The software behind perfect printed and digital communication
Perfect printed and digital communication

News Release

Pompey, France  02/08/2012

Global Graphics reports fourth quarter and full year 2011 results

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Comparisons for the fourth quarter of 2011 with the same quarter of the previous year include:
  • Sales of Euro 2.7 million this quarter (Euro 2.7 million at Q4 2010 exchange rates), compared with Euro 2.8 million in Q4 2010;
  • An operating profit of Euro 0.4 million this quarter, compared with an operating profit of Euro 0.3 million in Q4 2010;
  • An adjusted operating profit of Euro 0.4 million this quarter, compared with an adjusted operating profit of Euro 0.5 million in Q4 2010;
  • An adjusted pre-tax profit of Euro 0.4 million this quarter (or an adjusted pre-tax profit of Euro 0.04 per share) compared with an adjusted pre-tax profit of Euro 0.6 million in Q4 2010 (or an adjusted pre-tax profit of Euro 0.05 per share);
  • A net profit of Euro 0.4 million this quarter (or a net profit of Euro 0.04 per share) compared with a net profit of Euro 0.1 million in Q4 2010 (or a net profit of Euro 0.01 per share); and
  • An adjusted net profit of Euro 0.4 million this quarter (or an adjusted net profit of Euro 0.04 per share) compared with an adjusted net profit of Euro 0.2 million in Q4 2010 (or an adjusted net profit of Euro 0.02 per share).

Commenting on performance, Gary Fry, Chief Executive Officer, said: “Our fourth quarter results show a healthy operating and net profit which marks a pleasing end to what has been a very busy and exciting year.

“During the quarter, we signed two important contracts with large Japanese digital printer manufacturers which expect to announce products at the drupa exhibition in May and to start shipping later this year. They have licensed our high-performance Harlequin Host Renderer RIP which is optimized to drive digital presses at full speed and supplied as a software development kit (SDK), so that customers can create competitive differentiation in their solutions.

“In the electronic document segment, we are pleased to see that the gDoc platform SDK is now being used by multiple partners who are developing end-user applications, initially targeting the legal market, with the intent to open up opportunities on mobile platforms, notably on smartphones and tablets such as the iPad.”

Fourth quarter 2011 performance
Sales for the quarter ended 31 December 2011 amounted to Euro 2.7 million compared with Euro 2.8 million in the fourth quarter 2010, or a sequential decrease of 3.9% at current exchange rates and of 6.0% at constant exchange rates.

Total operating expenses (excluding cost of sales but including other operating expenses and income, as applicable) amounted to Euro 2.2 million this quarter, compared with Euro 2.4 million in the fourth quarter of 2010, and with Euro 2.3 million, Euro 2.0 million, and Euro 2.0 million, in Q1 2011, Q2 2011, and Q3 2011, respectively.  

The Company reported an operating profit of Euro 0.4 million for this quarter (or an operating profit equivalent to 15.2% of Q4 2011 sales), compared with an operating profit of Euro 0.3 million in Q4 2010 (or an operating profit equivalent to 11.0% of that quarter’s sales).

The Company reported an adjusted operating profit (as defined in an accompanying table) of Euro 0.4 million for this quarter (or an adjusted operating profit equivalent to 14.5% of Q4 2011 sales), compared with an adjusted operating profit of Euro 0.5 million in Q4 2010, which was equivalent to 17.6% of that quarter’s sales.

The Company reported an adjusted pre-tax profit (as defined in an accompanying table) of Euro 0.4 million for this quarter, compared with an adjusted pre-tax profit of Euro 0.6 million in Q4 2010. Accordingly adjusted pre-tax EPS was a profit of Euro 0.04 this quarter compared with an adjusted pre-tax profit of Euro 0.05 per share in Q4 2010.

The Company reported a net profit of Euro 0.4 million for this quarter (or a net profit of Euro 0.04 per share this quarter), compared with a net profit of Euro 0.1 million in Q4 2010 (or a net profit of Euro 0.01 per share in Q4 2010).

The Company reported an adjusted net profit (as defined in an accompanying table) of Euro 0.4 million for this quarter, compared with an adjusted net profit of Euro 0.2 million in Q4 2010. Accordingly, adjusted net EPS was a profit of Euro 0.04 this quarter, compared with a profit of Euro 0.02 per share in Q4 2010.

Full year 2011 performance
Sales for the year ended 31 December 2011 amounted to Euro 9.0 million, compared with Euro 9.6 million for the year ended 31 December 2010, or a sequential decrease of 6.8% at current exchange rates, and of 4.5% at constant exchange rates.

