Retalix Announces Fourth Quarter and FY 2010 Results

/ Source: GlobeNewswire

RA'ANANA, Israel, March 2, 2011 (GLOBE NEWSWIRE) -- Retalix® Ltd. (Nasdaq:RTLX), a leading provider of software and services for retailers and distributors, announced today results for the fourth quarter and full year ended December 31, 2010.

Summarized financial highlights for the fourth quarter and twelve-month period ended December 31, 2010:

  • Total Revenues for the full year were $207.4 million, compared with $192.4 million in 2009. Total revenues for the fourth quarter of 2010 were $53.8 million, compared to $46.4 million in the fourth quarter of 2009.
  • Adjusted Income from Operations (Non-GAAP)* for the full year was $19.8 million, compared to $15.5 million in 2009. In the fourth quarter of 2010 adjusted income from operations (non-GAAP) was $4.5 million, compared to $0.2 million in the fourth quarter of 2009.
  • Income from Operations (GAAP) for the full year was $12.4 million, compared to $7.8 million in 2009. In the fourth quarter of 2010 income from operations (GAAP) was $2.7 million, compared to a loss of ($3.1) million in the fourth quarter of 2009.
  • Financial Income for the full year was $3.5 million, compared to financial income of $1.8 million in 2009. In the fourth quarter of 2010 financial income was $2 million, compared to $0.2 million the fourth quarter of 2009. Included in the financial income is $0.8 million in the fourth quarter of 2010 and a total of approximately $2 million for the full year in interest income related to tax refunds, in addition to the impact of currency fluctuations on the Company's non-dollar assets and the value of the Company's forward currency transactions.
  • Adjusted Net Income (Non-GAAP)* for the full year grew to a record level of $17.1 million, or $0.70 per diluted share, compared to $12 million, or $0.57 per diluted share, in 2009. In the fourth quarter of 2010 the adjusted net income (non-GAAP) was $4 million, or $0.16 per diluted share, compared to a loss of ($0.9) million, or ($0.04) per diluted share, in the fourth quarter of 2009. The per diluted share calculation for the fourth quarter includes an increase in the weighted diluted shares outstanding to approximately 24.6 million versus 22.1 million shares in the fourth quarter of 2009 and for the full year 2010 the weighted diluted shares outstanding was 24.5 million versus 21 million shares for the full year 2009. The increases reflect the private placement to the Alpha Group completed in November 2009.
  • GAAP Net Income for the year was $10.8 million, or $0.44 per diluted share, versus $5.8 million, or $0.28 per diluted share, in 2009. For the fourth quarter of 2010, GAAP net income was $2.6 million, or $0.11 per diluted share, versus a loss of ($4.0) million, or a loss of ($0.18) per diluted share, in the fourth quarter of 2009. The per diluted share figures again reflect the increase in shares outstanding mentioned above.
  • generated for the full year was $33.9 million, of which $15.3 million was generated during the fourth quarter of 2010. The cash flow from operating activities for the full year includes $10.6 million related to a tax refund and interest.
  • Balance Sheet grew to about $134.6 million in cash and cash equivalents, deposits and marketable securities with negligible debt as of December 31, 2010.

Shuky Sheffer, Chief Executive Officer of Retalix, said, "2010 was an important transition year for Retalix. We grew total revenues and profitability coming in at the higher end of our guidance, including a new record level of over $17 million in Net Income (Non-GAAP) for Retalix. We built a clear strategy for the company and are executing on this plan. In our first full year the new management team produced consistent performance, achieved its targets and took important steps including investing in building our growth engines, enhancing the infrastructure and customer facing teams and creating a sales driven organization to enable future growth. We are beginning 2011 with a lot of excitement, including the launch of our breakthrough new store suite, the Retalix 10 Store Suite, which offers advanced software applications and a unique architecture that seamlessly combines major customer-centric retail functions while enabling quicker time-to-market and reducing the total cost of ownership. We are also continuing to build and expand our value-added service offerings and pursuing new opportunities created by the blurring of lines between the retail verticals and in new geographies for Retalix."

Hugo Goldman, the Company's Chief Financial Officer, said, "In the fourth quarter of 2010 we again reported strong improvements in total revenues and our operating and net income versus the year-ago period. Included in our fourth quarter operating expenses were increased investments in sales and marketing and R&D as we prepared for the January 2011 launch of our innovative new store platform, Retalix 10. We also continued to invest in our services offering and add to our headcount to enhance our infrastructure and customer facing operations. Including the increased investments we were still able to achieve an 8.4% operating margin (non-GAAP) in the fourth quarter and a 9.5% operating margin (non-GAAP) for the full year. We also continued to produce a very healthy cash flow from operations, generating approximately $15.3 million in the fourth quarter and nearly $34 million for the full year. The interest income from the tax refunds along with our currency hedges and favorable fluctuations in the currency markets combined to provide strong financial income. We do not expect to have the same levels of financial income in 2011. The cash flows helped us to continue to maintain a very strong balance sheet with over $134 million in cash and cash equivalents with very negligible debt."

