RA'ANANA, Israel, May 7, 2015 /PRNewswire/ -- NICE Systems
(NASDAQ: NICE) today announced results for the first quarter ended
March 31, 2015.
First Quarter 2015 non-GAAP Financial
Highlights:
- Revenues of $246 million, up 7.5%
year-over-year
- Product revenue increased 17% year-over-year
- Operating margin of 21.3%, up from 18.2% last year
- Fully diluted earnings per share of $0.72, up 26% year-over-year
- Record cash from operations of $104
million, compared to $58
million last year
"We are pleased to report another strong quarter," said
Barak Eilam, CEO of NICE. "We
reported Non-GAAP revenue growth of 7.5%, which would have been 10%
excluding the negative impact from foreign exchange rates, Non-GAAP
earnings per share growth of 26%, demonstrating strong leverage in
our business model, and record cash flow from operations. We owe
these strong results to solid execution supported by strong growth
in analytics, and the further implementation of our operational
plan to streamline our business and improve profitability."
Mr. Eilam continued, "Innovation has been a cornerstone to much
of our success. We will continue to accelerate innovation and
move products faster to market. With a growing addressable market
and a solid leadership position, we believe that we are
well-positioned to capture the many opportunities ahead of us."
Dividend Declaration
The Company declared a cash dividend for the first quarter of
2015 of $0.16 per share. The record
date will be May 20th,
2015 and the payment date will be June
3th, 2015. Tax will be withheld at a rate of
15%.
Share Repurchase Program
The Company announced that its Board of Directors has authorized
a new program to repurchase up to $100
million of its issued and outstanding ordinary shares and
ADRs. Repurchases may be made from time to time in the open market
or in privately negotiated transactions and will be in accordance
with applicable securities laws and regulations. The timing and
amount of the repurchase transactions will be determined by
management and may depend on a variety of factors, including market
conditions, alternative investment opportunities and other
considerations. The program does not obligate the Company to
acquire any particular amount of ordinary shares and ADRs and the
program may be modified or discontinued at any time without prior
notice.
Interactions 2015 - Investor Day
The Company will be hosting its Investor Day on June 1st and 2nd in conjunction with its annual
user conference in San Antonio,
Texas. Analysts and investors who would like to register,
please email IR@NICE.com.
Non-GAAP Financial Highlights for the First Quarter Ended
March 31:
Revenues: First quarter 2015 non-GAAP total revenues were
$246.1 million, up 7.5% from
$229.0 million for the first quarter
of 2014.
Gross Profit: First quarter 2015 non-GAAP gross profit
and non-GAAP gross margin increased to $167.1 million and 67.9%, respectively, from
$149.8 million and 65.4%,
respectively, for the first quarter of 2014.
Operating Income: First quarter 2015 non-GAAP operating
income and non-GAAP operating margin increased to $52.5 million and 21.3%, respectively, from
$41.6 million and 18.2%,
respectively, for the first quarter of 2014.
Net Income: First quarter 2015 non-GAAP net income and
non-GAAP net margin increased to $44.1
million and 17.9%, respectively, from $34.8 million and 15.2%, respectively, for the
first quarter of 2014.
Fully Diluted Earnings Per Share: First quarter 2015
non-GAAP fully diluted earnings per share increased 26.3% to
$0.72, compared to $0.57 for the first quarter of 2014.
GAAP Financial Highlights for the First Quarter Ended
March 31:
Revenues: First quarter 2015 total revenues increased
7.6% to $246.0 million compared to
$228.6 million for the first quarter
of 2014.
Gross Profit: First quarter 2015 gross profit and gross
margin increased to $158.9 million
and 64.6%, respectively, from $138.9
million and 60.8%, respectively, for the first quarter of
2014.
Operating Income: First quarter 2015 operating income and
operating margin increased to $34.4
million and 14.0%, respectively, from $16.8 million and 7.3%, respectively, for the
first quarter of 2014.
