Tuesday March 11, 3:48 am ET

Israel's Formula Q4 net loss narrows

JERUSALEM, March 11 (Reuters) - Israeli software holding company Formula Systems said on Tuesday its net loss sharply narrowed in the fourth quarter due to an acceleration of a corporate reorganisation.

Formula recorded a net loss of $3.4 million, or 34 cents per share, in the fourth quarter compared with a loss of $27.6 million, $2.96 a share, in the same period a year ago.

Revenues slipped to $73.6 million from $88.2 million in the fourth quarter of 2001. It had sales of $283.3 million in all of 2002, down from $351.4 million in 2001, and posted a net loss of $2.4 million, or 24 cents a share, in 2002 compared with a net loss of $55.3 million, or $5.93 a share, in 2001.

Formula projected its subsidiaries would generate revenues of $320 million to $350 million in 2003 "while targeting profitability and positive cash flow from operations."

During the fourth quarter, Formula merged its subsidiaries Matrix (Tel Aviv:MTRX.TA - News), New Applicom, Sintec Advanced Technologies (Tel Aviv:SYTC.TA - News) and Sivan Training and Systems (Tel Aviv:SVAN.TA - News) to create what it called Israel's largest information technology firm.

It also merged its units Crystal Systems (NasdaqNM:CRYS - News) and Liraz Systems (Tel Aviv:LRAZ.TA - News) and finalised taking a controlling interest in Sapiens (NasdaqNM:SPNS - News). Formula said it intends to consolidate Sapiens' results starting in the first quarter.