MIND CTI Reports Second Quarter 2007 Results

Cash Flow From Operating Activities of $1.34 Million


YOQNEAM, ISRAEL--(Marketwire - August 7, 2007) - MIND CTI Ltd. (NASDAQ: MNDO), a leading provider of convergent end-to-end billing and customer care product based solutions for tier 2 and tier 3 carriers worldwide, today announced results for the second quarter 2007.

Financial Highlights of Q2 2007

--  Revenues of $4.05 million, compared with $5.07 million in the second
    quarter of 2006.
--  Operating income was $211 thousand, or 5% of revenue, excluding
    amortization of intangible assets of $102 thousand and equity-based
    compensation expense of $67 thousand.
--  GAAP operating income was $42 thousand, or 1% of revenue.
--  Net income was $677 thousand or $0.03 per share, excluding
    amortization of intangible assets of $102 thousand and equity-based
    compensation expense of $67 thousand.
--  GAAP net income was $508 thousand, or $0.02 per share compared with
    GAAP net loss of $492 thousand or $0.02 per share in the second quarter of
    2006.
--  Cash flow from operating activities in Q2 2007 was $1.34 million.
    

Six Months Highlights

--  Revenues of $8.86 million, compared with $10.33 million in the first
    six months of 2006.
--  Net income was $2.01 million or $0.09 per share, excluding
    amortization of intangible assets of $218 thousand and equity-based
    compensation expense of $131 thousand.
--  GAAP net income was $1.66 million, or $0.08 per share compared with
    GAAP net income of $162 thousand or $0.01 per share in the first six months
    of 2006.
--  Cash flow from operating activities in first six months of 2007 was
    $2.20 million.
--  Cash position of approximately $35.5 million on June 30, 2007.
    

Monica Eisinger, Chairperson and CEO, commented: "Although in the first half of 2007 we experienced a decline in our revenues, we succeeded in managing our expenses accordingly and we generated over $2 million in cash flow from our operations. While the results reflect the effect of delayed decisions and long sales cycles, we operate in a very active market that shows continuous demand for our products and services. The strong install base and the long-term relationships with our customers continue to represent the majority of our revenue and are the basis for future revenue stream. We are pleased to announce a new win this quarter, a Pan-European IP services carrier to whom we will provide a complete customer care and billing solution. We expect to see new wins in the following quarters and we expect to increase our profitability as well."

Revenue Distribution for Q2 2007

Sales in the Americas represented 43% and sales in Europe represented 38% of total revenue. Revenue from our customer care and billing software totaled $3.13 million, while revenue from our enterprise call management software was $915 thousand. The revenue breakdown from our business lines of products was $1.13 million, or 28% from licenses, $1.74 million, or 43% from maintenance and $1.18 million, or 29% from services.

Conference Call Information

MIND will host a conference call on August 8, 2007 at 8:30 a.m., Eastern Time, to discuss the Company's second quarter 2007 results and other financial and business information. The call will be carried live on the Internet via www.fulldisclosure.com and the MIND website, www.mindcti.com. For those unable to listen to the live web cast, a replay will be available.

About MIND

MIND CTI Ltd. is a leading provider of convergent prepaid and postpaid end-to-end billing and customer care solutions for VoIP, Mobile, Wireline and Quad-play carriers worldwide. Since 1997 MIND has been a pioneer in enabling the VoIP technology for emerging and incumbent service providers. In August 2005 MIND acquired Sentori, Inc., a US based provider of customer care and billing solutions to wireless carriers and mobile virtual network operators (MVNOs). Sentori, Inc. brings over ten years of wireless experience and eight years of a wireless operational solution to carriers. A global company, MIND operates from offices in Europe, Israel and the United States, serving customers in more than 40 countries around the world. For financial information, reports and presentations, please visit the Investor Relations site: http://www.mindcti.com/ir

Cautionary Statement for Purposes of the "Safe Harbor" Provisions of the Private Securities Litigation Reform Act of 1995: All statements other than historical facts included in the foregoing press release regarding the Company's business strategy are "forward-looking statements." These statements are based on management's beliefs and assumptions and on information currently available to management. Forward-looking statements are not guarantees of future performance, and actual results may materially differ. The forward-looking statements involve risks, uncertainties, and assumptions, including the risks discussed in the Company's filings with the United States Securities Exchange Commission. The Company does not undertake to update any forward-looking information.

