Global Graphics reports fourth quarter and full year 2009 results

Comparisons for the quarter ended 31 December 2009 with the same quarter of the previous year include:

  • Sales of Euro 2.2 million this quarter (Euro 2.4 million at Q4 2008 exchange rates) compared with Euro 2.7 million in Q4 2008;
  • An operating loss of Euro 0.5 million this quarter, compared with an operating loss of Euro 0.1 million in Q4 2008;
  • An adjusted operating loss of Euro 0.3 million this quarter, as was already the case in Q4 2008;
  • An adjusted pre-tax loss of Euro 0.3 million this quarter (or an adjusted pre-tax loss of Euro 0.03 per share), compared with a nominal adjusted pre-tax loss in Q4 2008 (or an adjusted pre-tax loss of Euro 0.00 per share);
  • A net loss of Euro 0.1 million this quarter (or a net loss of Euro 0.01 per share), compared with a net loss of Euro 0.2 million in Q4 2008 (or a net loss of Euro 0.02  per share); and
  • A nominal adjusted net profit this quarter (or an adjusted net profit of Euro 0.00 per share), compared with an adjusted net loss of Euro 0.4 million in Q4 2008 (or an adjusted net loss of Euro 0.04 per share).
Commenting on performance, Gary Fry, Chief Executive Officer, said: “one of the companies in the office printing market that had been evaluating our embedded technology through 2009 signed a contract with us in the fourth quarter, with corresponding first product shipments being expected in next August. This is a very encouraging validation of the performance of our technology in this segment and the competitive edge it can provide to our customers.

“As to the eDoc segment, during the fourth quarter, we invested in a dedicated, US-based sales force which will focus on selling into the US corporate market via our corporate license plan. We also launched our knowledge worker desktop application, gDoc Fusion, on 1 December and were encouraged by the significant number of downloads recorded to date for this product.  We are supporting the launch of gDoc Fusion with a comprehensive marketing program and have also adopted a ‘freemium’ strategy to promote widespread distribution and sales of the gDoc range of products.”

Fourth quarter 2009 performance
Sales for the quarter amounted to Euro 2.2 million, compared with Euro 2.7 million for the same quarter of 2008, or a sequential decrease of 18.7 % at current exchange rates, and of 10.4% at constant exchange rates.

Total operating expenses amounted to Euro 2.6 million this quarter, compared with Euro 2.7 million for the same quarter of 2008, and included non-recurring expenses of Euro 0.1 million.

The Company reported an operating loss of Euro 0.5 million for this quarter (or a loss equal to 21.1 % of Q4 2009 sales), compared with an operating loss of Euro 0.1 million for the same quarter of 2008 (or a loss equal to 2.1% of Q4 2008 sales).

The Company reported an adjusted operating loss (or EBITA, as defined in the accompanying table) of Euro 0.3 million for this quarter, as was already the case in the same quarter of 2008. Accordingly, EBITA margin was -14.8 % of sales in Q4 2009, compared with -11.2% of sales in Q4 2008.

The Company reported an adjusted pre-tax loss (as defined in the accompanying table) of Euro 0.3 million for this quarter, compared with a nominal adjusted pre-tax loss for the same quarter of 2008. Accordingly, adjusted pre-tax EPS was a loss of Euro 0.03 in Q4 2009, compared with Euro 0.00 in Q4 2008.

The Company reported a net loss of Euro 0.1 million for this quarter (or a net loss of Euro 0.01 per share), compared with a net loss of Euro 0.2 million for the same quarter of 2008 (or a net loss of Euro 0.02 per share).

The Company reported a nominal adjusted net profit (as defined in the accompanying table) for this quarter (or an adjusted net profit of Euro 0.00 per share), compared with an adjusted net loss of Euro 0.4 million for the same quarter of 2008 (or an adjusted net loss of Euro 0.04 per share).

Full year 2009 performance
Sales for the year ended 31 December 2009 were Euro 9.4 million (Euro 8.9 million at 2008 rates) compared with Euro 11.2 million in the year ended 31 December 2008, or a decrease of 16.2 % at current exchange rates, and of 20.4% at constant exchange rates.

Sales in the Print segment of the Company’s business were Euro 7.6 million in 2009, compared with Euro 9.4 million in 2008, or a decrease of 19.6% at current exchange rates and of 23.5% at constant exchange rates.
Sales in the eDoc segment of the Company’s business were Euro 1.8 million in 2009, compared with Euro 1.7 million in 2008, or an increase of 2.5% at current exchange rates but a decrease of 3.4% at constant exchange rates.

Total operating expenses amounted to Euro 10.4 million in the year ended 31 December 2009, compared with Euro 10.8 million in the year ended 31 December 2008, and included Euro 0.1 million of non-recurring expenses relating to changes made in the Company’s senior management team in the last quarter of 2009, notably the hiring of Mike Finta as director of development.

The Company reported an operating loss of Euro 1.3 million in the year ended 31 December 2009 (or -14.3 % of 2009 sales), compared with an operating loss of Euro 0.1 million in the year ended 31 December 2008 (or -0.8% of 2008 sales).

The Company reported an adjusted operating loss of Euro 1.5 million in the year ended 31 December 2009 (or –16.4 % of 2009 sales), compared with an adjusted operating loss of Euro 0.3 million in the year ended 31 December 2008 (or -2.7 % of 2008 sales).

