Press Release: Formula Systems Reports Third Quarter and Nine-Months Period Ended September 30, 2025 Financial Results

Dow Jones
Nov 20, 2025

OR YEHUDA, Israel, Nov. 20, 2025 (GLOBE NEWSWIRE) -- Formula Systems (1985) Ltd. (Nasdaq and TASE: FORTY) ("Formula Systems," or the "Company"), a global information technology group engaged, through its subsidiaries and affiliates, in providing software consulting services and computer-based business solutions and developing proprietary software products, today announced its third quarter and nine-months period ended September 30, 2025 results of operations.

Financial Highlights for the Quarter Ended September 30, 2025

   -- On August 13, 2025, Sapiens International Corporation N.V, (hereafter 
      "Sapiens") announced that it has entered into a definitive agreement to 
      be acquired by Advent, a leading global private equity investor, for 
      $43.50 per common share, in an all-cash transaction. Under the terms of 
      the agreement, the Company will continue to retain significant minority 
      ownership in Sapiens, which under the new structure will translate into 
      an approximately 18% ownership stake. Retaining this meaningful minority 
      position reflects the Company's continued conviction in Sapiens' 
      long-term strategy, its talented team, and the exciting opportunities 
      ahead in partnership with Advent to accelerate the transition to AI and 
      SaaS, delivering the next generation of insurance solutions for Sapiens 
      customers. On November 19, 2025, Sapiens held an extraordinary general 
      meeting of shareholders at which all proposals relating to the definitive 
      agreement were approved. The transaction is expected to close during 2025 
      fourth quarter or during the first quarter of 2026, subject to the 
      satisfaction of customary closing conditions and receipt of regulatory 
      approvals. Following the signing of the definitive agreement by Sapiens' 
      to be acquired by Advent and its approval by Sapiens' shareholders, the 
      consolidated results of Sapiens are reported separately as discontinued 
      operations in our third quarter financial statements. 
 
   -- Revenues for the third quarter ended September 30, 2025, increased by 
      approximately 23.6% year over year, to approximately $696.6 million, 
      compared to approximately $563.6 million in the same period last year. 
 
   -- Operating income for the third quarter ended September 30, 2025, 
      increased by approximately 10.8% year over year, to approximately $54.6 
      million, compared to approximately $49.2 million in the same period last 
      year. Operating income for the third quarter ended September 30, 2024 
      included a capital gain in an amount of $6.5 million, realized from the 
      initial public offering of our affiliate, TSG IT Advanced Systems Ltd, on 
      the Tel-Aviv stock exchange. This gain reflected the appreciation in 
      value of our investment in TSG IT Advanced Systems Ltd and was recorded 
      under "Other income, net" in our consolidated financial statements. 
      Excluding the capital gain recorded with respect to TSG IT Advanced 
      Systems' initial public offering, operating income for the third quarter 
      ended September 30, 2025 would have increased by approximately 27.7% 
      compared to the same period last year. 
 
   -- Net income from continued operation attributable to Formula Systems' 
      shareholders for the third quarter ended September 30, 2025, decreased by 
      approximately 26.4% year over year, to approximately $11.6 million, or 
      $0.73 per fully diluted share, compared to $15.8 million, or $1.00 per 
      fully diluted share, in the same period last year. Excluding the impact 
      of the capital gain recorded with respect to TSG IT Advanced Systems 
      initial public offering, net income from continued operation attributable 
      to Formula Systems' shareholders for the third quarter ended September 
      30, 2025, would have increased by approximately 25.2% compared to the 
      same period last year. 
 
   -- Net income attributable to Formula Systems' shareholders for the third 
      quarter ended September 30, 2025, decreased by approximately 26.6% year 
      over year, to approximately $17.3 million, or $1.08 per fully diluted 
      share, compared to $23.6 million, or $1.51 per fully diluted share, in 
      the same period last year. Excluding the impact of the capital gain 
      recorded with respect to TSG IT Advanced Systems initial public offering, 
      net income attributable to Formula Systems' shareholders for the third 
      quarter ended September 30, 2025 would have increased by approximately 
      1.2% compared to the same period last year. 

