-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, N2B22q3/Z/9et8TjGmfC/NAKradNL/nvAl2GCFMTsF2rnWHM16cOkddSb8rNccYI UDhQ73Jj8GFK9xqjba4g+w== 0000950123-99-000448.txt : 19990201 0000950123-99-000448.hdr.sgml : 19990201 ACCESSION NUMBER: 0000950123-99-000448 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990128 FILED AS OF DATE: 19990129 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PARADIGM GEOPHYSICAL LTD CENTRAL INDEX KEY: 0000931131 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 000000000 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 6-K SEC ACT: SEC FILE NUMBER: 000-29538 FILM NUMBER: 99515973 BUSINESS ADDRESS: STREET 1: MERKAZIM HOUSE 32 MASKIT ST STREET 2: P O BOX 2061 CITY: HERZLIA B STATE: L3 ZIP: 46120 BUSINESS PHONE: 2818763473 MAIL ADDRESS: STREET 1: 4 GREENSPOINT PLAZA 16945 NORTHCHASE STREET 2: DRIVE SUITE 1400 CITY: HOUSTON STATE: TX ZIP: 77060 6-K 1 PARADIGM GEOPHYSICAL LTD. 1 FORM 6-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 OF THE SECURITIES EXCHANGE ACT OF 1934 For the Month of January 1999 PARADIGM GEOPHYSICAL LTD. (Translation of Registrant's Name into English) Merkazim House 32 Maskit Street P.O.B. 2061 Herzlia B, Israel 46120 (Address of Principal Executive Offices) Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F. Form 20-F....X.... Form 40-F........ Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes........ No....X.... If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-..................... 2 Attached to the Registrant's Form 6-K for the month of January 1999 and incorporated by reference herein is the Registrant's news release dated January 28, 1999. 3 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. PARADIGM GEOPHYSICAL LTD. (Registrant) By:/s/ Brian Berman Brian Berman Chief Financial Officer Dated: January 29, 1999 EX-99 2 PRESS RELEASE 1 CONTACTS: BRIAN W. BERMAN CFO, PARADIGM GEOPHYSICAL +972-9-970-9339 brian@geodepth.com ROBERT D. FERRIS STEVEN CURTIS RUDER FINN RUDER FINN 1-212-715-1573 1-212-593-6319 ferrisb@ruderfinn.com curtiss@ruderfinn.com
PARADIGM GEOPHYSICAL ANNOUNCES RECORD 1998 RESULTS REVENUES UP 82 PERCENT YEAR OVER YEAR; SEQUENTIAL EARNINGS GROWTH OF 12 PERCENT IN Q4 Herzlia, Israel, January 28, 1999: Paradigm Geophysical Ltd. (NASDAQ:PGEOF) today announced revenues for the year ended December 31, 1998 of $45.4 million, an increase of 82 percent over the $24.9 million recorded for the year ended December 31, 1997. Net income for the year ended December 31,1998 was $4.55 million ($0.49 per share), compared with a loss of $10.8 million ($4.66 loss per share) for the year ended December 31,1997. Revenues for the fourth quarter ended December 31, 1998 were $11.7 million, as compared with $12.9 million in revenues in the fourth quarter ended December 31,1997, in which the acquisition of CogniSeis Development, Inc. ("CogniSeis") occurred. Net income for the quarter was $1.57 million ($0.15 per share) compared with a loss of $11.06 million ($4.75 loss per share) in the same period last year, and 12 percent higher than third quarter levels of $1.4 million ($0.13 per share). The results of the fourth quarter of 1997 and the full year 1997 are not comparable with the results for the same periods of 1998 because of the consolidation into Paradigm's accounts of the fourth quarter 1997 operations of CogniSeis. Paradigm Geophysical Ltd. acquired CogniSeis in October 1997. In addition, as a consequence of the acquisition, fourth quarter 1997 revenues reflect a significant backlog of CogniSeis software sales 2 that closed in that quarter and also reflect $2.3 million of hardware sales. (Paradigm has discontinued the CogniSeis practice of actively marketing hardware). -More- PARADIGM GEOPHYSICAL ANNOUNCES RECORD 1998 RESULTS..... HIGHLIGHTS FOR THE YEAR - - PRODUCT SALES INCREASE - - GROSS MARGINS IMPROVE - - RESEARCH AND DEVELOPMENT COMMITMENT INCREASES 160 PERCENT OVER 1997 Commenting on the results, Eldad Weiss, President and CEO, said, "We are pleased to report 1998 as a record year in spite of industry wide cuts in exploration and production spending. We are especially pleased that during this last quarter we have maintained our market position and our sales levels. It is management's belief that Paradigm's reputation as a best-of-class and first choice provider has been greatly enhanced as the industry continues to recognize the increased productivity, lower costs and reduced drilling risks our solutions provide." Revenues from software products (excluding hardware sales) increased by 10 percent over third quarter levels, to $6.5 million. Maintenance and support revenue remained at the third quarter level of $2.7 million, while Geophysical Services revenue, at $2.0 million, grew by 15 percent over the third quarter. (There was a significant reduction in hardware sales