KIBBUTZ SHAMIR, Israel,
Nov. 23, 2010 /PRNewswire-FirstCall/
-- Shamir Optical Industry Ltd. (Nasdaq: SHMR)
("Shamir"), a leading provider of innovative products
and technology to the ophthalmic lens market, today announced
unaudited financial results for the third quarter ended
September 30, 2010.
For the quarter ended September 30,
2010, revenues increased 4.7% to $37.8 million, compared with revenues of
$36.2 million for the same period in
2009. Gross profit for the quarter was $20.8
million, or 54.9% of revenues, compared with gross profit of
$19.7 million, or 54.6% of revenues
for the same period last year.
For the quarter ended September 30,
2010, operating income decreased 7.0% to $4.5 million, or 11.9% of revenues, compared with
operating income of $4.8 million, or
13.4% of revenues for the same period last year. The
reduction in operating income year-over-year was primarily the
result of increased research and development costs and elevated
general and administrative costs associated with the Company's
recently announced transaction with Essilor International.
Net income for the quarter increased 18.5% to $4.3 million, compared with net income of
$3.7 million for the same period in
2009. Net income attributable to Shamir's shareholders was
$4.2 million or $0.25 per diluted share, compared with
$3.6 million or $0.22 per diluted share for the same period in
2009.
Excluding the effect of non-cash stock-based compensation
expenses, amortization of intangible assets and Essilor transaction
costs in 2010, operating income for the quarter was
$5.5 million, or 14.5% of revenues,
compared with operating income of $5.2
million, or 14.3% of revenues, for the same period last
year.
Excluding the effect of non-cash stock-based compensation
expenses, amortization of intangible assets, net of tax, accretion
of redeemable non-controlling interest and Essilor transaction
costs, net of tax in 2010, net income attributable to Shamir's
shareholders for the quarter was $4.8
million, or $0.29 per diluted
share, compared with net income of $3.9
million, or $0.24 per diluted
share for the same period last year.
The reconciliation of GAAP operating income and net income to
non-GAAP operating income and non-GAAP net income is set forth
below.
As of September 30, 2010, the
Company had cash and cash equivalents, including short-term
investments of $37.8 million.
As was previously announced, the Company declared a dividend
in the amount of $13.5 million
(approximately $0.804 per share) to
be paid on November 24, 2010.
Commenting on the results, Amos
Netzer, Chief Executive Officer of Shamir, said, "I am
pleased with our results for the third quarter of 2010 We
executed solidly and continued to make important inroads in many of
our operating markets, with the goal of advancing the recognition
for Shamir-branded products. Concurrent with these efforts, we
continue to stress the importance of strict cost controls, which
has always been a major component of our operating philosophy."
Mr. Netzer continued, "To support our long range goals of
expanding our worldwide sales, we recently executed an agreement
with a local distributor of our products in the Netherlands. We are confident in our
ability to penetrate and expend our holdings in this market and to
promote the Shamir brand in the Benelux region."
For the fiscal year ending December 31,
2010, Shamir confirmed its estimate for 2010 revenue growth
to be in the range of 11%-15%, under the assumption of December 2009 exchange rates.
Conference Call:
Shamir has scheduled a conference call for 10:00 a.m. ET today to discuss third quarter
results. To participate in the call, please dial (888)
562.3356 (U.S. and Canada) or
(973) 582.2700 (International). The conference ID for this
event is 23919422. For those unable to participate there will
be a replay available from 1:00 p.m.
ET on November 23, 2010,
through 11:59 p.m. ET, November 30, 2010. Please call: (800)
642.1687 (U.S. and Canada) or
(706) 645.9291 (International). The ID code for the replay is
23919422.
The call will be available as a live, listen-only webcast at
www.kcsa.com. Please go to the KCSA website at least 15 minutes
prior to the scheduled start time to register, download and install
any necessary audio software. A 30-day archive of the webcast will
be available approximately 2 hours after the conclusion of the live
call.
About non – GAAP financial measures
This press release includes non-GAAP financial measures -
non-GAAP operating income and non-GAAP net income – that exclude
certain charges. The presentation of this 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 of Shamir believes that non-GAAP operating income
and non-GAAP net income provides meaningful supplemental
information because these numbers reflect our core operational
results and are used by management internally to review Shamir's
financial results.
