EXHIBIT 99.1
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Investor Relations Contacts:
Roni Gavrielov Jeffrey Goldberger/Marybeth Csaby
KM / KCSA Investor Relations KCSA Strategic Communications
+972-3-516-7620 212-896-1249/212-896-1236
roni@km-ir.co.il jgoldberger@kcsa.com / mcsaby@kcsa.com
SHAMIR OPTICAL INDUSTRY LTD.
REPORTS SECOND QUATER 2010 RESULTS
--REVENUE INCREASED 16.3% YEAR-OVER-YEAR
--OPERATING INCOME INCREASED 58.1% YEAR-OVER-YEAR
KIBBUTZ SHAMIR, ISRAEL, AUGUST 19, 2010 - Shamir Optical Industry Ltd.
(Nasdaq: SHMR) ("SHAMIR"), a leading provider of innovative products and
technology to the ophthalmic lens market, today announced unaudited financial
results for the second quarter ended June 30, 2010.
For the quarter ended June 30, 2010, revenues increased 16.3% to $41.0
million, compared with revenues of $35.2 million for the same period in 2009.
Gross profit for the quarter was $22.8 million, or 55.6% of revenues, compared
with gross profit of $19.0 million, or 53.8% of revenues for the same period
last year.
For the quarter ended June 30, 2010, operating income increased 58.1% to
$6.4 million, or 15.7% of revenues, compared with operating income of $4.1
million, or 11.6% of revenues for the same period last year.
Net income for the quarter increased 12.6% to $4.3 million, compared with
net income of $3.9 million for the same period in 2009. Net income attributable
to Shamir's shareholders was $4.2 million or $0.25 per diluted share, compared
with $3.7 million or $0.22 per diluted share for the same period in 2009.
Excluding the effect of non-cash stock-based compensation expenses,
amortization of intangible assets and in 2009 compensation to the Company's
former Chief Executive Officer, operating income for the quarter was $7.0
million, or 17.0% of revenues, compared with operating income of $4.8 million,
or 13.6% of revenues, for the same period last year.
Excluding the effect of non-cash stock-based compensation expenses,
amortization of intangible assets, net of tax, accretion of redeemable
non-controlling interest and in 2009 compensation to the Company's former Chief
Executive Officer, net of tax, net income attributable to Shamir's shareholders
for the quarter was $4.6 million, or $0.27 per diluted share, compared with net
income of $4.3 million, or $0.26 per diluted share for the same period last
year.
The reconciliation of GAAP operating income and net income to non-GAAP
operating income and non-GAAP net income is set forth below.
As of June 30, 2010, the Company had cash and cash equivalents, including
short-term investments of $34.0 million.
Commenting on second quarter results, Amos Netzer, chief executive officer
of Shamir, said, "During the second quarter, Shamir continued to execute
successfully according to its business plan, resulting in favorable operating
results throughout its geographic markets. We are pleased with our results in
2010 in the United States, which we attribute to our efforts to increase our
points of distribution in the country. We continue to explore opportunities
throughout the world to expand the presence of Shamir-branded products."
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SHAMIR / PAGE 2
For the fiscal year ending December 31, 2010, Shamir raised its previous
estimate for 2010 revenue growth to the range of 11%-15%, under the assumption
of December 2009 exchange rates.
CONFERENCE CALL:
Shamir has scheduled a conference call for 10:00 a.m. ET today to discuss
second quarter results. To participate in the call, please dial (888) 562.3356
(U.S. and Canada) or (973) 582.2700 (International). The conference ID for this
event is 93569786. For those unable to participate there will be a replay
available from 1:00 p.m. ET on August 19, 2010, through 11:59 p.m. ET, August
26, 2010. Please call: (800) 642.1687 (U.S. and Canada) or (706) 645.9291
(International). The ID code for the replay is 93569786.
The call will be available as a live, listen-only webcast at www.kcsa.com.
Please go to the KCSA website at least 15 minutes prior to the scheduled start
time to register, download and install any necessary audio software. A 30-day
archive of the webcast will be available approximately 2 hours after the
conclusion of the live call.
ABOUT NON - GAAP FINANCIAL MEASURES
This press release includes non-GAAP financial measures - non-GAAP
operating income and non-GAAP net income - that exclude certain charges. The
presentation of this financial information is not intended to be considered in
isolation or as a substitute for the financial information prepared and
presented in accordance with GAAP. Management of Shamir believes that non-GAAP
operating income and non-GAAP net income provides meaningful supplemental
information because these numbers reflect our core operational results and are
used by management internally to review Shamir's financial results.
