Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2020shares | |
Entity Central Index Key | 0001338940 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2020 |
Document Fiscal Period Focus | FY |
Document Type | 20-F |
Amendment Flag | false |
Document Registration Statement | false |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Document Period End Date | Dec. 31, 2020 |
Entity File Number | 000-51694 |
Entity Registrant Name | Perion Network Ltd. |
Entity Incorporation, State or Country Code | IL |
Entity Address, Address Line One | 26 HaRokmim Street |
Entity Address, City or Town | Holon |
Entity Address Country | IL |
Entity Address, Postal Zip Code | 5885849 |
Title of 12(b) Security | Ordinary shares, par value NIS 0.03 per share |
Trading Symbol | PERI |
Name of Exchange on which Security is Registered | NASDAQ |
Entity Common Stock, Shares Outstanding | 27,351,974 |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Auditor attestation flag | true |
Entity Filer Category | Accelerated Filer |
Entity Emerging Growth Company | false |
Document Accounting Standard | U.S. GAAP |
Entity Shell Company | false |
Business Contact [Member] | |
Contact Personnel Name | Maoz Sigron |
Entity Address, Address Line One | 26 HaRokmim Street |
Entity Address, City or Town | Holon |
Entity Address Country | IL |
Entity Address, Postal Zip Code | 5885849 |
City Area Code | 972 |
Local Phone Number | 73-3981582 |
Contact Personnel Fax Number | 972-3-644-5502 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current Assets: | ||
Cash and cash equivalents | $ 47,656 | $ 38,389 |
Restricted cash | 1,222 | 1,216 |
Short-term bank deposits | 12,700 | 23,234 |
Accounts receivable (net of allowance of $694 and $417 at December 31, 2020 and 2019, respectively) | 81,221 | 49,098 |
Prepaid expenses and other current assets | 4,560 | 3,170 |
Total Current Assets | 147,359 | 115,107 |
Property and equipment, net | 6,770 | 10,918 |
Operating lease right-of-use assets | 20,266 | 22,429 |
Intangible assets, net | 24,376 | 2,635 |
Goodwill | 152,303 | 125,809 |
Deferred taxes | 7,111 | 6,171 |
Other assets | 496 | 708 |
Total Assets | 358,681 | 283,777 |
Current Liabilities: | ||
Accounts payable | 72,498 | 47,681 |
Accrued expenses and other liabilities | 21,188 | 18,414 |
Short-term operating lease liability | 4,514 | 3,667 |
Short-term loans and current maturities of long-term loans | 8,333 | 8,333 |
Deferred revenues | 5,711 | 4,188 |
Short-term payment obligation related to acquisitions | 7,869 | 1,025 |
Total Current Liabilities | 120,113 | 83,308 |
Long-Term Liabilities: | ||
Long-term debt, net of current maturities | 8,333 | |
Long-term operating lease liability | 17,698 | 20,363 |
Payment obligation related to acquisition | 30,035 | |
Other long-term liabilities | 6,713 | 6,591 |
Total Liabilities | 174,559 | 118,595 |
Commitments and Contingencies | ||
Shareholders' Equity: | ||
Ordinary shares of ILS 0.03 par value - Authorized: 43,333,333 shares at December 31, 2020 and 2019; Issued: 27,467,313 and 26,357,798 shares at December 31, 2020 and 2019, respectively; Outstanding: 27,351,974 and 26,242,459 shares at December 31, 2020 and 2019, respectively | 224 | 213 |
Additional paid-in capital | 251,933 | 243,211 |
Treasury shares at cost (115,339 shares at December 31, 2020 and 2019) | (1,002) | (1,002) |
Accumulated other comprehensive income | 112 | 130 |
Accumulated deficit | (67,145) | (77,370) |
Total Shareholders' Equity | 184,122 | 165,182 |
Total Liabilities and Shareholders' Equity | $ 358,681 | $ 283,777 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) $ in Thousands | Dec. 31, 2020USD ($)shares | Dec. 31, 2020₪ / shares | Dec. 31, 2019USD ($)shares | Dec. 31, 2019₪ / shares |
Statement of Financial Position [Abstract] | ||||
Accounts receivable, allowance | $ | $ 694 | $ 417 | ||
Ordinary shares, par value per share | ₪ / shares | ₪ 0.03 | ₪ 0.03 | ||
Ordinary shares, shares authorized | 43,333,333 | 43,333,333 | ||
Ordinary shares, shares issued | 27,467,313 | 26,357,798 | ||
Ordinary shares, shares outstanding | 27,351,974 | 26,242,459 | ||
Treasury shares | 115,339 | 115,339 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenues: | |||
Total Revenues | $ 328,063 | $ 261,450 | $ 252,845 |
Costs and Expenses: | |||
Cost of revenues | 22,477 | 25,520 | 23,757 |
Customer acquisition costs and media buy | 197,626 | 135,891 | 128,351 |
Research and development | 30,880 | 22,585 | 18,884 |
Selling and marketing | 39,085 | 34,736 | 38,918 |
General and administrative | 15,819 | 14,999 | 16,450 |
Depreciation and amortization | 9,923 | 9,711 | 9,719 |
Restructuring charges | 2,075 | ||
Total Costs and Expenses | 315,810 | 243,442 | 238,154 |
Income from Operations | 12,253 | 18,008 | 14,691 |
Financial expenses, net | 2,638 | 3,470 | 3,794 |
Income before Taxes on Income | 9,615 | 14,538 | 10,897 |
Taxes on income (benefit) | (610) | 1,645 | 2,776 |
Net Income | $ 10,225 | $ 12,893 | $ 8,121 |
Net Earnings per Share - Basic | $ 0.38 | $ 0.50 | $ 0.31 |
Net Earnings per Share - Diluted | $ 0.36 | $ 0.49 | $ 0.31 |
Weighted average number of shares - Basic | 26,687,145 | 25,965,357 | 25,850,067 |
Weighted average number of shares - Diluted | 28,797,747 | 26,357,585 | 25,855,225 |
Search Advertising and other [Member] | |||
Revenues: | |||
Total Revenues | $ 179,365 | $ 173,587 | $ 126,868 |
Display and Social Advertising [Member] | |||
Revenues: | |||
Total Revenues | $ 148,698 | $ 87,863 | $ 125,977 |
CONSOLIDATED STATEMENT OF COMPR
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 10,225 | $ 12,893 | $ 8,121 |
Other comprehensive income (loss): | |||
Change in foreign currency translation adjustment | 49 | (185) | (167) |
Cash Flow Hedge: | |||
Unrealized gain (loss) from cash flow hedges | 697 | 445 | (429) |
Less: reclassification adjustment for net gain (loss) included in net income (loss) | (764) | (272) | 206 |
Net change | (67) | 173 | (223) |
Other comprehensive loss | (18) | (12) | (390) |
Comprehensive income | $ 10,207 | $ 12,881 | $ 7,731 |
STATEMENTS OF CHANGES IN SHAREH
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Other Comprehensive income (loss) [Member] | Retained earnings (Accumulated deficit) [Member] | Treasury Shares [Member] | Total | |
Balance at Dec. 31, 2017 | $ 211 | $ 236,975 | $ 532 | $ (98,384) | $ (1,002) | $ 138,332 | |
Balance, shares at Dec. 31, 2017 | 25,850,021 | ||||||
Share-based compensation | 2,718 | 2,718 | |||||
Proceeds from exercise of stock-based compensation | [1] | ||||||
Proceeds from exercise of stock-based compensation, shares | 167 | ||||||
Other comprehensive loss | (390) | (390) | |||||
Net income | 8,121 | 8,121 | |||||
Balance at Dec. 31, 2018 | $ 211 | 239,693 | 142 | (90,263) | (1,002) | 148,781 | |
Balance, shares at Dec. 31, 2018 | 25,850,188 | ||||||
Share-based compensation | 2,293 | 2,293 | |||||
Proceeds from exercise of stock-based compensation | $ 2 | 1,225 | 1,227 | ||||
Proceeds from exercise of stock-based compensation, shares | 392,271 | ||||||
Other comprehensive loss | (12) | (12) | |||||
Net income | 12,893 | 12,893 | |||||
Balance at Dec. 31, 2019 | $ 213 | 243,211 | 130 | (77,370) | (1,002) | $ 165,182 | |
Balance, shares at Dec. 31, 2019 | 26,242,459 | 26,242,459 | |||||
Share-based compensation | 4,447 | $ 4,447 | |||||
Proceeds from exercise of stock-based compensation | $ 11 | 4,275 | 4,286 | ||||
Proceeds from exercise of stock-based compensation, shares | 1,109,515 | ||||||
Other comprehensive loss | (18) | (18) | |||||
Net income | 10,225 | 10,225 | |||||
Balance at Dec. 31, 2020 | $ 224 | $ 251,933 | $ 112 | $ (67,145) | $ (1,002) | $ 184,122 | |
Balance, shares at Dec. 31, 2020 | 27,351,974 | 27,351,974 | |||||
[1] | Less than $1 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Operating activities: | |||
Net income | $ 10,225 | $ 12,893 | $ 8,121 |
Adjustments required to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 9,923 | 9,711 | 9,719 |
Restructuring costs related to impairment of property and equipment | 462 | ||
Share-based compensation expense | 4,447 | 2,293 | 2,718 |
Foreign currency translation | 19 | (86) | 3 |
Accrued interest, net | (125) | (204) | 1,005 |
Deferred taxes, net | (3,093) | (1,756) | 335 |
Accrued severance pay, net | (23) | 96 | (783) |
Change in payment obligation related to acquisitions | 4,646 | 1,025 | |
Fair value revaluation - convertible debt | 600 | (1,585) | |
Loss from sale of property and equipment | 10 | ||
Net changes in operating assets and liabilities: | |||
Accounts receivable, net | (32,049) | 6,416 | 7,423 |
Prepaid expenses and other current assets | (1,185) | 646 | 9,451 |
Operating lease right-of-use assets | 2,595 | 3,119 | |
Operating lease liabilities | (2,255) | (1,518) | |
Accounts payable | 24,742 | 9,459 | (1,066) |
Accrued expenses and other liabilities | 2,776 | 1,653 | (1,524) |
Deferred revenues | 1,506 | 394 | (1,478) |
Net cash provided by operating activities | 22,159 | 44,741 | 32,801 |
Investing activities: | |||
Purchases of property and equipment | (459) | (1,209) | (2,038) |
Proceeds from sale of property and equipment | 5 | 492 | 59 |
Capitalization of development costs | (1,756) | ||
Short-term deposits, net | 10,534 | (19,234) | 1,913 |
Cash paid in connection with acquisitions, net of cash acquired | (19,000) | (1,200) | |
Net cash used in investing activities | (8,920) | (21,151) | (1,822) |
Financing activities: | |||
Proceeds from exercise of stock-based compensation | 4,286 | 1,227 | |
Payments made in connection with acquisition | (1,813) | (3,333) | |
Proceeds from long-term loans | 25,000 | ||
Repayment of convertible debt | (15,850) | (8,167) | |
Repayment of long-term loans | (8,333) | (8,332) | (36,509) |
Net cash used in financing activities | (4,047) | (24,768) | (23,009) |
Effect of exchange rate changes on cash and cash equivalents | 81 | (20) | 78 |
Net increase (decrease) in cash and cash equivalents and restricted cash | 9,273 | (1,198) | 8,048 |
Cash and cash equivalents and restricted cash at beginning of year | 39,605 | 40,803 | 32,755 |
Cash and cash equivalents and restricted cash at end of year | 48,878 | 39,605 | 40,803 |
Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheet | |||
Cash and cash equivalents | 47,656 | 38,389 | 39,109 |
Restricted cash included in Long-term interest-bearing bank deposits | 1,222 | 1,216 | 1,694 |
Cash and cash equivalents and restricted cash at end of year | 48,878 | 39,605 | 40,803 |
Cash paid during the year for: | |||
Income taxes | 3,180 | 4,007 | 1,256 |
Interest | 1,097 | 2,320 | 3,567 |
Non-cash investing and financing activities: | |||
Creation of new lease right-of-use assets arising from lease liability | 1,671 | 25,537 | |
Purchase of property and equipment on credit | $ 3 | $ 15 | $ 1 |
GENERAL
GENERAL | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GENERAL | NOTE 1: GENERAL Perion Network Ltd. ("Perion") and its wholly-owned subsidiaries (collectively referred to as the "Company"), is a global technology company that provides agencies, brands and publishers with innovative solutions that cover the three main pillars of digital advertising – ad search, social media, and display/video and CTV advertising. On January 14, 2020, the Company completed the acquisition of Content IQ LLC (see Note 4) and on July 22, 2020, the Company consummated the assets acquisition of Pub Ocean (see Note 4). |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 2: SIGNIFICANT ACCOUNTING POLICIES Basis of consolidation The consolidated financial statements include the accounts of Perion and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated. Use of estimates The preparation of the consolidated financial statements in conformity with U.S. Generally Accepted Accounting Principles (“GAAP”) requires management to make estimates, judgments and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. Actual results could differ materially from those estimates. On an ongoing basis, the Company's management evaluates its estimates, including those related to sales allowances and allowance for credit losses, fair value of intangible assets and goodwill, useful lives of intangible assets, fair value of share-based awards, realizability of deferred tax assets, tax uncertainties, and contingent liabilities, among others. Such estimates are based on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of the Company’s assets and liabilities. Financial statements in U.S. dollars The reporting currency of the Company is the U.S. dollar (“USD”). Major parts of the Company’s operations are carried out by the Company and its subsidiaries in the United States and Israel. The functional currency of these entities is the USD. Accordingly, monetary accounts maintained in currencies other than the USD are remeasured into USD, in accordance with ASC 830, "Foreign Currency Matters". All transaction gains and losses resulting from the re-measurement of the monetary balance sheet items are reflected in the statements of income as financial income or expenses, as appropriate. Management believes that the USD is the currency of the primary economic environment in which the Company operates. The financial statements of other subsidiaries, whose functional currency is determined to be their local currency, have been translated into USD. All balance sheet accounts have been translated using the exchange rates in effect at the balance sheet date. Statement of operations amounts have been translated using the average exchange rate for each applicable quarter. The resulting translation adjustments are reported as an accumulated other comprehensive income (loss) component of shareholders' equity. F - 14 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) Cash and cash equivalents and short-term deposits The Company considers all short-term, highly liquid and unrestricted cash balances, with stated maturities of three months or less from date of purchase, as cash equivalents. Short-term deposits are bank deposits with maturities of more than three months but less than one year. The short-term deposits as of December 31, 2020 and 2019 are denominated primarily in USD and bear interest at an average annual rate of 0.35% and 2.16%, respectively. Restricted cash Restricted cash is comprised primarily of security deposits that are held to secure the Company’s hedging activity, lease obligations and certain letters of credit associated with lease obligations. Restricted cash in the amount of $1,222 and $1,216, as of December 31, 2020 and 2019, respectively. Accounts receivable and allowance for credit losses Trade accounts receivables are stated at realizable value, net of an allowance for credit losses. The Company evaluates its outstanding accounts receivable and establishes an allowance for credit losses. based on information available on their credit condition, current aging, historical experience and future economic and market conditions. These allowances are reevaluated and adjusted periodically as additional information is available. As of December 31, 2020 and 2019, the Company has recorded an allowance in the amounts of $694 and $417, respectively. Total expenses for doubtful debts during 2020, 2019 and 2018 amounted to $323, $78 and $180, respectively. Property and equipment Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets at the following annual rates: % Computers and peripheral equipment 33 Office furniture and equipment 6 - 15 Leasehold improvements are amortized using the straight-line method over the term of the lease or the estimated useful life of the improvements, whichever is shorter. Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities and operating lease liabilities in the Company’s consolidated balance sheets. Finance leases are included in property, plant and equipment, net, other current liabilities, and other long-term liabilities in the Company’s consolidated balance sheets. F - 15 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) ROU assets represent the right to use an underlying asset for the lease term and lease liabilities obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The Company uses incremental borrowing rates based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expenses for lease payments are recognized on a straight-line basis over the lease term. Impairment of long-lived assets, Right-of-use assets and intangible assets subject to amortization The Company’s long-lived assets (assets group) to be held or used, including property and equipment, right of use assets and intangible assets subject to amortization are reviewed for impairment in accordance with ASC 360, "Accounting for the Impairment or Disposal of Long-Lived Assets", whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. The recoverability of these assets is measured by comparing the carrying amounts to the future undiscounted cash flows the assets are expected to generate. If property and equipment and intangible assets are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the asset exceeds its fair market value. In determining the fair values of long-lived assets for the purpose of measuring impairment, the Company's assumptions include those that market participants will consider in valuations of similar assets. Goodwill and intangible assets Goodwill reflects the excess of the purchase price of business acquired over the fair value of net assets acquired. Goodwill is not amortized but instead is tested for impairment, in accordance with ASC 350, “Intangibles – Goodwill and Other”, at the reporting unit level, at least annually at December 31 each year, or more frequently if events or changes in circumstances indicate that the carrying value may be impaired. Following the early adoption of ASU 2017-04, "Simplifying the Test for Goodwill Impairment" by the Company in January 2017, any excess of the carrying amount of the reporting unit over its fair value is recognized as an impairment loss, and the carrying value of goodwill is written down to fair value. The majority of the inputs used in the discounted cash flow model to determine the fair value of the reporting units are unobservable and thus are considered to be Level 3 inputs. Intangible assets that are not considered to have an indefinite useful life are amortized over their estimated useful lives. The Customer Relationship, technology and trade name are amortized over their estimated useful lives in proportion to the economic benefits realized. This accounting policy results in accelerated amortization of such intangible assets as compared to the straight-line method. Revenue recognition The Company applies the provisions of Accounting Standards Codification 606, Revenue from Contracts with Customers ("ASC 606" or "Topic 606"). F - 16 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The Company applies the practical expedient for incremental costs of obtaining contracts when the associated revenues is recognized over less than one year. The Company generates revenues primarily from two major sources: Display and Social Advertising Revenues (“Advertising”) Search Advertising and other Revenues (“Search Monetization”) For more disaggregated information of revenues refer to Note 19. The Company’s payments terms are less than one year. Therefore, no finance component is recognized. The Company evaluates whether Search and Advertising Revenues should be presented on a gross basis, which is the amount that a customer pays for the service, or on a net basis, which is the amount of the customer payment less amounts the Company pays to publishers. In making that evaluation, the Company considers whether it controls the promised good or service before transferring that good or service to the customer. The Company considers indicators such as whether the Company is the primary obligor in the arrangement and assumes risks and rewards as a principal or an agent, including the credit risk, whether the Company has latitude in establishing prices and selecting its suppliers and whether it changes the products or performs part of the service. The evaluation of these factors is subject to significant judgment and subjectivity. Generally, in cases in which the Company is primarily obligated in a transaction, is subject to risk, involved in the determination of the product (or the service) specifications, separately negotiates each revenue service agreement or publisher agreement and can have several additional indicators, revenue is recorded on a gross basis. Remaining performance obligations (RPOs) represent amounts collected on contracted revenues that have not yet been recognized. As of