SPNS Sapiens International Corporation NV

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 6-K

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 OF

THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of February 2025

 

Commission File Number 000-20181

 

SAPIENS INTERNATIONAL CORPORATION N.V.

(Translation of Registrants name into English)

 

Azrieli Center

26 Harokmim St.

Holon, 5885800 Israel

(Address of Principal Executive Office)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F ☒      Form 40-F ☐

 

 

 

CONTENTS

 

Exhibit		Title of Exhibit
99.1		Sapiens Reports Fourth Quarter 2024 Financial Results

 

 

SIGNATURE

 

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.

 

	Sapiens International Corporation N.V.
Date: February 18, 2025	By:	/s/ Roni Giladi
		Name:	Roni Giladi
		Title:	Chief Financial Officer

 

 

Exhibit Index

 

The following exhibit is furnished as part of this Form 6-K:

 

Exhibit		Description
99.1		Sapiens Reports Fourth Quarter 2024 Financial Results

 

 

3

 

 Exhibit 99.1

 

 

 

Sapiens Reports Fourth Quarter 2024 Financial Results

 

Rochelle Park, NJ, February 18, 2025 – 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 ended December 31, 2024.

 

Summary Results for Fourth Quarter 2024 (USD in millions, except per share data)

 

		GAAP												Non-GAAP
		Q4 2024				Q4 2023				% Change				Q4 2024				Q4 2023				% Change
Revenue		$	134.3			$	130.9				2.6	%		$	134.3			$	130.9				2.6	%
Gross Profit		$	60.1			$	55.9				7.5	%		$	62.7			$	59.4				5.6	%
Gross Margin			44.8	%			42.8	%			200 bps				46.7	%			45.4	%			130 bps
Operating Income		$	21.7			$	20.1				8.0	%		$	24.5			$	24.2				1.3	%
Operating Margin			16.2	%			15.4	%			80 bps				18.2	%			18.4	%			-20 bps
Net Income (*)		$	17.9			$	17.0				5.3	%		$	20.7			$	20.1				3.1	%
Diluted EPS		$	0.32			$	0.30				6.7	%		$	0.37			$	0.36				2.8	%

 

Summary Results for Full Year end 2024 (USD in millions, except per share data)

 

		GAAP												Non-GAAP
		2024				2023				% Change				2024				2023				% Change
Revenue		$	542.4			$	514.6				5.4	%		$	542.4			$	514.8				5.4	%
Gross Profit		$	238.1			$	219.6				8.4	%		$	248.9			$	233.0				6.8	%
Gross Margin			43.9	%			42.7	%			120 bps				45.9	%			45.3	%			60 bps
Operating Income		$	85.8			$	78.9				8.9	%		$	98.7			$	94.1				4.8	%
Operating Margin			15.8	%			15.3	%			50 bps				18.2	%			18.3	%			-10 bps
Net income (*)		$	72.2			$	62.4				15.6	%		$	83.3			$	75.0				11.0	%
Diluted EPS		$	1.29			$	1.12				15.2	%		$	1.48			$	1.35				9.6	%

 

(*)

Attributable to Sapiens’ shareholders

 

 

Roni Al-Dor, President and CEO of Sapiens, stated, “In the fourth quarter we achieved $134 million in revenue, a 2.6% year over year increase. This quarter showcased solid execution across our key regions and ongoing growth of our core Life business. For the full year 2024, we delivered a 5.4% increase in revenue, reflecting the signing of deals with new and existing customers. North America led our global performance with a 6.3% year-over-year revenue increase. By leveraging our Microsoft cloud strategy and scalable SaaS platform, we are accelerating our clients’ migration to the cloud.”

 

“Our continued investment in a future-proof, modular, open insurance platform-integrating core capabilities with advanced data analytics and AI-is set to drive further growth. We are well positioned to deepen relationships with existing customers, capture additional market share, and strengthen growth across all regions.”

 

“We are introducing 2025 guidance for non-GAAP revenue in a range of $553 million to $558 million, and non-GAAP operating profit in a range of $98 million to $102 million with operating margin of 18% at the midpoint. On a constant currency basis, our growth rate would be 3.4%, and our operating margin would be 18.7% at the mid-point.

