SECURITIES AND
EXCHANGE COMMISSION
Washington, D.C. 20549
F O R M 6-K
REPORT OF FOREIGN
ISSUER PURSUANT TO RULE 13a-16 OR
15d-16 UNDER THE SECURITIES EXCHANGE ACT OF
1934
For the month of January, 2003
OPTIBASE LTD.
2 Gav Yam Center
7 Shenkar St
P.O.Box
, 2170
Herzliya 46120
Israel
Indicate by check mark whether the
registrant files or will file annual reports under cover of Form 20-F or Form 40-F
.
Form 20-F __X__ Form 40-F ______
Indicate by check mark whether by
furnishing the information contained in this Form, the registrant 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):____________
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EXHIBIT INDEX
| Exhibit Number |
Description of Document |
| 99.1 | Press Release reporting Fourth Quarter and Year End 2002 Results |
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Signatures
Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the registrant certifies that it meets all the requirements for filing on Form 6-K and has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Dated: February 10, 2003. | By: |
OPTIBASE Limited ________________ Zvi Halperin, President |
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| FOR: | OPTIBASE, LTD. |
| OPTIBASE | Yael Paz, Investor Relations Manager |
| CONTACT: | 011-972-9-9709-255 |
| KCSA | Jeff Corbin |
| CONTACTS: | (212) 896-1214 |
| JCORBIN@KCSA.COM |
FINAL FOR RELEASE
OPTIBASE, LTD.
ANNOUNCES FOURTH QUARTER
AND YEAR-END 2002
RESULTS
Company announces first orders
for MGW 5100;
Cash position increases
in 2002
HERZLIYA, Israel, February 10, 2002 – Optibase, Ltd. (NASDAQ: OBAS), a leader in digital streaming solutions over broadband networks, today announced fourth quarter and year- end results for the period ending December 31, 2002.
Revenues for the fourth quarter ended December 31, 2002 were $4.3 million, compared with $7.3 million for the same quarter a year ago, and compared with $4.1 million in the third quarter of 2002. Pro forma net loss for the fourth quarter, excluding the effects of various costs and charges* (“Cost and Charges”) were $(160,000), or $(0.01) per basic and fully diluted share, based on 12.3 million weighted average shares outstanding, compared with pro forma net loss of $(1.2) million or $(0.10) per basic and fully diluted share, based on 11.9 million weighted average shares outstanding for the same quarter in 2001. Sequentially, pro forma net loss, excluding the effects of the Costs and Charges, decreased approximately $795,000 from a net loss of $(955,000), or $(0.08) per basic and fully diluted share. This decrease resulted from a slight increase in revenues in addition to a significant increase in financial income of approximately $908,000, net.
Actual net loss for the fourth quarter, including the effects of the Costs and Charges was $(885,000), or $(0.07) per basic and fully diluted share, compared with a net loss of $(1.2) million or $(0.10) per basic and fully diluted share for the same quarter in 2001, and a net loss of $(2.0) million or $(0.16) in the previous quarter.
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For the year ended December 31, 2002, revenues were $20.4 million, compared with $29.4 million for the 2001 year. Pro forma net loss, excluding the effects of the Costs and Charges was $(1.7) million, or $(0.14) per basic and fully diluted share, compared with pro forma net loss of $(6.9) million or $(0.58) per basic and fully diluted share, for the year ended December 31, 2001.
Actual net loss for the year ended December 31, 2002, including the effects of the Costs and Charges was $(12.9) million, or $(1.06) per basic and fully diluted share, compared with a net loss of $(39.1) million or $(3.24) per basic and fully diluted share, for the year ended December 31, 2001.
The Costs and Charges for the fourth quarter ended December 31, 2002 totaled approximately $725,000 of which approximately $291,000 were stock option charges, $498,000 inventory write-off, $(124,000) reserves and assets adjustment, net and $60,000 equity in loss of affiliate. During the fourth quarter, due to changes in the Company’s product lines, the Company had written-of inventory items totaling approximately $498,000. In addition, the Company had reviewed its short-term accrued expenses, liabilities and tax assets and wrote off invalid amounts totaling approximately $(124,000), net.
