Company Announces Incremental $125 million Share Buyback Authorization
FREMONT, California –- September 11, 2017 — Electronics For Imaging, Inc. (Nasdaq:EFII), a world leader in customer-focused digital printing innovation, today announced its results for the second quarter of 2017.
For the quarter ended June 30, 2017, the Company reported record second quarter revenue of $247.0 million, up 1% compared to second quarter 2016 revenue of $245.7 million. GAAP net income was $2.8 million, down 47% compared to $5.2 million for the same period in 2016 or $0.06 per diluted share, down 45% compared to $0.11 per diluted share for the same period in 2016. Non-GAAP net income was $25.5 million, down 4% compared to non-GAAP net income of $26.7 million for the same period in 2016 or $0.54 per diluted share, down 4% compared to $0.56 per diluted share for the same period in 2016. Cash flow from operating activities was $24.1 million, up 5% compared to $22.9 million during the same period in 2016.
For the six months ended June 30, 2017, the Company reported revenue of $475.7 million, down 1% year-over-year compared to $479.8 million for the same period in 2016. GAAP net income was $7.5 million or $0.16 per diluted share, compared to $7.3 million or $0.15 per diluted share for the same period in 2016. Non-GAAP net income was $51.3 million or $1.09 per diluted share, compared to non-GAAP net income of $52.9 million or $1.10 per diluted share for the same period in 2016. Cash flow from operating activities for the six months ended June 30, 2017, was $39.0 million, up 22% compared to $31.9 million during the same period in 2016.
“While we sincerely regret the delay in announcing our second quarter results and the impact on our shareholders, we are pleased to report that the EFI team delivered record Q2 revenue with solid cash generation,” said Guy Gecht, CEO of EFI. “We expect this momentum to continue into the second half of the year, with anticipated record Q3 revenue, while making additional progress on our pipeline of new industry leading products, including the planned commercialization of the Nozomi.”
Share Buyback Program
Separately, EFI announced that its Board of Directors has approved a $125 million increase in the firm’s share buyback authorization and supplemented the prior program, which, as of September 8, 2017, had $28.8 million available for purchases.
EFI will discuss the Company’s financial results by conference call at 8:00 am ET/5:00 am PT today. Instructions for listening to the conference call over the Web are available on the investor relations portion of EFI’s website at www.efi.com.
EFI™ is a global technology company, based in Silicon Valley, and is leading the worldwide transformation from analog to digital imaging. We are passionate about fueling customer success with products that increase competitiveness and boost productivity. To do that, we develop breakthrough technologies for the manufacturing of signage, packaging, textiles, ceramic tiles, and personalized documents, with a wide range of printers, inks, digital front ends, and a comprehensive business and production workflow suite that transforms and streamlines the entire production process. (www.efi.com)
Safe Harbor for Forward Looking Statements
Certain statements in this press release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements other than statements of historical fact including words such as “address”, “anticipate”, “believe”, “consider”, “continue”, “develop”, “estimate”, “expect”, “further”, “look”, “plan”, and “progress” and statements in the future tense are forward looking statements. The statements in this press release that could be deemed forward-looking statements include statements regarding EFI’s strategy, plans, expectations regarding its revenue growth, introduction of new products, product portfolio, productivity, future opportunities for EFI and its customers, demand for products, and any statements or assumptions underlying any of the foregoing.
Forward-looking statements are subject to certain risks and uncertainties that could cause our actual future results to differ materially, or cause a material adverse impact on our results. Potential risks and uncertainties include, but are not necessarily limited to, intense competition in each of our businesses, including competition from products developed by EFI’s customers; our ability to remediate the material weaknesses identified in EFI’s internal control over financial reporting; the uncertainty of the outcome of the pending securities lawsuits against EFI; unforeseen expenses; fluctuations in currency exchange rates; the difficulty of aligning expense levels with revenue; management’s ability to forecast revenues, expenses and earnings; our ability to successfully integrate acquired businesses; changes in the mix of products sold; the uncertainty of market acceptance of new product introductions; challenge of managing asset levels, including inventory and variations in inventory levels; the uncertainty of continued success in technological advances; the challenges of obtaining timely, efficient and quality product manufacturing and supply of components; any world-wide financial and economic difficulties and downturns; adverse tax-related matters such as tax audits, changes in our effective tax rate or new tax legislative proposals; the unpredictability of development schedules and commercialization of products by the leading printer manufacturers and declines or delays in demand for our related products; the impact of changing consumer preferences on demand for our textile products; litigation involving intellectual property rights or other related matters; the uncertainty regarding the amount and timing of future share repurchases by EFI and the origin of funds used for such repurchases; the market prices of EFI’s common stock prior to, during and after the share repurchases; and any other risk factors that may be included from time to time in the Company’s SEC reports.
The statements in this press release are made as of the date of this press release. EFI undertakes no obligation to update information contained in this press release. Amounts are subject to rounding.
For further information regarding risks and uncertainties associated with EFI’s businesses, please refer to the section entitled “Risk Factors” in the Company’s SEC filings, including, but not limited to, its annual report on Form 10-K and its quarterly reports on Form 10-Q, copies of which may be obtained by contacting EFI’s Investor Relations Department by phone at 650-357-3828 or by email at email@example.com or EFI’s Investor Relations website at www.efi.com.
Use of Non-GAAP Financial Information
To supplement our condensed consolidated financial results prepared under generally accepted accounting principles, or GAAP, we use non-GAAP measures of net income and earnings per diluted share that are GAAP net income and GAAP earnings per diluted share adjusted to exclude certain costs, expenses, and gains. A reconciliation of the adjustments to GAAP results for the three and six months ended June 30, 2017 and 2016 is provided below. In addition, an explanation of how management uses non-GAAP financial information to evaluate its business, the substance behind management’s decision to use this non-GAAP financial information, the material limitations associated with the use of non-GAAP financial information, the manner in which management compensates for those limitations, and the substantive reasons management believes that this non-GAAP financial information provides useful information to investors is included under “About our Non-GAAP Net Income and Adjustments” after the tables below.
These non-GAAP measures are not in accordance with or an alternative to GAAP and may be materially different from other non-GAAP measures, including similarly titled non-GAAP measures, used by other companies. The presentation of this additional information should not be considered in isolation from, as a substitute for, or superior to, net income or earnings per diluted share prepared in accordance with GAAP. Non-GAAP financial measures have limitations in that they do not reflect certain items that may have a material impact upon our reported financial results. We expect to continue to incur expenses of a nature similar to the non-GAAP adjustments described above, and exclusion of these items from our non-GAAP net income and non-GAAP earnings per diluted share should not be construed as an inference that these costs are unusual, infrequent, or non-recurring.
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Chief Financial Officer
Market Street Partners