 

Quarterly Results Conference Call

 

Management will host a conference call and webcast today, February 18, 2025, at 9:30 a.m. Eastern Time (4:30 p.m. 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: 972-3-9180644
UK: 0-800-917-5108

 

The live webcast of the call can be viewed on Sapiens’ website at: veidan.activetrail.biz/sapiensq4-2024. 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, ARR, 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 Annual Recurring Revenue (“ARR”) as the annualized value of our revenue from customer subscriptions, term licenses, maintenance, application maintenance, and cloud solutions, which may not be the same as the timing and amount of revenue recognized. The ARR run rate is equal to the product of (i) the sum of these revenues in our most recently completed fiscal quarter, multiplied by (ii) four.

 

The Company defines Adjusted EBITDA as net profit, adjusted to eliminate valuation adjustment on acquired deferred revenue, stock-based compensation expense, depreciation and amortization, capitalization 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 as well, in order 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) is a global leader in intelligent insurance software solutions. With Sapiens’ robust platform, customer-driven partnerships, and rich ecosystem, insurers are empowered to future-proof their organizations with operational excellence in a rapidly changing marketplace. We help insurers harness the power of AI and advanced automation to support core solutions for property and casualty, workers’ compensation, and life insurance, including reinsurance, financial & compliance, data & analytics, digital, and decision management. Sapiens boasts a longtime global presence, serving over 600 customers in more than 30 countries with its innovative SaaS offerings. Recognized by industry experts and selected for the Microsoft Top 100 Partner program, Sapiens is committed to partnering with our customers for their entire transformation journey and is continuously innovating to ensure their success.

 

Investor and Media Contact   Yaffa Cohen-Ifrah Chief Marketing Officer and Head of Investor Relations, Sapiens Yaffa.cohen-ifrah@sapiens.com +1 917-533-4782

Investor Contacts   Brett Maas Managing Partner, Hayden IR +1 646-536-7331 brett@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,
		2024				2023				2024				2023
		(unaudited)				(unaudited)				(unaudited)				(unaudited)
Revenue			134,305				130,859				542,379				514,584
Cost of revenue			74,158				74,910				304,272				294,990
Gross profit			60,147				55,949				238,107				219,594
Operating expenses:
Research and development, net			16,523				16,084				66,302				63,475
Selling, marketing, general and administrative			21,926				19,776				85,956				77,251
Total operating expenses			38,449				35,860				152,258				140,726
Operating income			21,698				20,089				85,849				78,868
Financial and other expenses (income), net			(864	)			(560	)			(3,978	)			1,750
Taxes on income			4,695				3,624				17,507				14,251
Net income			17,867				17,025				72,320				62,867
Attributable to non-controlling interest			-				52				141				423
Net income attributable to Sapiens’ shareholders			17,867				16,973				72,179				62,444
Basic earnings per share			0.32				0.30				1.29				1.13
Diluted earnings per share			0.32				0.30				1.29				1.12
Weighted average number of shares outstanding used to compute basic earnings per share (in thousands)			55,887				55,733				55,821				55,372
Weighted average number of shares outstanding used to compute diluted earnings per share (in thousands)			56,164				55,910				56,154				55,721

 

 

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,
		2024				2023				2024				2023
		(unaudited)				(unaudited)				(unaudited)				(unaudited)
GAAP revenue			134,305				130,859				542,379				514,584
Valuation adjustment on acquired deferred revenue			-				55				-				220
Non-GAAP revenue			134,305				130,914				542,379				514,804
GAAP gross profit			60,147				55,949				238,107				219,594
Revenue adjustment			-				55				-				220
Amortization of capitalized software			1,540				1,501				6,124				5,775
Amortization of other intangible assets			1,005				1,865				4,635				7,396
Non-GAAP gross profit			62,692				59,370				248,866				232,985
GAAP operating income			21,698				20,089				85,849				78,868
Gross profit adjustments			2,545				3,421				10,759				13,391
Capitalization of software development			(1,759	)			(1,543	)			(7,133	)			(6,518	)
Amortization of other intangible assets			1,211				1,169				4,943				4,403
Stock-based compensation			723				698				2,952				3,658
Acquisition-related costs (*)			50				318				1,298				339
Non-GAAP operating income			24,468				24,152				98,668				94,141
GAAP net income attributable to Sapiens’ shareholders			17,867				16,973				72,179				62,444
Operating income adjustments			2,770				4,063				12,819				15,273
Taxes on income			73				(955	)			(1,735	)			(2,693	)
Non-GAAP net income attributable to Sapiens’ shareholders			20,710				20,081				83,263				75,024

 

(*)

Acquisition-related costs pertain to charges on behalf of M&A agreements related to future performance targets and retention criteria, as well as completed or prospective third-party services, such as tax, accounting and legal rendered.