Financial income in the fourth quarter was significantly higher than in the previous quarters, and totaled approximately 1.7 million. This income is due to the sale of corporate bonds and to interest the Company received on its investments.
As of December 31, 2002, the Company had cash, cash equivalents and other financial investments of $45.3 million, compared with $45.1 million in December 2001, and stockholders’ equity of $49.5 million.
Zvi Halperin, President and Chief Financial Officer, said, “This year has been quite challenging for Optibase, as the Company reorganized and refocused its operations. Our results this quarter are indicative of the reduced spending in general in the technology sector worldwide especially in our target markets. While operating in this difficult environment, we have been forced to take necessary action of cutting back on expenses, and at the same time focusing intensely on the growth of our core products. Alongside with our decision to cut back on expenses, we have managed to continue investing in the development and introduction of new products to the market and have met this goal with the recent launches of both MGW 2400 and MGW 5100, Windows Media and carrier grade streaming platforms.”
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“As a result of our commitment to our product lines, we are pleased to announce that we have received orders for multiple MGW 5100 units, from both the U.S and International markets. We expect to realize the remainder of the revenues from these orders – approximately $900,000 – during the first half of 2003. We believe that during the year 2003 we will see substantial deployments of video over IP services. We believe that our MGW 5100 platform will provide operators with the flexibility required to add video to their offerings at reduced capital and operating expenses.”
He continued, “Conserving our cash resources has been and will continue to be a top priority. As a result, we remain financially sound with $45.3 million in cash equivalents and investments. In the fourth quarter, we decreased our pro-forma operating expenses by more than $1.1 million compared with the fourth quarter of 2001. Looking at 2003, while working to increase revenues, we expect to further reduce our annual operating expenses by at least one million dollars.
He concluded, “Optibase continues to see the deployment of the MGW 2000 in the enterprise market. Most recently, the Rockford Public School district installed a district wide video streaming system based on Optibase’s MGW 2000 and additional similar projects are underway. Additionally, we have begun to see increased interest in VBox technology products and have successfully sold the VBox DTA cards to Nielsen Media Research. We continue to maintain our technological leadership and to expand our customer base into the video over IP market, which we believe, offers attractive opportunities for long-term growth.”
About Optibase
Optibase, Ltd. (NASDAQ: OBAS) provides high-quality, cost-effective products that enable the preparation and delivery of MPEG-based digital media over broadband networks. Optibase has created a breadth of product offerings used in applications, such as: video-on-demand; real-time video streaming; digital video archiving; distance learning; and business television. Headquartered in Israel, Optibase operates through its wholly-owned subsidiary in San Jose, California and offices in Scandinavia, Austria, France, Japan and China. Optibase products are marketed in over 40 countries through a combination of direct sales, independent distributors, system integrators and OEM partners. For further information, please visit www.optibase.com.
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Conference Call: Optibase has scheduled a conference call for 10:00 a.m. EDT, February 11, 2003 to discuss the fourth quarter and year-end results. Interested parties may access the conference call live over the Internet at www.kcsa.com.
Note
*Costs and charges defined above include amortization and impairment of goodwill and other acquisition-related charges, stock option charges, inventory write-off, reserves and assets adjustment, other nonrecurring expenses, other than temporary impairment of financial instruments, equity in loss of affiliate and cumulative effect of changes in accounting principle
This news release contains forward-looking statements concerning our marketing and operations plans. These statements involve a number of risks and uncertainties including, but not limited to, risks related to the evolving market for digital video, competition, our ability to manage growth and expansion, general economic conditions and other risk factors. For a more detailed discussion of these and other risks that may cause actual results to differ from the forward looking statements in this news release, please refer to Optibase’s most recent annual report, its Registration Statement on Form F-1 filed with the United States Securities and Exchange Commission and other filings with the SEC.
(Tables to Follow)
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Optibase Ltd.