Net Income: : First quarter 2015 net income and
net margin increased to $29.2 million
and 11.9%, respectively, compared to $15.7
million and 6.9%, respectively, for the first quarter of
2014.
Fully Diluted Earnings Per Share: Fully diluted earnings
per share for the first quarter of 2015 was $0.48 compared to $0.26 for the first quarter of 2014.
Operating Cash Flow and Cash Balance: First quarter 2015
operating cash flow was $104.1
million. In the first quarter, $6.3
million was used for share repurchases and $9.6 million for dividends. As of March 31, 2015, total cash and cash equivalents,
short term investments and marketable securities were $591.2 million, with no debt.
Second Quarter and Full Year 2015 Guidance:
Second Quarter 2015: Second quarter 2015 non-GAAP total
revenues are expected to be in a range of $249 million to $257 million. Second quarter 2015
non-GAAP fully diluted earnings per share are expected to be in a
range of $0.67 to $0.73.
Full Year 2015: The Company continues to expect full year
2015 non-GAAP total revenues to be in a range of $1,065 million to $1,085 million. The Company
increased its full year 2015 non-GAAP fully diluted earnings per
share to a range of $3.10 to
$3.21.
Quarterly Results Conference Call
NICE management will host its earnings conference call today,
May 7th, 2015 at 8:30 AM EDT, 13:30
GMT, 15:30 Israel, to
discuss the results and the company's outlook. To participate in
the call, please dial in to the following numbers: United States 1-866-804-8688 or
+1-718-354-1175, International +44(0)1296-480-100, United Kingdom 0-800-783-0906, Israel 1-809-242-041. The Passcode is 772 554
88. Additional access numbers can be found at
http://www.btconferencing.com/globalaccess/?bid=54_attended. The
call will be webcast live on the Company's website at
http://www.nice.com/news-and-events/ir-events. An online
replay will also be available approximately two hours following the
call. A telephone replay of the call will be available for 7 days
after the live broadcast, and may be accessed by dialing:
United States 1-877-482-6144,
International +44(0)20-7136-9233, United
Kingdom 0-800-032-9687. The Passcode for the replay is
62250445.
Non-GAAP financial measures consist of GAAP financial measures
adjusted to exclude: amortization of acquired intangible assets,
re-organization expenses, restructuring expenses, share-based
compensation, certain business combination accounting entries,
amortization of an investment in affiliate and tax adjustment re
non-GAAP adjustments. The purpose of such adjustments is to give an
indication of our performance exclusive of non-cash charges and
other items that are considered by management to be outside of our
core operating results. Our non-GAAP financial measures are not
meant to be considered in isolation or as a substitute for
comparable GAAP measures, and should be read only in conjunction
with our consolidated financial statements prepared in accordance
with GAAP. Our management regularly uses our supplemental non-GAAP
financial measures internally to understand, manage and evaluate
our business and make operating decisions. These non-GAAP measures
are among the primary factors management uses in planning for and
forecasting future periods. Business combination accounting rules
requires us to recognize a legal performance obligation related to
a revenue arrangement of an acquired entity. The amount assigned to
that liability should be based on its fair value at the date of
acquisition. The non-GAAP adjustment is intended to reflect the
full amount of such revenue. We believe this adjustment is useful
to investors as a measure of the ongoing performance of our
business. We believe these non-GAAP financial measures provide
consistent and comparable measures to help investors understand our
current and future operating cash flow performance. These non-GAAP
financial measures may differ materially from the non-GAAP
financial measures used by other companies. Reconciliation between
results on a GAAP and non-GAAP basis is provided in a table
immediately following the Consolidated Statements of Income.