December 31, 2020, the aggregate amount of the RPOs was $5,711. The Company anticipates that it will satisfy all of its remaining performance obligation associated with the deferred revenue within the prospective fiscal year. Contract balances are presented separately on the consolidated balance sheets as either Accounts receivable or Deferred revenues. The Company does not have contract assets. Accounts receivable includes amounts billed and currently due from customers. Deferred revenues are recorded when payments are received from customers in advance of the Company's rendering of services. Revenues recognized during 2020 from amounts included within the Deferred revenues balance at the beginning of the period amounted to $4,188. F - 17 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) Cost of revenues Cost of revenues consists primarily of expenses associated with the operation of the Company’s server hosting, data verification and targeting, campaign creative, labor, as well as content acquisition costs and customer support. Customer acquisition costs and media buy Customer acquisition costs and media buy consist of amounts paid to publishers who distribute the Company’s search solutions and services as well as the costs of advertising inventory and user acquisition costs incurred in our advertising business. Customer acquisition costs are based either on revenue share arrangements with minimum guarantee or fixed rates, which are charged as incurred. Research and development costs Research and development costs are charged to the statement of income as incurred, except for certain costs relating to internally developed software, which are capitalized. The Company capitalizes certain internal and external software development costs, consisting primarily of direct labor associated with creating the internally developed software. Software development projects generally include three stages: (i) the preliminary project stage (all costs expensed as incurred); (ii) the application development stage (costs are capitalized) and (iii) the post implementation/operation stage (all costs expensed as incurred). The costs capitalized in the application development stage primarily include the costs of designing the application, coding and testing of the system. Capitalized costs are amortized using the straight-line method over the estimated useful life of the software, generally three years, once it is ready for its intended use. The Company believes that the straight-line recognition method best approximates the manner in which the expected benefit will be derived. Management evaluates the useful lives of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. Capitalized software development costs, net of accumulated amortization, of $1,392 and $4,448 are included in property and equipment in the consolidated balance sheets as of December 31, 2020 and 2019, respectively (see Note 5). Income taxes The Company accounts for income taxes in accordance with ASC 740, "Income Taxes". This Statement prescribes the use of the liability method, whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. To the extent necessary, the Company provides a valuation allowance to reduce deferred tax assets to their estimated realizable value. The Company accounts for uncertain tax positions in accordance with ASC 740, which contains a two-step approach for recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position taken or expected to be taken in a tax return by determining if the weight of available evidence indicates that it is more likely than not that the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. F - 18 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) Severance pay The Company's agreements with employees in Israel are in accordance with section 14 of the Severance Pay Law, 1963 (“Section 14”), where the Company's contributions for severance pay is paid to the employee upon termination instead of the severance liability that would otherwise be payable under the law as aforementioned. Upon contribution to a fund, based on the full amount of the employee's monthly salary, and release of the fund to the employee, no additional severance payments are required to be made by the Company to the employee. Therefore, the related obligation and amounts deposited on behalf of such obligation are not stated on the balance sheet, as the Company is legally released from obligation to such employees once the deposit amounts have been paid. Severance expenses for the years ended December 31, 2020, 2019 and 2018 amounted to $1,754, $1,270 and $1,230, respectively. The balances of severance deposits and accrued severance pay are immaterial and included in other assets and other long-term liabilities on the accompanying balance sheets, respectively. Employee benefit plan The Company’s U.S. operations maintain a retirement plan (the “U.S. Plan”) that qualifies as a deferred salary arrangement under Section 401(k) of the Internal Revenue Code. Participants in the U.S. Plan may elect to defer a portion of their pre-tax earnings, up to the Internal Revenue Service’s annual contribution limit. The Company matches up to 100% of each participant’s contributions, up to 6% of employee deferral. Contributions to the U.S. Plan are recorded during the year contributed as an expense in the consolidated statement of income. Total employer 401(k) contributions for the years ended December 31, 2020, 2019 and 2018 were $624, $691 and $751, respectively. Comprehensive income (loss) The Company accounts for comprehensive income (loss) in accordance with ASC 220, "Comprehensive Income". This statement establishes standards for the reporting and display of comprehensive income and its components in a full set of general purpose financial statements. Comprehensive income generally represents all changes in shareholders' equity during the period except those resulting from investments by, or distributions to, shareholders. The Company determined that its other comprehensive income (loss) relates to hedging derivative instruments and foreign currency translation adjustments. Net earnings per share In accordance with ASC 260, "Earnings Per Share", basic net earnings per share ("Basic EPS") is computed by dividing net earnings attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted net earnings per share ("Diluted EPS") reflects the potential dilution that could occur if share options and other commitments to issue ordinary shares were exercised or equity awards vested, resulting in the issuance of ordinary shares that could share in the net earnings of the Company. F - 19 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The weighted average number of ordinary shares related to the outstanding options, restricted shares, convertible debt and warrants excluded from the calculations of diluted net earnings per ordinary share, as these securities are anti-dilutive, was 3,178,024, 4,087,559 and 4,725,618 for the years ended December 31, 2020, 2019 and 2018, respectively. Concentrations of credit risk Financial instruments, which potentially subject the Company to a concentration of credit risk, consist primarily of cash and cash equivalents, bank deposits, restricted cash and accounts receivable. The majority of the Company’s cash and cash equivalents, bank deposits and restricted cash are invested in USD instruments with major banks in the U.S. and Israel. Deposits in the U.S. may be in excess of insured limits and are not insured in other jurisdictions. Generally, these deposits may be redeemed upon demand and, therefore, bear minimal risk. The Company’s major customers are financially sound, and the Company believes low credit risk is associated with these customers. To date, the Company has not experienced any material bad debt losses. Share-based compensation The Company accounts for share-based compensation under ASC 718, "Compensation - Stock Compensation", which requires the measurement and recognition of compensation expense based on estimated fair values for all share-based payment awards made to employees, contractors and directors. ASC 718 requires companies to estimate the fair value of equity-based awards on the date of grant, using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in the Company's consolidated statement of income. The Company estimates forfeitures to be estimated at the time of grant, and revised if necessary in subsequent periods, if actual forfeitures differ from those estimates. The Company recognizes compensation expenses for the value of its awards, which have graded vesting based on service conditions, using the straight-line method, over the requisite service period of each of the awards, net of estimated forfeitures. Estimated forfeitures are based on actual historical pre-vesting forfeitures. For performance-based share units, the Company recognizes compensation expenses for the value of such awards, if and when the Company concludes that it is probable that a performance condition will be achieved based on the accelerated attribution method over the requisite service period. The Company should reassess the probability of vesting at each reporting period for awards with performance conditions and adjust compensation cost based on its probability assessment. The Company accounted for changes in award terms as a modification in accordance with ASC 718. A modification to the terms of an award should be treated as an exchange of the original award for a new award with total compensation cost equal to the grant-date fair value of the original award plus the incremental value measured at the same date. Under ASC 718, the calculation of the incremental value is based on the excess of the fair value of the new (modified) award based on current circumstances over the fair value of the original award measured immediately before its terms are modified based on current circumstances. F - 20 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The Company estimates the fair value of its new share-based awards using the Binomial option-pricing model. The following table presents the various assumptions used to estimate the fair value of the Company's share-based awards granted to employees and directors in the periods presented: Year ended December 31 2020 2019 2018 Risk-free interest rate 0.29% - 1.60% 0.70% - 2.90% 1.50% - 3.00% Expected volatility 53% - 59% 43% - 55% 48% - 57% Early exercise factor 110% - 200% 110% - 230% 150% - 200% Forfeiture rate post vesting 0% - 34% 0% - 34% 0% - 34% Dividend yield 0% 0% 0% The expected volatility is calculated based on the actual historical share price movements of the Company’s share. The expected option term represents the period that the Company’s share options are expected to be outstanding. The early exercise factor and the forfeiture rate post-vesting are calculated based on the Company’s estimated early exercise and post-vesting forfeiture multiples, which are based on comparable companies and on actual historical data. The risk-free interest rate is based on the yield from U.S. Treasury zero-coupon bonds, with a term which is equivalent to the expected term of the share-based awards. The dividend yield is based on the current decision of the Company’s management not to distribute any dividends. The fair value of restricted share units (“RSU”) is based on the market value of the underlying shares on the date of grant. Derivative instruments The Company accounts for derivatives and hedging based on ASC 815, "Derivatives and Hedging", which requires recognizing all derivatives on the balance sheet at fair value. If the derivatives meet the definition of a cash flow hedge and are so designated, depending on the nature of the hedge, the effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income and reclassified into earnings in the same period, or periods, during which the hedged transaction affects earnings. The ineffective portion of a derivative’s change in fair value, if any, is recognized in earnings, as well as gains and losses from a derivative’s change in fair value that are not designated as hedges are recognized in earnings immediately. In order to mitigate the potential adverse impact on cash flows resulting from fluctuations in the exchange rate of the new Israeli shekels (“ILS”), the Company hedges portions of its forecasted expenses denominated in ILS with SWAP and options contracts. The Company does not speculate in these hedging instruments in order to profit from foreign currency exchanges, nor does it enter into trades for which there are no underlying exposures. To protect against the increase in value of forecasted foreign currency cash flow resulting mainly from salaries and related benefits paid in ILS during the year, the Company hedges portions of its anticipated payroll denominated in ILS for a period of one to twelve months with forward and options contracts (the “Hedging Contracts”). Accordingly, when the USD strengthens against the ILS, the decline in present value of future ILS currency expenses is offset by losses in the fair value of the Hedging Contracts. Conversely, when the USD weakens, the increase in the present value of future ILS expenses is offset by gains in the fair value of the Hedging Contracts. These Hedging Contracts are designated as cash flow hedges. F - 21 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The Company follows the requirements of ASC No. 815, Derivatives and Hedging Additionally, in order to mitigate the potential adverse impact of the fluctuations in the ILS-USD exchange rate in connection with the convertible debt (see Note 10), the Company has entered into a cross currency interest rate SWAP agreement (the “SWAP”) in order to hedge the future interest and principal payments, which are all denominated in ILS. However, since the convertible debt was measured at fair value at each reporting date, the SWAP does not qualify and was not designated as hedge under ASC 815. Therefore, gains or losses resulted from the change of the SWAP's fair value were recognized immediately as incurred in "financial expenses, net". The Company measured the fair value of these contracts in accordance with ASC 820, "Fair Value Measurement and Disclosures", and they were classified as level 2. On June 6, 2019, the SWAP agreements were terminated concurrently with the early redemption of the convertible bond. In order to limit the Company’s interest expenses derived from the secured credit agreement in which the Company entered concurrently with the closing of Interactive Holding Corp. acquisition in 2015 (“Undertone”), the Company has purchased a Cap Option for the interest amounts that was expected to be paid until June 2018. The cap option was designated as cash flow hedge under ASC 815. The notional value of the Company’s derivative instruments as of December 31, 2020 and 2019, amounted to $0 and $3,918, respectively. Notional values in USD are translated and calculated based on the spot rates for options and swap. Gross notional amounts do not quantify risk or represent assets or liabilities of the Company; however, they are used in the calculation of settlements under the contracts. Fair value of financial instruments The carrying amounts of financial instruments carried at cost, including cash and cash equivalents, short-term deposits, restricted cash, accounts receivable, and other assets, accounts payable, accrued expenses and other liabilities approximate their fair value due to the short-term maturities of such instruments. The Company follows the provisions of ASC No. 820, “Fair Value Measurement” (“ASC 820”), which defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining a fair value, the Company uses various valuation approaches. ASC 820 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing an asset or liability, based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect assumptions that market participants would use in pricing an asset or liability, based on the best information available under given circumstances. F - 22 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The hierarchy is broken down into three levels, based on the observability of inputs and assumptions, as follows: • Level 1 • Level 2 • Level 3 Treasury shares In the past, the Company repurchased its ordinary shares on the open market. The Company holds the shares as treasury shares and presents their cost as a reduction of shareholders' equity. Business combinations The Company accounted for business combination in accordance with ASC 805, "Business Combinations". ASC 805 requires recognition of assets acquired, liabilities assumed, and any non-controlling interest at the acquisition date, measured at their fair values as of that date. Any excess of the fair value of net assets acquired over purchase price is allocated to goodwill and any subsequent changes in estimated contingencies are to be recorded in earnings. In addition, changes in valuation allowance related to acquired deferred tax assets and in acquired income tax position are to be recognized in earnings. Acquisition related costs are expensed to the statement of income in the period incurred. Recent Adopted Accounting Pronouncements: In June 2016 the FASB issued Accounting Standards Update (ASU) No. 2016-13 "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments". The FASB subsequently issued amendments to ASU 2016-13, which have the same effective date and transition date of January 1, 2020. This standard requires entities to estimate an expected lifetime credit loss on financial assets ranging from short-term trade accounts receivable to long-term financings and report credit losses using an expected losses model rather than the incurred losses model that was previously used, and establishes additional disclosures related to credit risks. The Company adopted Topic 326 effective January 1, 2020. The adoption of this standard did not have a material impact on the Company’s condensed consolidated financial statements. The Consolidated Financial Statements for the year ended December 31, 2020 are presented under the new standard, while comparative periods presented are not adjusted and continue to be reported in accordance with the Company’s historical accounting policy. The adoption of this standard did not have a material impact on the Company’s condensed consolidated financial statements. In August 2018, the FASB issued ASU 2018-13 “Fair Value Measurement (Topic 820)—Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement”. This guidance removes certain disclosure requirements related to the fair value hierarchy, modifies existing disclosure requirements related to measurement uncertainty and adds new disclosure requirements. F - 23 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The new disclosure requirements include disclosing the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. Certain disclosures required by this guidance must be applied on a retrospective basis and others on a prospective basis. The guidance was adopted for interim and annual periods beginning after December 15, 2019, although early adoption is permitted. The adoption of this standard did not have a material impact on the Company’s condensed consolidated financial statements. The Consolidated Financial Statements and disclosures for the year ended December 31, 2020 are presented under the new standard, while comparative periods presented are not adjusted and continue to be reported in accordance with the Company’s historical accounting policy. Recent Accounting Pronouncements not yet adopted In December 2019, the FASB issued Accounting Standards Update No. 2019-12, Income Taxes (Topic 740): “Simplifying the Accounting for Income Taxes” (ASU 2019-12), which simplifies the accounting for income taxes. This guidance will be effective for fiscal years, and interim |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 12 Months Ended |
Dec. 31, 2020 | |
FAIR VALUE OF FINANCIAL INSTRUMENTS [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | NOTE 3: FAIR VALUE OF FINANCIAL INSTRUMENTS The following table present liabilities measured at fair value on a recurring basis as of December 31, 2020: Fair value measurements using input type Level 1 Level 2 Level 3 Total Liabilities: Contingent consideration in connection to the acquisitions $ - $ - $ 37,904 $ 37,904 Total financial liabilities $ - $ - $ 37,904 $ 37,904 The following table present assets measured at fair value on a recurring basis as of December 31, 2019: Fair value measurements using input type Level 1 Level 2 Level 3 Total Assets Derivative assets $ - $ 73 $ - $ 73 Total financial assets $ - $ 73 $ - $ 73 |
