BluePhoenix Solutions Reports First Quarter 2013 Results

Continued progress is shown in Q1 with Operating Profit of $97K and a reduced expense run rate, non-GAAP earnings per share increase of 65%

SEATTLE, Washington May 30th, 2013 – BluePhoenix Solutions (NASDAQ: MDSY), the leader in legacy lifecycle modernization, today announced financial results for the first quarter of 2013. The turnaround plan continues to be on target resulting in Operating Profit of $97K and reduced expenses on a sequential quarter basis (Q1 vs. Q4).

Q1 Operating Profit was $97K vs. Q1 2012 loss of ($2.94MM). Q1 Non-GAAP Operating Loss was ($527K) vs. Q1 2012 loss ($1.69MM). Q1 Non-GAAP Operating Expenses decreased (as part of the restructuring plan) to $1.7MM a $300K reduction from Q4 2012 (of $2MM). Q1 Non-GAAP Earnings Per Share were at a loss of ($0.08) per diluted share compared to a loss of ($0.02) in Q4 2012 and a loss of ($0.23) in Q1 2012. Ending cash decreased ($455K) to $2.1MM from $2.56MM in Q4 2012.

Matt Bell, CEO of BluePhoenix said “We are very happy with the progress we are making and the quarterly numbers continue to show improving results. Almost all of the restructuring is behind us and we are now focused on our core strengths, building sales, and launching new marketing efforts. As a result the pipeline is growing and we are finding new areas to leverage existing technology to sell to new markets.”

BluePhoenix will go over the following numbers during their quarterly conference call today at 4:30PM Eastern US time. The call can be accessed by dialing 1-888-668-9141 within the United States, or via +972-3-9180610 if calling internationally, approximately five minutes prior to its scheduled commencement. A live Veidan Broadcasting and a replay can be accessed through a link that will be available via the BluePhoenix website.

 

GAAP Results (in thousands US$)

Q1 2013

Q4 2012

Q1 2012*

Revenues

2,198

3,059

2,024

Operating profit (loss)

97

218

(2,938)

Net loss

(600)

(383)

(3,249)

Loss per share, diluted*

(0.06)

(0.04)

(0.50)

Non-GAAP Results (in thousands US$)

Q1 2013

Q4 2012

Q1 2012*

Revenues

2,198

3,059

2,024

Operating profit (loss)

(527)

(72)

(1,692)

Net (Loss) Income

(823)

(264)

(1,501)

Earnings (Loss) per share, diluted*

(0.08)

(0.02)

(0.23)

 

Notes:
* The results for Q1 2012 are presented after reclassification of Liacom Ltd and Bridgequest as discontinued operation.

Non-GAAP financial measures

The release includes non-GAAP diluted earnings per share and other non-GAAP financial measures, including non-GAAP operating income and non-GAAP net income. These non-GAAP measures exclude the following items:

  • Amortization of intangible assets;
  • Stock-based compensation;
  • Onetime expenses related to cost saving plan and one time charges;
  • Revaluation of derivatives and discount amortization;
  • Gain on sales of subsidiaries and Appbuilder ;
  • Net loss from discontinued operation.

 

The presentation of these non-GAAP financial measures should be considered in addition to BluePhoenix’ GAAP results and is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. BluePhoenix’ management believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance by excluding certain charges and gains that may not be indicative of BluePhoenix’ core business operating results. BluePhoenix believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing BluePhoenix’ performance. These non-GAAP financial measures also facilitate comparisons to BluePhoenix’ historical performance. BluePhoenix includes these non-GAAP financial measures because management believes they are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision-making. Non-GAAP measures are reconciled to comparable GAAP measures in the table entitled “Unaudited Reconciliation of GAAP to Non-GAAP.”

 

About BluePhoenix Solutions

BluePhoenix Solutions Ltd. (NASDAQ: MDSY) is the leading provider of legacy language and database translation. The BluePhoenix portfolio includes a comprehensive suite of tools and services for automated database and application migration. Leveraging over 20 years of best-practice domain expertise, BluePhoenix works closely with its customers to minimize risk and provide a clear path from legacy platforms like COBOL, Natural/Adabas and others to modern solutions like SQL, DB2, Java and more. BluePhoenix customers come from diverse industries and vertical markets such as automotive, banking and financial services, insurance, manufacturing, and retail. BluePhoenix has offices in the USA, UK, Italy, Romania, and Israel.

Cautionary Statement Regarding Forward-Looking Statements

Certain statements contained in this release may be deemed forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and other Federal Securities laws. You can identify these and other forward-looking statements by the use of words such as “may,” “will,” “plans,” “believes,” “estimates,” “expects,” “predicts”, “intends,” the negative of such terms, or other comparable terminology. Because such statements deal with future events, plans, projections, or future performance of the Company, they are subject to various risks and uncertainties that could cause actual results to differ materially from the Company’s current expectations. These risks and uncertainties include but are not limited to: the effects of the global economic and financial trends; market demand for the Company’s products; successful implementation of the Company’s products; changes in the competitive landscape, including new competitors or the impact of competitive pricing and products; and such other risks and uncertainties as identified in BluePhoenix’ most recent Annual Report on Form 10-K and other reports filed by it with the SEC. Except as otherwise required by law, BluePhoenix undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. This press release is also available at http://modernsystems.com. All names and trademarks are their owners’ property.

 

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