NICE Reports Record Results for the Fourth Quarter and Full Year 2011

 

February 15, 2012

Ra’anana, Israel, February 15, 2012 - NICE Systems (NASDAQ: NICE) today announced results for the fourth quarter and full year ending December 31, 2011.

Fourth Quarter 2011 non-GAAP Financial and Business Highlights Include:   

  • Record revenues of $214 million, up 14% year over year
  • Fully diluted earnings per share increased 18% to a record $0.60
  • Cash from operations totaled $53 million
  • Record bookings resulting in book to bill substantially greater than 1
  • Company completed its acquisition of Merced in February

Full Year 2011 non-GAAP Financial and Business Highlights Include: 

  • Record revenues of $798 million, up 15% year over year
  • Record gross and operating margins at 65.5% and 18.7%, respectively
  • Fully diluted earnings per share increased 20% to a record $2.10
  • Cash from operations totaled $154 million
  • Backlog at year-end reaches an all-time high

“We are pleased to finish the very strong year with record results for both the fourth quarter and full year 2011,” said Zeevi Bregman, President and CEO of NICE Systems. “We ended the fourth quarter with very strong bookings, a record backlog, and a healthy pipeline, and we look forward to another year of profitable growth in 2012.”

Mr. Bregman continued, “Much of the success we had in 2011 was marked by the strong growth of our analytics-based solutions. As a leader in innovating around structured and unstructured data analytics, we are seeing strong demand from our customers who are using our best-in-class analytics-based solutions to help them derive better insight into their businesses in real-time. Our solutions are generating impact for our customers by improving top and bottom line business performance, ensuring compliance, achieving a better customer experience for their customers and safeguarding people and assets.”

Non-GAAP Financial Highlights for the Fourth Quarter and Full Year Ended December 31, 2011:

Revenues: Fourth quarter 2011 non-GAAP total revenues were a record $213.6 million, up 14.3% from $186.9 million for the fourth quarter of 2010. Non-GAAP total revenues for the full year 2011 increased 14.7% to $797.7 million compared to $695.3 million for the full year 2010.

Gross Profit: Fourth quarter 2011 non-GAAP gross profit and non-GAAP gross margin were a record $141.7 million and 66.3%, respectively, compared to $123.5 million and 66.1%, respectively, for the fourth quarter of 2010. Full year 2011 non-GAAP gross profit and non-GAAP gross margin were $522.1 million and 65.5%, respectively, compared to $451.9 million and 65.0%, respectively, for the same period last year.

Operating Income: Fourth quarter 2011 non-GAAP operating income increased to a record $39.8 million compared to $34.8 million for the fourth quarter of 2010. Fourth quarter 2011 Non-GAAP operating margin was unchanged at 18.6% compared to the fourth quarter of 2010. Full year 2011 non-GAAP operating income and non-GAAP operating margin increased to $148.9 million and 18.7%, respectively, compared to $123.4 million and 17.8%, respectively, for the full year 2010. 

Net Income: Fourth quarter 2011 non-GAAP net income and non-GAAP net margin increased to $37.6 million and 17.6%, respectively, compared to $32.7 million and 17.5%, respectively, for the fourth quarter of 2010. Full year 2011 non-GAAP net income and non-GAAP net margin increased to $134.6 million and 16.9%, respectively, from $112.1 million and 16.1%, respectively, for the same period last year.

Fully Diluted Earnings Per Share: Fourth quarter 2011 non-GAAP fully diluted earnings per share increased to a record $0.60, up 17.6% from $0.51 for the fourth quarter of 2010. Full year 2011 non-GAAP fully diluted earnings per share increased to $2.10, up 20% from $1.75 for the full year 2010.

GAAP Financial Highlights for the Fourth Quarter and Full Year Ended December 31, 2011:

Revenues: Fourth quarter 2011 total revenues increased 14.8% to a record $213.6 million compared to $186.1 million for the fourth quarter of 2010. Full year 2011 total revenues increased 15.1% to a record $793.8 million compared to $689.5 million for the full year 2010.

Gross Profit: Fourth quarter 2011 gross profit and gross margin were $132.0 million and 61.8%, respectively, compared to $115.9 million and 62.3%, respectively, for the fourth quarter of 2010. Full year 2011 gross profit and gross margin increased to $486.5 million and 61.3%, respectively, up from $420.4 million and 61.0%, respectively, for the same period last year.

Operating Income: Fourth quarter 2011 operating income and operating margin were $15.1 million and 7.1%, respectively, compared to $17.2 million and 9.2%, respectively, for the fourth quarter of 2010. Full year 2011 operating income and operating margin increased to $59.0 million and 7.4%, respectively, compared with $49.1 million and 7.1%, respectively, for the full year 2010.

Net Income: Fourth quarter 2011 net income and net margin were $15.2 million and 7.1%, respectively, compared to $17.4 million and 9.3%, respectively, for the fourth quarter of 2010. Full year 2011 net income and net margin increased to $57.3 million and 7.2%, respectively, compared to $48.7 million and 7.1%, respectively, for the full year 2010.

