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SCITEX ANNOUNCES FOURTH QUARTER AND FULL YEAR 1999
RESULTS
HERZLIA, ISRAEL -- February 2, 2000: Scitex Corporation Ltd. (NASDAQ:SCIX)
today announced net income for the fourth quarter of 1999 of $12.8 million
or $0.30 per share (diluted), compared to $6.4 million or $0.15 per share
for the fourth quarter of 1998. Fourth quarter 1999 results include the
reduction of $2 million in reserves associated with the company's sale
of the digital video business in 1998. Excluding this item, net income
from continuing operations for the fourth quarter of 1999 was $10.8 million
or $0.25 per share.
Revenues for the fourth quarter of 1999 were $196 million, up 11% from the $177 million recorded in the fourth quarter of 1998. Gross profit for the fourth quarter of 1999 was $84.8 million (43.2% of sales), compared with $77.4 million (43.7% of sales) in the same period last year. Operating income for the fourth quarter of 1999 was $18.2 million, compared to $14.1 million recorded in the fourth quarter of 1998.
Commenting on the results, Yoav Z. Chelouche, President and Chief Executive Officer, said: "The results are very strong. Fourth quarter revenues were the highest in Scitex's history and operating profits reached a five year high. The quarter saw the completion of our turnaround of the preprint business, returning it to growth and profitability. This was followed by the recently announced agreement to merge this business with Creo Products Inc. The results are a further significant milestone in the pursuit of our strategy to achieve market leadership for our businesses."
Net income for the full year of 1999 was $31 million or $0.71 per share
(diluted) compared to a loss of $111 million or ($2.58) per share in 1998.
Full year 1999 results include $7 million reduction in reserves associated
with the sale of the digital video business in 1998. Excluding this item
net income from continuing operations was $24 million or $0.55 per share
(diluted) compared to net income of $10 million or $0.23 per share in
1998 (excluding $44.3 million in-process
R&D write-off associated with the acquisition of Idanit).
For the full year of 1999, operating income was $50 million, up 142% compared to 1998 operating income of $20 million (excluding $44.3 million charges for in-process R&D associated with the acquisition of Idanit). Revenues for the full year were $690 million, an increase of 8% over the $640 million achieved in 1998.
In the fourth quarter of 1999, revenues from the Americas were $90 million compared to $81 million for the fourth quarter of 1998. Revenues from Europe were $73 million compared to $70 million for the fourth quarter last year. Japan recorded revenues of $14 million for the quarter compared to $15 million for the fourth quarter last year, while Asia Pacific and other regions recorded $19 million in revenues compared to $11 million for the fourth quarter of 1998.
Chelouche continued: "Digital Preprint revenues for the fourth quarter of 1999 were a record $135 million compared with $119 million in the fourth quarter of 1998. Sales of our industry-leading Lotem(tm) computer-to-plate system grew rapidly in all geographical regions."
Revenues from Scitex Digital Printing in the fourth quarter of 1999 were $39 million, compared to the $42 million recorded in the same period last year. In 1999 SDP introduced the Scitex VersaMark(tm) technology platform which is the basis for new products and applications. The Scitex VersaMark accounted for over 40% of SDP's equipment sales in this quarter.
In a separate announcement issued today, SDP reported that it has won a major contract to supply eight Scitex VersaMark digital printing systems to British Telecom. This is a strategic account for SDP. The equipment will enable British Telecom's billing centers to print over one billion pages per annum.
Scitex Wide Format Printing recorded strong growth in the quarter with revenues of $17.4 million, compared to $7.8 million in the fourth quarter of 1998. The successful integration of Idanit and Matan during the year, together with the breadth of the product line, enabled Scitex Wide Format Printing to become the leading player in the sector. The new Scitex Pressjet(tm) wide format printer, designed to provide digital solutions to the silk screen printing market has entered beta testing. It is the world's fastest wide format inkjet printer.
The 50/50 joint venture with KBA, Karat Digital Press, which develops and manufactures the highly innovative 74 Karat(tm) short-run, color, digital offset press, expanded its beta testing program in the final quarter of 1999, with units installed at six test sites by the year end.
Vio Worldwide Limited, Scitex's 50/50 joint venture with British Telecom, is pioneering Internet and telecom services for the printing industry. During Q4 1999, it expanded access to its services via the Internet. Vio Worldwide is enjoying a growing user base, including Internet users.
After the close of the quarter, Scitex announced that following its investment in RTimage Ltd., it will hold approximately 13% of the company's shares (fully diluted). RTimage is a leading provider of professional Internet-based imaging products and services for the graphic arts and medical communities.
Eyal Desheh, Corporate Vice President and Chief Financial Officer, said:
"Scitex's financial results in the last quarter of 1999 demonstrate
management's commitment to the turnaround of the business and position
Scitex for strong organic growth in the future. Closing the year with
a healthy balance sheet, we have the flexibility to pursue strategic add-ons
to our core digital printing business."
As detailed in the press release issued on January 18, Scitex's
strategy will continue to be:
- To achieve market leadership in digital printing and ink-jet technologies;
- To pursue emerging opportunities offered by the Internet in the imaging and media sectors;
- To exploit synergies between Scitex's operating units.
Contacts: Bob Nagle/Scitex Corporation Ltd. T: 781-280-7242. Mark Sullivan/Scitex America Corp. T: 781-275-5150. Craig Kevghas/CPR Marketing, Inc. T: 978-392-8990