Pro Forma Condensed
Consolidated Statement of Operations
For the Fourth Quarter
and Year Ended December 31, 2002
(Excluding various costs and charges as described below)
| Year ended | Three months ended | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| December 31 2002 $ Audited |
December 31 2001 $ Audited |
December 31 2002 $ Unaudited |
December 31 2001 $ Unaudited | |||||||||||
| Revenues | 20,424 | 29,432 | 4,306 | 7,272 | ||||||||||
| Gross profit | 11,251 | 15,634 | 2,290 | 3,895 | ||||||||||
| Operating expenses: | ||||||||||||||
| Research and development, net | 6,600 | 11,149 | 1,601 | 2,180 | ||||||||||
| Selling, general and administrative, net | 9,914 | 14,033 | 2,404 | 2,938 | ||||||||||
| Total operating expenses | 16,514 | 25,182 | 4,005 | 5,118 | ||||||||||
| Operating (loss) | (5,263 | ) | (9,548 | ) | (1,715 | ) | (1,223 | ) | ||||||
| Other income (expenses) | (14 | ) | 4 | - | - | |||||||||
| Financial income (expenses), net | 3,713 | 2,666 | 1,679 | 94 | ||||||||||
| Net (loss) before tax | (1,564 | ) | (6,878 | ) | (36 | ) | (1,129 | ) | ||||||
| Provision for tax | 124 | 67 | 124 | 67 | ||||||||||
| Net (loss) | (1,688 | ) | (6,945 | ) | (160 | ) | (1,196 | ) | ||||||
| Net loss per share: | ||||||||||||||
| Cash LPS - basic and diluted | $ | (0.14 | ) | $ | (0.58 | ) | $ | (0.01 | ) | $ | (0.10 | ) | ||
| Number of shares used in computing | ||||||||||||||
| earnings per share (basic and diluted) | 12,203 | 12,059 | 12,316 | 11,928 | ||||||||||
| Amount in thousands, except per share data | ||||||||||||||
| The above pro forma amounts have been adjusted to exclude the following items: | ||||||||||||||
| Amortization and Impairment of goodwill and | ||||||||||||||
| other acquisition-related charges | 994 | 26,088 | - | (515 | ) | |||||||||
| Stock option charges | 1,381 | 2,213 | 291 | 530 | ||||||||||
| Inventory write-off | 498 | - | 498 | - | ||||||||||
| Reserves & assets adjustment, net | (124 | ) | - | (124 | ) | - | ||||||||
| Reorganization and restructure expenses | 7,296 | 2,064 | - | - | ||||||||||
| Other than temporary impairment of | ||||||||||||||
| financial instruments | - | 1,791 | - | - | ||||||||||
| Equity in loss of affiliate | 324 | - | 60 | - | ||||||||||
| Cumulative effect of changes in accounting | ||||||||||||||
| principle | 854 | - | - | - | ||||||||||
| Net effect of pro forma adjustments | 11,223 | 32,156 | 725 | 15 | ||||||||||
(Additional Tables to Follow)
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OPTIBASE REPORTS/6
Optibase Ltd.