About Shamir
Shamir is a leading provider of innovative products and
technology to the spectacle lens market. Utilizing its proprietary
technology, the company develops, designs, manufactures, and
markets progressive lenses to sell to the ophthalmic market. In
addition, Shamir utilizes its technology to provide design services
to optical lens manufacturers under service and royalty agreements.
Progressive lenses are used to treat presbyopia, a vision condition
where the eye loses its ability to focus on close objects.
Progressive lenses combine several optical strengths into a single
lens to provide a gradual and seamless transition from near to
intermediate, to distant vision. Shamir differentiates its products
from its competitors' primarily through lens design. Shamir's
leading lenses are marketed under a variety of trade names,
including Shamir Creation(TM), Shamir Piccolo(TM), Shamir
Office(TM), Shamir Autograph(TM), Shamir Attitude(TM) and Shamir
Smart(TM). Shamir believes that it has one of the world's
preeminent research and development teams for progressive lenses,
molds, and complementary technologies and tools. Shamir developed
software dedicated to the design of progressive lenses. This
software is based on Shamir's proprietary mathematical algorithms
that optimize designs of progressive lenses for a variety of
activities and environments. Shamir also has created software tools
specifically designed for research and development and production
requirements, including Eye Point Technology software, which
simulates human vision.
Safe Harbor Statement
Statements concerning Shamir's business outlook or future
economic performance; product introductions and plans and
objectives related thereto; and assumptions made or expectations as
to any future events, conditions, performance or other matters, are
"forward-looking statements" as that term is defined under U.S.
federal securities laws. Forward-looking statements are subject to
various risks, uncertainties and other factors that could cause
actual results to differ materially from those stated in such
statements. These risks, uncertainties and factors include, but are
not limited to: The conflicts in the region; the effects of
competition in our industry, and changes in our relationships with
optical laboratories, distributors, research and development
partners and other third parties; the effects of the international
expansion of our operations and our ability to manage our growth,
including our ability to manage potential future acquisitions; the
effect of global economic conditions in general and conditions in
Shamir's industry and target markets in particular; shifts in
supply and demand; market acceptance of new products and continuing
products' demand; the impact of competitive products and pricing on
Shamir's and its customers' products and markets; timely product
and technology development/upgrades and the ability to manage
changes in market conditions as needed; interest rate fluctuations;
and other factors detailed in Shamir's filings with the Securities
and Exchange Commission. Shamir assumes no obligation to update the
information in this release.
(Tables to follow)
SHAMIR OPTICAL INDUSTRY
LTD.
Consolidated Balance
Sheets
|
|
(US dollars in thousands, except
share and per share data)
|
|
As of
December 31,
|
|
As of
September 30,
|
|
|
|
2009
|
|
2010
|
|
|
|
|
|
(Unaudited)
|
|
CURRENT ASSETS:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
19,929
|
|
$
20,645
|
|
Short-term investment
|
|
11,679
|
|
17,127
|
|
Trade receivables (1)
|
|
33,648
|
|
35,041
|
|
Other receivables and prepaid
expenses
|
|
7,918
|
|
7,777
|
|
Inventory
|
|
26,946
|
|
28,277
|
|
TOTAL CURRENT
ASSETS
|
|
100,120
|
|
108,867
|
|
|
|
|
|
|
|
LONG-TERM
INVESTMENTS:
|
|
|
|
|
|
Severance pay fund
|
|
2,909
|
|
2,819
|
|
Long-term receivables
|
|
427
|
|
386
|
|
Investments in
affiliates
|
|
1,306