ACQUISITIONS
ACQUISITIONS | 12 Months Ended |
Dec. 31, 2020 | |
Business Combinations [Abstract] | |
ACQUISITIONS | NOTE 4: ACQUISITIONS a. Septa Communications LLC On March 28, 2019, the Company consummated the acquisition of 100% of the shares of Septa Communications LLC, also known as “Captain Growth”. Captain Growth is a Ukrainian-based start-up that has developed a proprietary AI platform to better connect and deliver relevant campaign messages through the entire ad journey. Total consideration for the acquisition was $1,200 paid in cash at closing. b. Content IQ LLC On January 14, 2020, the Company consummated the acquisition of Content IQ LLC (“Content IQ”), a privately held company founded in 2014, based in New York City. Content IQ has created data algorithm and analytics tools that deconstruct content, revenue and distribution to solve current major digital publishing challenges. The total consideration for the acquisition was $37,838, comprised of $15,000 paid in cash at closing and a contingent consideration (with a maximum amount of up to $47,050), tied to revenues and EBITDA-based metrics over a period of two years, estimated at fair value of $22,838 at the acquisition date. As of December 31, 2020, the contingent consideration is estimated at fair value of $19,546. The change in fair value of the contingent consideration was recorded to general and administrative expenses. In addition, the acquisition includes a retention-based component of up to $11,000. F - 25 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date: Fair value Property and equipment, net $ 4 Technology 12,483 Customer Relationship 4,243 Deferred Taxes (2,253 ) Goodwill 23,361 Net assets acquired $ 37,838 Technology Customer relationships The following table represents the pro-forma condensed unaudited consolidated statements of operations as if the acquisition completed during the years ended December 31, 2019 and 2020, had been included in the condensed consolidated statements of operations of the Company for the years ended December 31, 2019 and 2020: Year ending December 31, 2020 2019 Revenues $ 329,068 $ 299,871 Net Income $ 8,079 $ 3,985 The pro-forma results have been calculated after applying the Company’s accounting policies and adjusting the results of all acquisitions to reflect the additional payroll related expenses, revaluation of the earnout liability and depreciation and amortization that would have been charged assuming the fair value adjustments to property, plant and equipment and intangible assets had been applied since the acquisitions date, together with the consequential tax effects. The pro-forma results are based on estimates and assumptions, which the Company believes are reasonable. The pro-forma results are not the results that would have been realized had the acquisitions actually occurred on January 1, 2019 and 2020, are not necessarily indicative of the Company’s condensed consolidated statements of operations in future periods. F - 26 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) c. Pub Ocean On July 22, 2020, the Company acquired the net assets of Pub Ocean Limited, also known as “Pub Ocean” (the "Pub Ocean Acquisition"), a rapidly growing digital publisher-focused technology company with scalable content distribution and real-time revenue analytics technology. The total consideration for the acquisition was $13,399, comprised of $4,000 paid in cash at closing and a contingent consideration (with a maximum amount of up to $17,000), tied to financial targets over a two-year The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date: Fair value Property and equipment, net $ 15 Other creditors (25 ) Technology 9,618 Customer Relationship 658 Goodwill 3,133 Net assets acquired $ 13,399 Technology Customer relationships Pro forma results of operations related to this acquisition have not been prepared because they are not material to the Company’s consolidated statements of operations. In connection with the Pub Ocean Acquisition, the Company amended the Content IQ Membership Interest Purchase Agreement (“MIPA”). Under the terms of the amended MIPA, it was agreed with the sellers of Content IQ (“the Sellers”), that (i) revenues and EBITDA of Pub Ocean will be attributed towards Sellers’ revenue and EBITDA targets under the MIPA with Perion; and (ii) Sellers will bear 40% of the cost of milestone payments that are ultimately payable to Pub Ocean under the Asset Acquisition agreement, which will be paid solely by deductions from their own earn-out payments and certain escrowed amounts. |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | NOTE 5: PROPERTY AND EQUIPMENT, NET December 31, 2020 2019 Cost: Computers and peripheral equipment $ 6,776 $ 7,212 Office furniture and equipment 2,682 2,703 Leasehold improvements 8,658 8,678 Capitalized software 12,473 12,473 Total cost 30,589 31,066 Less: accumulated depreciation and amortization (23,819 ) (20,148 ) Property and equipment, net $ 6,770 $ 10,918 Depreciation and amortization expenses totaled to $4,662, $5,455 and $4,950, for the years ended December 31, 2020, 2019 and 2018, respectively. During 2018 the Company capitalized software development costs of $1,756. During 2019 and 2020 there were no software development capitalization cost. Amortization expense for the related capitalized internally developed software in the consolidated statements of income amounted to $3,056, $3,607 and $2,978 during 2020, 2019 and 2018, respectively. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS, NET | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS, NET | NOTE 6: GOODWILL AND OTHER INTANGIBLE ASSETS, NET a. Goodwill The changes in the net carrying amount of goodwill in 2019 and 2020 were as follows: Balance as of January 1, 2019 $ 125,051 Acquisition of Captain growth $ 758 Balance as of December 31, 2019 $ 125,809 Acquisition of Content IQ $ 23,361 Acquisition of Pub Ocean $ 3,133 Balance as of December 31, 2020 $ 152,303 Goodwill has been recorded as a result of prior acquisitions and represents excess of the consideration over the net fair value of the assets of the businesses acquired. As of December 31, 2020, the Company has two reporting units – Advertising and Search monetization. The Company performs tests for impairment of goodwill at the reporting unit level at least annually, or more frequently if events or changes in circumstances occur that would more likely than not reduce the fair value of a reporting unit below its carrying value. No impairment was incurred for the years ended December 31, 2020, 2019 and 2018. F - 28 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) b. Intangible assets, net The following is a summary of intangible assets as of December 31, 2020: December 31, 2019 Additions Amortization OCI December 31, 2020 Acquired technology $ 31,159 $ 22,101 $ - $ 152 $ 53,412 Accumulated amortization (21,810 ) - (3,579 ) (159 ) (25,548 ) Impairment (8,749 ) - - - (8,749 ) Acquired technology, net 600 22,101 ( 3,579 ) ( 7 ) 19,115 Customer relationships 31,911 4,901 - 48 36,860 Accumulated amortization (20,727 ) - (1,465 ) 31 (22,161 ) Impairment (10,426 ) - - - (10,426 ) Customer relationships, net 758 4,901 ( 1,465 ) 79 4,273 Tradename and other 18,284 - - 219 18,503 Accumulated amortization (11,897 ) - (217 ) (291 ) (12,405 ) Impairment (5,110 ) - - - (5,110 ) Tradename and other, net 1,277 - ( 217 ) ( 72 ) 988 Intangible assets, net $ 2,635 $ 27,002 $ ( 5,261 ) $ - $ 24,376 The following is a summary of intangible assets as of December 31, 2019: December 31, 2018 Additions Amortization OCI December 31, 2019 Acquired technology $ 30,807 $ 442 $ - $ ( 90 ) $ 31,159 Accumulated amortization (21,242 ) - (649 ) 81 (21,810 ) Impairment (8,749 ) - - - (8,749 ) Acquired technology, net 816 442 ( 649 ) ( 9 ) 600 Customer relationships 31,940 - - ( 29 ) 31,911 Accumulated amortization (19,825 ) - (928 ) 26 (20,727 ) Impairment (10,426 ) - - - (10,426 ) Customer relationships, net 1,689 - ( 928 ) ( 3 ) 758 Tradename and other 18,415 - - ( 131 ) 18,284 Accumulated amortization (9,314 ) - (2,679 ) 96 (11,897 ) Impairment (5,110 ) - - - (5,110 ) Tradename and other, net 3,991 - ( 2,679 ) ( 35 ) 1,277 Intangible assets, net $ 6,496 $ 442 $ ( 4,256 ) $ ( 47 ) $ 2,635 F - 29 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The estimated useful life of the intangible assets are as follows: Estimated useful life Acquired technology 3-5 years Customer relationships 4-7 years Tradename and other 4-11 years Amortization of intangible assets, net, in each of the succeeding five years and thereafter is estimated as follows: 2021 $ 5,438 2022 5,450 2023 5,462 2024 5,395 2025 1,858 Thereafter 773 $ 24,376 |
ACCRUED EXPENSES AND OTHER LIAB
ACCRUED EXPENSES AND OTHER LIABILITIES | 12 Months Ended |
Dec. 31, 2020 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES AND OTHER LIABILITIES | NOTE 7: ACCRUED EXPENSES AND OTHER LIABILITIES December 31, 2020 2019 Employees and payroll accruals $ 13,970 $ 10,506 Government authorities 3,422 2,540 Accrued expenses 3,003 5,092 Other short-term liabilities 793 276 $ 21,188 $ 18,414 |
DERIVATIVES AND HEDGING ACTIVIT
DERIVATIVES AND HEDGING ACTIVITES | 12 Months Ended |
Dec. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVES AND HEDGING ACTIVITES | NOTE 8: DERIVATIVES AND HEDGING ACTIVITES As of December 31, 2019, The fair value of the Company’s outstanding derivative instruments reflected as prepaid expenses and other current assets was $73 and reflected as Accumulated other comprehensive income was $67. As of December 31, 2020 the fair value of the Company’s outstanding derivatives instruments was $0. The net amounts reclassified from accumulated other comprehensive loss to the operating expenses are as follows: Gain recognized in Statements of Comprehensive Income Gain (loss) recognized in consolidated statements of Income Year ended December 31, Year ended December 31, 2020 Statement of Income 2020 2019 2018 Derivatives designated as hedging instruments: Foreign exchange options and forward contracts $ 67 "Operating expenses" $ 764 $ 272 $ (206 ) Derivatives not designated as hedging instruments: Foreign exchange options and forward contracts - "Financial expenses" (166 ) 59 (186 ) SWAP - "Financial expenses" - 380 (2,487 ) Total $ 67 $ 598 $ 711 $ ( 2,879 ) |
SHORT TERM AND LONG-TERM DEBT
SHORT TERM AND LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
SHORT TERM AND LONG-TERM DEBT | NOTE 9: SHORT TERM AND LONG-TERM DEBT On December 17, 2018, ClientConnect Ltd., a former Israeli subsidiary of Perion, which merged into Perion on June 30, 2020, executed a new loan facility, in the amount of $25,000. Proceeds of the loan facility were applied to refinancing of the existing debt as well as the debt of Undertone, a US subsidiary of Perion. ClientConnect's obligations under the facility were assumed by Perion in the context of the merger. Principal on the loan is payable in twelve equal quarterly instalments beginning March 2019 and maturing on December 31, 2021. The interest on the loan is at the rate of three-month LIBOR plus 5.7% per annum, payable quarterly. The credit facility is secured by liens on the assets of Perion and Undertone and is guaranteed by Undertone. The guarantee by Undertone is limited to $33,000. Financial covenants for the loan facility are tested at the level of Perion on a consolidated basis. As of December 31, 2020, the Company meets all of its covenants. F - 31 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) As of December 31, 2020, the aggregate principal annual maturities according to all of the above loan agreements were as follows: Repayment amount 2021 8,333 Present value of principal payments $ 8,333 Less: current portion (8,333 ) Long-term debt $ - On May 19, 2020, the Company entered into a short-term secured credit line in the amount of up to $20 million with Bank Mizrahi, which was scheduled to mature on May 18, 2021. On August 11, 2020, the Company withdrawn an amount of $12.5 million from this credit line. Such a withdrawal was a short-term revolving loan for a three-month period. On December 21, 2020, this credit facility was repaid in full. On March 8, 2021, the Company had repaid it’s loan facility (see Note 20). |
CONVERTIBLE DEBT
CONVERTIBLE DEBT | 12 Months Ended |
Dec. 31, 2020 | |
CONVERTIBLE DEBT [Abstract] | |
CONVERTIBLE DEBT | NOTE 10: CONVERTIBLE DEBT In September 2014, the Company completed a public offering in Israel of its Series L Convertible Bonds (the "Bonds"), with an aggregate par value of approximately ILS 143.5 million. The Bonds were issued at a purchase price equal to 96.5% of their par value and bear annual interest at a rate of 5%, payable semi-annually, subject to a possible increase up to 6% in the event and to the extent the Company’s debt rating is downgraded. The Bonds’ principal, denominated in ILS, was repayable in five equal annual instalments commencing on March 31, 2016. The Bonds were convertible, at the election of each holder, into the Company’s ordinary shares at a conversion price of ILS 100.815 per share from the date of issuance and until March 15, 2020. The ordinary shares issued upon conversion of the Bonds will be listed on the NASDAQ Stock Market (“Nasdaq”) and the Tel-Aviv Stock Exchange (“TASE”), to extent that the Company's ordinary shares are listed thereon at the time of conversion. The conversion price is subject to adjustment in the event that the Company effects a share split or reverse share split, rights offering or a distribution of bonus shares or a cash dividend. The Company had the option to redeem the Bonds upon delisting of the Bonds from the TASE, subject to certain conditions. In addition, the Company was able to redeem the Bonds or any part thereof at its discretion after December 1, 2014, subject to certain conditions. The Company elected to apply the fair value option in accordance with ASC 825, “Financial Instruments”, to the Bonds and therefore all unrealized gains and losses were recognized in earnings. On May 15, 2019 the Company announced it provided a Notice of Redemption to the Noteholders of its 5% Series L Convertible Bonds that was fully paid on June 6 th F - 32 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The changes of the long-term convertible debt in 2020 and 2019 were as follows: Balance as of January 1, 2019 (*) $ 15,453 Change in accrued interest 267 Change in fair value 600 Payment of interest (470 ) Payment of principal (15,850 ) Balance as of December 31, 2019 $ - Balance as of December 31, 2020 $ - (*) Includes accrued interest of $193. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2020 | |
Lessee Disclosure [Abstract] | |
LEASES | NOTE 11: LEASES In January 2014, the Company entered into a lease agreement for new corporate offices in Holon, Israel. The lease expires in January 2025 In June 2018, Undertone entered into a lease agreement for its office at World Trade Center (WTC) New York. The lease expires in May 2026. Additionally, the Company may choose an early termination in 2023. In January 2019, Our French subsidiary entered into a lease agreement for its office at Paris, France. The lease expires in March 2028. Certain other facilities of the Company are rented under operating lease agreements, which expire on various dates, the latest of which is in 2023. The Company recognizes rent expense under such arrangements on a straight-line basis. The Company's capitalized operating lease agreements have remaining lease terms ranging from 0.83 year to 7.25 years. The following table represents the weighted-average remaining lease term and discount rate: Year ended December 31, 2020 Weighted average remaining lease term 5.13 Years Weighted average discount rate 7.42% The discount rate was determined based on the estimated collateralized borrowing rate of the Company, adjusted to the specific lease term and location of each lease. F - 33 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) Maturities of operating lease liabilities were as follows: Year ending December 31, 2021 $ 5,970 2022 5,290 2023 4,909 2024 4,907 2025 2,931 Thereafter 2,602 Total lease payments *) 26,609 Less – imputed interest (4,397 ) Present value of lease liabilities $ 22,212 *) Total lease payments have not been reduced by sublease rental payments of $6,376 due in the future under non-cancelable subleases. Facilities leasing expenses (net) in the years 2020, 2019 and 2018 were $3,493, $3,076 and $4,123 respectively. Out of which, Sublease income amounted to $3,235, $2,682 and $2,213 in the years 2020, 2019 and 2018, respectively. Cash paid for amounts included in measurement of lease liabilities during 2020 was $ 6,521. |
COMMITMENT AND CONTINGENT LIABI
COMMITMENT AND CONTINGENT LIABILITIES | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENT AND CONTINGENT LIABILITIES | NOTE 12: COMMITMENT AND CONTINGENT LIABILITIES a. Contingent purchase obligation On November 30, 2012, the Company completed the acquisition of 100% of Sweet IM’s shares. Pursuant to the terms of the Share Purchase Agreement (“SPA”) between the Company and SweetIM, the Company was obligated to pay SweetIM's shareholders, among other payments, a payment of up to $7,500 in cash in May 2014 if certain milestones were met (the “Contingent Payment”). The milestones were based on the Company's GAAP revenues in 2013, and the absence of certain changes in the industry in which the Company operates. On May 28, 2014, the Company paid $2,500 in respect of the Contingent Payment. Following such payment, on June 22, 2014, SweetIM’s Shareholders’ representative notified the Company claiming that the Company owes SweetIM’s shareholders the entire Contingent Payment. In April 2015, pursuant to the SPA, an arbitration process with respect to this claim has commenced in Israel. Based on the August 2018 ruling of the arbitrator, the remaining balance of the Contingent Payment shall be paid to SweetIM's shareholders in 3 equal installments, the last of which was paid during January 2019. F - 34 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) b. Legal Matters On December 22, 2015, Adtile Technologies Inc. filed a lawsuit against the Company and Intercept Interactive Inc. (“Intercept”), a subsidiary of Interactive Holding Corp., in the United States District Court for the District of Delaware. The lawsuit alleges various causes of action against Perion and Undertone related to Undertone’s alleged unauthorized use and misappropriation of Adtile’s proprietary information and trade secrets. Adtile is seeking injunctive relief and, unspecified monetary damages. On June 23, 2016, the court denied Adtile’s motion for a preliminary injunction. On June 24, 2016, the court (i) granted the Company’s motion to dismiss, and (ii) granted Intercept’s motion to stay the action and compel arbitration. In November 2017, the court dismissed the case for administrative reasons, since Adtile had not commenced arbitration proceedings. The Company is still unable to predict the outcome or range of possible loss as of the date of these financial statements, since to date Adtile had not commenced arbitration procedures. Regardless, the Company believes it has strong defenses against this lawsuit and intends to defend against it vigorously. In addition, from time to time, the Company is party to other various legal proceedings, claims and litigation that arise in the ordinary course of business. It is the opinion of management that the ultimate outcome of these matters will not have a material adverse effect on the Company's financial position, results of operations or cash flows. |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