 

 

Adjusted EBITDA Calculation
U.S. dollars in thousands

 

		Three months ended								Year ended
		December 31,								December 31,
		2024				2023				2024				2023
GAAP operating profit			21,698				20,089				85,849				78,868
Non-GAAP adjustments:
Valuation adjustment on acquired deferred revenue			-				55				-				220
Amortization of capitalized software			1,540				1,501				6,124				5,775
Amortization of other intangible assets			2,216				3,034				9,578				11,799
Capitalization of software development			(1,759	)			(1,543	)			(7,133	)			(6,518	)
Stock-based compensation			723				698				2,952				3,658
Compensation related to acquisition and acquisition-related costs			50				318				1,298				339
Non-GAAP operating profit			24,468				24,152				98,668				94,141
Depreciation			891				1,115				4,371				3,865
Adjusted EBITDA			25,359				25,267				103,039				98,006

 

Summary of NON-GAAP Financial Information
U.S. dollars in thousands (except per share amounts)

 

		Q4 2024				Q3 2024				Q2 2024				Q1 2024				Q4 2023
Revenues			134,305				137,025				136,800				134,249				130,914
Gross profit			62,692				62,809				62,481				60,884				59,370
Operating income			24,468				25,101				24,836				24,263				24,152
Adjusted EBITDA			25,359				26,389				25,931				25,360				25,267
Net income to Sapiens’ shareholders			20,710				21,091				21,041				20,421				20,081
Diluted earnings per share			0.37				0.37				0.37				0.36				0.36

 

Annual Recurring Revenue (“ARR”)

U.S. dollars in thousands 

 

		Three months ended
		December 31,
		2024				2023
Annual Recurring Revenue			175,542				164,840

 

Non-GAAP Revenues by Geographic Breakdown
U.S. dollars in thousands

 

		Q4 2024				Q3 2024				Q2 2024				Q1 2024				Q4 2023
North America			56,753				55,755				57,918				55,158				54,882
Europe			65,903				69,281				66,072				68,727				65,239
Rest of the World			11,649				11,989				12,810				10,364				10,793
Total			134,305				137,025				136,800				134,249				130,914

 

 

Non-GAAP Revenue breakdown

U.S. dollars in thousands

 

		Three months ended								Year ended
		December 31,								December 31,
		2024				2023				2024				2023
Software products and re-occurring post-production services (*)			97,336				90,399				390,328				342,156
Pre-production implementation services (**)			36,969				40,515				152,051				172,648
Total Revenues			134,305				130,914				542,379				514,804

 

		Three months ended								Year ended
		December 31,								December 31,
		2024				2023				2024				2023
Software products and re-occurring post-production services (*)			52,356				48,815				208,742				182,154
Pre-production implementation services (**)			10,336				10,555				40,124				50,831
Total Gross profit			62,692				59,370				248,866				232,985

 

		Three months ended								Year ended
		December 31,								December 31,
		2024				2023				2024				2023
Software products and re-occurring post-production services (*)			53.8	%			54.0	%			53.5	%			53.2	%
Pre-production implementation services (**)			28.0	%			26.1	%			26.4	%			29.4	%
Gross Margin			46.7	%			45.4	%			45.9	%			45.3	%

 

(*)	Software products and re-occurring post-production services include mainly subscription, term license, maintenance, application maintenance, cloud solutions and post-production services. This revenue stream is a mix of recurring and re-occurring in nature.

 

(**)	Pre-production implementation services include mainly implementation services before go-live, which are one-time in nature.

 

Adjusted Free Cash-Flow
U.S. dollars in thousands

 

		Q4 2024				Q3 2024				Q2 2024				Q1 2024				Q4 2023
Cash-flow from operating activities			42,109				13,083				8,545				18,488				38,646
Increase in capitalized software development costs			(1,759	)			(1,834	)			(1,823	)			(1,717	)			(1,543	)
Capital expenditures			(419	)			(1,125	)			(666	)			(466	)			(421	)
Free cash-flow			39,931				10,124				6,056				16,305				36,682
Cash payments attributed to acquisition-related costs(*) (**)			1,238				124				134				751				221
Adjusted free cash-flow			41,169				10,248				6,190				17,056				36,903

 

(*)	Included in cash-flow from operating activities

 

(**)	Acquisition-related payments pertain to charges on behalf of M&A agreements related to future performance targets and retention criteria, as well as completed or prospective third-party services, such as tax, accounting and legal rendered.