Condensed Consolidated
Statement of Operations
For the Fourth Quarter
and Year Ended December 31, 2002
| Year ended | Three months ended | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| December 31 2002 $ Audited |
December 31 2001 $ Audited |
December 31 2002 $ Unaudited |
December 31 2001 $ Unaudited | |||||||||||
| Revenues | 20,424 | 29,432 | 4,306 | 7,272 | ||||||||||
| Gross profit | 10,158 | 14,416 | 1,793 | 3,597 | ||||||||||
| Operating expenses: | ||||||||||||||
| Research and development, net | 8,128 | 15,562 | 1,773 | 2,962 | ||||||||||
| Selling, general and administrative, net | 10,041 | 15,770 | 2,400 | 2,992 | ||||||||||
| Reorganization and restructure expenses | 7,296 | 22,997 | - | (1,119 | ) | |||||||||
| Total operating expenses | 25,465 | 54,329 | 4,173 | 4,835 | ||||||||||
| Operating loss | (15,307 | ) | (39,913 | ) | (2,380 | ) | (1,238 | ) | ||||||
| Other (expenses) income | (14 | ) | 4 | - | - | |||||||||
| Financial income, net | 3,713 | 875 | 1,679 | 94 | ||||||||||
| Net (loss) before tax | (11,608 | ) | (39,034 | ) | (701 | ) | (1,144 | ) | ||||||
| Provision for tax | 124 | 67 | 124 | 67 | ||||||||||
| Equity in loss of affiliate | 325 | - | 60 | - | ||||||||||
| Net loss before cumulative effect of changes in | ||||||||||||||
| accounting principle | (12,057 | ) | (39,101 | ) | (885 | ) | (1,211 | ) | ||||||
| Cumulative effect of changes in accounting | ||||||||||||||
| principle | 854 | - | - | - | ||||||||||
| Net loss | (12,911 | ) | (39,101 | ) | (885 | ) | (1,211 | ) | ||||||
| Other comprehensive income | ||||||||||||||
| Unrealized holding gains (losses) on available | ||||||||||||||
| for sale securities | 389 | 802 | 1,663 | (30 | ) | |||||||||
| Total comprehensive income | (12,522 | ) | (38,299 | ) | 778 | (1,241 | ) | |||||||
| Net loss per share: | ||||||||||||||
| Before cumulative effect of changes in | ||||||||||||||
| accounting principle - basic and diluted | $ | (0.99 | ) | $ | (3.24 | ) | $ | (0.07 | ) | $ | (0.10 | ) | ||
| Cumulative effect of changes in accounting | ||||||||||||||
| principle - basic and diluted | $ | (0.07 | ) | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.00 | ) | ||
| After cumulative effect of changes in | ||||||||||||||
| accounting principle - basic and diluted | $ | (1.06 | ) | $ | (3.24 | ) | $ | (0.07 | ) | $ | (0.10 | ) | ||
| Number of shares used in computing earning per | ||||||||||||||
| share (basic and diluted) | 12,203 | 12,059 | 12,316 | 11,928 | ||||||||||
| Amount in thousands, except per share data | ||||||||||||||
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OPTIBASE REPORTS/7
Optibase Ltd.
Condensed Consolidated Balance
Sheets
| December 31 2002 $ Audited |
December 31 2001 $ Audited | |||||||
|---|---|---|---|---|---|---|---|---|
| Assets | ||||||||
| Current Assets: | ||||||||
| Cash, cash equivalents and short term investments | 45,320 | 42,989 | ||||||
| Trade receivables net of bad debts | 2,650 | 4,710 | ||||||
| Inventories | 4,237 | 5,568 | ||||||
| Other receivables and prepaid expenses | 1,577 | 1,414 | ||||||
| Total current assets | 53,784 | 54,681 | ||||||
| Long term investments in marketable securities | ||||||||
| and bank deposits | - | 2,107 | ||||||
| Other long term investments | 3,531 | 2,913 | ||||||
| 3,531 | 5,020 | |||||||
| Fixed assets, net | 2,173 | 3,044 | ||||||
| Other assets, net | 220 | 8,792 | ||||||
| Total assets | 59,708 | 71,537 | ||||||
| Liabilities and shareholders' equity | ||||||||
| Current Liabilities: | ||||||||
| Current Maturities | 129 | 207 | ||||||
| Trade payables | 2,064 | 2,204 | ||||||
| Accrued expenses and other liabilities | 6,360 | 7,144 | ||||||
| Total current liabilities | 8,553 | 9,555 | ||||||
| Accrued severance pay | 1,646 | 1,590 | ||||||
| Long-Term lease | 14 | 133 | ||||||
| Total shareholders' equity | 49,495 | 60,259 | ||||||
| Total liabilities and shareholders' equity | 59,708 | 71,537 | ||||||
| Amounts in thousands | ||||||||
# # #
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