SHAREHOLDERS' EQUITY | NOTE 13: SHAREHOLDERS' EQUITY a. Ordinary shares The ordinary shares of the Company entitle their holders to voting rights, the right to receive cash dividend and the right to a share in excess assets upon liquidation of the Company. On August 2, 2018 the Company's Shareholders' approved a 3:1 “Reverse Share Split” of its Ordinary shares, which became effective on August 26, 2018. The accompanying consolidated financial statements and notes give retroactive effect to the reverse share split for all periods presented. All fractional shares created by the Reverse Share Split have been rounded down to the nearest whole share. b. Share Options, Restricted Share Units and Warrants In 2003, the Company's Board of Directors approved the 2003 Equity Incentive Plan (the "Plan") for an initial term of ten years from adoption and on December 9, 2012, extended the term of the Plan for an additional ten years. On August 7, 2013, the Company’s Board of Directors approved amendments to the Plan which include the ability to grant RSUs and restricted shares. The contractual term of the share options is generally no more than seven years and the vesting period of the options and RSUs granted under the Plan is between one and three years from the date of grant. The rights of the ordinary shares issued upon the exercise of share options or RSUs are identical to those of the other ordinary shares of the Company. As of December 31, 2020, there were 691,577 ordinary shares reserved for future share-based awards under the Plan. F - 35 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The following table summarizes the activities for the Company’s service-based share options for the year ended December 31, 2020: Weighted average Number of options Exercise price Remaining contractual term (in years) Aggregate intrinsic value Outstanding at January 1, 2020 4,091,127 $ 3.79 4.70 $ 10,226 Granted 1,915,435 2.66 - - Exercised (1,042,849 ) 3.86 - 5,010 Cancelled (436,666 ) 4.36 - - Outstanding at December 31, 2020 4,527,047 $ 3.24 21.79 $ 42,942 Exercisable at December 31, 2020 1,902,226 $ 3.70 3.51 $ 17,171 Vested and expected to vest at December 31, 2020 3,789,743 $ 3.36 3.22 $ 35,604 The weighted-average grant-date fair value of options granted during the years ended December 31, 2020, 2019 and 2018 was $3.14, $1.75 and $1.27, respectively. The aggregate intrinsic value of the outstanding share options at December 31, 2020, represents the intrinsic value of all outstanding options since they were all in-the-money as of such date. The number of options expected to vest reflects an estimated forfeiture rate. The following table summarizes the activities for the Company’s performance-based share options for the year ended December 31, 2020: Weighted average Number of Performance based options Exercise price Remaining contractual term (in years) Aggregate intrinsic value Outstanding at January 1, 2020 66,666 $ 3.24 4.95 $ 199 Granted 815,354 2.62 - - Exercised (66,666 ) 3.24 - 514 Cancelled (46,043 ) - - - Outstanding at December 31, 2020 769,311 2.78 40.53 7,653 Exercisable at December 31, 2020 200,000 5.35 6.58 1,476 Vested and expected to vest at December 31, 2020 596,988 $ 3.58 4.51 $ 5,460 The weighted-average grant-date fair value of options granted during the year ended December 31, 2020 was $3.12. No performance-based options were granted during 2019 and 2018. F - 36 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The aggregate intrinsic value of the outstanding performance-based options at December 31, 2020, represents the intrinsic value of all outstanding options since they were all in-the-money as of such date. The following table summarizes additional information regarding outstanding and exercisable options under the Company's share Option Plan as of December 31, 2020: Outstanding Exercisable Range of exercise price Number of options Weighted average remaining contractual life (years) Weighted average exercise price Number of options Weighted average remaining contractual life (years) Weighted average exercise price $ 0.00 – 0.50 1,051,494 79.46 $ - - - $ - 1.03 – 2.94 316,567 3.98 2.76 190,741 3.76 2.71 3.00 – 3.38 1,509,699 3.88 3.19 1,082,647 3.51 3.21 4.23 – 6.90 1,508,954 4.79 5.18 598,005 3.47 4.66 7.08 – 9.81 132,000 5.66 8.20 22,500 4.10 7.97 $ 10.01 –12.75 8,333 0.00 11.07 8,333 0.00 11.07 4,527,047 21.79 $ 3.24 1,902,226 3.51 $ 3.70 The Company recognized share-based compensation expenses related to its share-based awards in the consolidated statements of operations as follows: Year ended December 31, 2020 2019 2018 Cost of revenues $ 102 $ 164 $ 136 Research and development 887 488 448 Selling and marketing 1,898 515 848 General and administrative 1,560 1,126 1,286 Total $ 4,447 $ 2,293 $ 2,718 As of December 31, 2020, there was $6,815 of unrecognized compensation cost related to outstanding options. These amounts are expected to be recognized over a weighted-average period of 1.54 years related to outstanding options. To the extent the actual forfeiture rate is different from what has been estimated, share-based compensation related to these awards will differ from the initial expectations. c. As part of the acquisition of Undertone, the Company granted warrants to purchase |
FINANCIAL INCOME (EXPENSE), NET
FINANCIAL INCOME (EXPENSE), NET | 12 Months Ended |
Dec. 31, 2020 | |
Other Income and Expenses [Abstract] | |
FINANCIAL INCOME (EXPENSE), NET | NOTE 14: FINANCIAL INCOME (EXPENSE), NET Year ended December 31, 2020 2019 2018 Financial income: Interest income $ 287 $ 624 $ 296 Foreign currency translation gains - - 827 Change in fair value of convertible debt - - 1,585 Change in fair value of SWAP - 380 - Other 45 147 366 $ 332 $ 1,151 $ 3,074 Financial expense: Foreign currency translation losses $ (1,537 ) $ (950 ) $ - Interest expense on debts (1,045 ) (2,334 ) (3,938 ) Change in fair value of SWAP - - (2,487 ) Change in fair value of convertible debt - (600 ) - Bank charges and other (388 ) (737 ) (443 ) $ ( 2,970 ) $ ( 4,621 ) $ ( 6,868 ) Financial expense, net $ ( 2,638 ) $ ( 3,470 ) $ ( 3,794 ) |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 15: INCOME TAXES a. Income before taxes on income Income before taxes on income is comprised as follows: Year ended December 31, 2020 2019 2018 Domestic $ 12,175 $ 21,095 $ 9,081 Foreign (2,560 ) (6,557 ) 1,816 Total $ 9,615 $ 14,538 $ 10,897 F - 38 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) b. Taxes on income Taxes on income are comprised as follows: Year ended December 31, 2020 2019 2018 Current taxes $ 2,498 $ 3,816 $ 1,706 Taxes in respect of previous years 6 (129 ) 612 Deferred tax expense (benefit) (3,114 ) (2,042 ) 458 Total $ ( 610 ) $ 1,645 $ 2,776 Taxes on income by jurisdiction were as follows: Year ended December 31, 2020 2019 2018 Domestic $ 1,031 $ 3,055 $ 2,187 Foreign (1,641 ) (1,410 ) 589 Total $ ( 610 ) $ 1,645 $ 2,776 Domestic: Current taxes $ 1,466 $ 3,519 $ 1,121 Deferred tax (benefit) expense (984 ) (197 ) 649 Taxes in respect of previous years 549 (267 ) 417 Total - Domestic $ 1,031 $ 3,055 $ 2,187 Foreign: Current taxes $ 1,032 $ 297 $ 585 Deferred tax benefit (2,130 ) (1,845 ) (191 ) Taxes in respect of previous years (543 ) 138 195 Total - Foreign $ ( 1,641 ) $ ( 1,410 ) $ 589 Total income tax expense (benefit) $ ( 610 ) $ 1,645 $ 2,776 F - 39 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) c. Deferred Taxes Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The significant components of the Company’s deferred tax assets and liabilities are as follows: December 31, 2020 2019 Deferred tax assets: Net operating loss and other losses carry forwards $ 4,049 $ 4,490 Research and development 2,287 2,865 Intangible assets 1,476 2,543 Other temporary differences mainly relating to reserve and allowances 1,553 624 Deferred tax assets, before valuation allowance $ 9,365 $ 10,522 Valuation allowance 2,254 4,351 Total deferred tax assets, net $ 7,111 $ 6,171 Domestic: Long term deferred tax asset, net $ 2,034 $ 1,050 $ 2,034 $ 1,050 Foreign: $ 5,077 $ 5,121 Long term deferred tax asset, net $ 5,077 $ 5,121 Total deferred tax asset, net $ 7,111 $ 6,171 The $2,097 change in the total valuation allowance for the year ended December 31, 2020, relates to the projected utilization of certain operating loss carry-forwards and temporary differences for which a full valuation allowance was previously recorded. F - 40 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) d. Reconciliation of the Company’s effective tax rate to the statutory tax rate in Israel A reconciliation between the theoretical tax expense, assuming all income is taxed at the statutory tax rate applicable to income of the Company, and the actual tax expense as reported in the statement of income is as follows: Year ended December 31, 2020 2019 2018 Income before taxes on income $ 9,615 $ 14,538 $ 10,897 Statutory tax rate in Israel 23.0 % 23.0 % 23.0 % Theoretical tax expense $ 2,211 $ 3,344 $ 2,506 Increase (decrease) in tax expenses resulting from: "Preferred Enterprise" benefits * (1,701 ) (2,973 ) (1,301 ) Non-deductible expenses 2,409 374 298 Tax adjustment in respect of different tax rate of foreign subsidiaries 228 397 511 Deferred taxes related to prior years (1,576 ) - - Change in valuation allowance (2,097 ) 421 541 Other (84 ) 82 221 Taxes on income $ ( 610 ) $ 1,645 $ 2,776 * Benefit per ordinary share from "Preferred Enterprise" status: Basic $ 0.06 $ 0.11 $ 0.05 Diluted $ 0.06 $ 0.11 $ 0.05 e. Income tax rates Taxable income of Israeli companies was generally subject to corporate tax at the rate of 23% in 2018, 2019 and 2020. However, the effective tax rate payable by a company that derives income from a Preferred Enterprise (as discussed below) may be considerably lower. Non-Israeli subsidiaries are taxed according to the tax laws in their respective countries of residence. Deferred taxes were not provided for undistributed earnings of the Company’s foreign subsidiaries. Currently, the Company does not intend to distribute any amounts of its undistributed earnings as dividends. The Company intends to reinvest these earnings indefinitely in the foreign subsidiaries and pay down its debt. Accordingly, no deferred income taxes have been provided in respect of these subsidiaries. If these earnings were distributed to Israel in the form of dividends or otherwise, the Company would be subject to additional Israeli income taxes (subject to an adjustment for foreign tax credits) and foreign withholding taxes. The amount of undistributed earnings of foreign subsidiaries is immaterial. F - 41 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) f. Law for the Encouragement of Capital Investments, 1959 The Law for Encouragement of Capital Investments, 1959 (the "Investment Law") provides tax benefits for Israeli companies meeting certain requirements and criteria. The Investment Law has undergone certain amendments and reforms in recent years. The Israeli parliament enacted a reform to the Investment Law, effective January 2011 (which was amended in August 2013). According to the reform, a flat rate tax applies to Preferred Income of companies eligible for the "Preferred Enterprise" status. In order to be eligible for Preferred Enterprise status, a company must meet minimum requirements to establish that it contributes to the country’s economic growth and is a competitive factor for the gross domestic product. The Company’s Israeli operations elected “Preferred Enterprise” status, starting in 2011. Benefits granted to a Preferred Enterprise include reduced tax rates. As part of the Economic Efficiency Law (Legislative Amendments for Accomplishment of Budgetary Targets for Budget Years 2017-2018), 5777-2016, the tax rate is 16% for all other Areas other than Development Area A (which was 7.5% from 2017 onward). A distribution from a Preferred Enterprise out of the "Preferred Income" would be subject to 20% withholding tax for Israeli-resident individuals and non-Israeli residents (subject to applicable treaty rates), for dividends which are distributed on or after January 1, 2014 and from “Preferred Income” that was produced or accrued after such date. A distribution from a Preferred Enterprise out of the "Preferred Income" would be exempt from withholding tax for an Israeli-resident company. g. The New Technological Enterprise Incentives Regime (Amendment 73 to the Investment Law) In December 2016, the Economic Efficiency Law (Legislative Amendments for Applying the Economic Policy for the 2017 and 2018 Budget Years), 2016 which includes Amendment 73 to the Law for the Encouragement of Capital Investments ("Amendment 73") was published and was pending the publication of regulations, in May 2017 regulations were promulgated by the Finance Ministry to implement the "Nexus Principles" based on OECD guidelines published as part of the Base Erosion and Profit Shifting (BEPS) project. Following the publication of the regulations Amendment 73 became fully effective. According to Amendment 73, a Preferred Technological Enterprise, as defined in Amendment 73, with total consolidated revenues of less than NIS 10 billion, shall be subject to 12% tax rate on income derived from intellectual property (in development area A—a tax rate of 7.5%). In order to qualify as a Preferred technological enterprise certain criteria must be met, such as a minimum ratio of annual R&D expenditure and R&D employees, as well as having at least 25% of annual revenues derived from exports. Any dividends distributed from income from the preferred technological enterprises will be subject to tax at a rate of 20%. Amendment 73 further provides that, in certain circumstances, a dividend distributed to a foreign corporate shareholder, would be subject to a 4% tax rate (if the percentage of foreign shareholders exceeds 90%). F - 42 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The Company assessed the criteria for qualifying as a “Preferred Technological Enterprise,” status and concluded that the Company is eligible to the above-mentioned benefits. h. Uncertain tax positions A reconciliation of the beginning and ending balances of the total amounts of unrecognized tax benefits is as follows: December 31, 2020 2019 Balance at the beginning of the year $ 4,232 $ 4,034 Increase (Decrease) related to prior year tax positions, net 293 (249 ) Increase related to current year tax positions, net - 447 Balance at the end of the year $ 4,525 $ 4,232 In 2020, The Company recognizes interest accrued related to unrecognized tax benefits in interest expense and penalties in tax expenses. During the years ended December 31, 2020, 2019 and 2018, the Company recognized approximately $444, $158 and $12 in interest and penalties. The Company had $1,017 and $573 for the payment of interest and penalties accrued at December 31, 2020, and 2019, respectively which are included in the balance of the end at the year. The Company does not expect uncertain tax positions to change significantly over the next 12 months, except in the case of settlements with tax authorities, the likelihood and timing of which are difficult to estimate. The Company believes that it has adequately provided for any reasonably foreseeable outcome related to tax audits and settlements, although the final tax outcome of its tax audits could be different from that which is reflected in the Company's income tax provisions and accruals. Such differences could have a material effect on the Company's income tax provision and net income in the period in which such determination is made. The Company’s tax assessments in Israel and the U.S. for tax years prior to 2015 and 2016 respectively are considered final. The Company has net operating losses in the U.S. from prior tax periods beginning in 2011 which may be subject to examination upon utilization in future tax periods i. Tax loss carry-forwards As of December 31, 2020, the Company’s U.S. subsidiaries have Federal net operating loss carry-forwards of $3,471 and States net operating loss carry-forwards of $2,746. Net operating losses in the U.S. may be carried forward through periods which will expire in the years starting from 2031 2035 F - 43 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) As of December 31, 2020, the Company’s European subsidiaries have net operating loss carry-forwards of $6,402 which may be carried forward indefinitely. The Company has accumulated net operating losses for tax purposes as of December 31, 2020, in the amount of approximately $11,111, which may be carried forward and offset against taxable income in the future for an indefinite period. The net operating losses may be offset against taxable income annually with a limitation of up to 20% of the total accumulated losses but no more than 50% of the Company's taxable income. The limitation applies during the years 2020-2024. In addition, the Company has accumulated capital losses for tax purposes as of December 31, 2020, of approximately $1,570, which may be carried forward and offset against taxable capital gains in the future for an indefinite period, but are limited as stated above. j. US Tax Reform: On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “TCJA”). The TCJA makes broad and complex changes to the Code. The changes include, but are not limited to: • A corporate income tax rate decrease from • The transition of U.S international taxation from a worldwide tax system to a territorial system by providing a • A one-time transition tax on the mandatory deemed repatriation of cumulative foreign earnings as of In March 2018, the FASB issued Accounting Standards Update No. 2018-05, "Income Taxes Topic (740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118" ("ASU 2018-05") to address situations when a registrant does not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the TCJA. In March 2020, in response to the COVID-19 pandemic the Coronavirus Aid, Relief and Economic Security (“CARES”) Act was enacted. The CARES Act comprises of a spending package and tax reliefs in order to reduce the impact of the pandemic. The tax portion of the CARES Act includes several corporate tax relief provisions such as: eliminating the taxable income limitation and allowing carryback to the prior 5 years for net operating losses (“NOLs”) arising in 2018, 2019 and 2020; increasing the business interest deduction limitation from 30% to 50%; accelerated refunds of AMT credits and other provisions. The Company is considering which provisions are relevant for its US subsidiaries. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | NOTE 16: EARNINGS PER SHARE The table below presents the computation of basic and diluted net earnings per common share: Year ended December 31, 2020 2019 2018 Numerator: Net income attributable to ordinary shares - basic $ 10,225 $ 12,893 $ 8,121 Net income - diluted $ 10,225 $ 12,893 $ 8,121 Denominator: Number of ordinary shares outstanding during the year 26,687,145 25,965,357 25,850,067 Weighted average effect of dilutive securities: Employee options and restricted share units 2,110,602 392,228 5,158 Diluted number of ordinary shares outstanding 28,797,747 26,357,585 25,855,225 Basic net earnings per ordinary share $ 0.38 $ 0.50 $ 0.31 Diluted net earnings per ordinary share $ 0.36 $ 0.49 $ 0.31 Ordinary shares equivalents excluded because their effect would have been anti-dilutive 3,178,024 4,087,559 4,725,618 |
RESTRUCTURING COSTS
RESTRUCTURING COSTS | 12 Months Ended |
Dec. 31, 2020 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING COSTS | NOTE 17: RESTRUCTURING COSTS Restructuring charges were recorded in connection with plans in order to reduce workforce, close certain facilities and other cost saving measures which amounted to $2,100 during 2018. In 2020 and 2019, there were no restructuring charges. |
MAJOR CUSTOMERS
MAJOR CUSTOMERS | 12 Months Ended |
Dec. 31, 2020 | |
Risks and Uncertainties [Abstract] | |
MAJOR CUSTOMERS | NOTE 18: MAJOR CUSTOMERS A substantial portion of the Company's revenue is derived from search fees and online advertising, the market for which is highly competitive and rapidly changing. Significant changes in this industry or in customer buying behavior would adversely affect the Company’s operating results. The following table sets forth the customers that represent 10% or more of the Company’s total revenues in each of the years presented below: Year ended December 31, 2020 2019 2018 Customer A 51% 63% 45% |
GEOGRAPHIC INFORMATION
GEOGRAPHIC INFORMATION | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
GEOGRAPHIC INFORMATION | NOTE 19: GEOGRAPHIC INFORMATION The Company operates as one operating segment. Operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the Chief Operating Decision Maker, who is the Chief Executive Officer, in deciding how to allocate resources and assessing performance. Over the past few years, the Company has completed several acquisitions. These acquisitions have allowed the Company to expand its offerings, presence and reach in various markets. While the Company has offerings in multiple enterprise markets, the Company’s business operates in one segment which is the High Impact Advertising solutions, and the Company’s Chief Operating Decision Maker evaluates the Company’s financial information and resources and assesses the performance of these resources on a consolidated basis. The following table presents the total revenues for the years ended December 31, 2020, 2019 and 2018, allocated to the geographic areas in which they were generated: Year ended December 31, 2020 2019 2018 North America (mainly U.S.) $ 272,220 $ 195,903 $ 197,440 Europe 49,222 50,669 46,858 Other 6,621 14,878 8,547 $ 328,063 $ 261,450 $ 252,845 The total revenues are attributed to geographic areas based on the location of the end-users. The following table presents the locations of the Company’s long-lived assets as of December 31, 2020 and 2019: December 31, 2020 2019 Israel $ 11,343 $ 15,816 U.S. 10,157 11,987 Europe 5,536 5,544 $ 27,036 $ 33,347 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 20: SUBSEQUENT EVENTS a. On January 20, 2021, the Company closed a follow on offering whereby b. On March 8, 2021, the Company early repaid the full amount of its loan facility with bank Mizrachi or a principal |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of consolidation | Basis of consolidation The consolidated financial statements include the accounts of Perion and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated. |