Outlook for FY 2011

Sheffer added, "As we begin 2011 we believe Retalix is well positioned with the innovative solutions designed to help retailers enhance their customer experience and operations by reducing the time, investment and effort required to integrate new technologies into their operations. In 2010 we built our long-term strategy and now we are executing on this plan, working hard to capture the market opportunities and build our pipeline.

Our business traditionally builds quarter-to-quarter and our expectation is the same for 2011. We expect total revenues for 2011 to be in the range of $217 million to $228 million. We also expect to maintain at least the same level of profitability in 2011 as compared to 2010, while continuing the investments to enhance and build our products and service offerings and operations. We believe that the positive responses to our efforts from our existing and new customers and industry analysts, confirms the opportunities our investments are creating and gives us the confidence that we can start to leverage these investments in the year ahead."

Avi Naor Appointed as Chairman of the Board of Retalix

Retalix also announced that the appointment of Avi Naor, a member of Retalix's board of directors, as chairman of the board has now become effective. In September 2010, Retalix announced that Avi Naor would succeed Eli Gelman who had requested to step down from the chairman of the board position to carry out his new responsibilities as the CEO and president of Amdocs. Gelman continues to serve as a member of the board of directors of Retalix. Naor and Gelman are members of the Alpha Group and joined Retalix's board of directors in 2009, after the Alpha Group completed its investment in Retalix in November 2009.

Conference Call and Webcast Information

Retalix will be holding a conference call to discuss results for the full year and fourth quarter of 2010 on Wednesday, March 2nd 9:00 am Eastern Time (4:00 pm Israel Time). This conference can be accessed by all interested parties through the Company's web site at , which web site is not part of this press release. For those unable to participate during the live broadcast, a replay will be available shortly after the call on Retalix's web site.

About Retalix

Retalix is an independent provider of software solutions and services to retailers and distributors worldwide. Retalix solutions serve the needs of grocery chains, convenience and fuel retailers, food and consumer goods distributors and independent grocers. The Company offers a portfolio of software applications that automate and synchronize essential retail and supply chain operations, encompassing stores, headquarters and warehouses. The Company's International headquarters are located in Ra'anana, Israel, and its American headquarters are located in Dallas, Texas. For more information about Retalix, please visit www.retalix.com, the contents of which are not part of this press release.

The Retalix Ltd. logo is available at

Retalix is a registered trademark of Retalix Ltd. in the United States and in other countries. The names of actual companies, products and services mentioned herein may be the trademarks of their respective owners.

* Note Regarding the Use of Non-GAAP Financial Information

In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, Retalix uses Non-GAAP measures of operating income, operating margin, net income and earnings per diluted share, which are adjustments from results based on GAAP to exclude non-cash equity based compensation, indirect private placement costs, and amortization of intangibles related to acquisitions, as well as impairment of goodwill when applicable. Retalix's management believes the Non-GAAP financial information provided in this release is useful to investors' understanding and assessment of the Company's on-going core operations and prospects for the future. The presentation of this Non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. Management also uses both GAAP and Non-GAAP information in evaluating and operating business internally and as such deemed it important to provide this information to investors. Reconciliations between GAAP measures and Non-GAAP measures are contained following the GAAP financial statements in this press release.   

Safe Harbor for Forward-Looking Statements:

Except for statements of historical fact, the information presented herein constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other U.S. federal securities laws. For example, the statements regarding our "Outlook for FY 2011" including our expected results, expected demand and opportunities, future expansion of product offerings and services, and future strategic plans and positioning, all involve forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Retalix, including revenues, income and expenses, to be materially different from any future results, performance or achievements or other guidance or outlooks expressed or implied by such forward-looking statements. Such factors include risks relating to Retalix's anticipated future financial performance and growth, the performance of the US dollar relative to other currencies, continued roll-outs with existing customers, continued interest in Retalix's new platforms, the perception by leading retailers of Retalix's reputation, the potential benefits to food and fuel retailers and distributors, expansion into new geographic markets, and other factors over which Retalix may have little or no control. This list is intended to identify only certain of the principal factors that could cause actual results to differ. Readers are referred to the reports and documents filed by Retalix with the Securities and Exchange Commission, including Retalix's Annual Report on Form 20-F for the year ended December 31, 2009, for a discussion of these and other important risk factors. Except as required by law, Retalix undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof, or to reflect the occurrence of unanticipated events.

 

 

 

CONTACT: Retalix Ltd. Hugo Goldman +972-9-776-6677 investors@retalix.com