About NICE
NICE Systems (NASDAQ: NICE) is the
worldwide leading provider of software solutions that enable
organizations to take the next best action in order to improve
customer experience and business results, ensure compliance, fight
financial crime, and safeguard people and assets. NICE's solutions
empower organizations to capture, analyze, and apply, in real time,
insights from both structured and unstructured Big Data. This data
comes from multiple sources, including phone calls, mobile apps,
emails, chat, social media, video, and transactions. NICE solutions
are used by over 25,000 organizations in more than 150 countries,
including over 80 of the Fortune 100 companies. www.nice.com.
Trademark Note: NICE and the NICE logo are trademarks or
registered trademarks of NICE Systems. All other marks are
trademarks of their respective owners. For a full list of NICE
Systems' marks, please see:
http://www.nice.com/nice-trademarks.
Investors
Marty Cohen, +1 212 574 3635,
ir@nice.com, ET
Yisca Erez, +972 9 775-3798, ir@nice.com, CET
Media Contact
Erik
Snider, +1 877 245 7448, erik.snider@nice.com
Forward-Looking Statements
This press release
contains forward-looking statements as that term is defined in the
Private Securities Litigation Reform Act of 1995. Such
forward-looking statements, including the statements by Mr. Eilam,
are based on the current beliefs, expectations and assumptions of
the management of NICE-Systems Ltd. (the Company). In some cases,
such forward-looking statements can be identified by terms such as
believe, expect, may, will, intend, project, plan, estimate or
similar words. Forward-looking statements are subject to a number
of risks and uncertainties that could cause the actual results or
performance of the Company to differ materially from those
described herein, including but not limited to the impact of the
global economic environment on the Company's customer base
(particularly financial services firms) potentially impacting our
business and financial condition; competition; changes in
technology and market requirements; decline in demand for the
Company's products; inability to timely develop and introduce new
technologies, products and applications; difficulties or delays in
absorbing and integrating acquired operations, products,
technologies and personnel; loss of market share; an inability to
maintain certain marketing and distribution arrangements; and the
effect of newly enacted or modified laws, regulation or standards
on the Company and our products. For a more detailed description of
the risk factors and uncertainties affecting the company, refer to
the Company's reports filed from time to time with the Securities
and Exchange Commission, including the Company's Annual Report on
Form 20-F. The forward-looking statements contained in this press
release are made as of the date of this press release, and the
Company undertakes no obligation to update or revise them, except
as required by law.
NICE SYSTEMS LTD.
AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF INCOME
|
U.S. dollars in
thousands (except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
ended
|
|
|
March
31,
|
|
|
2015
|
|
2014
|
|
|
Unaudited
|
|
Unaudited
|
|
|
|
|
|
Revenue:
|
|
|
|
|
Product
|
$ 92,596
|
|
$ 78,970
|
|
Services
|
153,393
|
|
149,604
|
Total
revenue
|
245,989
|
|
228,574
|
|
|
|
|
|
Cost of
revenue:
|
|
|
|
|
Product
|
25,109
|
|
28,116
|
|
Services
|
61,955
|
|
61,550
|
Total cost of
revenue
|
87,064
|
|
89,666
|
|
|
|
|
|
Gross
profit
|
158,925
|
|
138,908
|
|
|
|
|
|
Operating
Expenses:
|
|
|
|
|
Research and
development, net
|
36,931
|
|
36,529
|
|
Selling and
marketing
|
62,225
|
|
59,937
|
|
General and
administrative
|
21,670
|
|
18,903
|
|
Amortization of
acquired intangible assets
|
3,734
|
|
6,439
|
|
Restructuring
expenses
|
-
|
|
316
|
Total operating
expenses
|
124,560
|
|
122,124
|
|
|
|
|
|
Operating
income
|
34,365
|
|
16,784
|
|
|
|
|
|
Finance and other
income, net
|
1,699
|
|
828
|
|
|
|
|
|
Income before taxes
on income
|
36,064
|
|
17,612
|
Taxes on
income
|
6,827
|
|
1,896
|
|
|
|
|
|
Net income
|
$ 29,237
|
|
$ 15,716
|
|
|
|
|
|
Basic earnings per
share
|
$ 0.49
|
|
$ 0.26
|
|
|
|
|
|
Diluted earnings per
share
|
$ 0.48
|
|
$ 0.26
|
|
|
|
|
|
Weighted average
number of shares
|
|
|
|
outstanding used to
compute:
|
|
|
|
|
|
|
|
|
Basic earnings per
share
|
59,371
|
|
59,896
|
Diluted earnings per
share
|
61,203
|
|
61,360
|
NICE SYSTEMS LTD.