Use of estimates | Use of estimates The preparation of the consolidated financial statements in conformity with U.S. Generally Accepted Accounting Principles (“GAAP”) requires management to make estimates, judgments and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. Actual results could differ materially from those estimates. On an ongoing basis, the Company's management evaluates its estimates, including those related to sales allowances and allowance for credit losses, fair value of intangible assets and goodwill, useful lives of intangible assets, fair value of share-based awards, realizability of deferred tax assets, tax uncertainties, and contingent liabilities, among others. Such estimates are based on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of the Company’s assets and liabilities. |
Financial statements in U.S. dollars | Financial statements in U.S. dollars The reporting currency of the Company is the U.S. dollar (“USD”). Major parts of the Company’s operations are carried out by the Company and its subsidiaries in the United States and Israel. The functional currency of these entities is the USD. Accordingly, monetary accounts maintained in currencies other than the USD are remeasured into USD, in accordance with ASC 830, "Foreign Currency Matters". All transaction gains and losses resulting from the re-measurement of the monetary balance sheet items are reflected in the statements of income as financial income or expenses, as appropriate. Management believes that the USD is the currency of the primary economic environment in which the Company operates. The financial statements of other subsidiaries, whose functional currency is determined to be their local currency, have been translated into USD. All balance sheet accounts have been translated using the exchange rates in effect at the balance sheet date. Statement of operations amounts have been translated using the average exchange rate for each applicable quarter. The resulting translation adjustments are reported as an accumulated other comprehensive income (loss) component of shareholders' equity. |
Cash and cash equivalents and short-term deposits | Cash and cash equivalents and short-term deposits The Company considers all short-term, highly liquid and unrestricted cash balances, with stated maturities of three months or less from date of purchase, as cash equivalents. Short-term deposits are bank deposits with maturities of more than three months but less than one year. The short-term deposits as of December 31, 2020 and 2019 are denominated primarily in USD and bear interest at an average annual rate of 0.35% and 2.16%, respectively. |
Restricted cash | Restricted cash Restricted cash is comprised primarily of security deposits that are held to secure the Company’s hedging activity, lease obligations and certain letters of credit associated with lease obligations. Restricted cash in the amount of $1,222 and $1,216, as of December 31, 2020 and 2019, respectively. |
Accounts receivable and allowance for credit losses | Accounts receivable and allowance for credit losses Trade accounts receivables are stated at realizable value, net of an allowance for credit losses. The Company evaluates its outstanding accounts receivable and establishes an allowance for credit losses. based on information available on their credit condition, current aging, historical experience and future economic and market conditions. These allowances are reevaluated and adjusted periodically as additional information is available. As of December 31, 2020 and 2019, the Company has recorded an allowance in the amounts of $694 and $417, respectively. Total expenses for doubtful debts during 2020, 2019 and 2018 amounted to $323, $78 and $180, respectively. |
Property and equipment | Property and equipment Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets at the following annual rates: % Computers and peripheral equipment 33 Office furniture and equipment 6 - 15 Leasehold improvements are amortized using the straight-line method over the term of the lease or the estimated useful life of the improvements, whichever is shorter. |
Leases | Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities and operating lease liabilities in the Company’s consolidated balance sheets. Finance leases are included in property, plant and equipment, net, other current liabilities, and other long-term liabilities in the Company’s consolidated balance sheets. F - 15 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) ROU assets represent the right to use an underlying asset for the lease term and lease liabilities obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The Company uses incremental borrowing rates based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expenses for lease payments are recognized on a straight-line basis over the lease term. |
Impairment of long-lived assets, Right-of-use assets and intangible assets subject to amortization | Impairment of long-lived assets, Right-of-use assets and intangible assets subject to amortization The Company’s long-lived assets (assets group) to be held or used, including property and equipment, right of use assets and intangible assets subject to amortization are reviewed for impairment in accordance with ASC 360, "Accounting for the Impairment or Disposal of Long-Lived Assets", whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. The recoverability of these assets is measured by comparing the carrying amounts to the future undiscounted cash flows the assets are expected to generate. If property and equipment and intangible assets are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the asset exceeds its fair market value. In determining the fair values of long-lived assets for the purpose of measuring impairment, the Company's assumptions include those that market participants will consider in valuations of similar assets. |
Goodwill and intangible assets | Goodwill and intangible assets Goodwill reflects the excess of the purchase price of business acquired over the fair value of net assets acquired. Goodwill is not amortized but instead is tested for impairment, in accordance with ASC 350, “Intangibles – Goodwill and Other”, at the reporting unit level, at least annually at December 31 each year, or more frequently if events or changes in circumstances indicate that the carrying value may be impaired. Following the early adoption of ASU 2017-04, "Simplifying the Test for Goodwill Impairment" by the Company in January 2017, any excess of the carrying amount of the reporting unit over its fair value is recognized as an impairment loss, and the carrying value of goodwill is written down to fair value. The majority of the inputs used in the discounted cash flow model to determine the fair value of the reporting units are unobservable and thus are considered to be Level 3 inputs. Intangible assets that are not considered to have an indefinite useful life are amortized over their estimated useful lives. The Customer Relationship, technology and trade name are amortized over their estimated useful lives in proportion to the economic benefits realized. This accounting policy results in accelerated amortization of such intangible assets as compared to the straight-line method. Revenue recognition The Company applies the provisions of Accounting Standards Codification 606, Revenue from Contracts with Customers ("ASC 606" or "Topic 606"). |
Revenue recognition | The Company applies the practical expedient for incremental costs of obtaining contracts when the associated revenues is recognized over less than one year. The Company generates revenues primarily from two major sources: Display and Social Advertising Revenues (“Advertising”) Search Advertising and other Revenues (“Search Monetization”) For more disaggregated information of revenues refer to Note 19. The Company’s payments terms are less than one year. Therefore, no finance component is recognized. The Company evaluates whether Search and Advertising Revenues should be presented on a gross basis, which is the amount that a customer pays for the service, or on a net basis, which is the amount of the customer payment less amounts the Company pays to publishers. In making that evaluation, the Company considers whether it controls the promised good or service before transferring that good or service to the customer. The Company considers indicators such as whether the Company is the primary obligor in the arrangement and assumes risks and rewards as a principal or an agent, including the credit risk, whether the Company has latitude in establishing prices and selecting its suppliers and whether it changes the products or performs part of the service. The evaluation of these factors is subject to significant judgment and subjectivity. Generally, in cases in which the Company is primarily obligated in a transaction, is subject to risk, involved in the determination of the product (or the service) specifications, separately negotiates each revenue service agreement or publisher agreement and can have several additional indicators, revenue is recorded on a gross basis. Remaining performance obligations (RPOs) represent amounts collected on contracted revenues that have not yet been recognized. As of December 31, 2020, the aggregate amount of the RPOs was $5,711. The Company anticipates that it will satisfy all of its remaining performance obligation associated with the deferred revenue within the prospective fiscal year. Contract balances are presented separately on the consolidated balance sheets as either Accounts receivable or Deferred revenues. The Company does not have contract assets. Accounts receivable includes amounts billed and currently due from customers. Deferred revenues are recorded when payments are received from customers in advance of the Company's rendering of services. Revenues recognized during 2020 from amounts included within the Deferred revenues balance at the beginning of the period amounted to $4,188. |
Cost of revenues | Cost of revenues Cost of revenues consists primarily of expenses associated with the operation of the Company’s server hosting, data verification and targeting, campaign creative, labor, as well as content acquisition costs and customer support. |
Customer acquisition costs and media buy | Customer acquisition costs and media buy Customer acquisition costs and media buy consist of amounts paid to publishers who distribute the Company’s search solutions and services as well as the costs of advertising inventory and user acquisition costs incurred in our advertising business. Customer acquisition costs are based either on revenue share arrangements with minimum guarantee or fixed rates, which are charged as incurred. |
Research and development costs | Research and development costs Research and development costs are charged to the statement of income as incurred, except for certain costs relating to internally developed software, which are capitalized. The Company capitalizes certain internal and external software development costs, consisting primarily of direct labor associated with creating the internally developed software. Software development projects generally include three stages: (i) the preliminary project stage (all costs expensed as incurred); (ii) the application development stage (costs are capitalized) and (iii) the post implementation/operation stage (all costs expensed as incurred). The costs capitalized in the application development stage primarily include the costs of designing the application, coding and testing of the system. Capitalized costs are amortized using the straight-line method over the estimated useful life of the software, generally three years, once it is ready for its intended use. The Company believes that the straight-line recognition method best approximates the manner in which the expected benefit will be derived. Management evaluates the useful lives of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. Capitalized software development costs, net of accumulated amortization, of $1,392 and $4,448 are included in property and equipment in the consolidated balance sheets as of December 31, 2020 and 2019, respectively (see Note 5). |
Income taxes | Income taxes The Company accounts for income taxes in accordance with ASC 740, "Income Taxes". This Statement prescribes the use of the liability method, whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. To the extent necessary, the Company provides a valuation allowance to reduce deferred tax assets to their estimated realizable value. The Company accounts for uncertain tax positions in accordance with ASC 740, which contains a two-step approach for recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position taken or expected to be taken in a tax return by determining if the weight of available evidence indicates that it is more likely than not that the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. |
Severance pay | Severance pay The Company's agreements with employees in Israel are in accordance with section 14 of the Severance Pay Law, 1963 (“Section 14”), where the Company's contributions for severance pay is paid to the employee upon termination instead of the severance liability that would otherwise be payable under the law as aforementioned. Upon contribution to a fund, based on the full amount of the employee's monthly salary, and release of the fund to the employee, no additional severance payments are required to be made by the Company to the employee. Therefore, the related obligation and amounts deposited on behalf of such obligation are not stated on the balance sheet, as the Company is legally released from obligation to such employees once the deposit amounts have been paid. Severance expenses for the years ended December 31, 2020, 2019 and 2018 amounted to $1,754, $1,270 and $1,230, respectively. The balances of severance deposits and accrued severance pay are immaterial and included in other assets and other long-term liabilities on the accompanying balance sheets, respectively. |
Employee benefit plan | Employee benefit plan The Company’s U.S. operations maintain a retirement plan (the “U.S. Plan”) that qualifies as a deferred salary arrangement under Section 401(k) of the Internal Revenue Code. Participants in the U.S. Plan may elect to defer a portion of their pre-tax earnings, up to the Internal Revenue Service’s annual contribution limit. The Company matches up to 100% of each participant’s contributions, up to 6% of employee deferral. Contributions to the U.S. Plan are recorded during the year contributed as an expense in the consolidated statement of income. Total employer 401(k) contributions for the years ended December 31, 2020, 2019 and 2018 were $624, $691 and $751, respectively. |
Comprehensive income (loss) | Comprehensive income (loss) The Company accounts for comprehensive income (loss) in accordance with ASC 220, "Comprehensive Income". This statement establishes standards for the reporting and display of comprehensive income and its components in a full set of general purpose financial statements. Comprehensive income generally represents all changes in shareholders' equity during the period except those resulting from investments by, or distributions to, shareholders. The Company determined that its other comprehensive income (loss) relates to hedging derivative instruments and foreign currency translation adjustments. |
Net earnings per share | Net earnings per share In accordance with ASC 260, "Earnings Per Share", basic net earnings per share ("Basic EPS") is computed by dividing net earnings attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted net earnings per share ("Diluted EPS") reflects the potential dilution that could occur if share options and other commitments to issue ordinary shares were exercised or equity awards vested, resulting in the issuance of ordinary shares that could share in the net earnings of the Company. F - 19 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The weighted average number of ordinary shares related to the outstanding options, restricted shares, convertible debt and warrants excluded from the calculations of diluted net earnings per ordinary share, as these securities are anti-dilutive, was 3,178,024, 4,087,559 and 4,725,618 for the years ended December 31, 2020, 2019 and 2018, respectively. |
Concentrations of credit risk | Concentrations of credit risk Financial instruments, which potentially subject the Company to a concentration of credit risk, consist primarily of cash and cash equivalents, bank deposits, restricted cash and accounts receivable. The majority of the Company’s cash and cash equivalents, bank deposits and restricted cash are invested in USD instruments with major banks in the U.S. and Israel. Deposits in the U.S. may be in excess of insured limits and are not insured in other jurisdictions. Generally, these deposits may be redeemed upon demand and, therefore, bear minimal risk. The Company’s major customers are financially sound, and the Company believes low credit risk is associated with these customers. To date, the Company has not experienced any material bad debt losses. |
Share-based compensation | Share-based compensation The Company accounts for share-based compensation under ASC 718, "Compensation - Stock Compensation", which requires the measurement and recognition of compensation expense based on estimated fair values for all share-based payment awards made to employees, contractors and directors. ASC 718 requires companies to estimate the fair value of equity-based awards on the date of grant, using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in the Company's consolidated statement of income. The Company estimates forfeitures to be estimated at the time of grant, and revised if necessary in subsequent periods, if actual forfeitures differ from those estimates. The Company recognizes compensation expenses for the value of its awards, which have graded vesting based on service conditions, using the straight-line method, over the requisite service period of each of the awards, net of estimated forfeitures. Estimated forfeitures are based on actual historical pre-vesting forfeitures. For performance-based share units, the Company recognizes compensation expenses for the value of such awards, if and when the Company concludes that it is probable that a performance condition will be achieved based on the accelerated attribution method over the requisite service period. The Company should reassess the probability of vesting at each reporting period for awards with performance conditions and adjust compensation cost based on its probability assessment. The Company accounted for changes in award terms as a modification in accordance with ASC 718. A modification to the terms of an award should be treated as an exchange of the original award for a new award with total compensation cost equal to the grant-date fair value of the original award plus the incremental value measured at the same date. Under ASC 718, the calculation of the incremental value is based on the excess of the fair value of the new (modified) award based on current circumstances over the fair value of the original award measured immediately before its terms are modified based on current circumstances. F - 20 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The Company estimates the fair value of its new share-based awards using the Binomial option-pricing model. The following table presents the various assumptions used to estimate the fair value of the Company's share-based awards granted to employees and directors in the periods presented: Year ended December 31 2020 2019 2018 Risk-free interest rate 0.29% - 1.60% 0.70% - 2.90% 1.50% - 3.00% Expected volatility 53% - 59% 43% - 55% 48% - 57% Early exercise factor 110% - 200% 110% - 230% 150% - 200% Forfeiture rate post vesting 0% - 34% 0% - 34% 0% - 34% Dividend yield 0% 0% 0% The expected volatility is calculated based on the actual historical share price movements of the Company’s share. The expected option term represents the period that the Company’s share options are expected to be outstanding. The early exercise factor and the forfeiture rate post-vesting are calculated based on the Company’s estimated early exercise and post-vesting forfeiture multiples, which are based on comparable companies and on actual historical data. The risk-free interest rate is based on the yield from U.S. Treasury zero-coupon bonds, with a term which is equivalent to the expected term of the share-based awards. The dividend yield is based on the current decision of the Company’s management not to distribute any dividends. The fair value of restricted share units (“RSU”) is based on the market value of the underlying shares on the date of grant. |