|
|
1,282
|
|
TOTAL LONG-TERM
INVESTMENTS
|
|
4,642
|
|
4,487
|
|
|
|
|
|
|
|
PROPERTY, PLANT AND EQUIPMENT,
NET
|
|
38,568
|
|
37,627
|
|
OTHER ASSETS
|
|
7,439
|
|
6,161
|
|
GOODWILL
|
|
12,945
|
|
13,740
|
|
TOTAL ASSETS
|
|
$
163,714
|
|
$
170,882
|
|
|
|
|
|
|
|
CURRENT LIABILITIES:
|
|
|
|
|
|
Short-term bank credit and
loans
|
|
$
11,033
|
|
$
8,985
|
|
Current maturities of long-term
loans
|
|
6,879
|
|
5,040
|
|
Trade payables
|
|
11,680
|
|
12,873
|
|
Accrued expenses and other
liabilities
|
|
15,447
|
|
16,007
|
|
TOTAL CURRENT
LIABILITIES
|
|
45,039
|
|
42,905
|
|
|
|
|
|
|
|
LONG-TERM
LIABILITIES:
|
|
|
|
|
|
Long-term loans
|
|
12,599
|
|
8,813
|
|
Capital leases
|
|
2,367
|
|
1,654
|
|
Accrued severance pay
|
|
3,270
|
|
3,246
|
|
Other long-term
liabilities
|
|
2,763
|
|
904
|
|
Deferred income taxes
|
|
2,224
|
|
2,162
|
|
TOTAL LONG-TERM
LIABILITIES
|
|
23,223
|
|
16,779
|
|
|
|
|
|
|
|
Redeemable non-controlling
interests
|
|
690
|
|
2,146
|
|
EQUITY:
|
|
|
|
|
|
Share capital
|
|
|
|
|
|
Common shares of NIS 0.01 par
value
|
|
|
|
|
|
Authorized: 100,000,000 shares
at December 31, 2009 and September 30, 2010; Issued and
outstanding: 16,592,345 and 16,781,096 shares at
December 31, 2009 and September 30, 2010, respectively
|
|
37
|
|
38
|
|
Additional paid-in
capital
|
|
68,230
|
|
70,168
|
|
Accumulated other comprehensive
income
|
|
(1,122)
|
|
(1,686)
|
|
Retained earnings
|
|
24,795
|
|
36,791
|
|
Total Shamir Optical
Industry Ltd. Shareholders' equity
|
|
91,940
|
|
105,311
|
|
Non-controlling
interests
|
|
2,822
|
|
3,741
|
|
TOTAL
EQUITY
|
|
94,762
|
|
109,052
|
|
TOTAL LIABILITIES AND
EQUITY
|
|
$
163,714
|
|
$
170,882
|
|
(1) Net of allowance for
doubtful accounts of $ 3,076 and $ 3,326 as of December 31, 2009
and September 30, 2010, respectively
|
|
|
|
|
|
|
|
|
SHAMIR OPTICAL INDUSTRY
LTD.
Consolidated Statements of
Income
(US dollars in thousands, except
per share data)
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
|
2009
|
|
2010
|
|
2009
|
|
2010
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
Revenues, net
|
$ 36,157
|
|
$ 37,845
|
|
$
105,311
|
|
$
118,918
|
|
Cost of revenues
|
16,410
|
|
17,075
|
|
48,748
|
|
53,513
|
|
Gross profit
|
19,747
|
|
20,770
|
|
56,563
|
|
65,405
|
|
|
|
|
|
|
|
|
|
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
Research and development
costs
|
802
|
|
1,098
|
|
2,332
|
|
3,245
|
|
Selling and marketing
expenses
|
10,274
|
|
10,724
|
|
30,422
|
|
32,701
|
|
General and administrative
expenses
|
3,828
|
|
4,445
|
|
11,023
|
|
13,051
|
|
Total operating
expenses
|
14,904
|
|
16,267
|
|
43,777
|
|
48,997
|
|
Operating income
|
4,843
|
|
4,503
|
|
12,786
|
|
16,408
|
|
|
|
|
|
|
|
|
|
|
Financial expenses (income) and
other, net
|
335
|
|
(851)
|
|
237
|
|
166
|
|
Income before taxes on
income
|
4,508
|
|
5,354
|
|
12,549
|
|
16,242
|
|
Taxes on income
|
826
|
|
1,071
|
|
2,877
|
|
3,581
|
|
Income after taxes on
income
|
3,682
|
|
4,283
|
|
9,672
|
|
12,661
|
|
|
|
|
|
|
|
|
|
|
Equity in losses
(earnings) of affiliates, net
|
13
|
|
28
|
|
(48)
|
|
55
|
|
Accretion of redeemable non
controlling interest
|
-
|
|
(92)
|
|
-
|
|
3
|
|
Net income
|
3,669
|
|
4,347
|
|
9,720
|
|
12,603
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to
non-controlling interests
|
43
|
|
196
|
|
276
|
|
607
|
|
Net income attributable to
Shamir Optical Industry Ltd. Shareholders
|
$
3,626
|
|
$
4,151
|
|
$
9,444
|
|
$
11,996
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings per
share:
|
|
|
|
|
|
|
|
|
Basic
|
$
0.22
|
|
$
0.25
|
|
$
0.58
|
|
$
0.72
|
|
Diluted
|
$
0.22
|
|
$
0.25
|
|
$
0.57
|
|
$
0.71
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of shares:
|
|
|
|
|
|
|
|
|
Basic
|
16,424
|
|
16,779
|
|
16,424
|
|
16,745
|
|
Dilutive
|
16,546
|
|
16,878
|
|
16,499
|
|
16,833
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SHAMIR OPTICAL INDUSTRY
LTD.
