Matrix announces the results of the third quarter of 2011

13/11/2011

 
Company revenues increased by about 16.6% and reached a record NIS 435M Operating profit grew by about 9% and reached approximately NIS 35.4M Net profit grew by about 6% and reached approximately NIS 22.2M
 
Matrix closes the third quarter of 2011 showing growth in revenues and profit, and preserves its leading position in the Israeli IT market. Moti Gutman, Matrix CEO: "We conclude an excellent quarter with peak revenues and increase in operating and net profit. Our core businesses, the software solutions and services sector, showed a growth of about 19%. Substantial growth in this quarter, occurring in all sectors of activity, is the result of correct investment in solutions and of winning projects in a range of market sectors, as well as of our continued provision of professional services at the highest level to our customers. We are glad that our customers continue to expand their business with us through various projects, and we are proud of the success of our new projects and solutions. I'm proud of Matrix having been chosen again as a market leader in value-added services in the Israeli IT market, the fourth consecutive time, with a large gap between us and our competitors, as published in the latest IT market report by the research firm IDC.
Summary of profit and loss in the third quarter (in thousands of NIS)
 
 
For three months ending on
For nine months ending on
 
30.09.11
30.09.10
30.09.11
30.09.10
Turnover
435,156
373,188
1,285,720
1,114,179
Cost of sales and services
356,598
300,855
1,052,292
896,880
Gross profit
78,558
72,333
233,428
217,299
 
R&D expenses
--
149
--
458
Sales and marketing expenses
17,178
15,049
49,665
45,590
Management and general expenses
25,953
24,609
77,897
75,036
Profit from regular activities
35,427
32,481
105,866
96,203
 
 
 
 
Net financing costs
5,661
7,056
20,372
15,709
Net financing gains
535
2,677
4,161
7,022
The company’s share in the losses of affiliated companies
(734)
(1,026)
(1,218)
(2,437)
Profit before taxes
29,567
27,076
88,431
85,079
Taxes on income
7,333
6,068
21,801
18,964
Net profit
22,234
21,008
66,636
66,115
 
Net profit attributable to:
Owners of equity rights in the company
22,352
21,043
66,806
66,120
Minority rights
(118)
(35)
(170)
(5)
Net profit
22,234
21,008
66,636
66,115
 
In the third quarter of 2011, Matrix won new contracts in the entire range of its sectors and services, including: Business Service Management (BSM) project for a shipping company; setup of websites for the government, the IDF, and a large service company; mobile projects for public institutions, including field workers and terminals; cyber projects in the security sector; automated warehouses for an international shipping company and a distribution company; an ERP project for a factoring enterprise; wide-range system conversion projects for two financial institutions; integration projects (SOA) for the army; deals in the area of command and control products; business services-oriented management and an OEM deal for the high-tech sector; broad-scope CRM-based deployment projects in the financial sector, and SAP-based in the industry sector; numerous storage and virtualization projects for the high-tech and trade and industry sectors; the establishment of a near-shore center for a company in the public sector; a near-shore development center in the area of BI and the establishment of near-shore development activity for a large industrial company; the establishment of an automated testing center for a large insurance company, and two significant testing projects for a security company and for a high-tech company; and more.
 
ANALYSIS OF RESULTS
Company Revenues
Company revenues in the third quarter grew by approximately 16.6% and reached approximately NIS 435M compared with approximately NIS 373M in the corresponding quarter of the previous year.
 
Operating Profit
Operating profit grew by approximately 9% and amounted to approximately NIS 35.4M, compared with NIS 32.5M in the corresponding quarter of the previous year.
 
 
Net Profit
Net profit in the quarter amounted to approximately NIS 22.2M, compared with around NIS 21M in the corresponding quarter of the previous year, a growth of about 6%.
Activity sectors
Revenues from the software solutions and software services sector, the core business of the company, amounted to approximately NIS 302M compared with approximately NIS 253.7M in the corresponding quarter of the previous year, an increase of about 19%. Operating profit of the sector amounted to approximately NIS 26.5M compared with about NIS 24.8M in the corresponding quarter of the previous year, an increase of about 7%.
Revenues from the marketing of software products sector amounted to approximately NIS 39.3M compared with approximately NIS 38.4M in the corresponding quarter of the previous year, an increase of about 2.3%.
Revenues from the infrastructure integration and communications sector amounted to approximately NIS 61.5M compared with approximately NIS 55.7M in the corresponding quarter of the previous year, an increase of about 10.5%. Operating profit in the sector amounted to approximately NIS 2.5M compared with approximately NIS 2M in the corresponding quarter of the previous year, an increase of about 25%. Sector growth is due in part to new customers and demand in new areas like cloud computing solutions, virtualization, and advanced solutions for data storage and backup.
Revenues from the training and deployment sector, amounted to approximately NIS 41.5M compared with approximately NIS 35M in the corresponding quarter of the previous year, an increase of about 18.6%. Operating profit of the sector amounted to approximately NIS 2.2M compared with about NIS 1.2M in the corresponding quarter of the previous year, an increase of about 83%.
 
Cash flow and financing sources
The positive cash flow from current activity amounted to approximately NIS 44,415 thousand.
The company has cash reserves and short-term financial assets in the amount of approximately NIS 183M.
Dividends. Total dividends distributed from the start of the period amounted to approximately NIS 50.3M. This morning the company announced a further distribution of dividends in an amount of approximately NIS 16.8M.
Shareholders’ equity capital as of the date of the report amounted to about NIS 573M compared with approximately NIS 545M on 30.09.10.
The current ratio of the company stands at 1.6.
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