Derivative instruments | Derivative instruments The Company accounts for derivatives and hedging based on ASC 815, "Derivatives and Hedging", which requires recognizing all derivatives on the balance sheet at fair value. If the derivatives meet the definition of a cash flow hedge and are so designated, depending on the nature of the hedge, the effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income and reclassified into earnings in the same period, or periods, during which the hedged transaction affects earnings. The ineffective portion of a derivative’s change in fair value, if any, is recognized in earnings, as well as gains and losses from a derivative’s change in fair value that are not designated as hedges are recognized in earnings immediately. In order to mitigate the potential adverse impact on cash flows resulting from fluctuations in the exchange rate of the new Israeli shekels (“ILS”), the Company hedges portions of its forecasted expenses denominated in ILS with SWAP and options contracts. The Company does not speculate in these hedging instruments in order to profit from foreign currency exchanges, nor does it enter into trades for which there are no underlying exposures. To protect against the increase in value of forecasted foreign currency cash flow resulting mainly from salaries and related benefits paid in ILS during the year, the Company hedges portions of its anticipated payroll denominated in ILS for a period of one to twelve months with forward and options contracts (the “Hedging Contracts”). Accordingly, when the USD strengthens against the ILS, the decline in present value of future ILS currency expenses is offset by losses in the fair value of the Hedging Contracts. Conversely, when the USD weakens, the increase in the present value of future ILS expenses is offset by gains in the fair value of the Hedging Contracts. These Hedging Contracts are designated as cash flow hedges. F - 21 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The Company follows the requirements of ASC No. 815, Derivatives and Hedging Additionally, in order to mitigate the potential adverse impact of the fluctuations in the ILS-USD exchange rate in connection with the convertible debt (see Note 10), the Company has entered into a cross currency interest rate SWAP agreement (the “SWAP”) in order to hedge the future interest and principal payments, which are all denominated in ILS. However, since the convertible debt was measured at fair value at each reporting date, the SWAP does not qualify and was not designated as hedge under ASC 815. Therefore, gains or losses resulted from the change of the SWAP's fair value were recognized immediately as incurred in "financial expenses, net". The Company measured the fair value of these contracts in accordance with ASC 820, "Fair Value Measurement and Disclosures", and they were classified as level 2. On June 6, 2019, the SWAP agreements were terminated concurrently with the early redemption of the convertible bond. In order to limit the Company’s interest expenses derived from the secured credit agreement in which the Company entered concurrently with the closing of Interactive Holding Corp. acquisition in 2015 (“Undertone”), the Company has purchased a Cap Option for the interest amounts that was expected to be paid until June 2018. The cap option was designated as cash flow hedge under ASC 815. The notional value of the Company’s derivative instruments as of December 31, 2020 and 2019, amounted to $0 and $3,918, respectively. Notional values in USD are translated and calculated based on the spot rates for options and swap. Gross notional amounts do not quantify risk or represent assets or liabilities of the Company; however, they are used in the calculation of settlements under the contracts. |
Fair value of financial instruments | Fair value of financial instruments The carrying amounts of financial instruments carried at cost, including cash and cash equivalents, short-term deposits, restricted cash, accounts receivable, and other assets, accounts payable, accrued expenses and other liabilities approximate their fair value due to the short-term maturities of such instruments. The Company follows the provisions of ASC No. 820, “Fair Value Measurement” (“ASC 820”), which defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining a fair value, the Company uses various valuation approaches. ASC 820 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing an asset or liability, based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect assumptions that market participants would use in pricing an asset or liability, based on the best information available under given circumstances. F - 22 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The hierarchy is broken down into three levels, based on the observability of inputs and assumptions, as follows: • Level 1 • Level 2 • Level 3 |
Treasury shares | Treasury shares In the past, the Company repurchased its ordinary shares on the open market. The Company holds the shares as treasury shares and presents their cost as a reduction of shareholders' equity. |
Business combinations | Business combinations The Company accounted for business combination in accordance with ASC 805, "Business Combinations". ASC 805 requires recognition of assets acquired, liabilities assumed, and any non-controlling interest at the acquisition date, measured at their fair values as of that date. Any excess of the fair value of net assets acquired over purchase price is allocated to goodwill and any subsequent changes in estimated contingencies are to be recorded in earnings. In addition, changes in valuation allowance related to acquired deferred tax assets and in acquired income tax position are to be recognized in earnings. Acquisition related costs are expensed to the statement of income in the period incurred. |
Recent Adopted Accounting Pronouncements: | Recent Adopted Accounting Pronouncements: In June 2016 the FASB issued Accounting Standards Update (ASU) No. 2016-13 "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments". The FASB subsequently issued amendments to ASU 2016-13, which have the same effective date and transition date of January 1, 2020. This standard requires entities to estimate an expected lifetime credit loss on financial assets ranging from short-term trade accounts receivable to long-term financings and report credit losses using an expected losses model rather than the incurred losses model that was previously used, and establishes additional disclosures related to credit risks. The Company adopted Topic 326 effective January 1, 2020. The adoption of this standard did not have a material impact on the Company’s condensed consolidated financial statements. The Consolidated Financial Statements for the year ended December 31, 2020 are presented under the new standard, while comparative periods presented are not adjusted and continue to be reported in accordance with the Company’s historical accounting policy. The adoption of this standard did not have a material impact on the Company’s condensed consolidated financial statements. In August 2018, the FASB issued ASU 2018-13 “Fair Value Measurement (Topic 820)—Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement”. This guidance removes certain disclosure requirements related to the fair value hierarchy, modifies existing disclosure requirements related to measurement uncertainty and adds new disclosure requirements. F - 23 PERION NETWORK LTD. AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) The new disclosure requirements include disclosing the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. Certain disclosures required by this guidance must be applied on a retrospective basis and others on a prospective basis. The guidance was adopted for interim and annual periods beginning after December 15, 2019, although early adoption is permitted. The adoption of this standard did not have a material impact on the Company’s condensed consolidated financial statements. The Consolidated Financial Statements and disclosures for the year ended December 31, 2020 are presented under the new standard, while comparative periods presented are not adjusted and continue to be reported in accordance with the Company’s historical accounting policy. |
Recent Accounting Pronouncements not yet adopted | Recent Accounting Pronouncements not yet adopted In December 2019, the FASB issued Accounting Standards Update No. 2019-12, Income Taxes (Topic 740): “Simplifying the Accounting for Income Taxes” (ASU 2019-12), which simplifies the accounting for income taxes. This guidance will be effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, and early adoption is permitted. The Company is currently evaluating the impact of the new guidance on its consolidated financial statements. |
Reclassifications | Reclassifications Certain items of expense have been reclassified to conform to current year financial statement presentation. |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Estimated Useful Lives at an Annual Rate | Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets at the following annual rates: % Computers and peripheral equipment 33 Office furniture and equipment 6 - 15 |
Schedule of assumptions used to estimate the fair value of the stock-based awards granted to employees and directors | The following table presents the various assumptions used to estimate the fair value of the Company's share-based awards granted to employees and directors in the periods presented: Year ended December 31 2020 2019 2018 Risk-free interest rate 0.29% - 1.60% 0.70% - 2.90% 1.50% - 3.00% Expected volatility 53% - 59% 43% - 55% 48% - 57% Early exercise factor 110% - 200% 110% - 230% 150% - 200% Forfeiture rate post vesting 0% - 34% 0% - 34% 0% - 34% Dividend yield 0% 0% 0% |
FAIR VALUE OF FINANCIAL INSTR_2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
FAIR VALUE OF FINANCIAL INSTRUMENTS [Abstract] | |
Schedule of Fair Value Measurements | The following table present liabilities measured at fair value on a recurring basis as of December 31, 2020: Fair value measurements using input type Level 1 Level 2 Level 3 Total Liabilities: Contingent consideration in connection to the acquisitions $ - $ - $ 37,904 $ 37,904 Total financial liabilities $ - $ - $ 37,904 $ 37,904 The following table present assets measured at fair value on a recurring basis as of December 31, 2019: Fair value measurements using input type Level 1 Level 2 Level 3 Total Assets Derivative assets $ - $ 73 $ - $ 73 Total financial assets $ - $ 73 $ - $ 73 |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) - Undertone [Member] | 12 Months Ended |
Dec. 31, 2020 | |
Business Acquisition [Line Items] | |
Schedule of Assets Acquired and Liabilities Assumed | The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date: Fair value Property and equipment, net $ 4 Technology 12,483 Customer Relationship 4,243 Deferred Taxes (2,253 ) Goodwill 23,361 Net assets acquired $ 37,838 The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date: Fair value Property and equipment, net $ 15 Other creditors (25 ) Technology 9,618 Customer Relationship 658 Goodwill 3,133 Net assets acquired $ 13,399 |
Schedule of pro forma information | The following table represents the pro-forma condensed unaudited consolidated statements of operations as if the acquisition completed during the years ended December 31, 2019 and 2020, had been included in the condensed consolidated statements of operations of the Company for the years ended December 31, 2019 and 2020: Year ending December 31, 2020 2019 Revenues $ 329,068 $ 299,871 Net Income $ 8,079 $ 3,985 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | December 31, 2020 2019 Cost: Computers and peripheral equipment $ 6,776 $ 7,212 Office furniture and equipment 2,682 2,703 Leasehold improvements 8,658 8,678 Capitalized software 12,473 12,473 Total cost 30,589 31,066 Less: accumulated depreciation and amortization (23,819 ) (20,148 ) Property and equipment, net $ 6,770 $ 10,918 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS, NET (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Goodwill | The changes in the net carrying amount of goodwill in 2019 and 2020 were as follows: Balance as of January 1, 2019 $ 125,051 Acquisition of Captain growth $ 758 Balance as of December 31, 2019 $ 125,809 Acquisition of Content IQ $ 23,361 Acquisition of Pub Ocean $ 3,133 Balance as of December 31, 2020 $ 152,303 |
Summary of Intangible Assets | The following is a summary of intangible assets as of December 31, 2020: December 31, 2019 Additions Amortization OCI December 31, 2020 Acquired technology $ 31,159 $ 22,101 $ - $ 152 $ 53,412 Accumulated amortization (21,810 ) - (3,579 ) (159 ) (25,548 ) Impairment (8,749 ) - - - (8,749 ) Acquired technology, net 600 22,101 ( 3,579 ) ( 7 ) 19,115 Customer relationships 31,911 4,901 - 48 36,860 Accumulated amortization (20,727 ) - (1,465 ) 31 (22,161 ) Impairment (10,426 ) - - - (10,426 ) Customer relationships, net 758 4,901 ( 1,465 ) 79 4,273 Tradename and other 18,284 - - 219 18,503 Accumulated amortization (11,897 ) - (217 ) (291 ) (12,405 ) Impairment (5,110 ) - - - (5,110 ) Tradename and other, net 1,277 - ( 217 ) ( 72 ) 988 Intangible assets, net $ 2,635 $ 27,002 $ ( 5,261 ) $ - $ 24,376 The following is a summary of intangible assets as of December 31, 2019: December 31, 2018 Additions Amortization OCI December 31, 2019 Acquired technology $ 30,807 $ 442 $ - $ ( 90 ) $ 31,159 Accumulated amortization (21,242 ) - (649 ) 81 (21,810 ) Impairment (8,749 ) - - - (8,749 ) Acquired technology, net 816 442 ( 649 ) ( 9 ) 600 Customer relationships 31,940 - - ( 29 ) 31,911 Accumulated amortization (19,825 ) - (928 ) 26 (20,727 ) Impairment (10,426 ) - - - (10,426 ) Customer relationships, net 1,689 - ( 928 ) ( 3 ) 758 Tradename and other 18,415 - - ( 131 ) 18,284 Accumulated amortization (9,314 ) - (2,679 ) 96 (11,897 ) Impairment (5,110 ) - - - (5,110 ) Tradename and other, net 3,991 - ( 2,679 ) ( 35 ) 1,277 Intangible assets, net $ 6,496 $ 442 $ ( 4,256 ) $ ( 47 ) $ 2,635 |
Schedule of Estimated Useful Life of the Intangible Assets | The estimated useful life of the intangible assets are as follows: Estimated useful life Acquired technology 3-5 years Customer relationships 4-7 years Tradename and other 4-11 years |
Schedule of Estimated Future Amortization Expense | Amortization of intangible assets, net, in each of the succeeding five years and thereafter is estimated as follows: 2021 $ 5,438 2022 5,450 2023 5,462 2024 5,395 2025 1,858 Thereafter 773 $ 24,376 |
ACCRUED EXPENSES AND OTHER LI_2
ACCRUED EXPENSES AND OTHER LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses and Other Liabilities | December 31, 2020 2019 Employees and payroll accruals $ 13,970 $ 10,506 Government authorities 3,422 2,540 Accrued expenses 3,003 5,092 Other short-term liabilities 793 276 $ 21,188 $ 18,414 |
DERIVATIVES AND HEDGING ACTIV_2
DERIVATIVES AND HEDGING ACTIVITES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of fair value of the Companys outstanding derivative instruments | As of December 31, 2019, The fair value of the Company’s outstanding derivative instruments reflected as prepaid expenses and other current assets was $73 and reflected as Accumulated other comprehensive income was $67. As of December 31, 2020 the fair value of the Company’s outstanding derivatives instruments was $0. |
Schedule of net amounts reclassified from accumulated other comprehensive loss to the operating expenses | The net amounts reclassified from accumulated other comprehensive loss to the operating expenses are as follows: Gain recognized in Statements of Comprehensive Income Gain (loss) recognized in consolidated statements of Income Year ended December 31, Year ended December 31, 2020 Statement of Income 2020 2019 2018 Derivatives designated as hedging instruments: Foreign exchange options and forward contracts $ 67 "Operating expenses" $ 764 $ 272 $ (206 ) Derivatives not designated as hedging instruments: Foreign exchange options and forward contracts - "Financial expenses" (166 ) 59 (186 ) SWAP - "Financial expenses" - 380 (2,487 ) Total $ 67 $ 598 $ 711 $ ( 2,879 ) |
SHORT TERM AND LONG-TERM DEBT (
SHORT TERM AND LONG-TERM DEBT (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Notes Payable to Banks [Member] | |
Debt Instrument [Line Items] | |
Schedule of aggregate principal annual payments of the bonds | As of December 31, 2020, the aggregate principal annual maturities according to all of the above loan agreements were as follows: Repayment amount 2021 8,333 Present value of principal payments $ 8,333 Less: current portion (8,333 ) Long-term debt $ - |
CONVERTIBLE DEBT (Tables)
CONVERTIBLE DEBT (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Instrument [Line Items] | |
Schedule of Changes of Long-term Convertible Debt | The changes of the long-term convertible debt in 2020 and 2019 were as follows: Balance as of January 1, 2019 (*) $ 15,453 Change in accrued interest 267 Change in fair value 600 Payment of interest (470 ) Payment of principal (15,850 ) Balance as of December 31, 2019 $ - Balance as of December 31, 2020 $ - (*) Includes accrued interest of $193. |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Lessee Disclosure [Abstract] | |
Schedule of Weighted-Average Remaining Lease Term and Discount Rate | The following table represents the weighted-average remaining lease term and discount rate: Year ended December 31, 2020 Weighted average remaining lease term 5.13 Years Weighted average discount rate 7.42% |
Schedule of Maturities of Operating Lease Liabilities | Maturities of operating lease liabilities were as follows: Year ending December 31, 2021 $ 5,970 2022 5,290 2023 4,909 2024 4,907 2025 2,931 Thereafter 2,602 Total lease payments *) 26,609 Less – imputed interest (4,397 ) Present value of lease liabilities $ 22,212 *) Total lease payments have not been reduced by sublease rental payments of $6,376 due in the future under non-cancelable subleases. |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Stock Option Activity | The following table summarizes the activities for the Company’s service-based share options for the year ended December 31, 2020: Weighted average Number of options Exercise price Remaining contractual term (in years) Aggregate intrinsic value Outstanding at January 1, 2020 4,091,127 $ 3.79 4.70 $ 10,226 Granted 1,915,435 2.66 - - Exercised (1,042,849 ) 3.86 - 5,010 Cancelled (436,666 ) 4.36 - - Outstanding at December 31, 2020 4,527,047 $ 3.24 21.79 $ 42,942 Exercisable at December 31, 2020 1,902,226 $ 3.70 3.51 $ 17,171 Vested and expected to vest at December 31, 2020 3,789,743 $ 3.36 3.22 $ 35,604 |
Schedule of Option Activity by Price Range | The following table summarizes additional information regarding outstanding and exercisable options under the Company's share Option Plan as of December 31, 2020: Outstanding Exercisable Range of exercise price Number of options Weighted average remaining contractual life (years) Weighted average exercise price Number of options Weighted average remaining contractual life (years) Weighted average exercise price $ 0.00 – 0.50 1,051,494 79.46 $ - - - $ - 1.03 – 2.94 316,567 3.98 2.76 190,741 3.76 2.71 3.00 – 3.38 1,509,699 3.88 3.19 1,082,647 3.51 3.21 4.23 – 6.90 1,508,954 4.79 5.18 598,005 3.47 4.66 7.08 – 9.81 132,000 5.66 8.20 22,500 4.10 7.97 $ 10.01 –12.75 8,333 0.00 11.07 8,333 0.00 11.07 4,527,047 21.79 $ 3.24 1,902,226 3.51 $ 3.70 |
