Emblaze Ltd. (LSE: BLZ)
("Emblaze" or "the Group")
Interim Management Statement
Ra'anana, Israel, 19 November 2009 - Emblaze is today announcing its Interim
Management Statement for the period commencing 1 January 2009 to 30 September
2009 (the "Reported Period"):
Highlights
The Group's performance during the Reported Period remains in line with
management expectations.
The Group's Growth arm, Formula Systems, reports improvement in profitability
despite the challenges in the global economy.
Following the reported period, Formula Systems announced that on 22 October
2009 it has completed the sale of its entire stake in nextSource Inc. for a
total consideration of $12 million, comprised of cash and release of bank
pledges. Formula expects to record capital gain from this transaction of
approximately $4 million in the forth quarter of 2009. Subsequently, Emblaze
expects to record approximately $2 million in capital gain for year end 2009.
Emblaze Mobile, a member of the Group's Innovation arm, announced earlier in
October the unveiling of its mobile platform, ELSE INTUITION™, jointly
developed with ACCESS CO. Exclusive unveiling of its first mobile device is
scheduled to take place in London on 24 November.
There has been no significant change in the Group's financial position during
the Reported Period.
Overview
GROWTH ARM - FORMULA
The table belowsummarises the Q3 2009 performance of Formula Systems in
comparison to its Q3 2008 performance (selected items):
Formula - Financial Highlights Three months ended Nine months ended
(unaudited consolidated results) September 30, September 30,
in $US million 2009 2008 % change 2009 2008 % change
Revenues 117.8 127.8 (7.9%) 345.7 373.5 (7.4%)
Operating income 9.6 9.8 (1.6%) 25.9 24.7 4.9%
Net income attributable to Formula 3.9 2.9 36.6% 11.1 10.2 8.8%
During the Reported Period, the Formula subsidiaries enjoyed continuing demand
for their products proving the need of businesses to save money, especially in
times of recession.
Matrix IT (TASE: MTRX) is one of Israel's leading integration and information
technology services companies with expertise in banking, insurance, telecom,
commerce and government IT solutions. In the period ending 30 September 2009,
Matrix continued to improve its performance as shown below:
Revenues for the third quarter were $91.4 million (Q3 2008: $101 million).
Revenues for the nine months period ending 30 September 2009 reached $270
million compared to $294 million for the first nine months of 2008.
Operating income in the third quarter was $7.9 million (Q3 2008: $7.8 million).
Operating income in the nine months period ending 30 September 2009 remained
steady with $21.2 million, compared to $21.6 million for the first nine months
of 2008.
Net income for the third quarter increased by 73.1% to $5.7 million (Q3 2008:
$3.3 million).
Net income for the nine months period ending 30 September 2009 was $16.3
million, compared to $13.8 million for the first nine months of 2008.
The functional currency of Matrix is the NIS and as such its statement of
operations is translated to the USD at average exchange rate prevailing during
the applicable period. Eliminating the exchange rate fluctuation, Matrix has
showed a significant increase in revenues, operating income and net income of
4.7%, 6% and 37.5%, respectively in the first nine months, compared with the
same period in 2008. On November 17, 2009, Matrix resolved to distribute a
dividend of NIS10 million (approximately $2.7 million) to its shareholders.
Magic Software (NASDAQ & TASE: MGIC) is a provider of multiple-mode application
platform solutions.
Reported an eleventh consecutive quarter of profitability
Revenues for the third quarter were $13.5 million (Q2 2009: $13.6 million).
Revenues for the nine months period ending 30 September 2009 reached $40.9
million, compared to $46.9 million for the first nine months of 2008.
Operating income in the third quarter was $0.8 million (Q2 2009: $1.0 million).
Operating income in the nine months period ending 30 September 2009 was $2.5
million, compared to $3.1 million for the first nine months of 2008.
Net income for the third quarter was $0.9 million (Q2 2009: $1.1 million).
Net income for the nine months period ending 30 September 2009 was $2.7
million, compared to $3.4 million for the first nine months of 2008
Total cash, cash equivalents and short-term investments as of September 30,
2009 were $37 million, compared to $33 million as of December 31, 2008.
Cash flow from operations for the first nine months of 2009 amounted to $4.3
million.
On the operational side, Magic's US branch continues to gain new customers, and
increased revenues and profits this quarter. The Japanese branch also showed
improved revenues and profitability thanks to careful planning. The company has
won a number of new iBOLT deals including a SaaS/on-premise integration for
Clinical Financial Services in the US; a Lotus Notes integration for MintWave
in Japan; a Salesforce.com/SAP R/3 integration for AVL in Austria; and a SAP R/
3 integration for KLAFS in Germany. The company also entered into a new
partnership agreement with nefos GmbH, a leading consulting partner for
Salesforce.com, based in Zurich, Switzerland. The uniPaaS application platform
continues to be adopted worldwide and close to 100 uniPaaS RIA projects are
being implemented in Japan alone.