Financial Highlights for the Nine-Months Period Ended September 30, 2025

   -- Revenues for the nine-months period ended September 30, 2025, increased 
      by approximately 15.6% to approximately $1.92 billion, compared to 
      approximately $1.66 billion in the same period last year. 
 
   -- Operating income for the nine-months period ended September 30, 2025, 
      increased by approximately 14.4% to approximately $154.8 million, 
      compared to approximately $135.3 million in the same period last year. 
      Excluding the capital gain recorded with respect to TSG IT Advanced 
      Systems initial public offering, operating income for the nine-months 
      period ended September 30, 2025, would have increased by approximately 
      20.2% compared to the same period last year. 
 
   -- Net income from continued operation attributable to Formula Systems' 
      shareholders for the nine-months period ended September 30, 2025, 
      decreased by approximately 12.8% year over year, to approximately $32.2 
      million, or $2.02 per fully diluted share, compared to approximately 
      $36.9 million, or $2.36 per fully diluted share, in the same period last 
      year. Excluding the impact of the capital gain recorded with respect to 
      TSG IT Advanced Systems initial public offering, net income from 
      continued operation attributable to Formula Systems' shareholders for the 
      nine-months period ended September 30, 2025, would have increased by 
      approximately 5.9% compared to the same period last year. 
 
   -- Net income attributable to Formula Systems' shareholders for the 
      nine-months period ended September 30, 2025, decreased by approximately 
      13.3% year over year, to approximately $51.7 million, or $3.24 per fully 
      diluted share, compared to approximately $59.6 million, or $3.81 per 
      fully diluted share, in the same period last year. Excluding the impact 
      of the capital gain recorded with respect to TSG IT Advanced Systems 
      initial public offering, net income attributable to Formula Systems' 
      shareholders for the nine-months period ended September 30, 2025, would 
      have decreased by approximately 2.7% compared to the same period last 
      year. 
 
   -- As of September 30, 2025, Formula Systems held 48.12%, 43.42%, 46.71%, 
      69.1%, 42.32%, 90.1%, 80%, 100%, 100% and 51% of the outstanding ordinary 
      shares of Matrix IT Ltd., Sapiens International Corporation N.V., Magic 
      Software Enterprises Ltd., Michpal Technologies Ltd., TSG IT Advanced 
      Systems Ltd., Insync Staffing Solutions, Inc., Ofek Aerial Photography 
      Ltd., ZAP Group Ltd., Shamrad Electronics (1997) Ltd., and Hashahar 
      Telecom and Electricity Ltd., respectively. 
 
   -- Consolidated cash and cash equivalents and short-term bank deposits 
      totaled approximately $432.1 million as of September 30, 2025, compared 
      to approximately $563.2 million as of December 31, 2024. 
 
   -- Total equity as of September 30, 2025, was approximately $1.58 billion 
      (representing 47.4% of the total consolidated statements of financial 
      position), compared to approximately $1.39 billion (representing 46.1% of 
      the total consolidated statements of financial position) as of December 
      31, 2024. 

Declaration of Dividend for the Third Quarter of 2025

   -- Based on the Company's results, the Company's board of directors approved 
      the distribution of a cash dividend in an amount of NIS 1.64 per share 
      (approximately $0.50 per share) and in an aggregate amount of 
      approximately NIS 25.2 million (approximately $7.7 million). 
 
   -- The dividend is payable on January 13, 2026, to all of the Company's 
      shareholders of record at the close of trading on the Nasdaq Global 
      Select Market (or the Tel-Aviv Stock Exchange, as appropriate) on 
      December 30, 2025. The dividend will be paid in New Israeli Shekels with 
      respect to the Company's ordinary shares traded on the Tel Aviv Stock 
      Exchange and American Depositary Receipts traded on the Nasdaq Global 
      Select Market. 

In accordance with Israeli tax law, the dividend is subject to withholding tax at source at the rate of 30% (if the recipient of the dividend is at the time of distribution or was at any time during the preceding 12-month period the holder of 10% or more of the Company's share capital) or 25% (for all other dividend recipients) of the dividend amount payable to each shareholder of record, subject to applicable exemptions.