Schedule of Stock-Based Compensation Expense | The Company recognized share-based compensation expenses related to its share-based awards in the consolidated statements of operations as follows: Year ended December 31, 2020 2019 2018 Cost of revenues $ 102 $ 164 $ 136 Research and development 887 488 448 Selling and marketing 1,898 515 848 General and administrative 1,560 1,126 1,286 Total $ 4,447 $ 2,293 $ 2,718 |
Performance-based Stock Options [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Stock Option Activity | The following table summarizes the activities for the Company’s performance-based share options for the year ended December 31, 2020: Weighted average Number of Performance based options Exercise price Remaining contractual term (in years) Aggregate intrinsic value Outstanding at January 1, 2020 66,666 $ 3.24 4.95 $ 199 Granted 815,354 2.62 - - Exercised (66,666 ) 3.24 - 514 Cancelled (46,043 ) - - - Outstanding at December 31, 2020 769,311 2.78 40.53 7,653 Exercisable at December 31, 2020 200,000 5.35 6.58 1,476 Vested and expected to vest at December 31, 2020 596,988 $ 3.58 4.51 $ 5,460 |
FINANCIAL INCOME (EXPENSE), N_2
FINANCIAL INCOME (EXPENSE), NET (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Other Income and Expenses [Abstract] | |
Schedule of Financial Income (Expense), Net | Year ended December 31, 2020 2019 2018 Financial income: Interest income $ 287 $ 624 $ 296 Foreign currency translation gains - - 827 Change in fair value of convertible debt - - 1,585 Change in fair value of SWAP - 380 - Other 45 147 366 $ 332 $ 1,151 $ 3,074 Financial expense: Foreign currency translation losses $ (1,537 ) $ (950 ) $ - Interest expense on debts (1,045 ) (2,334 ) (3,938 ) Change in fair value of SWAP - - (2,487 ) Change in fair value of convertible debt - (600 ) - Bank charges and other (388 ) (737 ) (443 ) $ ( 2,970 ) $ ( 4,621 ) $ ( 6,868 ) Financial expense, net $ ( 2,638 ) $ ( 3,470 ) $ ( 3,794 ) |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income (Loss) Before Taxes | Income before taxes on income is comprised as follows: Year ended December 31, 2020 2019 2018 Domestic $ 12,175 $ 21,095 $ 9,081 Foreign (2,560 ) (6,557 ) 1,816 Total $ 9,615 $ 14,538 $ 10,897 |
Schedule of Income Taxes | Taxes on income are comprised as follows: Year ended December 31, 2020 2019 2018 Current taxes $ 2,498 $ 3,816 $ 1,706 Taxes in respect of previous years 6 (129 ) 612 Deferred tax expense (benefit) (3,114 ) (2,042 ) 458 Total $ ( 610 ) $ 1,645 $ 2,776 |
Schedule of Income Taxes by Jurisdiction | Taxes on income by jurisdiction were as follows: Year ended December 31, 2020 2019 2018 Domestic $ 1,031 $ 3,055 $ 2,187 Foreign (1,641 ) (1,410 ) 589 Total $ ( 610 ) $ 1,645 $ 2,776 Domestic: Current taxes $ 1,466 $ 3,519 $ 1,121 Deferred tax (benefit) expense (984 ) (197 ) 649 Taxes in respect of previous years 549 (267 ) 417 Total - Domestic $ 1,031 $ 3,055 $ 2,187 Foreign: Current taxes $ 1,032 $ 297 $ 585 Deferred tax benefit (2,130 ) (1,845 ) (191 ) Taxes in respect of previous years (543 ) 138 195 Total - Foreign $ ( 1,641 ) $ ( 1,410 ) $ 589 Total income tax expense (benefit) $ ( 610 ) $ 1,645 $ 2,776 |
Schedule of Deferred Tax Assets (Liabilities) | Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The significant components of the Company’s deferred tax assets and liabilities are as follows: December 31, 2020 2019 Deferred tax assets: Net operating loss and other losses carry forwards $ 4,049 $ 4,490 Research and development 2,287 2,865 Intangible assets 1,476 2,543 Other temporary differences mainly relating to reserve and allowances 1,553 624 Deferred tax assets, before valuation allowance $ 9,365 $ 10,522 Valuation allowance 2,254 4,351 Total deferred tax assets, net $ 7,111 $ 6,171 Domestic: Long term deferred tax asset, net $ 2,034 $ 1,050 $ 2,034 $ 1,050 Foreign: $ 5,077 $ 5,121 Long term deferred tax asset, net $ 5,077 $ 5,121 Total deferred tax asset, net $ 7,111 $ 6,171 |
Schedule of the Reconciliation of the Effective Tax Rate | A reconciliation between the theoretical tax expense, assuming all income is taxed at the statutory tax rate applicable to income of the Company, and the actual tax expense as reported in the statement of income is as follows: Year ended December 31, 2020 2019 2018 Income before taxes on income $ 9,615 $ 14,538 $ 10,897 Statutory tax rate in Israel 23.0 % 23.0 % 23.0 % Theoretical tax expense $ 2,211 $ 3,344 $ 2,506 Increase (decrease) in tax expenses resulting from: "Preferred Enterprise" benefits * (1,701 ) (2,973 ) (1,301 ) Non-deductible expenses 2,409 374 298 Tax adjustment in respect of different tax rate of foreign subsidiaries 228 397 511 Deferred taxes related to prior years (1,576 ) - - Change in valuation allowance (2,097 ) 421 541 Other (84 ) 82 221 Taxes on income $ ( 610 ) $ 1,645 $ 2,776 * Benefit per ordinary share from "Preferred Enterprise" status: Basic $ 0.06 $ 0.11 $ 0.05 Diluted $ 0.06 $ 0.11 $ 0.05 |
Schedule of Unrecognized Tax Benefits | A reconciliation of the beginning and ending balances of the total amounts of unrecognized tax benefits is as follows: December 31, 2020 2019 Balance at the beginning of the year $ 4,232 $ 4,034 Increase (Decrease) related to prior year tax positions, net 293 (249 ) Increase related to current year tax positions, net - 447 Balance at the end of the year $ 4,525 $ 4,232 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of the computation of basic and diluted net earnings per common share | The table below presents the computation of basic and diluted net earnings per common share: Year ended December 31, 2020 2019 2018 Numerator: Net income attributable to ordinary shares - basic $ 10,225 $ 12,893 $ 8,121 Net income - diluted $ 10,225 $ 12,893 $ 8,121 Denominator: Number of ordinary shares outstanding during the year 26,687,145 25,965,357 25,850,067 Weighted average effect of dilutive securities: Employee options and restricted share units 2,110,602 392,228 5,158 Diluted number of ordinary shares outstanding 28,797,747 26,357,585 25,855,225 Basic net earnings per ordinary share $ 0.38 $ 0.50 $ 0.31 Diluted net earnings per ordinary share $ 0.36 $ 0.49 $ 0.31 Ordinary shares equivalents excluded because their effect would have been anti-dilutive 3,178,024 4,087,559 4,725,618 |
MAJOR CUSTOMERS (Tables)
MAJOR CUSTOMERS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Risks and Uncertainties [Abstract] | |
Schedule of Revenues and Receivables by Major Customer | The following table sets forth the customers that represent 10% or more of the Company’s total revenues in each of the years presented below: Year ended December 31, 2020 2019 2018 Customer A 51% 63% 45% |
GEOGRAPHIC INFORMATION (Tables)
GEOGRAPHIC INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of total revenues attributed to geographic areas | The following table presents the total revenues for the years ended December 31, 2020, 2019 and 2018, allocated to the geographic areas in which they were generated: Year ended December 31, 2020 2019 2018 North America (mainly U.S.) $ 272,220 $ 195,903 $ 197,440 Europe 49,222 50,669 46,858 Other 6,621 14,878 8,547 $ 328,063 $ 261,450 $ 252,845 |
Schedule of property and equipment attributed to geographic areas | The following table presents the locations of the Company’s long-lived assets as of December 31, 2020 and 2019: December 31, 2020 2019 Israel $ 11,343 $ 15,816 U.S. 10,157 11,987 Europe 5,536 5,544 $ 27,036 $ 33,347 |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Summary of Significant Accounting Policies [Line Items] | |||
Short-term deposits average rate (as a percent) | 0.35% | 2.16% | |
Restricted cash, current | $ 1,222 | $ 1,216 | |
Severance expenses | 1,754 | 1,270 | $ 1,230 |
Total employer 401(k) contributions | $ 624 | $ 691 | $ 751 |
Weighted average number of anti-dilutive securities excluded from diluted earnings per share | 3,178,024 | 4,087,559 | 4,725,618 |
Total expenses for doubtful debts | $ 323 | $ 78 | $ 180 |
Notional value of derivative instruments | 0 | 3,918 | |
Property and equipment, net | 6,770 | 10,918 | |
Deferred revenues | 4,188 | ||
Aggregate amount of Remaining performance obligations | 5,711 | ||
Accounts receivable, allowance for doubtful accounts | 694 | 417 | |
Capitalized software [Member] | |||
Summary of Significant Accounting Policies [Line Items] | |||
Property and equipment, net | $ 1,392 | $ 4,448 |
SIGNIFICANT ACCOUNTING POLICI_5
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Estimated Useful Lives at Annual Rates) (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Computers and peripheral equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives, annual rate | 33.00% |
Office furniture and equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives, annual rate | 6.00% |
Office furniture and equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives, annual rate | 15.00% |
SIGNIFICANT ACCOUNTING POLICI_6
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Stock-Based Compensation Assumptions) (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate, minimum | 0.29% | 0.70% | 1.50% |
Risk-free interest rate, maximum | 1.60% | 2.90% | 3.00% |
Expected volatility, minimum | 53.00% | 43.00% | 48.00% |
Expected volatility, maximum | 59.00% | 55.00% | 57.00% |
Dividend yield | 0.00% | 0.00% | 0.00% |
Minimum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Early exercise factor (as a percent) | 110.00% | 110.00% | 150.00% |
Forfeiture rate post vesting | 0.00% | 0.00% | 0.00% |
Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Early exercise factor (as a percent) | 200.00% | 230.00% | 200.00% |
Forfeiture rate post vesting | 34.00% | 34.00% | 34.00% |
FAIR VALUE OF FINANCIAL INSTR_3
FAIR VALUE OF FINANCIAL INSTRUMENTS (Schedule of Fair Value Measurements) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Assets: | ||
Derivative assets | $ 73 | |
Total financial assets | 73 | |
Liabilities: | ||
Contingent consideration in connection to the acquisitions | $ 37,904 | |
Total financial liabilities | 37,904 | |
Level 1 [Member] | ||
Assets: | ||
Derivative assets | ||
Total financial assets | ||
Liabilities: | ||
Contingent consideration in connection to the acquisitions | ||
Total financial liabilities | ||
Level 2 [Member] | ||
Assets: | ||
Derivative assets | 73 | |
Total financial assets | 73 | |
Liabilities: | ||
Contingent consideration in connection to the acquisitions | ||
Total financial liabilities | ||
Level 3 [Member] | ||
Assets: | ||
Derivative assets | ||
Total financial assets | ||
Liabilities: | ||
Contingent consideration in connection to the acquisitions | 37,904 | |
Total financial liabilities | $ 37,904 |
ACQUISITIONS (Narrative) (Detai
ACQUISITIONS (Narrative) (Details) - USD ($) $ in Thousands | Jan. 14, 2020 | Jul. 22, 2020 | Mar. 28, 2019 | Dec. 31, 2020 |
Septa Communications LLC [Member] | ||||
Business Acquisition [Line Items] | ||||
Cash paid | $ 1,200 | |||
Content IQ LLC [Member] | ||||
Business Acquisition [Line Items] | ||||
Cash paid | $ 15,000 | |||
Maximum contingent consideration for acquisition | 47,050 | |||
Estimated fair value of contingent consideration | 22,838 | $ 19,546 | ||
Retention-based component of acquisition | $ 11,000 | |||
Earn out period | 2 years | |||
Pub Ocean Limited [Member] | ||||
Business Acquisition [Line Items] | ||||
Cash paid | $ 4,000 | |||
Maximum contingent consideration for acquisition | 17,000 | |||
Estimated fair value of contingent consideration | 9,399 | $ 12,313 | ||
Retention-based component of acquisition | $ 1,000 | |||
Earn out period | 2 years |
ACQUISITIONS (Schedule of Asset
ACQUISITIONS (Schedule of Assets Acquired and Liabilities Assumed) (Details) - USD ($) $ in Thousands | Jan. 14, 2020 | Jul. 22, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Goodwill | $ 152,303 | $ 125,809 | $ 125,051 | ||
Content IQ LLC [Member] | |||||
Property and equipment, net | $ 4 | ||||
Deferred Taxes | (2,253) | ||||
Goodwill | 23,361 | ||||
Net assets acquired | 37,838 | ||||
Content IQ LLC [Member] | Technology-Based Intangible Assets [Member] | |||||
Intangible assets | $ 12,483 | ||||
Weighted Avarage Useful Life | 5 years | ||||
Content IQ LLC [Member] | Customer Relationships [Member] | |||||
Intangible assets | $ 4,243 | ||||
Weighted Avarage Useful Life | 7 years | ||||
Pub Ocean Limited [Member] | |||||
Property and equipment, net | $ 15 | ||||
Other creditors | (25) | ||||
Goodwill | 3,133 | ||||
Net assets acquired | 13,399 | ||||
Pub Ocean Limited [Member] | Technology-Based Intangible Assets [Member] | |||||
Intangible assets | $ 9,618 | ||||
Weighted Avarage Useful Life | 5 years | ||||
Pub Ocean Limited [Member] | Customer Relationships [Member] | |||||
Intangible assets | $ 658 | ||||
Weighted Avarage Useful Life | 7 years |
ACQUISITIONS (Schedule of pro f
ACQUISITIONS (Schedule of pro forma information) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Business Combinations [Abstract] | ||
Revenues | $ 329,068 | $ 299,871 |
Net Income | $ 8,079 | $ 3,985 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | |||
Property and equipment | $ 30,589 | $ 31,066 | |
Less: accumulated depreciation and amortization | (23,819) | (20,148) | |
Property and equipment, net | 6,770 | 10,918 | |
Depreciation and amortization expenses | 4,662 | 5,455 | $ 4,950 |
Capitalized software development costs | 1,756 | ||
Amortization expense | 3,056 | 3,607 | $ 2,978 |
Computers and peripheral equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | 6,776 | 7,212 | |
Office furniture and equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | 2,682 | 2,703 | |
Leasehold Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | 8,658 | 8,678 | |
Capitalized software [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | 12,473 | 12,473 | |
Property and equipment, net | $ 1,392 | $ 4,448 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS, NET (Schedule of Changes in Goodwill) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill [Line Items] | ||
Balance as of January 1 | $ 125,809 | $ 125,051 |
Balance as of December 31 | 152,303 | 125,809 |
Content IQ LLC [Member] | ||
Goodwill [Line Items] | ||
Acquisition | 23,361 | |
Pub Ocean [Member] | ||
Goodwill [Line Items] | ||
Acquisition | $ 3,133 | |
Captain growth [Member] | ||
Goodwill [Line Items] | ||
Acquisition | $ 758 |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS, NET (Summary of Intangible Assets) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Intangible assets, Net | ||
Balance at beginning of period | $ 2,635 | $ 6,496 |
Additions | 27,002 | 442 |
Amortization | (5,261) | (4,256) |
OCI | (47) | |
Balance at end of period | 24,376 | 2,635 |
Technology-Based Intangible Assets [Member] | ||
Intangible assets, Gross | ||
Balance at beginning of period | 31,159 | 30,807 |
Additions | 22,101 | 442 |
Amortization | ||
OCI | 152 | (90) |
Balance at end of period | 53,412 | 31,159 |
Accumulated amortization | ||
Balance at beginning of period | (21,810) | (21,242) |
Additions | ||
Amortization | (3,579) | (649) |
OCI | (159) | 81 |
Balance at end of period | (25,548) | (21,810) |
Impairment | ||
Balance at beginning of period | (8,749) | (8,749) |
Additions | ||
Amortization | ||
OCI | ||
Balance at end of period | (8,749) | (8,749) |
Intangible assets, Net | ||
Balance at beginning of period | 600 | 816 |
Additions | 22,101 | 442 |
Amortization | (3,579) | (649) |
OCI | (7) | (9) |
Balance at end of period | 19,115 | 600 |
Customer Relationships [Member] | ||
Intangible assets, Gross | ||
Balance at beginning of period | 31,911 | 31,940 |
Additions | 4,901 | |
Amortization | ||
OCI | 48 | (29) |
Balance at end of period | 36,860 | 31,911 |
Accumulated amortization | ||
Balance at beginning of period | (20,727) | (19,825) |
Additions | ||
Amortization | (1,465) | (928) |
OCI | 31 | 26 |
Balance at end of period | (22,161) | (20,727) |
Impairment | ||
Balance at beginning of period | (10,426) | (10,426) |
Additions | ||
Amortization | ||
OCI | ||
Balance at end of period | (10,426) | (10,426) |
Intangible assets, Net | ||
Balance at beginning of period | 758 | 1,689 |
Additions | 4,901 | |
Amortization | (1,465) | (928) |
OCI | 79 | (3) |
Balance at end of period | 4,273 | 758 |
Tradename and other [Member] | ||
Intangible assets, Gross | ||
Balance at beginning of period | 18,284 | 18,415 |
Additions | ||
Amortization | ||
OCI | 219 | (131) |
Balance at end of period | 18,503 | 18,284 |
Accumulated amortization | ||
Balance at beginning of period | (11,897) | (9,314) |
Additions | ||
Amortization | (217) | (2,679) |
OCI | (291) | 96 |
Balance at end of period | (12,405) | (11,897) |
Impairment | ||
Balance at beginning of period | (5,110) | (5,110) |
Additions | ||
Amortization | ||
OCI | ||
Balance at end of period | (5,110) | (5,110) |
Intangible assets, Net | ||
Balance at beginning of period | 1,277 | 3,991 |
Additions | ||
Amortization | (217) | (2,679) |
OCI | (72) | (35) |
Balance at end of period | $ 988 | $ 1,277 |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS, NET (Schedule of Estimated Useful Life of Intangible Assets) (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Technology-Based Intangible Assets [Member] | Minimum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted Avarage Useful Life | 3 years |
Technology-Based Intangible Assets [Member] | Maximum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted Avarage Useful Life | 5 years |
Customer Relationships [Member] | Minimum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted Avarage Useful Life | 4 years |
Customer Relationships [Member] | Maximum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted Avarage Useful Life | 7 years |
Tradename and other [Member] | Minimum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted Avarage Useful Life | 4 years |
Tradename and other [Member] | Maximum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted Avarage Useful Life | 11 years |
GOODWILL AND OTHER INTANGIBLE_6
GOODWILL AND OTHER INTANGIBLE ASSETS, NET (Schedule Of Estimated Future Amortization Expense) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
2021 | $ 5,438 | ||
2022 | 5,450 | ||
2023 | 5,462 | ||
2024 | 5,395 | ||
2025 | 1,858 | ||
Thereafter | 773 | ||
Net carrying amount | $ 24,376 | $ 2,635 | $ 6,496 |
ACCRUED EXPENSES AND OTHER LI_3
ACCRUED EXPENSES AND OTHER LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Payables and Accruals [Abstract] | ||
Employees and payroll accruals | $ 13,970 | $ 10,506 |
Government authorities | 3,422 | 2,540 |
Accrued expenses | 3,003 | 5,092 |
Other short-term liabilities | 793 | 276 |
Accrued expenses and other liabilities, total | $ 21,188 | $ 18,414 |
DERIVATIVES AND HEDGING ACTIV_3
DERIVATIVES AND HEDGING ACTIVITES (Schedule of Fair Value of Company's Outstanding Derivative Instruments) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2020 | |
Derivatives designate as hedging instruments: | ||
Foreign exchange forward contracts and other derivatives - Prepaid expenses and other current assets | $ 73 | |
Foreign exchange forward contracts and other derivatives - Accumulated other comprehensive income | $ 67 | |
Derivatives not designated as hedging instruments: | ||
Fair value of derivatives | $ 0 |
DERIVATIVES AND HEDGING ACTIV_4
DERIVATIVES AND HEDGING ACTIVITES (Schedule of Net (Gains) Losses Reclassified from Accumulated Other Comprehensive Income (Loss) to Operating Expenses) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Derivatives not designated as hedging instruments: | |||
Total | $ 598 | $ 711 | $ (2,879) |
Financial expenses [Member] | SWAP [Member] | |||
Derivatives not designated as hedging instruments: | |||
Gain (loss) recognized in Consolidated Statements of Income | 380 | (2,487) | |
Foreign exchange options and forward contracts [Member] | |||
Derivatives designated as hedging instruments: | |||
Gain recognized in Statements of Comprehensive Income | 67 | ||
Derivatives not designated as hedging instruments: | |||
Gain recognized in Statements of Comprehensive Income | |||
Total | 67 | ||
Foreign exchange options and forward contracts [Member] | Operating expenses [Member] | |||
Derivatives designated as hedging instruments: | |||
Gain (loss) recognized in Consolidated Statements of Income | 764 | 272 | (206) |
Foreign exchange options and forward contracts [Member] | Financial expenses [Member] | |||
Derivatives not designated as hedging instruments: | |||
Gain (loss) recognized in Consolidated Statements of Income | (166) | $ 59 | $ (186) |
SWAP [Member] | |||
Derivatives not designated as hedging instruments: | |||