Sapiens International Corporation (NASDAQ and TASE: SPNS) is a global provider
of information technology ("IT") solutions that modernise business processes to
enable insurance and other leading companies to quickly adapt to change.
Sapiens has reported its twelfth consecutive quarter of operational profit and
fifth consecutive quarter of Net income.
Revenues reached $12.9 million, an increase of 17% (Q3 2008: $11.0 million).
Operating profit increased 114% to $1.5 million (Q3 2008: $0.7 million).
Net Income reached $1.2 million on a non GAAP basis (Q3 2008: $0.8 million).
Total equity of $25.2 million, which represents 47% of balance sheet.
Earnings per share for this quarter were $0.05 (fully diluted), a significant
increase from $0.02 (fully diluted) earnings per share reported in Q3 2008.
Going forward, Sapiens expects to continue to expand its market reach by
focusing on the insurance industry with INSIGHT, its insurance solutions suite.
INNOVATION ARM
During the Reported Period, the subsidiaries of our Innovation arm achieved the
following:
Emblaze Mobile, design house for cutting-edge mobile technology, is already
actively promoting its mobile device to top-tier mobile operators worldwide,
and operator evaluations are currently underway. On 22 October 2009, Emblaze
Mobile and its partner ACCESS CO., LTD., a global provider of advanced software
technologies to the mobile and beyond-PC markets, unveiled ELSE INTUITION™, a
groundbreaking mobile platform jointly developed by ACCESS and Emblaze Mobile.
ELSE INTUITION™ combines ACCESS Linux Platform™ v3.0, ACCESS' flagship mobile
Linux® platform, with a state-of-the art user experience, innovative user
interface and a suite of services provided by Emblaze Mobile. The first ELSE™,
the first mobile device based on the ELSE INTUITION™ platform was previewed at
the same time. The unveiling of Emblaze Mobile's device - the first ELSE™ - is
scheduled to take place in London on 24 November 2009.
EMOZE, a provider of Push Email and synchronisation technology for mobile
devices, released the first dedicated push content client - a live update
service dedicated to football, pushing real-time news, scores, groups, tables
and pictures of the day for the vast football community worldwide in
preparation for the 2010 World Cup be held in South Africa.
Emblaze VCON Ltd., is a wholly owned subsidiary of ZONE-IP Ltd. Recent
transactions, including the bid on Tanberg by Cisco and the acquisition of
Life-Size by Logitech, provide further evidence that the videoconferencing
market is undergoing consolidation. In order to be among the leaders in this
market, Emblaze VCON continues to focus on providing the best software for
videoconferencing. The award winning vPoint HD with the addition of WebPoint
allows Emblaze VCON to provide solutions for a quick and easy videoconference
to every desktop in enterprises of all sizes. Emblaze VCON is in the process of
contracting with additional distributors in new territories in order to further
expand its reach.
Outlook
Both the Group's Growth and Innovation divisions are progressing well. Formula
continued the prudent cost saving strategy which was translated into a strong
cash position. Despite the inevitable affects of the tough current economic
climate, we are pleased to report all of Formula's subsidiaries performed
solidly, generating positive operating and net profits. Formula remains well
positioned to benefit from an improving business environment.
The Group continues its investment in research and development of its
Innovation activities and expenditure is in line with management expectations.
The success of this investment can be seen with the progress of the mobile
platform that was already unveiled and the upcoming unveiling of the device,
first ELSE™. Management believes that the Group's mobile activity will make a
contribution to revenues and profits for the Group in 2010 and beyond.
Enquiries:
Harry Chathli, Alexis Gore
Corfin Communications +44 (0)20 7977 0020
About Emblaze
Emblaze Ltd is a group of technology companies addressing both growth and
innovation activities thus combining the stability of "bread and butter" mature
technology enterprises with "high-risk / high-reward" investments in
innovation.
Our Growth arm includes Formula Systems (NASDAQ: FORTY and TASE: FORT), which
harbors the following subsidiaries: Magic Software Enterprises Ltd. (NASDAQ &
TASE: MGIC) develops, markets and supports composite application development
and deployment platforms with a service-oriented architecture (SOA), including
application integration and business process management (BPM), with existing
and legacy systems; Matrix IT Ltd. (TASE: MTRX) is one of Israel's leading
integration and information technology services companies, active in four
principal areas: software solutions and services, software products,
infrastructure solutions and hardware products, and training and assimilation.;
Sapiens International Corporation N.V. (NASDAQ & TASE: SPNS) is a provider of
IT solutions that modernize business processes to enable insurance and other
companies to quickly adapt to changes.
Our Innovation arm includes Emblaze Mobile, a technology design house for
cutting-edge mobile devices; EMOZE, a provider of Push Email and
synchronisation technology for mobile devices; and ZONE-IP (Emblaze V CON), a
provider of wireless video communications technologies and conferencing
solutions for operators and enterprise markets over IP networks.
The Emblaze Group is traded on the London Stock Exchange (LSE: BLZ) since 1996.
www.Emblaze.com
As at 30 September 2009, the Group held 50.7% of Formula's issued share
capital