Debentures Covenants

As of September 30, 2025, Formula Systems was in compliance with all of its financial covenants under the debenture series issued by it, based on the following achievements:

Covenant 1

   -- Target equity attributable to Formula Systems' shareholders (excluding 
      non-controlling interests): required to be above $325 million. 
 
   -- Actual equity attributable to Formula Systems' shareholders as of 
      September 30, 2025 was $777.7 million. 

Covenant 2

   -- Target ratio of net financial indebtedness to net capitalization (in each 
      case, as defined under the indenture for Formula Systems' Series C and D 
      Secured Debentures): required to be below 65%. 
 
   -- Actual ratio of net financial indebtedness to net capitalization, as of 
      September 30, 2025, was 6.34%. 

Covenant 3

   -- Target ratio of net financial indebtedness to EBITDA (based on the 
      accumulated calculation for the four most recent quarters): required to 
      be below 5. 
 
   -- Actual ratio of net financial indebtedness to EBITDA as of September 30, 
      2025 was 0.13. 

Comments of Management

Commenting on the results, Guy Bernstein, CEO of Formula Systems, said: "We are very pleased to continue our strong momentum delivering solid and consistent results this quarter. Our performance underscores our sustained commitment to fostering durable growth and operational excellence across all major parts of our business lines. We take pride in our ongoing recognition as industry leaders, as we broaden and advance our capabilities in rapidly evolving technologies, including cloud, cybersecurity, digital solutions, data, DevOps and AI. These technologies enable us to provide significant value to our customers by supporting them in optimizing, accelerating and scaling their operations."

"Matrix reported its best third quarter in history with record-breaking results recorded across all its key financial indices: revenues, gross profit, operating income, net income and EBITDA. Matrix revenues for the third quarter grew by approximately 15.7% year over year, when measured based on New Israeli Shekel, reaching an all-time third quarter high of NIS 1.64 billion (approximately $488.0 million). Operating income for the third quarter increased by 21.5%, year over year, when measured based on New Israeli Shekel, reaching an all-time third quarter high of NIS 131.5 million (approximately $39.1 million). Matrix's leading position, particularly in high-demand technologies and solutions, its broad range of technological services and solutions, its wide sectoral diversification, and its wide U.S. operations all enable Matrix to maintain its vitality, value, and leadership in the industry for its clients, partners, and investors. These strengths allow Matrix to continue demonstrating growth even during challenging political and security periods, including the mobilization of hundreds of Matrix employees to reserve duty."

"Magic Software reported another strong quarter of growth and resilience, delivering record breaking third quarter and nine-months period performance in key financial indices, achieving all-time highs in revenues, gross profit and operating income, while continuing to strengthen its operational foundations and expand its strategic footprint in key markets, including the United States, where momentum remains robust. Magic Software results of operations demonstrate its strong position in the IT market along with the sustained demand for its digital, AI-driven and cloud transformation solutions, combined with disciplined execution across the organization. Magic Software revised its full-year 2025 revenue guidance, increasing the previous estimated range of $600 million to $610 million to a revised range of $610 million to $620 million. This updated guidance reflects Magic Software's sustained operational momentum and favorable outlook for the fourth quarter of the fiscal year, representing an anticipated annual revenue growth rate of approximately 10.4% to 12.2%. We believe in Magic Software's ability to sustain momentum and drive long-term profitability, delivering lasting value to its shareholders."

Matrix IT and Magic Software are now advancing into the final phase of completing the merger of Magic Software into Matrix IT, an undertaking that represents the largest merger ever executed in the Israeli IT sector, subject to receipt of all required regulatory approvals, including approval at the special general meetings of shareholders of each of the companies, both scheduled for December. This transaction constitutes for both companies a pivotal strategic milestone. The merger is expected to significantly enhance the combined entity's scale, capabilities, and global positioning, creating one of the largest publicly traded IT services companies worldwide. Based on current share prices of both companies. the combined entity is projected to exceed a valuation of NIS 11 billion (approximately $3.4 billion) and will benefit from an expanded international footprint, with particular strengthening in its core target market in the United States.

