CIMATRON LIMITED

RECONCILIATION BETWEEN GAAP AND NON-GAAP INFORMATION

(US Dollars in thousands, except for per share data)

Three months ended

Nine months ended

September 30,

September 30,

2014

2013

2014

2013

GAAP

Adj.

NON-GAAP

GAAP

Adj.

NON-GAAP

GAAP

Adj.

NON-GAAP

GAAP

Adj.

NON-GAAP

Total revenue 

11,160

-

11,160

10,301

-

10,301

33,877

-

33,877

31,498

-

31,498

Total cost of revenue (1)

1,465

(147)

1,318

1,405

(147)

1,258

4,418

(441)

3,977

4,122

(441)

3,681

Gross profit

9,695

147

9,842

8,896

147

9,043

29,459

441

29,900

27,376

441

27,817

   Research and development expenses (2)

1,857

(12)

1,845

1,790

(3)

1,787

5,643

(36)

5,607

5,276

(3)

5,273

   Selling, general and administrative expenses

6,374

6,222

5,891

5,861

19,609

19,173

18,694

18,579

Non-cash amortization of acquired intangible assets

-

-

(85)

Stock-based compensation

(152)

(30)

(436)

(30)

Operating income 

1,464

311

1,775

1,215

180

1,395

4,207

913

5,120

3,406

559

3,965

   Financial income (expenses), net

(105)

-

(105)

15

-

15

(109)

-

(109)

(9)

-

(9)

   Taxes on income (3)

(393)

(75)

(468)

(265)

(34)

(299)

(1,152)

(243)

(1,395)

(834)

(125)

(959)

   Other 

4

-

4

(1)

-

(1)

(22)

-

(22)

4

-

4

Net income 

970

236

1,206

964

146

1,110

2,924

670

3,594

2,567

434

3,001

   Less: Net income attributable to the noncontrolling interest

-

-

-

(9)

-

(9)

(10)

-

(10)

(6)

-

(6)

Net income attributable to Cimatron's shareholders

$ 970

$ 236

$ 1,206

$ 955

$ 146

$ 1,101

$ 2,914

$ 670

$ 3,584

$ 2,561

$ 434

$ 2,995

Net income per share - basic and diluted 

$ 0.09

$ 0.11

$ 0.10

$ 0.11

$ 0.27

$ 0.33

$ 0.27

$ 0.32

Weighted average number of shares outstanding

Basic EPS (in thousands)

10,761

10,761

9,727

9,727

10,748

10,748

9,480

9,480

Diluted EPS (in thousands)

10,761

10,761

9,740

9,740

10,761

10,761

9,488

9,488

(1) Non-GAAP adjustment to exclude non-cash amortization of acquired intangible assets

(2) Non-GAAP adjustment to exclude stock-based compensation

(3) Non-GAAP adjustment to exclude the effect of deferred taxes and other non-current tax provisions.