Total operating expenses amounted to Euro 8.5 million for the year ended 31 December 2011 (after effect of other operating income for Euro 0.2 million), compared with Euro 11.1 million for the year ended 31 December 2010, the latter figure including other operating expenses (net of other operating income) for Euro 0.7 million, which were notably relating to expenses incurred pursuant to the Company’s reorganization which was implemented in April 2010, or a sequential decrease of 23.7%.

The Company reported a nominal operating profit for the year ended 31 December 2011 (or an operating profit equivalent to 0.5% of 2011 sales), compared with an operating loss of Euro 1.9 million for the year ended 31 December 2010 (or an operating loss equivalent to 20.2% of 2010 sales).

The Company reported an adjusted operating loss (as defined in an accompanying table) of Euro 0.3 million for the year ended 31 December 2011 (or an adjusted operating loss equivalent to 3.3% of 2011 sales), compared with an adjusted operating loss of Euro 1.2 million for the year ended 31 December 2010 (or an adjusted operating loss equivalent to 12.4% of 2010 sales).

The Company reported an adjusted pre-tax loss (as defined in an accompanying table) of Euro 0.3 million for the year ended 31 December 2011 (or an adjusted pre-tax loss of Euro 0.03 per share), compared with an adjusted pre-tax loss of Euro 1.4 million for the year ended 31 December 2010 (or an adjusted pre-tax loss of Euro 0.14 per share).

The Company reported a net profit of Euro 0.2 million for the year ended 31 December 2011 (or a net profit of Euro 0.02 per share), compared with a net loss of Euro 2.6 million for the year ended 31 December 2010 (or a net loss of Euro 0.26 per share).

The Company reported an adjusted net loss (as defined in an accompanying table) of Euro 0.1 million for the year ended 31 December 2011, compared with an adjusted net loss of Euro 1.9 million for the year ended 31 December 2010. Accordingly, adjusted net EPS was a loss of Euro 0.01 per share for the year ended 31 December 2011, compared with a loss of Euro 0.19 per share for the year ended 31 December 2010.

Net cash position and cash flows from the Company’s operations
The Company had no outstanding debt and a cash position of Euro 2.3 million as at 31 December 2011, compared with Euro 1.4 million as at 30 June 2011 and with Euro 1.9 million as at 1 January 2011.

Cash flows provided by the Company’s operations amounted to Euro 1.8 million in the year ended 31 December 2011, allowing for the financing of its capital expenditures for Euro 1.4 million (of which Euro 1.3 million arising from the capitalization of eligible development costs), compared with an amount of Euro 0.4 million used by the Company’s operations in the year ended 31 December 2010.

Commentary on 2012
Gary Fry continued: “during the year ended 31 December 2011, we signed five strategically important contracts. They demonstrate a significant improvement in the Company’s position and set us up well for the current year as our customers start shipping products built on our technology.

“2012 being a drupa year, and given the level of interest that continues in our Harlequin Host Renderer for high-speed digital printing applications, we expect to close further significant contracts during the year.  We will also be exploring new market opportunities for the Jaws RIP as we will launch version 3.0 of this product during 2012.  

“Within the electronic document segment we expect to see multiple end-user deployments through our partners who are building conceptually new applications that link document management systems to user mobility.

“With the contracts that we signed in 2011 and the new business we expect to see in 2012, we are seeing a real turnaround of the Company’s long-term prospects.”
 
Fourth quarter and full year 2011 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 2011.  Callers should dial +44 (0)20 7162 0025 and mention conference ID “911624 Global Graphics quarterly results" to the operator.  The call will be available for replay for 7 working days by dialing number +44 (0)20 7031 4064 (freephone number UK only: 0800 358 1860), access code 911624.


Auditors’ reports on the 2011 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 7 February 2012, have been reviewed by the Company’s auditors, and are therefore final.  

The Company’s auditors still have additional audit procedures to perform, notably on the Company’s statutory financial statements, the full version of the notes attached to the Company’s consolidated financial statements, as well as on the reports relating to the year ended 31 December 2011 which have to be drafted by the Company’s Board of Directors as required by applicable legal and regulatory provisions.  
As in previous years, the auditors’ audit reports on the 2011 statutory and consolidated financial statements will be included in the Company’s annual financial report for that financial year.

First quarter 2012 results announcement

Global Graphics expects to announce its consolidated financial results for the first quarter of the year ending 31 December 2012 on Friday 27 April 2012 before market opening.

Annual meeting of the Company’s shareholders
Global Graphics expects to hold its annual meeting in Brussels (Belgium) on Friday 27 April 2012. 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 legal and regulatory provisions.

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 neither revise nor update any of them, neither to reflect events or circumstances after the date of this release, nor to reflect new information or the occurrence of unanticipated events.

Contact

Alain Pronost, CFO Tel: + 33 (0)6 62 60 56 51