Fully Diluted Earnings Per Share: Fully diluted earnings per share for the fourth quarter 2011 was $0.24 compared to $0.27 for the fourth quarter of 2010. Fully diluted earnings per share for the full year 2011 increased to $0.89 compared to $0.76 for the full year 2010.

Operating Cash Flow and Cash Balance: Fourth quarter 2011 operating cash flow was $53.3 million. In the fourth quarter, approximately $78 million that was used for acquisitions and $11 million that was used for share repurchases As of December 31, 2011, total cash and cash equivalents, short term investments and marketable securities were $562.6 million, with no debt.

First Quarter and Full Year 2012 Guidance:

Guidance for the first quarter and full year 2012 is as follows:

First Quarter 2012: First quarter non-GAAP total revenues for 2012 are expected to be in a range of $210 million to $218 million. First quarter non-GAAP fully diluted earnings per share for 2012 is expected to be in a range of $0.50 to $0.55.

Full Year 2012: Full year non-GAAP total revenues for 2012 are expected to be in a range of $930 million to $950 million. Full year non-GAAP fully diluted earnings per share for 2012 is expected to be in a range of $2.28 to $2.48.

Quarterly Results Conference Call

NICE management will host its earnings conference call today, February 15, 2012 at 8:30 AM EDT, 13:30 GMT, 15:30 Israel, to discuss the results and the company's outlook. To participate in the call, please dial in to the following numbers: United States 1-866-229-7198 or 1-888-668-9141, International +972-3- 9180610, United Kingdom 0-800-917-5108, Israel 03-9180609. The call will be webcast live on the Company’s website at http://www.nice.com/investor-relations/investor-relations-events​. An online replay will also be available approximately three hours following the call. A telephone replay of the call will be available for 72 hours after the live broadcast, and may be accessed by dialing: United States 1-888-782-4291, International +972-3-9255921, United Kingdom 0-800-917-4256, Israel 03-9255921.

Non-GAAP financial measures consist of GAAP financial measures adjusted to exclude: amortization of acquired intangible assets, re-organization expenses, share-based compensation expenses, certain business combination accounting entries and settlement and related expenses. The purpose of such adjustments is to give an indication of our performance exclusive of non-cash charges and other items that are considered by management to be outside of our core operating results. Our non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. Our management regularly uses our supplemental non-GAAP financial measures internally to understand, manage and evaluate our business and make operating decisions. These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. Business combination accounting rules requires us to recognize a legal performance obligation related to a revenue arrangement of an acquired entity. The amount assigned to that liability should be based on its fair value at the date of acquisition. The non-GAAP adjustment is intended to reflect the full amount of such revenue. We believe this adjustment is useful to investors as a measure of the ongoing performance of our business. We believe these non-GAAP financial measures provide consistent and comparable measures to help investors understand our current and future operating cash flow performance. These non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies. Reconciliation between results on a GAAP and non-GAAP basis is provided in a table immediately following the Consolidated Statements of Income.

About NICE
NICE Systems (NASDAQ: NICE) is the worldwide leader of intent-based solutions that capture and analyze interactions and transactions, realize intent, and extract and leverage insights to deliver impact in real time. Driven by cross-channel and multi-sensor analytics, NICE solutions enable organizations to improve business performance, increase operational efficiency, prevent financial crime, ensure compliance, and enhance safety and security. NICE serves over 25,000 organizations in the enterprise and security sectors, representing a variety of sizes and industries in more than 150 countries, and including over 80 of the Fortune 100 companies. www.nice.com

Trademark Note:NICE and the NICE logo are trademarks or registered trademarks of NICE Systems.  All other marks are trademarks of their respective owners.  For a full list of NICE Systems' marks, please see: http://www.nice.com/nice-trademarks

Corporate Media Contact

Galit Belkind, +1 877 245 7448, galit.belkind@nice.com

Investors

Marty Cohen, +1 212 574 3635,ir@nice.com, ET

Anat Earon-Heilborn, +972 9 775-3798,ir@nice.com, CET

Forward-Looking Statements
This press release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements, including the statements by Messer Bregman, are based on the current expectations of the management of NICE-Systems Ltd. (the Company) only, and are subject to a number of risks and uncertainties that could cause the actual results or performance of the Company to differ materially from those described herein, including but not limited to the impact of the global economic environment on the Company’s customer base (particularly financial services firms) and the resulting uncertainties; changes in technology and market requirements; decline in demand for the Company's products; inability to timely develop and introduce new technologies, products and applications; difficulties or delays in absorbing and integrating acquired operations, products, technologies and personnel; loss of market share; pressure on pricing resulting from competition; and inability to maintain certain marketing and distribution arrangements. For a more detailed description of the risk factors and uncertainties affecting the company, refer to the Company's reports filed from time to time with the Securities and Exchange Commission, including the Company’s Annual Report on Form 20-F. The forward-looking statements contained in this press release are made as of the date of this press release, and the Company undertakes no obligation to update or revise them, except as required by law.