"Michpal Technologies' successfully concluded on September 21, 2025 its initial public offering of 4,910,000 ordinary shares on the Tel-Aviv stock exchange at an initial public offering price of NIS 61.1 per share (approximately $18.6 per share) raising approximately NIS 288.7 million, net of issuance expenses (approximately $87.3 million). Michpal Technologies together with its subsidiaries (collectively, the "Michpal Group") engage in the fields of payroll, recruitment, time and attendance, pension administration, and human resources, as well as in the provision of software solutions for business and financial processes. As part of its activities, the Michpal Group develops and offers a broad suite of services, software products and proprietary technological solutions covering the full spectrum of human capital management within organizations. These offerings integrate cloud-based, artificial intelligence and automation technologies, alongside advanced solutions for the management of complex (partly digital) business processes across multiple use cases. Michpal Technologies concluded the third quarter of 2025 with revenues of NIS 49.8 million (approximately $14.8 million), growing 24.1% year over year when measured based on New Israeli Shekel.

"TSG concluded the third quarter of 2025 with strong results, demonstrating significant growth in revenue and profits. Revenues for the third quarter of 2025 increased by 30.4% year over year, when measured based on New Israeli Shekel, to NIS 109.8 million (approximately $32.6 million). Operating income for the third quarter, when measured based in New Israeli Shekel, increased by 50.9% year-over-year, when measured based on New Israeli Shekel, to NIS 10.1 million (approximately $3.0 million), compared to NIS 6.7 million (approximately $1.8 million) in the same period last year. TSG's continued growth is driven by a combination of business combination and organic expansion, mainly in its defense-sector activities, including, among other things, the initial delivery of licenses to the United States Army pursuant to a strategic agreement with an American company. Concurrently, TSG is experiencing growing demand from local municipalities and public-sector entities."

Stand-Alone Financial Measures

This press release presents, further below, certain stand-alone financial measures to reflect Formula Systems' stand-alone financial position in reference to its assets and liabilities as the parent company of its group of companies. These financial measures are prepared consistently with the accounting principles applied in the consolidated financial statements of the group. Such measures include investments in subsidiaries and a jointly controlled entity measured at cost adjusted by Formula Systems' share in the investees' accumulated undistributed earnings and other comprehensive income or loss.

Formula Systems believes that these financial measures provide useful information to management and investors regarding Formula Systems' stand-alone financial position. Formula Systems' management uses these measures to compare the Company's performance in the current period to that of prior periods for trend analysis. These measures are also used in financial reports prepared for management and in quarterly financial reports presented to the Company's board of directors. The Company believes that the use of these stand-alone financial measures provides an additional tool for investors to use in evaluating Formula Systems' financial position.

Management of the Company does not consider these stand-alone measures in isolation or as an alternative to financial measures determined in accordance with GAAP. Formula Systems urges investors to review the consolidated financial statements which it includes in press releases announcing quarterly financial results, including this press release, and not to rely on any single financial measure to evaluate the Company's business or financial position.

About Formula Systems

Formula Systems, whose ordinary shares are traded on the Tel-Aviv Stock Exchange and ADSs are traded on the Nasdaq Global Select Market, is a global information technology holding company engaged, through its subsidiaries and affiliates, in providing software consulting services and computer-based business solutions and developing proprietary software products.

For more information, visit www.formulasystems.com.

Press Contact:

Formula Systems (1985) Ltd.

+972-3-5389487

ir@formula.co.il

Forward Looking Statements

Certain matters discussed in this press release that are incorporated herein and therein by reference are forward-looking statements within the meaning of Section 27A of the Securities Act, Section 21E of the Exchange Act and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, that are based on Formula Systems' ("we," "us" or "our") beliefs, assumptions and expectations, as well as information currently available to us. Such forward-looking statements may be identified by the use of the words "anticipate," "believe," "estimate," "expect," "may," "will," "plan" and similar expressions. Such statements reflect our current views with respect to future events and are subject to certain risks and uncertainties. There are important factors that could cause our actual results, levels of activity, performance or achievements to differ materially from the results, levels of activity, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to: adverse macro-economic trends and their duration, including persistent inflation, relatively high interest rates, and supply chain delays, which trends may last for a significant period