Reconciliation of Non-GAAP
Operating Income and Net Income
(US dollars in thousands, except
per share data)
|
|
|
Three Months
Ended September 30,
|
|
Nine Months
Ended September 30,
|
|
|
2009
|
|
2010
|
|
2009
|
|
2010
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
$
4,843
|
|
$
4,503
|
|
$
12,786
|
|
$
16,408
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjustment:
|
|
|
|
|
|
|
|
|
Stock based
compensation
|
(60)
|
|
(138)
|
|
(372)
|
|
(427)
|
|
Amortization of intangible
assets
|
(272)
|
|
(361)
|
|
(761)
|
|
(1,077)
|
|
Essilor transaction
costs
|
-
|
|
(480)
|
|
-
|
|
(843)
|
|
Compensation to former
Chief Executive Officer
|
-
|
|
-
|
|
(303)
|
|
-
|
|
Non-GAAP operating
income
|
$
5,175
|
|
$
5,482
|
|
$
14,222
|
|
$
18,755
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to
Shamir Optical Industry Ltd. Shareholders
|
$
3,626
|
|
$
4,151
|
|
$
9,444
|
|
$
11,996
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjustment:
|
|
|
|
|
|
|
|
|
Stock based
compensation
|
(60)
|
|
(138)
|
|
(372)
|
|
(427)
|
|
Amortization of intangible
assets, net
|
(207)
|
|
(268)
|
|
(579)
|
|
(799)
|
|
Essilor transaction costs,
net
|
-
|
|
(360)
|
|
-
|
|
(632)
|
|
Accretion of redeemable
non controlling interest
|
-
|
|
92
|
|
-
|
|
(3)
|
|
Compensation to former
Chief Executive Officer, net
|
-
|
|
-
|
|
(227)
|
|
-
|
|
Non-GAAP net income attributable
to Shamir Optical Industry Ltd. Shareholders
|
$
3,893
|
|
$
4,825
|
|
$
10,622
|
|
$
13,857
|
|
|
|
|
|
|
|
|
|
|
Net earnings per
share:
|
|
|
|
|
|
|
|
|
Basic
|
$
0.24
|
|
$
0.29
|
|
$
0.65
|
|
$
0.83
|
|
Diluted
|
$
0.24
|
|
$
0.29
|
|
$
0.64
|
|
$
0.82
|
|
|
|
|
|
|
|
|
|
|
Number of shares:
|
|
|
|
|
|
|
|
|
Basic
|
16,424
|
|
16,779
|
|
16,424
|
|
16,745
|
|
Dilutive
|
16,546
|
|
16,878
|
|
16,499
|
|
16,833
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investor Relations
Contacts:
|
|
|
Roni Gavrielov
|
Jeffrey Goldberger/Marybeth
Csaby
|
|
KM / KCSA Investor
Relations
|
KCSA Strategic
Communications
|
|
+972-3-516-7620
|
212-896-1249/212-896-1236
|
|
roni@km-ir.co.il
|
jgoldberger@kcsa.com
/ mcsaby@kcsa.com
|
|
|
|
SOURCE Shamir Optical Industry Ltd.