AND SUBSIDIARIES
|
RECONCILIATION OF
GAAP TO NON-GAAP RESULTS
|
U.S. dollars in
thousands (except per share amounts)
|
|
|
|
|
|
|
|
Quarter
ended
|
|
|
March
31,
|
|
|
2015
|
|
2014
|
GAAP
revenues
|
$ 245,989
|
|
$ 228,574
|
Valuation adjustment
on acquired deferred service revenue
|
123
|
|
386
|
Non-GAAP
revenues
|
$ 246,112
|
|
$ 228,960
|
|
|
|
|
|
|
|
|
|
|
GAAP cost of
revenue
|
$ 87,064
|
|
$ 89,666
|
Amortization of
acquired intangible assets on cost of product
|
(7,087)
|
|
(8,864)
|
Amortization of
acquired intangible assets on cost of services
|
-
|
|
(327)
|
Cost of product
revenue adjustment (1,2)
|
(191)
|
|
(193)
|
Cost of services
revenue adjustment (1,2)
|
(761)
|
|
(1,131)
|
Non-GAAP cost
of revenue
|
$ 79,025
|
|
$ 79,151
|
|
|
|
|
|
|
|
|
|
|
GAAP gross
profit
|
$ 158,925
|
|
$ 138,908
|
Gross profit
adjustments
|
8,162
|
|
10,901
|
Non-GAAP gross
profit
|
$ 167,087
|
|
$ 149,809
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
expenses
|
$ 124,560
|
|
$ 122,124
|
Research and
development (1,2)
|
(699)
|
|
(674)
|
Sales and marketing
(1,2)
|
(2,739)
|
|
(3,751)
|
General and
administrative (1,2)
|
(2,822)
|
|
(2,721)
|
Amortization of
acquired intangible assets
|
(3,734)
|
|
(6,439)
|
Restructuring
expenses
|
-
|
|
(316)
|
Non-GAAP operating
expenses
|
$ 114,566
|
|
$ 108,223
|
|
|
|
|
|
|
|
|
|
|
GAAP finance &
other income, net
|
$ 1,699
|
|
$ 828
|
Amortization of an
investment in affiliate
|
238
|
|
-
|
Non-GAAP finance
& other income, net
|
$ 1,937
|
|
$ 828
|
|
|
|
|
|
|
|
|
|
|
GAAP taxes on
income
|
$ 6,827
|
|
$ 1,896
|
Tax adjustments re
non-GAAP adjustments
|
3,520
|
|
5,739
|
Non-GAAP taxes on
income
|
$ 10,347
|
|
$ 7,635
|
|
|
|
|
|
|
|
|
|
|
GAAP net
income
|
$ 29,237
|
|
$ 15,716
|
Valuation adjustment
on acquired deferred revenue
|
123
|
|
386
|
Amortization of
acquired intangible assets
|
10,821
|
|
15,630
|
Share-based
compensation (1)
|
7,212
|
|
7,690
|
Re-organization
expenses (2)
|
-
|
|
780
|
Restructuring
expenses
|
-
|
|
316
|
Amortization of an
investment in affiliate
|
238
|
|
-
|
Tax adjustments re
non-GAAP adjustments
|
(3,520)
|
|
(5,739)
|
Non-GAAP net
income
|
$ 44,111
|
|
$ 34,779
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted earnings
per share
|
$ 0.48
|
|
$ 0.26
|
|
|
|
|
|
Non-GAAP diluted
earnings per share
|
$ 0.72
|
|
$ 0.57
|
|
|
|
|
|
Shares used in
computing GAAP diluted earnings per share
|
61,203
|
|
61,360
|
|
|
|
|
|
Shares used in
computing Non-GAAP diluted earnings per share
|
61,203
|
|
61,360
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NICE SYSTEMS LTD.