and materially adversely affect our results of operations; the degree of our success in our plans to leverage our global footprint to grow our sales; the degree of our success in integrating the companies that we have acquired through the implementation of our M&A growth strategy; the degree of our success in developing and deploying new technologies for software solutions that address the updated needs of our customers and serve as the basis for our revenues; the lengthy development cycles for our solutions, which may frustrate our ability to realize revenues and/or profits from our potential new solutions; our lengthy and complex sales cycles, which do not always result in the realization of revenues; the degree of our success in retaining our existing customers or competing effectively for greater market share; difficulties in successfully planning and managing changes in the size of our operations; the frequency of the long-term, large, complex projects that we perform that involve complex estimates of project costs and profit margins, which sometimes change mid-stream; the challenges and potential liability that heightened privacy laws and regulations pose to our business; occasional disputes with clients, which may adversely impact our results of operations and our reputation; various intellectual property issues related to our business; potential unanticipated product vulnerabilities or cybersecurity breaches of our or our customers' systems particularly in the current hybrid office/work-from-home environment; risks related to industries, such as the insurance, healthcare, defense and the telecom, in which certain of our clients operate; risks posed by our global sales and operations, such as changes in regulatory requirements, supply chain disruptions, geopolitical, wide-spread viruses and epidemics or fluctuations in currency exchange rates; and risks related to our and our subsidiaries' principal location in Israel.

While we believe such forward-looking statements are based on reasonable assumptions, should one or more of the underlying assumptions prove incorrect, or these risks or uncertainties materialize, our actual results may differ materially from those expressed or implied by the forward-looking statements. Please read the risks discussed under the heading "Item 3.D Risk Factors" in our most recent Annual Report on Form 20-F for the year ended December 31, 2024, filed with the U.S. Securities and Exchange Commission on May 14, 2025, in order to review conditions that we believe could cause actual results to differ materially from those contemplated by the forward-looking statements. You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that future results, levels of activity, performance, events and circumstances reflected in the forward-looking statements will be achieved or will occur. Except as required by law, we undertake no obligation to update publicly any forward-looking statements for any reason, or to conform those statements to actual results or to changes in our expectations.

 
 FORMULA SYSTEMS 
 (1985) LTD. 
 CONSOLIDATED CONDENSED STATEMENTS 
 OF PROFIT OR LOSS 
 U.S. dollars in 
 thousands (except per 
 share data) 
                          Three months ended    Nine months ended 
                            September 30,           September 30, 
                         2025(*)     2024(*)     2025(*)     2024(*) 
                              Unaudited               Unaudited 
 Revenues                  696,638     563,631   1,918,748   1,660,220 
 Cost of revenues          560,930     453,652   1,539,697   1,335,746 
 
 Gross profit              135,708     109,979     379,051     324,474 
 Research and 
  development costs, 
  net                        4,936       4,528      14,736      11,847 
 Selling, marketing 
  and general and 
  administrative 
  expenses                  76,218      63,432     209,531     184,559 
 Other income, net               -       7,207           -       7,207 
 Operating income           54,554      49,226     154,784     135,275 
 
 Financial expenses, 
  net                        8,852       6,327      26,451      17,132 
 
 Income before taxes 
  on income                 45,702      42,899     128,333     118,143 
 Taxes on income            11,940       9,598      33,750      28,017 
 
 Income after taxes         33,762      33,301      94,583      90,126 
 Share of profit of 
  companies accounted 
  for at equity, net           928         324       1,967         293 
 
 Net income from 
  continued 
  operations                34,690      33,625      96,550      90,419 
 Net income from 
  discontinued 
  operations                13,269      18,059      45,237      52,318 
 Net income                 47,959      51,684     141,787     142,737 
 Net income 
  attributable to 
  non-controlling 
  interests from 
  continued 
  operations                23,096      17,865      64,384      53,532 
 Net income 
  attributable to 
  non-controlling 
  interests from 
  discontinued 
  operations                 7,535      10,201      25,706      29,589 
 Net income 
  attributable to 
  non-controlling 
  interest                  30,631      28,066      90,090      83,121 
 