Gain (loss) recognized in Consolidated Statements of Income |
SHORT TERM AND LONG-TERM DEBT_2
SHORT TERM AND LONG-TERM DEBT (Narrative) (Details) - USD ($) $ in Thousands | 1 Months Ended | |||
May 19, 2020 | Dec. 17, 2018 | Dec. 21, 2020 | Aug. 11, 2020 | |
Short-term secured credit line [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, maturity date | May 18, 2021 | |||
Short-term secured credit line maximum borrowing capacity | $ 20,000 | |||
Short-term secured credit line balance outstanding | $ 0 | $ 12,500 | ||
New loan facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, face amount | $ 25,000 | |||
Debt instrument, description of variable rate basis | LIBOR | |||
Debt instrument, basis spread on variable rate | 5.70% | |||
Debt instrument, maturity date | Dec. 31, 2021 | |||
Guarantee limit of credit facility | $ 33,000 |
SHORT TERM AND LONG-TERM DEBT_3
SHORT TERM AND LONG-TERM DEBT (Schedule of Aggregate Annual Maturities) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Long-term debt | $ 8,333 | |
Loan Agreements [Member] | ||
Debt Instrument [Line Items] | ||
2021 | 8,333 | |
Present value of principal payments | 8,333 | |
Less: current portion | (8,333) | |
Long-term debt |
CONVERTIBLE DEBT (Narrative) (D
CONVERTIBLE DEBT (Narrative) (Details) - Series L Convertible Bonds [Member] ₪ / shares in Units, $ in Thousands, ₪ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2018USD ($) | Sep. 30, 2014ILS (₪)₪ / shares | |
Debt Instrument [Line Items] | |||
Convertible bonds, aggregate par value | ₪ | ₪ 143.5 | ||
Bond purchase price expressed as a percentage of par value | 96.50% | ||
Convertible bonds, annual interest rate | 5.00% | ||
Date of first required payment | Mar. 31, 2016 | ||
Convertible bonds, conversion price | ₪ / shares | ₪ 100.815 | ||
Accrued interest | $ | $ 193 | ||
Maximum [Member] | |||
Debt Instrument [Line Items] | |||
Convertible bonds, annual interest rate | 6.00% |
CONVERTIBLE DEBT (Schedule of C
CONVERTIBLE DEBT (Schedule of Changes of Long-term Convertible Debt) (Details) - Series L Convertible Bonds [Member] $ in Thousands | 12 Months Ended | |
Dec. 31, 2019USD ($) | ||
Convertible Debt [Roll Forward] | ||
Balance at the beginning of period | $ 15,453 | [1] |
Change in accrued interest | 267 | |
Change in fair value | 600 | |
Payment of interest | (470) | |
Payment of principal | (15,850) | |
Balance at the end of period | ||
[1] | Includes accrued interest of $193. |
LEASES (Narrative) (Details)
LEASES (Narrative) (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020USD ($)Items | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Lessee, Lease, Description [Line Items] | |||
Optional time periods Holon, Israel lease can be extended | 24 months | ||
Number of additional lease periods Holon, Israel office can be extended | Items | 2 | ||
Lease expiration date Holon, Israel office | Jan. 31, 2025 | ||
Facilities leasing expenses (net) | $ 3,493 | $ 3,076 | $ 4,123 |
Sublease income | 3,235 | $ 2,682 | $ 2,213 |
Cash paid for measurement of lease liabilities | $ 6,521 | ||
Minimum [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease terms under capitalized operating lease agreements | 9 months 29 days | ||
Maximum [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease terms under capitalized operating lease agreements | 7 years 3 months |
LEASES (Schedule of Weighted-Av
LEASES (Schedule of Weighted-Average Remaining Lease Term and Discount Rate) (Details) | Dec. 31, 2020 |
Leases [Abstract] | |
Weighted average remaining lease term | 5 years 1 month 17 days |
Weighted average discount rate | 7.42% |
LEASES (Schedule of Maturities
LEASES (Schedule of Maturities of Operating Lease Liabilities) (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020USD ($) | ||
Operating leases | ||
Year one | $ 5,970 | |
Year two | 5,290 | |
Year three | 4,909 | |
Year four | 4,907 | |
Year five | 2,931 | |
Thereafter | 2,602 | |
Total lease payments | 26,609 | [1] |
Less - imputed interest | (4,397) | |
Present value of lease liabilities | 22,212 | |
Sublease rental payments | $ 6,376 | |
[1] | Total lease payments have not been reduced by sublease rental payments of $6,376 due in the future under non-cancelable subleases. |
COMMITMENT AND CONTINGENT LIA_2
COMMITMENT AND CONTINGENT LIABILITIES (Narrative) (Details) - Sweet Im Ltd [Member] - USD ($) $ in Thousands | May 28, 2014 | Nov. 30, 2012 |
Business Acquisition [Line Items] | ||
Percentage of shares acquired | 100.00% | |
Maximum subsequent consideration due for acquisition | $ 7,500 | |
Estimated contingent payment | $ 2,500 |
SHAREHOLDERS' EQUITY (Narrative
SHAREHOLDERS' EQUITY (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Option expiration term | 7 years | ||
Weighted average fair value of stock options granted | $ 3.14 | $ 1.75 | $ 1.27 |
Weighted-average grant-date fair value | $ 3.12 | ||
Total expense incurred | $ 4,447 | $ 2,293 | $ 2,718 |
Undertone [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Warrants to purchase ordinary shares granted | 66,666 | ||
Weighted average exercise price of warrants | $ 9.09 | ||
Total expense incurred | $ 59 | $ 61 | |
Employee Stock Option [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized compensation cost related to outstanding stock options and RSUs | $ 6,815 | ||
Warrant [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized compensation cost related to outstanding stock options and RSUs, expected period of recognition | 1 year 6 months 14 days | ||
Stock Option Plan 2003 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares available for grant | 691,577 | ||
Stock Option Plan 2003 [Member] | Restricted Stock Units (RSUs) [Member] | Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period for plan | 3 years |
SHAREHOLDERS' EQUITY (Schedule
SHAREHOLDERS' EQUITY (Schedule of Stock Option Activity) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Number of options | ||
Outstanding at January 1, 2020 | 4,091,127 | |
Granted | 1,915,435 | |
Exercised | (1,042,849) | |
Cancelled | (436,666) | |
Outstanding at December 31, 2020 | 4,527,047 | 4,091,127 |
Exercisable at December 31, 2020 | 1,902,226 | |
Vested and expected to vest at December 31, 2020 | 3,789,743 | |
Weighted average Exercise price | ||
Outstanding at January 1, 2020 | $ 3.79 | |
Granted | 2.66 | |
Exercised | 3.86 | |
Cancelled | 4.36 | |
Outstanding at December 31, 2020 | 3.24 | $ 3.79 |
Exercisable at December 31, 2020 | 3.70 | |
Vested and expected to vest at December 31, 2020 | $ 3.36 | |
Weighted average Remaining contractual term | ||
Outstanding | 21 years 9 months 14 days | 4 years 8 months 12 days |
Exercisable at December 31, 2020 | 3 years 6 months 3 days | |
Vested and expected to vest at December 31, 2020 | 3 years 2 months 19 days | |
Aggregate intrinsic value | ||
Outstanding at January 1, 2020 | $ 10,226 | |
Exercised | 5,010 | |
Outstanding at December 31, 2020 | 42,942 | $ 10,226 |
Exercisable at December 31, 2020 | 17,171 | |
Vested and expected to vest at December 31, 2020 | $ 35,604 | |
Performance-based Stock Options [Member] | ||
Number of options | ||
Outstanding at January 1, 2020 | 66,666 | |
Granted | 815,354 | |
Exercised | (66,666) | |
Cancelled | (46,043) | |
Outstanding at December 31, 2020 | 769,311 | 66,666 |
Exercisable at December 31, 2020 | 200,000 | |
Vested and expected to vest at December 31, 2020 | 596,988 | |
Weighted average Exercise price | ||
Outstanding at January 1, 2020 | $ 3.24 | |
Granted | 2.62 | |
Exercised | 3.24 | |
Cancelled | ||
Outstanding at December 31, 2020 | 2.78 | $ 3.24 |
Exercisable at December 31, 2020 | 5.35 | |
Vested and expected to vest at December 31, 2020 | $ 3.58 | |
Weighted average Remaining contractual term | ||
Outstanding | 40 years 6 months 10 days | 4 years 11 months 12 days |
Exercisable at December 31, 2020 | 6 years 6 months 29 days | |
Vested and expected to vest at December 31, 2020 | 4 years 6 months 3 days | |
Aggregate intrinsic value | ||
Outstanding at January 1, 2020 | $ 199 | |
Exercised | 514 | |
Outstanding at December 31, 2020 | 7,653 | $ 199 |
Exercisable at December 31, 2020 | 1,476 | |
Vested and expected to vest at December 31, 2020 | $ 5,460 |
SHAREHOLDERS' EQUITY (Schedul_2
SHAREHOLDERS' EQUITY (Schedule of Option Activity by Price Range) (Details) | 12 Months Ended |
Dec. 31, 2020$ / sharesshares | |
Outstanding | |
Number of options | shares | 4,527,047 |
Weighted average remaining contractual life (years) | 21 years 9 months 14 days |
Weighted average exercise price | $ 3.24 |
Exercisable | |
Number of options | shares | 1,902,226 |
Weighted average remaining contractual life (years) | 3 years 6 months 3 days |
Weighted average exercise price | $ 3.70 |
$0.00-$0.50 [Member] | |
Outstanding | |
Range of exercise price, minimum | 0 |
Range of exercise price, maximum | $ 0.50 |
Number of options | shares | 1,051,494 |
Weighted average remaining contractual life (years) | 79 years 5 months 15 days |
Weighted average exercise price | |
Exercisable | |
Number of options | shares | |
Weighted average exercise price | |
$1.03-$2.94 [Member] | |
Outstanding | |
Range of exercise price, minimum | 1.03 |
Range of exercise price, maximum | $ 2.94 |
Number of options | shares | 316,567 |
Weighted average remaining contractual life (years) | 3 years 11 months 23 days |
Weighted average exercise price | $ 2.76 |
Exercisable | |
Number of options | shares | 190,741 |
Weighted average remaining contractual life (years) | 3 years 9 months 3 days |
Weighted average exercise price | $ 2.71 |
$3.00-$3.38 [Member] | |
Outstanding | |
Range of exercise price, minimum | 3 |
Range of exercise price, maximum | $ 3.38 |
Number of options | shares | 1,509,699 |
Weighted average remaining contractual life (years) | 3 years 10 months 17 days |
Weighted average exercise price | $ 3.19 |
Exercisable | |
Number of options | shares | 1,082,647 |
Weighted average remaining contractual life (years) | 3 years 6 months 3 days |
Weighted average exercise price | $ 3.21 |
$4.23-$6.90 [Member] | |
Outstanding | |
Range of exercise price, minimum | 4.23 |
Range of exercise price, maximum | $ 6.90 |
Number of options | shares | 1,508,954 |
Weighted average remaining contractual life (years) | 4 years 9 months 14 days |
Weighted average exercise price | $ 5.18 |
Exercisable | |
Number of options | shares | 598,005 |
Weighted average remaining contractual life (years) | 3 years 5 months 19 days |
Weighted average exercise price | $ 4.66 |
$7.08-$9.81 [Member] | |
Outstanding | |
Range of exercise price, minimum | 7.08 |
Range of exercise price, maximum | $ 9.81 |
Number of options | shares | 132,000 |
Weighted average remaining contractual life (years) | 5 years 7 months 28 days |
Weighted average exercise price | $ 8.20 |
Exercisable | |
Number of options | shares | 22,500 |
Weighted average remaining contractual life (years) | 4 years 1 month 6 days |
Weighted average exercise price | $ 7.97 |
$10.01-$12.75 [Member] | |
Outstanding | |
Range of exercise price, minimum | 10.01 |
Range of exercise price, maximum | $ 12.75 |
Number of options | shares | 8,333 |
Weighted average exercise price | $ 11.07 |
Exercisable | |
Number of options | shares | 8,333 |
Weighted average exercise price | $ 11.07 |
SHAREHOLDERS' EQUITY (Schedul_3
SHAREHOLDERS' EQUITY (Schedule of Stock Based Compensation Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Share-based compensation expense | $ 4,447 | $ 2,293 | $ 2,718 |
Cost of revenues [Member] | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Share-based compensation expense | 102 | 164 | 136 |
Research and Development [Member] | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Share-based compensation expense | 887 | 488 | 448 |
Selling and Marketing [Member] | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Share-based compensation expense | 1,898 | 515 | 848 |
General and Administrative [Member] | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Share-based compensation expense | $ 1,560 | $ 1,126 | $ 1,286 |
FINANCIAL INCOME (EXPENSE), N_3
FINANCIAL INCOME (EXPENSE), NET (Schedule of Financial Income (Expense), Net) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Financial income: | |||
Interest income | $ 287 | $ 624 | $ 296 |
Foreign currency translation gains | 827 | ||
Change in fair value of convertible debt | 1,585 | ||
Change in fair value of SWAP | 380 | ||
Other | 45 | 147 | 366 |
Financial income | 332 | 1,151 | 3,074 |
Financial expense: | |||
Foreign currency translation losses | (1,537) | (950) | |
Interest expense on debts | (1,045) | (2,334) | (3,938) |
Change in fair value of SWAP | (2,487) | ||
Change in fair value of convertible debt | (600) | ||
Bank charges and other | (388) | (737) | (443) |
Financial expenses | (2,970) | (4,621) | (6,868) |
Financial expense, net | $ (2,638) | $ (3,470) | $ (3,794) |
INCOME TAXES (Narrative) (Detai
INCOME TAXES (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Taxes On Income [Line Items] | |||
Income tax rate | 23.00% | 23.00% | 23.00% |
Dividend distrubutions, withholding tax rate | 20.00% | ||
Net operating loss carry forward | $ 11,111 | ||
Company recognized interest and penalties | 444 | $ 158 | $ 12 |
Company recognized interest and penalties accrued | 1,017 | $ 573 | |
Capital loss | $ 1,570 | ||
Minimum [Member] | |||
Taxes On Income [Line Items] | |||
Income tax rate | 21.00% | ||
Business interest percentage | 30.00% | ||
Open tax year | 2020 | ||
Maximum [Member] | |||
Taxes On Income [Line Items] | |||
Income tax rate | 35.00% | ||
Business interest percentage | 50.00% | ||
Open tax year | 2024 | ||
Internal Revenue Service (IRS) [Member] | Earliest Tax Year [Member] | |||
Taxes On Income [Line Items] | |||
Expiration of operating loss carry forwards | Dec. 31, 2031 | ||
Internal Revenue Service (IRS) [Member] | Latest Tax Year [Member] | |||
Taxes On Income [Line Items] | |||
Expiration of operating loss carry forwards | Dec. 31, 2035 | ||
European Subsidiaries [Member] | Israel [Member] | |||
Taxes On Income [Line Items] | |||
Net operating loss carry forward | $ 6,402 | ||
Federal [Member] | |||
Taxes On Income [Line Items] | |||
Net operating loss carry forward | 3,471 | ||
State [Member] | |||
Taxes On Income [Line Items] | |||
Net operating loss carry forward | $ 2,746 | ||
Peripheral Regions Development Area A [Member] | |||
Taxes On Income [Line Items] | |||
Preferred Enterprise tax rate | 7.50% |
INCOME TAXES (Schedule of Incom
INCOME TAXES (Schedule of Income (Loss) Before Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ 12,175 | $ 21,095 | $ 9,081 |
Foreign | (2,560) | (6,557) | 1,816 |
Income before Taxes on Income | $ 9,615 | $ 14,538 | $ 10,897 |
INCOME TAXES (Schedule of Taxes
INCOME TAXES (Schedule of Taxes on Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Current taxes | $ 2,498 | $ 3,816 | $ 1,706 |
Taxes in respect of previous years | 6 | (129) | 612 |
Deferred tax expense (benefit) | (3,114) | (2,042) | 458 |
Taxes on income | $ (610) | $ 1,645 | $ 2,776 |
INCOME TAXES (Schedule of Tax_2
INCOME TAXES (Schedule of Taxes on Income by Jurisdiction (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Taxes on income by jurisdiction | |||
Domestic | $ 1,031 | $ 3,055 | $ 2,187 |
Foreign | (1,641) | (1,410) | 589 |
Taxes on income | (610) | 1,645 | 2,776 |
Domestic: | |||
Current taxes | 1,466 | 3,519 | 1,121 |
Deferred tax (benefit) expense | (984) | (197) | 649 |
Taxes in respect of previous years | 549 | (267) | 417 |
Total - Domestic | 1,031 | 3,055 | 2,187 |
Foreign: | |||
Current taxes | 1,032 | 297 | 585 |
Deferred tax benefit | (2,130) | (1,845) | (191) |
Taxes in respect of previous years | (543) | 138 | 195 |
Total - Foreign | (1,641) | (1,410) | 589 |
Total income tax expense (benefit) | $ (610) | $ 1,645 | $ 2,776 |
INCOME TAXES (Schedule of Defer
INCOME TAXES (Schedule of Deferred Tax Assets (Liabilities)) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||
Net operating loss and other losses carry forwards | $ 4,049 | $ 4,490 |
Research and development | 2,287 | 2,865 |
Intangible assets | 1,476 | 2,543 |
Other temporary differences mainly relating to reserve and allowances | 1,553 | 624 |
Deferred tax assets, before valuation allowance | 9,365 | 10,522 |
Valuation allowance | 2,254 | 4,351 |
Long term deferred tax asset, net | 7,111 | 6,171 |
Foreign Tax Authority [Member] | ||
Deferred tax assets: | ||
Long term deferred tax asset, net | $ 5,077 | 5,121 |
Domestic Tax Authority [Member] | ||
Deferred tax assets: | ||
Long term deferred tax asset, net | $ 1,050 |
INCOME TAXES (Schedule of the R
INCOME TAXES (Schedule of the Reconciliation of the Effective Tax Rate) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Income Tax Disclosure [Abstract] | ||||
Income before taxes on income | $ 9,615 | $ 14,538 | $ 10,897 | |
Statutory tax rate in Israel | 23.00% | 23.00% | 23.00% | |
Theoretical tax expense | $ 2,211 | $ 3,344 | $ 2,506 | |
Increase (decrease) in tax expenses resulting from: | ||||
"Preferred Enterprise" benefits | [1] | (1,701) | (2,973) | (1,301) |
Non-deductible expenses | 2,409 | 374 | 298 | |
Tax adjustment in respect of different tax rate of foreign subsidiaries | 228 | 397 | 511 | |
Deferred taxes related to prior years | (1,576) | |||
Change in valuation allowance | (2,097) | 421 | 541 | |
Other | (84) | 82 | 221 | |
Taxes on income | $ (610) | $ 1,645 | $ 2,776 | |
Benefit per ordinary share from "Preferred Enterprise" | ||||
Basic | $ 0.06 | $ 0.11 | $ 0.05 | |
Diluted | $ 0.06 | $ 0.11 | $ 0.05 | |
[1] | Benefit per ordinary share from "Preferred Enterprise" |
INCOME TAXES (Schedule of Unrec
INCOME TAXES (Schedule of Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Balance at the beginning of the year | $ 4,232 | $ 4,034 |
Increase (Decrease) related to prior year tax positions, net | 293 | (249) |
Increase related to current year tax positions, net | 447 | |
Balance at the end of the year | $ 4,525 | $ 4,232 |
EARNINGS PER SHARE (Schedule of
EARNINGS PER SHARE (Schedule of Computation of Basic and Diluted Net Earnings Per Common Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Numerator: | |||
Net income attributable to ordinary shares - basic | $ 10,225 | $ 12,893 | $ 8,121 |
Net income - diluted | $ 10,225 | $ 12,893 | $ 8,121 |
Denominator: | |||
Number of ordinary shares outstanding during the year | 26,687,145 | 25,965,357 | 25,850,067 |
Weighted average effect of dilutive securities: | |||
Employee options and restricted share units | 2,110,602 | 392,228 | 5,158 |
Diluted number of ordinary shares outstanding | 28,797,747 | 26,357,585 | 25,855,225 |
Basic net earnings per ordinary share | $ 0.38 | $ 0.50 | $ 0.31 |
Diluted net earnings per ordinary share | $ 0.36 | $ 0.49 | $ 0.31 |
Ordinary shares equivalents excluded because their effect would have been anti-dilutive | 3,178,024 | 4,087,559 | 4,725,618 |
RESTRUCTURING COSTS (Details)
RESTRUCTURING COSTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Development Project [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Total restructuring costs | $ 2,100 |
MAJOR CUSTOMERS (Details)
MAJOR CUSTOMERS (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Credit Concentration Risk [Member] | Sales Revenue, Net [Member] | Customer A [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 51.00% | 63.00% | 45.00% |
GEOGRAPHIC INFORMATION (Details
GEOGRAPHIC INFORMATION (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total Revenues | $ 328,063 | $ 261,450 | $ 252,845 |
Long-lived assets | 27,036 | 33,347 | |
North America (mainly U.S.) [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total Revenues | 272,220 | 195,903 | 197,440 |
Europe [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total Revenues | 49,222 | 50,669 | 46,858 |
Long-lived assets | 5,536 | 5,544 | |
Other [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total Revenues | 6,621 | 14,878 | $ 8,547 |
Israel [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Long-lived assets | 11,343 | 15,816 | |
U.S. [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Long-lived assets | $ 10,157 | $ 11,987 |
SUBSEQUENT EVENTS (Narrative) (
SUBSEQUENT EVENTS (Narrative) (Details) - USD ($) $ in Thousands | Mar. 08, 2021 | Jan. 20, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Repayment of debt | $ 8,333 | $ 8,332 | $ 36,509 | ||
Subsequent Event [Member] | |||||
Ordinary shares issued | 6,487,000 | ||||
Ordinary shares issued pursuant to the full exercise of an overallotment option granted to the underwriters | 748,500 | ||||
Proceeds received by the Company from offering | $ 61,126 | ||||
Subsequent Event [Member] | Mizrachi [Member] | |||||
Repayment of debt | $ 8,333 |