during this quarter, reflecting the Company's continuing policy not to market hardware actively, but to provide hardware only at our customers' request.) Overall gross margins for the fourth quarter of 1998 were 68 percent, versus 66 percent in the third quarter of 1998. The improvement was due principally to the reduction in the hardware cost component, and maintaining lower unit costs for maintenance and support. Fourth quarter margins for Geophysical Services remained flat at 40 percent, due to the under-utilization of our services capacity, which was greatly expanded in the third quarter in anticipation of increased demand for outsourced services in 1999. Research and development expenses for the fourth quarter of 1998 were $2.0 million compared with $1.9 million in the third quarter, and $2.7 in the same quarter of last year. For the total year R&D expenses were $8.0 million, an increase of 57 percent over the $5.1 million of R&D expenditures in 1997. This reflects the Company's continuing commitment to product enhancement and the delivery of new technology and productivity solutions to the market. 3 Other expenditures, for sales and marketing and general and administrative expenses, totaled $4.2 million, a decrease of 21 percent from the $5.3 million reported in the fourth quarter of 1997. Total 1998 expenditures for these categories were $16.4 million, an increase of 60 percent over 1997 expenditures of $10.3 million. -More- PARADIGM GEOPHYSICAL ANNOUNCES RECORD 1998 RESULTS..... Paradigm Geophysical Ltd. develops, markets and supports integrated computer aided exploration ("CAEX") software systems and provides seismic data processing and interpretation services to companies engaged in oil and natural gas exploration and development. Paradigm Geophysical serves this industry with offices and sales representatives in the United States, the United Kingdom, Canada, China, Australia, Argentina, Singapore, Venezuela, and Russia. "Paradigm Geophysical(R) " is the registered trademark of Paradigm Geophysical Ltd. Paradigm's web site is www.paradigmgeo.com. "Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995: Statements in this release which are not historical facts are forward-looking and involve risks and uncertainties, including, but not limited to, the impact of competitive products and pricing, increased investment to support product introductions, market acceptance of products, product transitions by the company and its competitors, currency fluctuations, changes in product sales mix, and other risks described in the company's registration statement and other Securities and Exchange Commission filings. 4
PARADIGM GEOPHYSICAL LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS - ------------------------------------------------------------------------------------------------------------------------------ U.S. dollars in thousands December 31, -------------------------------------------- 1997 1998 ---------------- ---------------- ASSETS CURRENT ASSETS: Cash and cash equivalents $ 8,229 $ 3,463 Trade receivables ( net of allowance for doubtful accounts - $568 in 1997 and $ 1,222 in 1998) 16,592 19,958 Other receivables and prepaid expenses 5,409 2,470 ---------------- ---------------- Total current assets 30,230 25,891 ---------------- ---------------- LONG-TERM TRADE RECEIVABLES 446 275 ---------------- ---------------- SEVERANCE PAY FUNDS 500 605 ---------------- ---------------- FIXED ASSETS Cost 9,537 14,997 Less - accumulated depreciation 3,471 (5,738) ---------------- ---------------- 6,066 9,259 ---------------- ---------------- OTHER ASSETS: Computer software development costs (net of accumulated amortization - $ 538 in 1997 and $ 1,041 in 1998) 1,182 679 Acquired developed technology (net of accumulated amortization of $ 350 in 1997 and $ 1,768 in 1998) 6,662 6,329 Other acquired technology (net of accumulated amortization in the amount of $ 110) - 993 Other assets, net 2,797 2,104 ---------------- ---------------- 10,641 10,105 ---------------- ---------------- $ 47,883 $ 46,135 ================ ================
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PARADIGM GEOPHYSICAL LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS - ------------------------------------------------------------------------------------------------------------------------------ U.S. dollars in thousands December 31, -------------------------------------------- 1997 1998 ---------------- ---------------- LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Short-term bank credit $ 711 $ 1,778 Current maturities of long-term bank loans 577 450 Trade payables 1,967 3,024 Other payables and accrued expenses 12,564 8,770 Deferred revenues 5,603 3,674 Note payable 9,500 - ---------------- ---------------- Total current liabilities 30,922 17,696 ---------------- ---------------- LONG-TERM BANK LOANS 483 39 ---------------- ---------------- BRIDGE LOAN PAYABLE 12,000 - ---------------- ---------------- ACCRUED SEVERANCE PAY 1,031 1,151 ---------------- ---------------- DEFERRED TAX LIABILITY 807 552 ---------------- ---------------- SHAREHOLDERS' EQUITY Preferred shares: Authorized - 4,735,806 shares of NIS 0.5 par value at December 31, 1997 and 0 shares at December 31, 1998; Issued and outstanding - 4,735,806 shares at December 31, 1997 and 0 shares at December 31, 1998 765 - Ordinary shares: Authorized - 20,000,000 shares of NIS 0.5 par value at December 31, 1998; Issued and outstanding - 2,328,682 shares at December 31, 1997 and 10,514,484 shares at December 31, 1998 521 1,758 Additional paid-in capital 19,707 39,236 Accumulated other comprehensive income (246) (742) Accumulated deficit (18,107) (13,555) ---------------- ---------------- Total shareholders' equity 2,640 26,697 ---------------- ---------------- $ 47,883 $ 46,135 ================ ================
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PARADIGM GEOPHYSICAL LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS - ---------------------------------------------------------------------------------------------------------- U.S. dollars in thousands (except for per share data) Year ended December 31, -------------------------------------------------- 1996 1997 1998 -------- -------- -------- Revenues: Products $ 5,981 $ 15,243 $ 27,491 Maintenance and support 1,737 4,736 10,583 Seismic data processing and interpretation Services 3,884 4,886 7,288 -------- -------- -------- 11,602 24,865 45,362 -------- -------- -------- Cost of revenues: Products 2,438 4,139 5,479 Maintenance and support 1,302 2,492 5,783 Seismic data processing and interpretation Services 1,910 2,533 4,108 5,650 9,164 15,370 -------- -------- -------- Gross profit 5,952 15,701 29,992 -------- -------- -------- Operating expenses: Research and development, net 1,840 5,095 8,061 Selling and marketing, net 5,466 6,102 9,642 General and administrative 4,072 4,227 6,720 Other expenses -- 10,676 -- -------- -------- -------- Total operating expenses 11,378 26,100 24,423 -------- -------- -------- Operating income (loss) (5,426) (10,399) 5,569 Financial income (expenses), net 57 (446) (661) -------- -------- -------- Income (loss) before income taxes $ (5,369) $(10,845) $ 4,908 Income taxes -- -- (356) -------- -------- -------- Net income (loss) (5,369) (10,845) 4,552 ======== ======== ======== Basic income (loss) per share $ (2.33) $ (4.66) $ 0.66 ======== ======== ======== Number of shares used in computing basic income (loss) per share 2,300 2,328 6,850 ======== ======== ======== Diluted income (loss) per share $ (2.33) $ (4.66) $ 0.49 ======== ======== ======== Number of shares used in computing diluted income (loss) per share 2,300 2,328 9,306 ======== ======== ========
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PARADIGM GEOPHYSICAL LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS - ------------------------------------------------------------------------------------------------------------------------ U.S. dollars in thousands (except for per share data) Three months ended December 31, ------------------------------------------ 1997 1998 ---------------- ----------------- Revenues: Products $ 9,051 $ 7,055 Maintenance and support 2,888 2,670 Seismic data processing and interpretation Services 933 1,990 ---------------- ----------------- 12,872 11,715 ---------------- ----------------- Cost of revenues: Products 3,109 1,103 Maintenance and support 1,061 1,495 Seismic data processing and interpretation services 691 1,201 ---------------- ----------------- 4,861 3,799 ---------------- ----------------- Gross profit 8,011 7,916 ---------------- ----------------- Operating expenses: Research and development, net 2,722 2,047 Selling and marketing, net 3,096 2,653 General and administrative 2,193 1,573 Other expenses 10,676 - ---------------- ----------------- Total operating expenses 18,687 6,273 ---------------- ----------------- Operating income (loss) (10,676) 1,643 Financial income (expenses), net (480) 64 ---------------- ----------------- Income (loss) before income taxes $ (11,156) $ 1,707 Income taxes (expense) 96 (136) ---------------- ----------------- Net income (loss) (11,060) 1,571 ================ ================= Basic income (loss) per share $ (4.75) $ 0.15 ================ ================= Number of shares used in computing basic income (loss) per share 2,328 10,514 ================ ================= Diluted income (loss) per share $ (4.75) $ 0.15 ================ ================= Number of shares used in computing diluted income (loss) per share 2,328 10,607 ================ =================
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