 Net income 
  attributable to 
  Formula's 
  shareholders from 
  continued 
  operations                11,594      15,760      32,166      36,887 
 Net income 
  attributable to 
  Formula's 
  shareholders from 
  discontinued 
  operations                 5,734       7,858      19,531      22,729 
 Net income 
  attributable to 
  Formula's 
  shareholders              17,328      23,618      51,697      59,616 
 
 Earnings per share 
  from continued 
  operations (basic)          0.76        1.03        2.10        2.42 
 Earnings per share 
  from discontinued 
  operations (basic)          0.37        0.52        1.28        1.49 
 Earnings per share 
  (basic)                     1.13        1.55        3.38        3.91 
 
 Earnings per share 
  from continued 
  operations 
  (diluted)                   0.73        1.00        2.02        2.36 
 Earnings per share 
  from discontinued 
  operations 
  (diluted)                   0.35        0.51        1.22        1.45 
 Earnings per share 
  (diluted)                   1.08        1.51        3.24        3.81 
 
 Number of shares used 
  in computing 
  earnings per share 
  (basic)               15,309,139  15,305,453  15,308,389  15,304,360 
 Number of shares used 
  in computing 
  earnings per share 
  (diluted)             15,804,200  15,650,374  15,765,582  15,616,220 
 
 (*) Following the signing of a definitive agreement 
  by Sapiens' to be acquired by Advent and its approval 
  by Sapiens' shareholders, 
     the consolidated results of Sapiens are reported separately 
      as discontinued operations in our third quarter financial 
      statements. 
 
 
 
FORMULA SYSTEMS (1985) LTD. 
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION 
U.S. dollars in thousands 
                                               September 30,  December 31, 
                                                  2025(*)         2024 
                                               -------------  ------------ 
                                                (Unaudited) 
                                               ------------- 
ASSETS 
CURRENT ASSETS: 
 Cash and cash equivalents                           431,312       507,799 
 Short-term deposits                                     770        55,401 
 Trade receivables, net                              784,099       803,235 
 Prepaid expenses and other accounts 
  receivable                                          80,562        89,882 
 Inventories                                          26,271        30,728 
 Assets in disposal groups classified as held 
  for sale                                           737,845             - 
Total current assets                               2,060,859     1,487,045 
---------------------------------------------  -------------  ------------ 
 
NON-CURRENT ASSETS: 
 Long-term investments and receivables                52,505        54,629 
 Deferred taxes                                       26,549        33,850 
 Investments in companies accounted for at 
  equity                                              37,085        39,196 
 Property, plant and equipment, net                   45,891        51,795 
 Right-of-use assets                                 147,796       156,225 
 Intangible assets, net and goodwill                 956,582     1,192,156 
Total non-current assets                           1,266,408     1,527,851 
---------------------------------------------  -------------  ------------ 
 
Total assets                                       3,327,267     3,014,896 
---------------------------------------------  =============  ============ 
 
LIABILITIES AND EQUITY 
CURRENT LIABILITIES: 
 Loans from banks and others                         173,938       141,782 
 Debentures                                           75,305        86,782 
 Current maturities of lease liabilities              41,516        45,240 
 Trade payables                                      285,476       296,211 
 Deferred revenues                                   146,576       173,959 
 Employees and payroll accrual                       203,815       234,845 
 Other accounts payable                               60,547        98,046 
 Dividend payable                                      7,838             - 
 Liabilities in respect of business 
  combinations                                         7,504         9,191 
 Put options of non-controlling interests             61,403        52,420 
 Liabilities directly associated with assets 
 in disposal 
 groups classified as held for sale                  226,368             - 
                                               -------------  ------------ 
Total current liabilities                          1,290,286     1,138,476 
---------------------------------------------  -------------  ------------ 
 
