructuring Charge
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1,186
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Net Profit
|
|
$
|
(945
|
)
|
|
$
|
325
|
|
|
$
|
(3,224
|
)
|
|
$
|
391
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Net income used for basic earnings per share
|
|
$
|
(945
|
)
|
|
$
|
325
|
|
|
$
|
(3,224
|
)
|
|
$
|
391
|
|
|
Shares Used in Basic Earnings per Share Calculation
|
|
|
18,010
|
|
|
|
17,932
|
|
|
|
17,958
|
|
|
|
17,923
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Basic Earnings per Share
|
|
$
|
(0.05
|
)
|
|
$
|
0.02
|
|
|
$
|
(0.18
|
)
|
|
$
|
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Net Income Used for Diluted Earnings per Share
|
|
$
|
(945
|
)
|
|
$
|
325
|
|
|
$
|
(3,224
|
)
|
|
$
|
391
|
|
|
Shares Used in Diluted Earnings per Share Calculation
|
|
|
18,010
|
|
|
|
17,955
|
|
|
|
17,958
|
|
|
|
17,949
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Diluted Earnings per Share
|
|
$
|
(0.05
|
)
|
|
$
|
0.02
|
|
|
$
|
(0.18
|
)
|
|
$
|
0.02
|
|