The Company reported an adjusted pre-tax loss of Euro 1.6 million in the year ended 31 December 2009 (or an adjusted pre-tax loss of Euro 0.16 per share), compared with an adjusted pre-tax profit of Euro 0.2 million in the year ended 31 December 2008 (or an adjusted pre-tax profit of Euro 0.02 per share).

The Company reported a net loss of Euro 1.6 million in the year ended 31 December 2009 (or a loss of Euro 0.16 per share), compared with a net loss of Euro 0.6 million in the year ended 31 December 2008 (or a net loss of Euro 0.06 per share).

The Company reported an adjusted net loss of Euro 1.7 million in the year ended 31 December 2009 (or an adjusted net loss of Euro 0.17 per share), compared with an adjusted net loss of Euro 0.6 million in the year ended 31 December 2008 (or an adjusted net loss of Euro 0.06 per share).

Cash flow
The Company had a net cash position of Euro 3.1 million at 31 December 2009, compared with Euro 4.5 million at 31 December 2008, or a decrease of Euro 1.4 million over 2009.
Net cash used by the Company’s operations was Euro 0.1 million in the year ended 31 December 2009 while net cash used in investing activities (through capital expenditures of computer equipment and capitalization of eligible development expenses) was Euro 1.4 million.
 
Concluding remarks
Gary Fry added: "2009 was a difficult trading year for most companies in our industry; yet our results are better than other industry participants with whom we are competing, even though they show a decrease, and I remain confident about our overall potential.

"We took the decision to continue with new strategic investments throughout 2009 in both segments of the Company’s business.  In the Print segment, as noted above, we have had validation from several potential customers in the office printing market that our embedded RIP solution, which was upgraded during 2009, gives them a truly competitive advantage over their existing solution, while, in the production printing segment, we expect the contribution to sales from new customers in 2010 to offset the overall decline we have been seeing from this market over the past few years.  In the eDoc segment for knowledge worker applications, we sharpened our focus on our go-to-market strategy.  Overall, I believe that our technology development and our sustained sales and marketing efforts put us in a strong position to unlock existing and future opportunities in all areas of our strategic focus.”

Fourth quarter and full year 2009 conference call details
Global Graphics will hold a conference call today at 10.00 CET about its results for the quarter and the year ended 31 December 2009. Callers should dial +44 (0)20 7162 0025 and mention "Global Graphics quarterly results conference call" to the operator.  
The call will be available for replay for 7 working days by dialing number +44 020 7031 4064 (freephone number UK only: 0800 358 1867), access code 857659.

Auditors’ reports on the 2009 Company’s statutory and consolidated accounts
The attached condensed consolidated financial statements and selected explanatory notes, which were drafted by the Company’s Board of Directors on 9 February 2010, have been audited by the Company’s auditors, and are therefore final.
The Company’s auditors still have additional audit procedures to perform, including, but not limited to, the Company’s statutory accounts, the full version of the notes attached to the Company’s consolidated accounts, as well as all reports drafted by the Company’s Board of Directors with respect of the year ended 31 December 2009.
As in previous years, their final audit reports will be included in the Company’s annual report for the year ended 31 December 2009.

2009 annual report
The Company expects to publish the electronic versions of its annual report (in English and in French) in the last week of March 2010.
Printed copies of the English and French reports will be available shortly thereafter. Should you wish to receive one or several copies of the Company’s 2009 annual report, please let us know by sending an e-mail to the following e-mail address: investor-relations@globalgraphics.com, or a request in writing to the registered office of the Company.

First quarter 2010 results announcement
Global Graphics expects to announce its consolidated financial results for the quarter ending 31 March 2010 on Friday 23 April 2010 before market opening.

Annual meeting of the Company’s shareholders
Global Graphics expects to hold its annual meeting on Friday 23 April 2010 in Brussels (Belgium). The precise timing, final agenda, proposed resolutions and voting procedures will be announced a minimum of 35 days in advance of meeting date in accordance with applicable provisions of French Company Law.

Editors notes

About Global Graphics
Global Graphics (http://www.globalgraphics.com) is a leading developer of e-document and printing software. It provides high-performance solutions to the graphic arts/commercial print and digital print markets and for knowledge worker and professional software applications.  The Company’s customers include Original Equipment Manufacturers (OEMs), system integrators, software developers and resellers and number the world’s leading brands of digital pre-press systems, large-format color printers, color proofing systems, digital copiers and printers for the corporate and SOHO (Small Office / Home Office) markets, as well as a wide variety of market leading software applications.

Forward-looking statements
This press release contains, in addition to historical information, forward-looking statements that involve risks and uncertainties. These include statements regarding the Company’s growth, funding, expansion plans and expected results for future periods. Such statements are based on management’s current expectations and are subject to a number of uncertainties and risks that could cause actual results to differ materially from those described in the forward-looking statements. Although management believes that their expectations reflected in the forward-looking statements are reasonable based on information currently available to them, they cannot assure any reader that the expectations will prove to have been correct. Accordingly, any reader should not place undue reliance on these forward-looking statements. In any event, these statements speak only as of the date of this release. The Company undertakes no obligation to revise or update any of them, neither to reflect events or circumstances after the date of this release, nor to reflect new information nor the occurrence of unanticipated events.

Contact

CFO Alain Pronost/Global Graphics

+33 3 83 49 45 08

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