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<PAGE> 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 2000
PARADIGM GEOPHYSICAL LTD.
(Translation of Registrant's Name into English)
Shenkar Street 9, Gav Yam Center No.3, 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-.....................
<PAGE> 2
Attached to the Registrant's Form 6-K for the month of January 2000 and
incorporated by reference herein is the Registrant's news release dated January
26, 2000.
<PAGE> 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/ Jonathan Keller
Jonathan Keller
Company Secretary
Dated: 27 January, 2000
<PAGE> 1
[PARADIGM GEOPHYSICAL LOGO]
FOR IMMEDIATE RELEASE
PARADIGM GEOPHYSICAL ANNOUNCES FOURTH QUARTER AND YEAR END RESULTS FOR THE
PERIOD ENDED DECEMBER 31, 1999
HERZLIA, ISRAEL - JANUARY 26, 2000 - Paradigm Geophysical Ltd. (NASDAQ: PGEO)
today announced its fourth quarter and year-end results for the period ended
December 31, 1999.
GROWTH HIGHLIGHTS:
- Revenues for the 1999 fiscal year increased by 20 percent to
$54.5 million as compared with $45.4 million in the same
period of 1998.
- Revenues for the fourth quarter increased by 40 percent
totaling $16.4 million as compared with $11.7 million during
the fourth quarter of 1998.
- Product revenues increased by 52 percent to $13.5 million from
$8.9 million in the third quarter of 1999, and increased by
39% as compared with $9.7 million the fourth quarter of 1998.
- Net income per share was $0.02 for the fourth quarter of 1999.
SUMMARY OF KEY RESULTS AND COMPARISONS
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
(US$ MIL.) 4TH QUARTER 3RD QUARTER 1999 FISCAL YEAR
----------------------------------------------------------------------------------------
1999 1998 Q499 AS % Q399 Q499 AS 1999 1998 1999 AS
Q498 % Q399 % 1998
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
REVENUE $16.4 $11.7 140% $12.9 127% $54.5 $45.4 120%
OPERATING INCOME/(LOSS) $0.4 $1.6 25% ($0.4) ($3.3) $5.6
NET INCOME/(LOSS) $0.3 $1.6 17% ($0.5) ($3.8) $4.6
EPS $0.02 $0.15 13% ($0.04) ($0.3) $0.49
CFPS $0.17 $0.29 58% $0.10 165% $0.30 $1.10 27%
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 2
MANAGEMENT COMMENTS:
Eldad Weiss, Chairman and CEO of Paradigm Geophysical Ltd., commented: "We are
very pleased with both the quarterly and year-end results. We have grown 20
percent in one of the most difficult years for the oil and gas sector. This
quarter's performance confirms industry acceptance of our solutions offerings."
"Paradigm maintains its commitment to new product development and building our
infrastructure to better serve our growing customer base. During 1999 we have
repositioned the Company from "The Seismic Data Analysis Company" to "THE
GEOSCIENCE KNOWLEDGE COMPANY" providing a wider range of geoscience products and
services. While this year has seen significant development and expansion, we
expect to expand our offerings even further during 2000," he concluded.
DETAILED RESULTS AND COMPARISONS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------
(US$ MIL.) 4TH QUARTER 3RD QUARTER 1999 FISCAL YEAR
------------------------------------------------------------------------------------
1999 1998 Q499 AS % Q399 Q499 AS 1999 1998 1999 AS %
Q498 % Q399 1998
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PRODUCT REVENUE $13.5 $9.7 139% $8.9 152% $43.0 $38.1 113%
SERVICES REVENUE $2.9 $2.0 145% $4.0 72% $11.5 $ 7.3 158%
EBITDA $2.2 $3.1 73% $1.4 165% $3.6 $10.2 36%
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
PRODUCT REVENUES: The growth in Product revenues this quarter by 39% over fourth
quarter 1998 and by 52% over third quarter 1999, illustrates the further
deepening of the Company's market penetration, the beginning of the market
turnaround, and to a lesser extent the traditionally strong fourth quarter.
SERVICES REVENUES: The growth in this quarter's revenues by 45% over fourth
quarter 1998 illustrates the general increase in demand for outsourced services,
and also the Company's increase in market share of high-end services. The
decline in Services revenue to 72% of third quarter 1999 revenues is due to
seasonal fluctuations in service demand. Backlog remains steady into the first
and second quarters of 2000.
Note: Paradigm changed its reporting format in this quarter. A guide to the new
format detailing the considerations that led to its adoption is available from
the Company on request, and is posted in the Investor Relations section of the
Company's web site.
Recent press announcements are available on Paradigm's web site:
www.paradigmgeo.com.
ABOUT PARADIGM GEOPHYSICAL LTD.
Paradigm Geophysical Ltd. provides geoscience software and service solutions to
the oil and gas industry. The Company has sales, customer support and service
offices in Houston, London, Aberdeen, Bahrain, Calgary, Moscow, Caracas, Buenos
Aires, Rio de Janeiro, Perth, Brisbane, Beijing, Jakarta and Singapore.
