FORMULA SYSTEMS (1985) LTD. Files Annual Report on Form 20-F

TL;DR

<b>FORMULA SYSTEMS (1985) LTD. has filed its annual report on Form 20-F for the fiscal year ending December 31, 2023, detailing its outstanding shares and ADS on the Nasdaq.</b>

AI Summary

FORMULA SYSTEMS (1985) LTD (FORTY) filed a Foreign Annual Report (20-F) with the SEC on May 15, 2024. FORMULA SYSTEMS (1985) LTD. filed its annual report on Form 20-F for the fiscal year ended December 31, 2023. The company is incorporated in Israel and its principal executive offices are located in Or Yehuda. As of December 31, 2023, the company had 15,332,667 ordinary shares outstanding. 141,398 ordinary shares were represented by American Depositary Shares (ADS). The trading symbol for the American Depositary Shares is FORTY on the Nasdaq Global Select Market.

Why It Matters

For investors and stakeholders tracking FORMULA SYSTEMS (1985) LTD, this filing contains several important signals. This filing provides investors with a comprehensive overview of the company's financial performance and operational status for the past fiscal year. The disclosure of outstanding shares and ADSs is crucial for understanding the company's capital structure and potential shareholder dilution.

Risk Assessment

Risk Level: low — FORMULA SYSTEMS (1985) LTD shows low risk based on this filing. The filing is a standard annual report (20-F) and does not contain any immediate red flags or significant new risks beyond typical business operations.

Analyst Insight

Review the full 20-F filing for detailed financial statements, management discussion, and risk factors to assess the company's performance and outlook.

Key Numbers

• 15,332,667 — Outstanding Ordinary Shares (As of December 31, 2023)
• 141,398 — Ordinary Shares represented by ADSs (As of December 31, 2023)
• 2023-12-31 — Fiscal Year End (Period covered by the report)

Key Players & Entities

• FORMULA SYSTEMS (1985) LTD. (company) — Registrant name
• FORTY (company) — Trading Symbol
• Nasdaq Global Select Market (company) — Exchange
• Asaf Berenstin (person) — Company Contact Person

FAQ

Industry Context

Formula Systems (1985) Ltd. operates in the computer programming services industry, as indicated by its SIC code.

Regulatory Implications

The company is filing a Form 20-F, which is an annual report required by the U.S. Securities and Exchange Commission for foreign private issuers.

What Investors Should Do

1. Analyze the detailed financial statements within the 20-F for revenue, profitability, and cash flow trends.
2. Review the Management's Discussion and Analysis section for insights into the company's strategy and outlook.
3. Examine the risk factors section for any new or evolving risks that could impact the company's operations or stock price.

Key Dates

• 2023-12-31: Fiscal Year End — End of the reporting period for the Form 20-F
• 2024-05-15: Filing Date — Date the Form 20-F was filed with the SEC

Year-Over-Year Comparison

This is the company's annual report for the fiscal year 2023, filed on Form 20-F.

Key Financial Figures

• $11.7 million — in the Nordics, for a purchase price of $11.7 million. Sapiens also signed an agreement for t

Filing Documents

• ea0205739-20f_formula.htm (20-F) — 4237KB
• ea020573901ex2-2_formula.htm (EX-2.2) — 51KB
• ea020573901ex8-1_formula.htm (EX-8.1) — 4KB
• ea020573901ex12-1_formula.htm (EX-12.1) — 9KB
• ea020573901ex12-2_formula.htm (EX-12.2) — 9KB
• ea020573901ex13-1_formula.htm (EX-13.1) — 3KB
• ea020573901ex13-2_formula.htm (EX-13.2) — 3KB
• ea020573901ex97-1_formula.htm (EX-97.1) — 27KB
• image_001.jpg (GRAPHIC) — 3KB
• fin_001.jpg (GRAPHIC) — 2KB
• ex97-1_001.jpg (GRAPHIC) — 3KB
• 0001213900-24-043687.txt (&nbsp;) — 17269KB
• forty-20231231.xsd (EX-101.SCH) — 294KB
• forty-20231231_cal.xml (EX-101.CAL) — 119KB
• forty-20231231_def.xml (EX-101.DEF) — 705KB
• forty-20231231_lab.xml (EX-101.LAB) — 1497KB
• forty-20231231_pre.xml (EX-101.PRE) — 741KB
• ea0205739-20f_formula_htm.xml (XML) — 2653KB

Item 18

Item 17 Item 18 If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in filing reflect the correction of an error to previously issued financial statements. Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive – based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to 240.10D-1(b). TABLE OF CONTENTS CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS ii CERTAIN TERMS AND CONVENTIONS vi PART I

IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS 1

OFFER STATISTICS AND EXPECTED TIMETABLE

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE 1

KEY INFORMATION

ITEM 3. KEY INFORMATION 1

INFORMATION ON THE COMPANY

ITEM 4. INFORMATION ON THE COMPANY 33

UNRESOLVED STAFF COMMENTS

ITEM 4A. UNRESOLVED STAFF COMMENTS 101

OPERATING AND FINANCIAL REVIEW AND PROSPECTS

ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS 101

DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES 144

MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS 163

FINANCIAL INFORMATION

ITEM 8. FINANCIAL INFORMATION 168

THE OFFER AND LISTING

ITEM 9. THE OFFER AND LISTING 173

ADDITIONAL INFORMATION

ITEM 10. ADDITIONAL INFORMATION 174

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 182

DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES 184 PART II

DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES 185

MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS 185

CONTROLS AND PROCEDURES

ITEM 15. CONTROLS AND PROCEDURES 185

RESERVED

ITEM 16. RESERVED 186

AUDIT COMMITTEE FINANCIAL EXPERT

ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT 186

CODE OF ETHICS

ITEM 16B. CODE OF ETHICS 186

PRINCIPAL ACCOUNTANT FEES AND SERVICES

ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES 186

EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES

ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES 187

PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS 187

CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT

ITEM 16F. CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT 187

CORPORATE GOVERNANCE

ITEM 16G. CORPORATE GOVERNANCE 187

MINE SAFETY DISCLOSURE

ITEM 16H. MINE SAFETY DISCLOSURE 188

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS 188

INSIDER TRADING POLICIES

ITEM 16J. INSIDER TRADING POLICIES 188

CYBERSECURITY

ITEM 16K. CYBERSECURITY 188 PART III

FINANCIAL STATEMENTS

ITEM 17. FINANCIAL STATEMENTS 190

FINANCIAL STATEMENTS

ITEM 18. FINANCIAL STATEMENTS 190

EXHIBITS

ITEM 19. EXHIBITS 190

SIGNATURES

SIGNATURES 191 INDEX TO FINANCIAL STATEMENTS F-1 i CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This annual report on Form 20-F contains various "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the safe harbor provisions of the U.S Private Securities Litigation Reform Act of 1995, as amended, with respect to our business, financial condition and results of operations. Such forward-looking statements reflect our current view with respect to future events and financial results. Statements which use the terms "anticipate," "believe," "expect," "plan," "intend," "estimate", "may", "will" and similar expressions are intended to identify forward looking statements. 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: 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 a portion of 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 and competing effectively for great

IDENTITY OF DIRECTORS, SENIOR MANAGEMENT

ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS Not applicable.

OFFER STATISTICS AND EXPECTED TIMETABLE

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE Not applicable.

KEY INFORMATION

ITEM 3. KEY INFORMATION A. [Reserved] B. Capitalization and Indebtedness Not applicable. C. Reasons for the Offer and Use of Proceeds Not applicable. D.

Risk Factors

Risk Factors Investing in our ordinary shares, including ordinary shares represented by ADSs, involves a high degree of risk and uncertainty. You should carefully consider the risks and uncertainties described below before investing in our ordinary shares or ADSs. Our business prospects, operating results and financial condition could be seriously harmed due to any of the following risks. Additional risks and uncertainties that we are not aware of or that we currently believe are immaterial may also adversely affect our business prospects, financial condition, and results of operations. The trading prices of our ordinary shares and ADSs could decline as a result of the realization of any of these risks, in which case you may lose part or all of your investment. 1 Risks Related to Our Business, Our Industry and Our Financial Condition The implementation of our M&A growth strategy, which requires the integration of our multiple acquired companies and their respective businesses, operations and employees with our own, and their respective businesses, operations and employees with our own, involves significant risks, and the failure to integrate successfully may adversely affect our future results. In the past decade we have completed a significant number of important acquisitions. most recently in the fourth quarter of 2023, our subsidiary Sapiens acquired NCDC S.A., a Poland-based company with a knowledge of Sapiens' products in the Nordics, for a purchase price of $11.7 million. Sapiens also signed an agreement for the purchase of the remaining outstanding shares of Sapiens Software Solutions (Decision) Ltd. from its minority shareholders, which was completed on March 27, 2024. During 2023, Sapiens also increased its holdings in Tiful Gemel (an Israeli provider of provident fund operation, pension clearinghouse services and other additional software services) and Neuralmatic to 100%, transforming those companies into wholly-owned subsidiaries of Sapiens; On J

View Full Filing

View this 20-F filing on SEC EDGAR