LONG-TERM LIABILITIES: 
 Loans from banks and others                          72,038        62,733 
 Debentures                                          163,446       188,090 
 Lease liabilities                                   112,454       119,586 
 Other long-term liabilities                              81        11,708 
 Deferred taxes                                       39,722        42,894 
 Deferred revenues                                    17,089        12,522 
 Liabilities in respect of business 
  combinations                                         9,503         8,751 
 Put options of non-controlling interests             39,566        30,553 
 Employee benefit liabilities                          5,714        10,238 
Total long-term liabilities                          459,613       487,075 
---------------------------------------------  -------------  ------------ 
 
EQUITY 
 Total equity attributable to Formula Systems 
  (1985) Ltd. shareholders                           777,693       679,338 
 Non-controlling interests                           799,675       710,007 
                                               -------------  ------------ 
Total equity                                       1,577,368     1,389,345 
---------------------------------------------  -------------  ------------ 
 
Total liabilities and equity                       3,327,267     3,014,896 
---------------------------------------------  =============  ============ 
 
 (*) Following the signing of a definitive agreement 
  by Sapiens' to be acquired by Advent and its approval 
  by Sapiens' shareholders, 
     the consolidated results of Sapiens are reported separately 
      as discontinued operations in our third quarter financial 
      statements. 
 
 
 
FORMULA SYSTEMS (1985) LTD. 
STAND-ALONE STATEMENTS OF FINANCIAL POSITION 
U.S. dollars in thousands 
                                               September 30,  December 31, 
                                                   2025           2024 
                                               -------------  ------------ 
                                                       (Unaudited) 
                                               --------------------------- 
ASSETS 
CURRENT ASSETS: 
 Cash and cash equivalents                            68,390        25,599 
 Dividend receivable                                  16,044        12,013 
 Sapiens International Corporation N.V. 
  classified as held for sale                        277,960             - 
 Other accounts receivable and prepaid 
  expenses                                             3,448         4,798 
Total current assets                                 365,842        42,410 
---------------------------------------------  -------------  ------------ 
 
NON-CURRENT ASSETS: 
      Investment in subsidiaries and a 
      jointly controlled entity (*) 
      --------------------------------------- 
 Matrix IT Ltd.                                      183,429       162,133 
 Sapiens International Corporation N.V.                    -       264,349 
 Magic Software Enterprises Ltd.                     133,247       133,786 
 TSG                                                  23,000        20,453 
 Michpal Group                                       112,605        69,127 
 ZAP                                                  55,834        55,392 
 Other                                                48,528        47,722 
                                               -------------  ------------ 
 Total investment in subsidiaries and a 
  jointly controlled entity                          556,643       752,962 
 
 Other investments and Long term receivables          21,683        24,860 
 Property, plants and equipment, net                      14            10 
                                               -------------  ------------ 
Total non-current assets                             578,340       777,832 
---------------------------------------------  -------------  ------------ 
 
Total assets                                         944,182       820,242 
---------------------------------------------  =============  ============ 
 
LIABILITIES AND EQUITY 
CURRENT LIABILITIES: 
 Loans from banks and others                           2,527         2,294 
 Debentures                                           51,795        45,807 
 Trade payables                                        1,216         1,146 
 Other accounts payable                                5,860         2,109 
 Put options of non-controlling interests              1,181         1,005 
 Dividends payable                                     7,838             - 
Total current liabilities                             70,417        52,361 
---------------------------------------------  -------------  ------------ 
 
LONG-TERM LIABILITIES: 
 Loans from banks and others                           1,470         3,047 
 Debentures                                           94,602        85,496 
Total long-term liabilities                           96,072        88,543 
---------------------------------------------  -------------  ------------ 
 
EQUITY                                               777,693       679,338 
                                               -------------  ------------ 
 
TOTAL LIABILITIES AND EQUITY                         944,182       820,242 
---------------------------------------------  =============  ============ 
 
 
(*)   The investments' carrying amounts are measured consistent 
       with the accounting principles applied in the consolidated 
       financial statements of the Group and representing 
       the investments' cost adjusted by Formula's share 
       in the investees' accumulated undistributed earnings 
       and other comprehensive income or loss. 
 

(END) Dow Jones Newswires

November 20, 2025 08:19 ET (13:19 GMT)

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