Revenues increased by about 9.1% and reached NIS 633.3M; operating profit increased by about 10.2% to approximately NIS 44.2M, and net profit increased by about 7.8% to approximately NIS 27.2M
Matrix released this morning the results of the first quarter of 2016. In the first quarter of 2016, its revenues rose to over NIS 633M, an increase of 9.1%. Operating profit increased by approximately 10.2%, and amounted to about NIS 44.2M, and net profit grew by approximately 7.8% to about NIS 27.2M.
Moti Gutman, Matrix CEO: "The strong results of the first quarter are expressed in the growth of all indicators, year after year, based on a broad foundation of activity areas that are the engine of our growth. Over the years, we were able to identify new market segments and areas becoming the ‘next thing’ in the computing world, and we positioned ourselves as market leaders in these areas."
“Matrix is currently working in five main areas of activity: software solutions and services in Israel; software solutions and services in the United States; marketing and support of software products; integration and infrastructure solutions for IT; and training and deployment. The software services sector in Israel and the United States represents the core activity of the company, amounting to about 71.7% of revenues. In the area of software solutions and services in Israel, constituting approximately 61% of revenues of Matrix in Israel, the company recorded an increase of 10.7% in revenues, to approximately NIS 395.6M, and a 30.4% increase in operating profit, to about NIS 21.3M. In other areas of activity as well, we showed growth in revenues: the software solutions and services sector in the United States grew by about 7.2%, and reached approximately NIS 68M; the IT integration and infrastructure solutions sector grew by about 7.3%, amounting to about NIS 99.4M, owing to the increase in the area of cloud solutions and services. Revenues in the training and deployment sector grew by about 16%, to approximately NIS 40M. All these contributed to a significant growth of about 10.2% in operating profit, and about 7.8% in net profit of the company, quarter-to-quarter.”
Gutman adds: "We are growing in Israel and abroad—our revenue growth rate in Israel this quarter was about 9.3%, and in the US, about 7.2%. In the traditional areas, the domestic market provides us with additional significant growth horizons, such as analytics and big data, cyber, cloud computing, digital and mobile, regulation and compliance—areas that currently represent an important part of our growth strategy. We see the US market as a growth engine for Matrix. We are building Matrix to be a leader of GRC (governance, risk management, and compliance) in international financial markets and are creating the infrastructure to expand the services to other areas."
“Matrix continues its policy of quarterly dividend distribution at a rate of up to 75% of annual net profit, giving investors a dividend yield of 5.5%. This morning, Matrix announced a distribution of dividend in the amount of NIS 20M.”
On March 15, 2016, the rating company, Midrug, confirmed Matrix’s Aa3.il issuer rating, attesting to the stability of the company for the ninth consecutive year. This rating reflects Midrug’s evaluation of the stability and business leadership of the company, as well as the stability of the financial parameters of profitability, financial strength, and medium-term coverage ratios. According to the rater’s evaluation, Matrix has a high client distribution, a leading position in the financial sector, low exposure in the field of hardware, and the ability to maintain significant liquid reserves over time—factors that contribute to stability and risk reduction."
"In addition, the analyst company STKI ranked Matrix as a market leader in the field of software services for the 11th consecutive year. Matrix leads in all significant subcategories in the field of software services, including software development services, information security, CRM and social, development services for mobile, implementation of analytics (BI) projects, software integration, outsourcing at the client’s site and based on the Nearshore model, training and deployment, software testing and quality assurance, ALM, and more. In addition, according to the research company, STKI, Matrix also leads in the marketing of software solutions and products in the fields of system solutions (infrastructure and operating systems), middleware, and BSM solutions."
Summary of Profit and Loss Reports for three months ending on Mar 31, 2016 and 2015 (in thousands of NIS)
In the first quarter of 2016, revenues increased by 9.1% and reached approximately NIS 633.3M, compared with approximately NIS 580.4M in the first quarter of 2015. The increase in sales is due to the growth in all sectors of activity. Matrix sales in the US represent approximately 10.5% of total sales, similar to the same quarter last year.
Operating profit in the first quarter of 2016 increased by 10.2% and amounted to NIS 44.2M, which represents approximately 7% of sales, compared with NIS 40.1M in the corresponding quarter of the previous year, representing about 6.9% of sales. The increase in operating profit stems mainly from the increase in gross profit.
Net profit in the first quarter of 2016 increased by 7.8% and amounted to approximately NIS 27.3M, compared with a profit of approximately NIS 25.3M in the corresponding quarter of the previous year. The increase in net profit is due primarily to an increase in operating profit, which was partially offset by an increase in financing and tax expenses.
Cash flow and cash balances
The positive cash flow from current activity in the first quarter of 2016 amounted to approximately NIS 75.2M, compared with approximately NIS 50.4M in the corresponding quarter of the previous year. The company has cash balances, cash equivalents, and financial assets in the amount of NIS 297M, compared with NIS 225.5M at the end of the first quarter of 2015, an increase of 31.7%.
Shareholders' equity: Shareholders' equity capital as of the date of the report amounted to about NIS 627.7M, compared with approximately NIS 607.1M at the end of the first quarter last year, an increase of 3.4%.
The "net" debt in relation to total assets stands at 7.6% (compared with 8.9% last year).
First quarter results from 2013 to 2016