Formula Systems (1985) (FORTY) Q3 2024 earnings summary

Executive summary

• Third quarter 2024 revenues reached a record $699.9 million, up 6.9% year-over-year.

• Net income attributable to shareholders rose 51.4% year-over-year to $23.6 million, or $1.51 per diluted share.

• Nine-month revenues hit $2.07 billion, up 4.3% year-over-year; net income for nine months rose 23.4% to $59.6 million.

• Operating income for Q3 increased 21.9% year-over-year to $71.0 million, including a $6.5 million capital gain from TSG IT Advanced Systems IPO.

Financial highlights

• Q3 gross profit was $172.9 million, up from $159.6 million a year ago.

• Q3 operating income reached $71.0 million, up from $58.2 million; nine-month operating income was $198.7 million, up from $179.0 million.

• Q3 net income attributable to shareholders was $23.6 million, up from $15.6 million; EPS (diluted) was $1.51 vs. $1.00.

• Cash and equivalents plus short-term deposits totaled $510.9 million as of September 30, 2024.

• Total equity was $1.36 billion, representing 47.8% of total assets.

Outlook and guidance

• Magic Software raised its 2024 revenue guidance to $544–$550 million, reflecting continued solid momentum.

• Matrix and Michpal plan further M&A transactions in 2024 to support accelerated growth.