RA'ANANA, Israel--(BUSINESS WIRE)--Oct. 29, 2003--NICE System (Company
Profile, Past
Stories, Case
Studies) (Nasdaq:NICE - News):
Highlights:
Revenue increased 3% sequentially and 51% year-over-year
Gross margin improved to 53.1%
GAAP EPS of $0.21; excluding restructuring charges, EPS was $0.24
Focus on working capital management helped generate $9.8 million operating cash flow; DSO declined to record low of 73 days
NICE Systems (Nasdaq:NICE - News), a worldwide leader of multimedia recording solutions, applications and related professional services for business interaction
management, today announced unaudited results for the quarter ending September 30, 2003.
Revenue in the third quarter was $58.0 million, a 3% sequential increase from $56.2 million in the second quarter of 2003, and a 51% increase from the third quarter of 2002.
On a GAAP basis, net income was $3.5 million, or $0.21 per share, compared with net income of $1.4 million, or $0.09 per share, on a fully diluted basis, in the second
quarter of 2003. In the third quarter of 2002, GAAP net income was $0.4 million, or $0.03 per fully diluted share.
Excluding restructuring charges, non-GAAP net income in the third quarter was $4.0 million, or $0.24 per fully diluted share, compared with net income of $2.3 million, or
$0.14 per fully diluted share in the second quarter of 2003, and net income of $0.4 million, or $0.03 per fully diluted share, in the year earlier period.
Commenting on the results, Haim Shani, president and CEO of NICE said, "We reported another strong quarter, reflecting especially good results in the contact
center/financial trading floor segment, where we continue to increase our market share and to leverage the former TCS customer base and distribution channels. We also
continued to increase our service revenues and achieved more than a two percentage point improvement in gross margin in Q3 versus Q2. For the first nine months of 2003
our gross margin is up over four margin points from the corresponding period in 2002."
Gross margin in the third quarter reached 53.1%, up from 51.0% in the second quarter of 2003 and 49.1% in the third quarter a year ago. Operating expenses increased
slightly on a sequential basis due a major customer event and trade show during the quarter. As a percent of revenue, operating expenses were 47.7% in the third quarter of
2003 compared with 48.5% in the second quarter of 2003 and 50.5% in the third quarter of 2002. On a GAAP basis, the company reported operating income of $3.2 million
for the third quarter. However, excluding restructuring charges, NICE had a non-GAAP operating profit of $3.6 million.
Balance Sheet
Total cash and equivalents at September 30, 2003 rose to $93.2 million compared with $87.0 million at June 30, 2003. Reflecting continued focus on working capital
management, the company generated operating cash flow of $9.8 million during Q3 and DSO fell to an all-time low of 73 days from 81 days at the end of the second quarter.
Outlook
Commenting on the outlook, Mr. Shani said, "We are expecting revenue in Q4 to be between $63 million and $68 million, depending on the timing of orders related to
several large projects. We continue to expect to report at least $0.80 per share for the full year, before special charges."
Conference Call
NICE will host a conference call to discuss these topics today at 8:30 a.m. EST (15:30 Israel). The call will be broadcast live on the internet via NICE's website at
www.nice.com. A telephone replay will be available for up to 72 hours after the call. The replay information will also be available on NICE's website.
About NICE
NICE Systems (Nasdaq:NICE - News) headquartered in Ra'anana, Israel, is a worldwide leader of multimedia digital recording solutions, applications and related professional
services for business interaction management. NICE products and solutions are used in contact centers, trading floors, air traffic control (ATC) sites, CCTV (closed circuit
television) security installations and government markets. NICE's synergistic technology platform enables customers to capture, evaluate and analyze business interactions
in order to improve business processes and gain competitive advantage. NICE's subsidiaries and local offices are based in the United States, Germany, United Kingdom,
France and Hong Kong. The company operates in more than 100 countries through a network of partners and distributors.
NICE's worldwide clients include: ABN Amro, Bank of England, Boston Communications, Compaq Computer Corporation, Deutsche Bank, Dresdner Bank, Emeraude
Group, US Federal Aviation Administration, Hong Kong Airport, Japan Ministry of Transport, Los Angeles Police Department, MicroAge Teleservices, NAV Canada, New
York Police Department, Nokia, SNT Group, Software Spectrum and Sydney Airport (NICE Web Site: www.nice.com).
Trademark Note: 360 Degree View, Agent@home, Big Picture Technology, Executive Connect, Executive Insight(a), Experience Your Customer, Investigator, Lasting
Loyalty, Listen Learn Lead, MEGACORDER, Mirra, My Universe, NICE, NiceAdvantage, NICE Analyzer, NiceCall, NiceCLS, NiceCMS, NICE Feedback, NiceFix,
NiceGuard, NICE Learning, NICE Link, NiceLog, ScreenSense, NiceScreen, NiceSoft, NICE Storage Center, NiceTrack, NiceUniverse, NiceUniverse LIVE, NiceVision,
NiceVision Harmony, NiceVision Mobile, NiceVision Pro, NiceVision Virtual, NiceWatch, Renaissance, Secure Your Vision, Tienna, Wordnet and other product names and
services mentioned herein are trademarks and registered trademarks of NICE Systems Ltd. All other registered and unregistered trademarks are the property of their
respective owners.
(a) In Australia only
This press release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such statements are based on the
current expectations of the management of NICE Systems Ltd. (the Company) only, and are subject to a number of risk factors and uncertainties, including but not limited to
changes in technology and market requirements, decline in demand for the Company's products, inability to timely develop and introduce new technologies, products and
applications, difficulties or delays in absorbing and integrating acquired operations, products, technologies and personnel, loss of market share, pressure on pricing resulting
from competition, and inability to maintain certain marketing and distribution arrangements, which could cause the actual results or performance of the Company to differ
materially from those described therein. We undertake no obligation to update these forward-looking statements. For a more detailed description of the risk factors and
uncertainties affecting the company, refer to the Company's reports filed from time to time with the Securities and Exchange Commission.
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