ABOUT SHAMIR
Shamir is a leading provider of innovative products and technology to the
spectacle lens market. Utilizing its proprietary technology, the company
develops, designs, manufactures, and markets progressive lenses to sell to the
ophthalmic market. In addition, Shamir utilizes its technology to provide design
services to optical lens manufacturers under service and royalty agreements.
Progressive lenses are used to treat presbyopia, a vision condition where the
eye loses its ability to focus on close objects. Progressive lenses combine
several optical strengths into a single lens to provide a gradual and seamless
transition from near to intermediate, to distant vision. Shamir differentiates
its products from its competitors' primarily through lens design. Shamir's
leading lenses are marketed under a variety of trade names, including Shamir
Creation(TM), Shamir Piccolo(TM), Shamir Office(TM), Shamir Autograph(TM),
Shamir Attitude(TM) and Shamir Smart(TM). Shamir believes that it has one of the
world's preeminent research and development teams for progressive lenses, molds,
and complementary technologies and tools. Shamir developed software dedicated to
the design of progressive lenses. This software is based on Shamir's proprietary
mathematical algorithms that optimize designs of progressive lenses for a
variety of activities and environments. Shamir also has created software tools
specifically designed for research and development and production requirements,
including Eye Point Technology software, which simulates human vision.
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SHAMIR / PAGE 3
SAFE HARBOR STATEMENT
Statements concerning Shamir's business outlook or future economic
performance; product introductions and plans and objectives related thereto; and
assumptions made or expectations as to any future events, conditions,
performance or other matters, are "forward-looking statements" as that term is
defined under U.S. federal securities laws. Forward-looking statements are
subject to various risks, uncertainties and other factors that could cause
actual results to differ materially from those stated in such statements. These
risks, uncertainties and factors include, but are not limited to: The conflicts
in the region; the effects of competition in our industry, and changes in our
relationships with optical laboratories, distributors, research and development
partners and other third parties; the effects of the international expansion of
our operations and our ability to manage our growth, including our ability to
manage potential future acquisitions; the effect of global economic conditions
in general and conditions in Shamir's industry and target markets in particular;
shifts in supply and demand; market acceptance of new products and continuing
products' demand; the impact of competitive products and pricing on Shamir's and
its customers' products and markets; timely product and technology
development/upgrades and the ability to manage changes in market conditions as
needed; interest rate fluctuations; and other factors detailed in Shamir's
filings with the Securities and Exchange Commission. Shamir assumes no
obligation to update the information in this release.
(TABLES TO FOLLOW)
================================================================================
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SHAMIR OPTICAL INDUSTRY LTD.
Consolidated Balance Sheets
(US DOLLARS IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
As of December 31, As of June 30,
2009 2010
------------ ------------
(Unaudited)
CURRENT ASSETS:
Cash and cash equivalents $ 19,929 $ 19,078
Short-term investment 11,679 14,909
Trade receivables (1) 33,648 35,513
Other receivables and prepaid expenses 7,918 7,968
Inventory 26,946 25,471
------------ ------------
TOTAL CURRENT ASSETS 100,120 102,939
LONG-TERM INVESTMENTS:
Severance pay fund 2,909 2,761
Long-term receivables 427 371
Investments in affiliates 1,306 1,257
------------ ------------
TOTAL LONG-TERM INVESTMENTS 4,642 4,389
PROPERTY, PLANT AND EQUIPMENT, NET 38,568 35,165
OTHER ASSETS 7,439 6,365
GOODWILL 12,945 13,218
------------ ------------
TOTAL ASSETS $ 163,714 162,076
============ ============
CURRENT LIABILITIES:
Short-term bank credit and loans $ 11,033 $ 8,349
Current maturities of long-term loans 6,879 4,917
Trade payables 11,680 13,903
Accrued expenses and other liabilities 15,447 14,233
------------ ------------
TOTAL CURRENT LIABILITIES 45,039 41,402
LONG-TERM LIABILITIES:
Long-term loans 12,599 9,232
Capital leases 2,367 1,726
Accrued severance pay 3,270 3,180
Other long-term liabilities 2,763 1,368
Deferred income taxes 2,224 2,075
------------ ------------
TOTAL LONG-TERM LIABILITIES 23,223 17,581
Redeemable non-controlling interests 690 2,022
------------ ------------
EQUITY:
Share capital
Common shares of NIS 0.01 par value
Authorized: 100,000,000 shares at December 31, 2009 and June 30,
2010; Issued and outstanding: 16,592,345 and 16,778,908 shares at
December 31, 2009 and June 30, 2010, respectively 37 38
Additional paid-in capital 68,230 70,019
Accumulated other comprehensive income (1,122) (5,036)
Retained earnings 24,795 32,640
------------ ------------
Total Shamir Optical Industry Ltd. Shareholders' equity 91,940 97,661
Non-controlling interests 2,822 3,410
------------ ------------
TOTAL EQUITY 94,762 101,071
------------ ------------
TOTAL LIABILITIES AND EQUITY $ 163,714 $ 162,076
============ ============
(1) Net of allowance for doubtful accounts of $ 3,076 and $ 3,021 as of December
31, 2009 and June 30, 2010, respectively
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SHAMIR OPTICAL INDUSTRY LTD.