"Paradigm Geophysical[R]" is the registered trademark of Paradigm Geophysical
Ltd.
<PAGE> 3
Safe Harbor statement: This news release may contain certain forward-looking
statements relating to the future performance of Paradigm Geophysical Ltd. Such
statements are subject to certain factors which may cause Paradigm's plans to
differ or results to vary from those expected including the risks associated
with the future capital expenditures by oil and gas companies, international oil
prices, 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 a variety of risks described in the Company's 20-F
filing with the U.S. Securities and Exchange Commission on June 30, 1999.
Paradigm undertakes no obligation to publicize or release results of any of
these forward-looking statements, which may be made to reflect events or
circumstances after the date hereof or to reflect the occurrence of unexpected
results.
FOR MORE INFORMATION, PLEASE CONTACT:
PARADIGM GEOPHYSICAL LTD.
BRIAN W. BERMAN, CFO
ARITA MATTSOFF, INVESTOR RELATIONS OFFICER
Paradigm Geophysical Ltd.
Phone: +972-9-970-9634
Fax: +972-9-970-9319
Email: [email protected] / [email protected]
RUDER-FINN, INC.
MAGDA GAGLIANO
Ruder Finn, Inc.
Phone: +1-212-593-6319
Fax: +1-212-715-1660
Email: [email protected]
CUBITT CONSULTING
NOGA VILLALON
Phone: +44-171-232-4591
Fax: +44-171-232-2541
Email: [email protected]
(tables to follow)
<PAGE> 4
PARADIGM GEOPHYSICAL LTD. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
- --------------------------------------------------------------------------------
U.S. DOLLARS IN THOUSANDS
<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------------------
1998 1999
----------------- -----------------
ASSETS
CURRENT ASSETS:
<S> <C> <C>
Cash and cash equivalents $ 3,463 $ 5,457
Trade receivables (net of allowance for doubtful accounts -
$1,222 in 1998 and $1,666 in 1999) 14,281 21,612
Accrued income 5,677 9,012
Other receivables and prepaid expenses 2,470 2,443
----------------- -----------------
Total current assets 25,891 38,524
----------------- -----------------
LONG-TERM TRADE RECEIVABLES 275 54
----------------- -----------------
SEVERANCE PAY FUNDS 605 861
----------------- -----------------
FIXED ASSETS:
Cost 14,997 21,610
Less - accumulated depreciation (5,738) (9,603)
----------------- -----------------
9,259 12,007
----------------- -----------------
OTHER ASSETS:
Acquired developed technology (net of accumulated
amortization of $1,878 in 1998 and $1,490 in 1999)
7,322 9,805
Other assets, net 2,783 4,914
---------------- ----------------
10,105 14,719
---------------- ----------------
$ 46,135 $ 66,165
================ ================
</TABLE>
<PAGE> 5
PARADIGM GEOPHYSICAL LTD. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
- --------------------------------------------------------------------------------
U.S. DOLLARS IN THOUSANDS
<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------------------------
1998 1999
---------------- ----------------
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
<S> <C> <C>
Short-term bank debt $ 1,778 $ 2,000
Current maturities of long-term bank loans 450 2,611
Current maturities of capital lease obligations - 344
Trade payables 3,024 2,774
Other payables and accrued expenses 7,811 8,792
Deferred revenues 3,674 6,539
---------------- ----------------
Total current liabilities 16,737 23,060
---------------- ----------------
LONG TERM LIABILITIES:
Long-term bank loans 39 3,891
Lease obligations 959 1,651
Accrued severance pay 1,151 1,650
Deferred tax liability 552 445
---------------- ----------------
Total long-term liabilities 2,701 7,637
---------------- ----------------
SHAREHOLDERS' EQUITY:
Ordinary shares:
Authorized - 20,000,000 shares of NIS 0.5 par value at
December 31, 1998 and at December 31, 1999
Issued and outstanding - 10,514,484 shares at
December 31, 1998 and 13,026,336 shares at
December 31, 1999 1,758 2,064
Additional paid-in capital 39,236 51,903
Accumulated other comprehensive loss (742) (1,166)
Accumulated deficit (13,555) (17,333)
---------------- ----------------
Total shareholders' equity 26,697 35,468
---------------- ----------------
$ 46,135 $ 66,165
================ ================
</TABLE>
<PAGE> 6
PARADIGM GEOPHYSICAL LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
- --------------------------------------------------------------------------------
U.S. DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS
<TABLE>
<CAPTION>
THREE MONTHS ENDED DECEMBER 31,
-------------------------------------
1998 1999
---------------- ----------------
Revenues:
<S> <C> <C>
Products 9,720 13,496
Services 1,990 2,947
---------------- ----------------
11,710 16,443
---------------- ----------------
Operating expenses:
Cost of revenues 2,622 4,628
Research and development 1,927 2,405
Selling, general and administrative 4,060 7,162
Depreciation 724 1,037
Amortization 733 785
---------------- ----------------
Total operating expenses 10,066 16,017
---------------- ----------------
Operating income (loss) 1,644 426
Financial expenses, net 74 151
---------------- ----------------
Income (loss) before income taxes 1,718 275
Income taxes 146 -
---------------- ----------------
Net income (loss) 1,572 275
================ ================
Basic income (loss) per share $ 0.15 $ 0.02