 

 

SAPIENS INTERNATIONAL CORPORATION N.V. AND ITS SUBSIDIARIES

 

CONDENSED CONSOLIDATED BALANCE SHEET

U.S. dollars in thousands

 

		December 31,				December 31,
		2024				2023
		(unaudited)				(unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents			163,690				126,716
Short-term bank deposit			52,500				75,400
Trade receivables, net and unbilled receivables			99,603				90,273
Other receivables and prepaid expenses			19,350				22,514
Total current assets			335,143				314,903
LONG-TERM ASSETS
Property and equipment, net			10,656				12,661
Severance pay fund			3,208				3,605
Goodwill and intangible assets, net			302,472				317,352
Operating lease right-of-use assets			20,746				23,557
Other long-term assets			19,486				17,546
Total long-term assets			356,568				374,721
TOTAL ASSETS			691,711				689,624
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Trade payables			8,414				6,291
Current maturities of Series B Debentures			19,796				19,796
Accrued expenses and other liabilities			77,390				77,873
Current maturities of operating lease liabilities			6,440				6,623
Deferred revenue			37,543				38,541
Total current liabilities			149,583				149,124
LONG-TERM LIABILITIES
Series B Debentures, net of current maturities			19,792				39,543
Deferred tax liabilities			6,899				10,820
Other long-term liabilities			10,331				11,538
Long-term operating lease liabilities			17,719				21,084
Accrued severance pay			7,758				7,568
Total long-term liabilities			62,499				90,553
EQUITY			479,629				449,947
TOTAL LIABILITIES AND EQUITY			691,711				689,624

 

 

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,
		2024				2023
		(unaudited)				(unaudited)
Cash flows from operating activities:
Net income			72,320				62,867
Reconciliation of net income to net cash provided by operating activities:
Depreciation			4,371				3,865
Amortization of capitalized software and other intangible assets			15,702				17,574
Accretion of discount on Series B Debentures			44				64
Capital loss from sale of property and equipment			19				195
Stock-based compensation related to options issued to employees			2,952				3,658
Net changes in operating assets and liabilities, net of amount acquired:
Decrease (increase) in trade receivables, net and unbilled receivables			(12,500	)			3,960
Decrease in deferred tax liabilities, net			(5,934	)			(3,003	)
Decrease (increase) in other operating assets			5,343				(5,402	)
Increase (decrease) in trade payables			2,126				(3,580	)
Decrease in other operating liabilities			(2,558	)			(8,948	)
Increase (decrease) in deferred revenues			(407	)			7,266
Increase in accrued severance pay, net			747				909
Net cash provided by operating activities			82,225				79,425
Cash flows from investing activities:
Purchase of property and equipment			(2,879	)			(2,574	)
Proceeds from (investments in) deposits			23,592				(55,499	)
Proceeds from sale of property and equipment			203				48
Payments for business acquisitions, net of cash acquired			(375	)			(8,060	)
Capitalized software development costs			(7,133	)			(6,518	)
Acquisition of intellectual property			-				(177	)
Net cash provided by (used in) investing activities			13,408				(72,780	)
Cash flows from financing activities:
Proceeds from employee stock options exercised			98				4,809
Distribution of dividend			(31,823	)			(28,144	)
Repayment of Series B Debenture			(19,796	)			(19,796	)
Acquisition deferred payment			(630	)			-
Acquisition of non-controlling interests			(4,131	)			(161	)
Dividend to non-controlling interest			-				(47	)
Net cash used in financing activities			(56,282	)			(43,339	)
Effect of exchange rate changes on cash and cash equivalents			(2,377	)			3,125
Increase (decrease) in cash and cash equivalents			36,974				(33,569	)
Cash and cash equivalents at the beginning of period			126,716				160,285
Cash and cash equivalents at the end of period			163,690				126,716

 

 

Debentures Covenants

 

As of December 31, 2024, 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 $479.6 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 (57.93)%.

 

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 (1.71).

 

 

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