AND SUBSIDIARIES
|
RECONCILIATION OF
GAAP TO NON-GAAP RESULTS (continued)
|
U.S. dollars in
thousands
|
|
|
|
|
|
(1)
|
Share-based
Compensation
|
|
|
|
|
|
Quarter
ended
|
|
|
March
31,
|
|
|
2015
|
|
2014
|
|
Cost of product
revenue
|
$ (191)
|
|
$ (193)
|
|
Cost of service
revenue
|
(761)
|
|
(1,075)
|
|
Research and
development
|
(699)
|
|
(674)
|
|
Sales and
marketing
|
(2,739)
|
|
(3,178)
|
|
General and
administrative
|
(2,822)
|
|
(2,570)
|
|
|
$ (7,212)
|
|
$ (7,690)
|
|
|
|
|
|
|
|
|
|
|
(2)
|
Re-organization
expenses
|
|
|
|
|
|
Quarter
ended
|
|
|
March
31,
|
|
|
2015
|
|
2014
|
|
Cost of service
revenue
|
$
-
|
|
$ (56)
|
|
Sales and
marketing
|
-
|
|
(573)
|
|
General and
administrative
|
-
|
|
(151)
|
|
|
$
-
|
|
$ (780)
|
NICE SYSTEMS LTD.
AND SUBSIDIARIES
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
U.S. dollars in
thousands
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
|
2015
|
|
2014
|
|
|
|
Unaudited
|
|
Unaudited
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$ 222,491
|
|
$
187,497
|
|
Short-term
investments
|
|
70,097
|
|
65,744
|
|
Trade
receivables
|
|
142,235
|
|
181,605
|
|
Other receivables and
prepaid expenses
|
|
40,039
|
|
34,041
|
|
Inventories
|
|
14,895
|
|
13,375
|
|
Deferred tax
assets
|
|
24,146
|
|
24,174
|
|
|
|
|
|
|
|
Total current
assets
|
|
513,903
|
|
506,436
|
|
|
|
|
|
|
LONG-TERM
ASSETS:
|
|
|
|
|
|
Long-term
investments
|
|
298,616
|
|
246,721
|
|
Other long-term
assets
|
|
38,127
|
|
38,541
|
|
Property and
equipment, net
|
|
40,740
|
|
41,875
|
|
Other intangible
assets, net
|
|
100,663
|
|
113,740
|
|
Goodwill
|
|
686,150
|
|
694,778
|
|
|
|
|
|
|
|
Total long-term
assets
|
|
1,164,296
|
|
1,135,655
|
|
|
|
|
|
|
TOTAL
ASSETS
|
|
$ 1,678,199
|
|
$ 1,642,091
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
|
Trade
payables
|
|
$ 12,858
|
|
$
11,910
|
|
Deferred revenues and
advances from customers
|
|
191,397
|
|
145,250
|
|
Accrued expenses and
other liabilities
|
|
194,812
|
|
221,086
|
|
|
|
|
|
|
|
Total current
liabilities
|
|
399,067
|
|
378,246
|
|
|
|
|
|
|
LONG-TERM
LIABILITIES:
|
|
|
|
|
|
Deferred tax
liabilities
|
|
21,209
|
|
23,882
|
|
Other long-term
liabilities
|
|
25,632
|
|
26,507
|
|
|
|
|
|
|
|
Total long-term
liabilities
|
|
46,841
|
|
50,389
|
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY
|
|
1,232,291
|
|
1,213,456
|
|
|
|
|
|
|
TOTAL LIABILITIES
AND SHAREHOLDERS' EQUITY
|
|
$ 1,678,199
|
|
$ 1,642,091
|
NICE SYSTEMS LTD.