================ ================
Number of shares used in computing
basic income (loss) per share 10,514 13,026
================ ================
Diluted income (loss) per share $ 0.15 $ 0.02
================ ================
Number of shares used in computing
diluted income (loss) per share 10,607 13,026
================ ================
</TABLE>
<PAGE> 7
PARADIGM GEOPHYSICAL LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
- --------------------------------------------------------------------------------
U.S. DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------------------------------
1997 1998 1999
---------------- ---------------- ----------------
Revenues:
<S> <C> <C> <C>
Products $ 19,979 $ 38,074 $ 43,023
Services 4,886 7,288 11,483
---------------- ---------------- ----------------
24,865 45,362 54,506
---------------- ---------------- ----------------
Operating expenses:
Cost of revenues 6,919 11,666 18,222
Research and development 4,728 7,660 9,306
Selling, general and administrative 9,744 15,822 20,638
Depreciation 2,012 2,298 3,865
Amortization 1,185 2,347 3,064
Non recurring expenses 10,676 - 2,705
---------------- ---------------- ----------------
Total operating expenses 35,264 39,793 57,800
---------------- ---------------- ----------------
Operating income (loss) (10,399) 5,569 (3,294)
Financial expenses, net (446) (661) (484)
---------------- ---------------- ----------------
Income (loss) before income taxes (10,845) 4,908 (3,778)
Income taxes - 356 -
---------------- ---------------- ----------------
Net income (loss) $ (10,845) $ 4,552 $ (3,778)
================ ================ ================
Basic income (loss) per share $ (4.66) $ 0.66 $ (0.31)
================ ================ ================
Number of shares used in computing
basic income (loss) per share 2,328 6,850 12,205
================ ================ ================
Diluted income (loss) per share $ (4.66) $ 0.49 $ (0.31)
================ ================ ================
Number of shares used in computing
diluted income (loss) per share 2,328 9,306 12,205
================ ================ ================
</TABLE>
<PAGE> 8
PARADIGM GEOPHYSICAL LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
- --------------------------------------------------------------------------------
U.S. DOLLARS IN THOUSANDS
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------------------------------
1997 1998 1999
---------------- ---------------- ----------------
Cash flows from operating activities:
<S> <C> <C> <C>
Net income (loss) for the period $ (10,845) $ 4,552 $ (3,778)
Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities:
Depreciation and amortization 3,197 4,778 6,622
Loss on disposal of property 139 - -
Write-off of intangible assets 207 - 1,595
In process research and development write-off upon
acquisition of CogniSeis 6,577 - -
Decrease (increase) in other assets (183) - 84
Increase in trade receivables, and accrued income (5,486) (5,035) (8,866)
Decrease (increase) in other receivables and
prepaid expenses (2,742) 1,432 (98)
Decrease (increase) in deferred tax assets and
liabilities, net (363) (202) 203
Increase (decrease) in deferred revenues 1,612 (1,929) 1,004
Increase (decrease) in trade and other payables
and accrued expenses 9,374 (5,384) 1,795
Increase in accrued severance pay, net 146 15 243
Payment of operating lease obligations - - (200)
---------------- ---------------- ----------------
Net cash provided by (used in) operating activities 1,633 (1,773) (1,396)
---------------- ---------------- ----------------
Cash flows from investing activities:
Capitalization of computer software costs (649) - -
Cash received on disposal of fixed assets 171 - -
Purchase of fixed assets (2,575) (4,516) (5,540)
Investment in Geotech - - (349)
Purchase of developed technology - - (826)
Investment in CogniSeis, net of cash acquired (8,541) -
Investment in PTM, net of cash acquired - - (8,379)
---------------- ---------------- ----------------
Net cash used in investing activities (11,594) (4,516) (15,094)
---------------- ---------------- ----------------
Cash flows from financing activities:
Amortization of debt issuance costs from warrants issued 125 475 -
Issuance of share capital, exercise of warrants and exercise
of options - 21,160 12,973
Deferred offering expenses (759) - -
Proceeds from long-term loans 1,089 - 6,500
Proceeds from bridge loans 12,000 - -
Repayment of bridge loan - (12,000) -
Repayment of note payable - (8,457) -
Repayment of long-term loans (883) (571) (427)
Short-term bank debt, net (495) 1,067 222
Payments on capital lease obligations - - (200)
---------------- ---------------- ----------------
Net cash provided by financing activities 11,077 1,674 19,068
---------------- ---------------- ----------------
Effect of exchange rate changes on cash and cash equivalents - (151) (584)
---------------- ---------------- ----------------
Increase (decrease) in cash and cash equivalents 1,116 (4,766) 1,914
Cash and cash equivalents at the beginning of the year 7,113 8,229 3,463
---------------- ---------------- ----------------
Cash and cash equivalents at the end of the year $ 8,229 $ 3,463 $ 5,457
================ ================ ================
</TABLE>
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