Matrix announces the results of the first quarter of 2011

13/06/2011

​All-time peak in revenues and operating profits in the first quarter
Revenues increased by about 14% to approximately NIS 422M, and operating profit by abut 11%, to approximately NIS 35 M

In the first quarter of 2011 Matrix continues to retain its leading position in the Israeli IT market. Moti Gutman, Matrix CEO: "In the first quarter of 2011 Matrix achieved an all-time record growth in revenues that reached approximately NIS 422M, a growth of about 14% compared with the corresponding quarter of the previous year; and also an all-time record growth in operating profit that reached approximately NIS 35M, a growth of about 11%. The growth in revenue and operating profit are the result of an increase in activity in all sectors, especially in the core business sector, software solutions and services, which showed a growth of about 12% in revenues and of about 11% in operating profit. Net profit suffered as a result of increase in financing expenses, in particular due to the CPI increase in the quarter (about 1%) compared with a decline of about 0.9% in the CPI in the corresponding quarter of the previous year.

The company's results continue to be manifest in a strong cash flow, which, together with the growing financial stability of Matrix, serves the ongoing implementation of the strategy of growth and the continuation of the policy of dividend distribution as in the past.

Several weeks ago, the rating company, STKI, for the sixth year in a row, ranked Matrix as a leader in the IT services market and as a leader in most of the important categories in the market, such as software development, the channels and digital field, CRM systems, Internet and mobile, training and deployment, software testing, integration and virtualization services, expert services, ERP leadership among Israeli companies, and more.

Summary of Profit and Loss (in thousands of NIS)

​
 
For three months ending on
 
31.03.11
31.03.10
Turnover
422,125
370,728
Cost of sales and services
345,120
298,375
Gross profit
77,005
72,353
 
R&D expenses
--
154
Sales and marketing expenses
15,947
14,963
Management and general expenses
25,999
25,659
Profit from regular activities
35,059
31,577
 
Net financing costs
4,830
1,966
Net financing gains
170
2,611
The company’s share in the losses of affiliated companies
864
900
Profit before taxes
29,525
31,322
Taxes on income
7,475
7,251
Net profit
22,060
24,071
 
 
 
Net profit of:
 
 
Owners of capital rights in the company
22,097
24,014
Minority rights
(37)
57
Net profit
22,060
24,071

Company Revenues

Company Revenues reached approximately NIS 422.1M compared with approximately NIS 371M in the corresponding quarter of the previous year, an increase of approximately 14%.
Revenues from the software services sector amounted to approximately NIS 272.8M compared with approximately NIS 243.3M in the corresponding quarter of the previous year, an increase of approximately 12%. Operating profits in the software services sector grew to NIS 25.5M, compared with NIS 23M in the corresponding quarter of the previous year, an increase of about 11%.
In the first quarter Matrix won important projects such as: Mobile project for the service manual of a leading Mobile services organization; mobile applications for preferred business clients; automated warehouse management (WMS) for two large retail companies; loan system for a leading bank; a BI project for a metrics and goals system for a telecom firm, and a BI system for a large public organization; two websites for financial clients; channel infrastructure for a bank, and a large integration and interface project in the capital market; conversion of dozens of knowledge management sites for a government organization; a central distribution system for a telecom client; and more.
Revenues in the Marketing of software products sector amounted to approximately NIS 52.7M compared with approximately NIS 37.1M in the corresponding quarter of the previous year, an increase of 42%.
Revenues from the integration and computer infrastructure sector amounted to about NIS 65.3M compared with approximately NIS 60.9M in the corresponding quarter of the previous year, an increase of about 7%.
Revenues from the training and deployment sector amounted to approximately NIS 41.3M compared with NIS 39.6M for the same period of the previous year, an increase of about 4%.
 
 
 
Operating Profit
Operating profit grew by approximately 11% and amounted to approximately NIS 35.1M, compared with NIS 31.6M in the corresponding quarter of the previous year.
 

Net Profit

Net profit in the quarter amounted to approximately NIS 22.1M, compared with around NIS 24M in the corresponding quarter of the previous year. The decrease in net profit, despite the increase in operating profit, resulted mainly from an increase in financing expenses.
Cash flow and financing sources. In the first quarter, cash flow from current activity amounted to approximately NIS 31,550 thousands, compared with around NIS 29,230 thousands in the corresponding quarter of the previous year.
The company has cash reserves and financial assets in the amount of NIS 256,612 thousands.
Dividends. On 12.4.2011 the company distributed a dividend of 18 agorot per share.
Shareholders’ equity capital as of the date of the report amounted to about NIS 551,371 thousand compared with approximately NIS 529,260 thousand on 31.03.10.
 
The current ratio of the company stands at 1.5.
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