Consolidated Statements of Income
(US DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
Three Months Ended June 30, Six Months Ended June 30,
----------------------- -----------------------
2009 2010 2009 2010
-------- -------- -------- --------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Revenues, net $ 35,234 $ 40,978 $ 69,154 $ 81,073
Cost of revenues 16,273 18,181 32,338 36,438
-------- -------- -------- --------
Gross profit 18,961 22,797 36,816 44,635
Operating Expenses:
Research and development costs 789 1,058 1,530 2,147
Selling and marketing expenses 10,283 10,807 20,148 21,977
General and administrative expenses 3,815 4,492 7,195 8,606
-------- -------- -------- --------
Total operating expenses 14,887 16,357 28,873 32,730
-------- -------- -------- --------
Operating income 4,074 6,440 7,943 11,905
Financial expenses (income) and other, net (931) 851 (98) 1,017
-------- -------- -------- --------
Income before taxes on income 5,005 5,589 8,041 10,888
Taxes on income 1,184 1,233 2,051 2,510
-------- -------- -------- --------
Income after taxes on income 3,821 4,356 5,990 8,378
Equity in losses (earnings) of affiliates, net (34) 28 (61) 27
Accretion of redeemable non controlling interest - (12) - 95
-------- -------- -------- --------
Net income 3,855 4,340 6,051 8,256
Net income attributable to non-controlling interests 159 188 233 411
-------- -------- -------- --------
Net income attributable to Shamir Optical Industry Ltd.
Shareholders $ 3,696 $ 4,152 $ 5,818 $ 7,845
======== ======== ======== ========
Net earnings per share:
Basic $ 0.23 $ 0.25 $ 0.35 $ 0.47
======== ======== ======== ========
Diluted $ 0.22 $ 0.25 $ 0.35 $ 0.47
======== ======== ======== ========
Number of shares:
Basic 16,424 16,776 16,424 16,728
Dilutive 16,475 16,853 16,475 16,810
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SHAMIR OPTICAL INDUSTRY LTD.
Reconciliation of Non-GAAP Operating Income and Net Income
(US DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
Three Months Ended June 30, Six Months Ended June 30,
----------------------- -----------------------
2009 2010 2009 2010
-------- -------- -------- --------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Operating income $ 4,074 $ 6,440 $ 7,943 $ 11,905
Non-GAAP adjustment:
Stock based compensation (165) (152) (312) (289)
Amortization of intangible assets (249) (359) (490) (716)
Compensation to former Chief Executive Officer (303) - (303) -
-------- -------- -------- --------
Non-GAAP operating income $ 4,791 $ 6,951 $ 9,048 $ 12,910
======== ======== ======== ========
Net income attributable to Shamir Optical Industry Ltd.
Shareholders $ 3,696 $ 4,152 $ 5,818 $ 7,845
Non-GAAP adjustment:
Stock based compensation (165) (152) (312) (289)
Amortization of intangible assets, net (187) (267) (372) (531)
Accretion of redeemable non controlling interest - 12 - (95)
Compensation to former Chief Executive Officer, net (227) - (227) -
-------- -------- -------- --------
Non-GAAP net income attributable to Shamir Optical
Industry Ltd. Shareholders $ 4,275 $ 4,559 $ 6,729 $ 8,760
======== ======== ======== ========
Net earnings per share:
Basic $ 0.26 $ 0.27 $ 0.41 $ 0.52
======== ======== ======== ========
Diluted $ 0.26 $ 0.27 $ 0.41 $ 0.52
======== ======== ======== ========
Number of shares:
Basic 16,424 16,776 16,424 16,728
Dilutive 16,475 16,853 16,475 16,810
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