Global Graphics Reports Fourth Quarter and Full Year 2000 Results.
Friday, March 02, 2001
Pompey, France, March 1, 2001 - GLOBAL GRAPHICS S.A. (EASDAQ: GLGR) announces financial results for the fourth quarter and full year 2000. The Company is amortizing purchased goodwill and purchased intangibles at a fast pace, over periods principally ranging between 3 to 5 years, resulting in significant amortization expenses in the periods following acquisitions. Total amortization for the fourth quarter was Euro 4.5 million, and for full year 2000 Euro 16.7 million for both unallocated goodwill and intangible assets (excluding the effect of deferred tax on it). In the previous quarter, a one-time charge of Euro 1.8 million was booked following the full write-off of all purchased in-process R&D at the date of the Jaws acquisition as required by US GAAP. Another goodwill amortization charge was recognized in the last two quarters of the years (principally in the last quarter) to reflect the increase in the gross value of the goodwill for ICG and Harlequin following the revision during the year 2000 of the initial purchase price allocations for these companies. Comments on profitability for the Company and each operating division mentioned in this press release are excluding the impact of these amortization expenses on results. Ebita is defined as Earnings Before Interest, Tax and intangibles amortization. Current net income is pro forma income computed by adding back to the reported net income the amortization expenses for intangible assets and unallocated goodwill, net of deferred tax impact on these, when applicable. Fourth Quarter 2000 Total company sales were Euro 26.6 million, an increase of 27% over 1999. Current earnings per share were Euro 0.60, three and a half times the fourth quarter 1999 current EPS of Euro 0.17. Hardware sales were Euro 17.7 million, versus Euro 15.7 million in 1999. Hardware Ebita margins improved considerably from 4.8% in the third quarter 2000 to 8.4% of sales in the fourth quarter. Printing software sales were very strong, reaching Euro 7.7 million at a Ebita margin of 46.8%. Xanalys had revenues of Euro 1.2 million, including the first revenues from the Campbell contract. It was the first profitable quarter for Xanalys, with Ebita of Euro 0.2 million. Full Year 2000 Total company sales were Euro 93.3 million, an increase of 52% over 1999 (Euro 61.2 million). Consolidated Ebita was Euro 14.0 million, more than double the 1999 figure of Euro 6.9 million. Current earnings per share (Current EPS) were Euro 1.29, versus Euro 0.51 in 1999. Hardware sales were Euro 66.9 million, with Ebita of Euro 5.0 million and current EPS of Euro 0.64. Printing software sales were Euro 24.4 million, with Ebita of Euro 10.3 million and current EPS of Euro 0.73. Xanalys sales were Euro 2.0 million, an Ebita loss of Euro 1.3 million and a current loss per share of Euro 0.08. Earnings per share were favorably impacted by a tax credit of Euro 1.3 million which was recognized in the first quarter of the year following completion of the capital increase for all related expenses which were offset against the share premium and were consequently not recognized in the income statement of the Company. The Company was also capable of recognizing a net favorable exchange gain on foreign exchange transactions, especially in the fourth quarter where significant gains realized in that period came to offset exchange losses incurred during the year on both inter company transactions of a short term nature and transactions with third parties.