EFI Reports Solid Q4 Results, Comments on filing delay
Wednesday, January 31, 2007
FOSTER CITY, Calif.--Jan. 30, 2007-- EFI, the world leader in digital controllers, super-wide format printers and inks and print management solutions, announced today its preliminary fourth quarter and full year results for 2006. For the quarter ended December 31, 2006, revenue was $153.9 compared to fourth quarter 2005 revenue of $145.4 million. For the year ended December 31 2006, revenue was up 20.3% to $563.7 million, compared to $468.5 million for the same period last year. Non-GAAP net income was $22.6 million or $0.35 per diluted share in the fourth quarter of 2006, compared to $23.1 million, or $0.36 per diluted share for the same period in 2005. Non-GAAP net income was $77.3 million or $1.19 per diluted share for the year ended December 31, 2006, compared to $56.7 million or $0.93 per diluted share for the year ended December 31, 2005. GAAP net income was $7.1 million or $0.12 per diluted share for the fourth quarter of 2006, compared to a net income of $11.4 million or $0.18 per diluted share for the same period in 2005. GAAP net income was $3.7 million or $0.06 per diluted share for the full year, compared to a net loss of $4.1 million or $0.07 per diluted share for 2005. Non-GAAP net income is computed by adjusting GAAP net income by the impact of recurring amortization of acquisition-related intangibles, stock-based compensation expenses, certain tax charges, as well as other non-recurring charges and gains. "In Q4 we delivered revenue at the high-end of our range fueled by 40% year over year revenue growth in our inkjet product line," said Guy Gecht, CEO of EFI. "Looking to 2007, after a seasonally down first quarter and despite the impact of product mix on our gross margins, we are expecting approximately 10% revenue growth resulting in 15%-20% EPS growth for the full year. We are excited about EFI's ongoing transformation into a more balanced business, and look for our results to benefit from our strategy in 2007 and beyond." Information regarding SEC filings and financial statements In October 2006, the Company announced that a Special Committee of its Board of Directors had commenced an independent investigation of EFI's historical stock option grants. The independent investigation was recommended by management based on a voluntary review of past option grant practices in which potential errors were discovered related to certain historical grants. Facts may come to light once the investigation is completed that may require the Company to change its accounting treatment of stock options granted in prior periods. This may have a material adverse effect on the Company's historical results for prior periods. Because the investigation is still ongoing, we cannot make any predictions or provide further information about any potential findings by the Special Committee at this time. As such, the preliminary results contained within this press release may be subject to significant adjustment as a result of a potential restatement of historical results following completion of the independent investigation by the Special Committee. The Company will make a future announcement about the results of the investigation as its findings are known. As a result of the ongoing investigation, the Company delayed the filing of its Form 10-Q for the quarter ended September 30, 2006, and expects to delay the filing of its Form 10-K for the year ended December 31, 2006. The Company is focused on resolving any potential issues as quickly as possible and plans to file all required periodic reports with the SEC as soon as possible following completion of the investigation.