Top Image Systems Reports Profitable Third Quarter

Tel Aviv-based document capture software specialist Top Image Systems continued its trend of profitability in its recently completed third quarter. For the three months ended Sept. 30, TIS reported "Non-GAAP net income of $0.95 million or $0.09 per diluted share, compared to $0.60 million or $0.05 per diluted share (the year previous). "TIS also reported "Positive cash flow from operations of $1.10 million, compared to $0.25 million; and Adjusted EBITDA of $1.0 million compared to $0.70 million."

This is all good news for TIS, which after seven consecutive profitable quarters now has $3.65 million in the bank, a decent turnaround for a company that spent several years focused on growth, while losing money. Interestingly, the company has actually gotten smaller during its profitable run and third-quarter revenue was $5.4 million, compared to $5.9 million for the 2009 third quarter. For the year, TIS is now predicting
"revenues to be between $21.5 and $21.8 million." compared to $23.5 miillion in 2009 and $32.2 million in 2008. However, the 2008 revenue especially was inflated by lower-margin low-end software/third-party sales related to TIS's acquisition of AsiaSoft. TIS has spent the last two years divesting itself of the lower-margin stuff and re-focusing on its higher-end data capture and digital mailroom business. The result has been the increased profitability.

All this is playing out against TIS' efforts to keep its stock trading on the Nasdaq, by getting the share price over $1.00 a share for a period of consecutive days. This week, it reached $1 for the first time in a while, but had fallen somewhere in the upper $.90s as of this post. Nonetheless the stock spike and profitable quarter, in continued tough economic times would appear good signs for TIS.