AND SUBSIDIARIES
|
CONSOLIDATED CASH
FLOW STATEMENTS
|
U.S. dollars in
thousands
|
|
|
|
|
Quarter
ended
|
|
|
|
March
31,
|
|
|
|
2015
|
|
2014
|
|
|
|
Unaudited
|
|
Unaudited
|
|
|
|
|
|
|
Operating
Activities
|
|
|
|
|
|
|
|
|
|
Net income
|
$ 29,237
|
|
$ 15,716
|
Adjustments to
reconcile net income to net cash provided by operating
activities
|
|
|
|
|
Depreciation and
amortization
|
15,076
|
|
20,685
|
|
Stock based
compensation
|
7,212
|
|
7,688
|
|
Excess tax benefit
from share-based payment arrangements
|
(638)
|
|
(125)
|
|
Amortization of
premium and discount and accrued interest on marketable
securities
|
646
|
|
498
|
|
Deferred taxes,
net
|
(3,520)
|
|
(5,738)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
Trade
Receivables
|
36,320
|
|
23,205
|
|
|
Other receivables and
prepaid expenses
|
(1,627)
|
|
(3,608)
|
|
|
Inventories
|
(1,828)
|
|
(728)
|
|
|
Trade
payables
|
1,140
|
|
(2,236)
|
|
|
Accrued expenses and
other current liabilities
|
(26,847)
|
|
(30,866)
|
|
|
Deferred
revenue
|
48,926
|
|
34,277
|
|
Other
|
37
|
|
(368)
|
|
|
|
|
|
|
|
|
Net cash
provided by operating activities
|
104,134
|
|
58,400
|
|
|
|
|
|
|
Investing
Activities
|
|
|
|
|
|
|
|
|
|
|
Purchase of property
and equipment
|
(3,219)
|
|
(4,337)
|
|
Proceeds from sale of
property and equipment
|
-
|
|
16
|
|
Purchase of
Investments
|
(85,983)
|
|
(13,274)
|
|
Proceeds from
Investments
|
30,982
|
|
14,591
|
|
Capitalization of
software development costs
|
-
|
|
(242)
|
|
Payments for business
acquisitions, net of cash acquired
|
-
|
|
(887)
|
|
|
|
|
|
|
|
|
Net cash used
in investing activities
|
(58,220)
|
|
(4,133)
|
|
|
|
|
|
|
Financing
Activities
|
|
|
|
|
|
|
|
|
|
|
Proceeds from
issuance of shares upon exercise of share options and
ESPP
|
9,015
|
|
8,748
|
|
Purchase of treasury
shares
|
(6,288)
|
|
(26,480)
|
|
Dividends
paid
|
(9,586)
|
|
(9,706)
|
|
Excess tax benefit
from share-based payment arrangements
|
638
|
|
125
|
|
Earnout payment
related to acquisitions
|
(262)
|
|
-
|
|
|
|
|
|
|
|
|
Net cash used
in financing activities
|
(6,483)
|
|
(27,313)
|
|
|
|
|
|
|
Effect of exchange
rates on cash and cash equivalents
|
(4,437)
|
|
238
|
|
|
|
|
|
|
Net change in cash
and cash equivalents
|
34,994
|
|
27,192
|
Cash and cash
equivalents, beginning of period
|
187,497
|
|
119,545
|
|
|
|
|
|
|
Cash and cash
equivalents, end of period
|
$ 222,491
|
|
$ 146,737
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/nice-reports-75-increase-in-non-gaap-revenue-and-26-increase-in-non-gaap-eps-for-the-first-quarter-2015-300079426.html
SOURCE NICE