                             MIND C.T.I. LTD.
                  CONDENSED CONSOLIDATED BALANCE SHEETS

                                                June 30
                                        ---------------------- December 31,
                                           2007        2006        2006
                                        ----------  ----------  ----------
                                              (Unaudited)       (Audited)
                                        ----------------------  ----------
                                                U.S. $ in thousands
                                        ----------------------------------
                Assets
CURRENT ASSETS:
 Cash and cash equivalents              $   25,484  $   25,694  $   27,571
 Accounts receivable:
  Trade                                      4,672       4,882       5,385
  Other                                        368         948         231
 Deferred income taxes                         148           8         154
 Inventories                                    35          30          35
                                        ----------  ----------  ----------
    Total  current assets                   30,707      31,562      33,376
INVESTMENTS AND OTHER NON CURRENT
 ASSETS:
  Marketable debentures                     10,000                  10,000
  Long term bank deposit                                10,000
  Other                                        908         746       1,003
PROPERTY AND EQUIPMENT, net of
 accumulated depreciation                    1,393       1,910       1,558
INTANGIBLE ASSETS, net of accumulated
amortization                                   670       1,160         888
GOODWILL                                     6,966       6,966       6,966
                                        ----------  ----------  ----------
  Total assets                          $   50,644  $   52,344  $   53,791
                                        ==========  ==========  ==========
    Liabilities and shareholders equity
CURRENT LIABILITIES:
 Accounts payable and accruals:
  Trade                                 $      440  $      699  $      464
  Other                                      1,611       1,584       2,509
 Deferred revenues                           1,339       1,412       1,236
 Advances from customers                       366         342         241
                                        ----------  ----------  ----------
    Total  current liabilities               3,756       4,037       4,450
EMPLOYEE RIGHTS UPON RETIREMENT              1,466       1,397       1,482
                                        ----------  ----------  ----------
    Total  liabilities                       5,222       5,434       5,932
                                        ----------  ----------  ----------
SHAREHOLDERS' EQUITY:
 Share capital                                  54          53          54
 Additional paid-in capital                 59,638      59,510      59,547
 Capital surplus                               456         161         325
 Accumulated deficit                       (14,726)    (12,814)    (12,067)
                                        ----------  ----------  ----------
    Total  shareholders' equity             45,422      46,910      47,859
                                        ----------  ----------  ----------
 Total liabilities and shareholders'
  equity                                $   50,644  $   52,344  $   53,791
                                        ==========  ==========  ==========



                             MIND C.T.I. LTD.
              CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

                          Six months          Three months      Year ended
                         ended June 30        ended June 30    December 31,
                     --------------------  --------------------
                         2007      2006        2007      2006       2006
                     ---------- ---------  ---------- ---------  ---------
                          (Unaudited)           (Unaudited)      (Audited)
                     --------------------  --------------------  ---------
                         U.S. $ in thousands (except per share data)
                     -----------------------------------------------------

REVENUES             $    8,856 $  10,326  $    4,049 $   5,074  $  20,060
COST OF REVENUES          2,620     3,090       1,275     1,492      5,675
                     ---------- ---------  ---------- ---------  ---------
GROSS PROFIT              6,236     7,236       2,774     3,582     14,385
RESEARCH AND
 DEVELOPMENT EXPENSES     2,782     3,326       1,366     1,588      6,118
SELLING AND
 MARKETING EXPENSES       1,922     1,867         987       885      3,628
GENERAL AND
 ADMINISTRATIVE
 EXPENSES                   822       758         379       399      2,135
                     ---------- ---------  ---------- ---------  ---------
OPERATING INCOME            710     1,285          42       710      2,504
FINANCIAL INCOME
 (EXPENSES) - net           988   *(1,053)        484   *(1,178)     *(222)
                     ---------- ---------  ---------- ---------  ---------
INCOME (LOSS) BEFORE
 TAXES ON INCOME          1,698       232         526      (468)     2,282
TAXES ON INCOME              39        70          18        24      1,373
                     ---------- ---------  ---------- ---------  ---------
NET INCOME (LOSS)    $    1,659 $     162  $      508 $    (492) $     909
                     ========== =========  ========== =========  =========
EARNING (LOSS) PER
 SHARE:
  Basic and diluted  $     0.08 $    0.01  $     0.02 $   (0.02) $    0.04
                     ========== =========  ========== =========  =========
WEIGHTED AVERAGE
 NUMBER OF ORDINARY
 SHARES USED IN
 COMPUTATION OF
 EARNINGS PER
 ORDINARY SHARE -
   IN THOUSANDS:
    Basic                21,578    21,500      21,590    21,528     21,515
                     ========== =========  ========== =========  =========
    Diluted              21,591    21,565      21,606    21,577     21,546
                     ========== =========  ========== =========  =========

* Financial expenses for the 6 and 3 month periods ended June 30, 2006 and
  for the year ended December 31, 2006 include a loss from a premature
  withdrawal of long-term bank deposits in the amount of $1,330,000.




                             MIND C.T.I. LTD.
              CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                        Six months           Three months      Year ended
                        ended June 30        ended June 30     December 31,
                     --------------------  --------------------
                         2007      2006        2007      2006       2006
                     ---------  ---------  ---------  ---------  ---------
                          (Unaudited)           (Unaudited)      (Audited)
                     --------------------  --------------------  ---------
                                    U.S. $ in thousands
                     -----------------------------------------------------
CASH FLOWS FROM
 OPERATING
 ACTIVITIES:
  Net income (loss)  $   1,659  $     162  $     508  $    (492) $     909
  Adjustments to
   reconcile net
   income (loss) to
   net cash provided
   by (used in)
   operating activities:
    Depreciation and
     amortization          464        815        219        329      1,391
    Deferred income
     taxes, net             68                    66                  (293)
    Accrued severance
     pay                   (16)        94        (32)        (8)       176
    Capital loss (gain)
     on sale of property
     and equipment - net     8         (8)         2         (4)        (3)
    Employees share
     based compensation
     expenses              131        161         67         84        325
    Changes in operating
     asset and liability
     items:
      Decrease (increase)
       in accounts
       receivable:
        Trade              713     (1,493)     1,147        309     (1,996)
      Interest accrued on
       marketable
       debentures            2                   137                   (37)
        Other             (139)      (217)        26         27        537
      Increase in
       inventories                                                      (5)
      Increase (decrease)
       in accounts payable
       and accruals:
        Trade              (24)        13        (63)       (90)      (222)
        Other             (898)      (157)      (293)      (161)       768
      Increase (decrease)
       in deferred
       revenues            103       (232)      (567)      (487)      (408)
      Increase (decrease)
       in advances from
       customers, net      125       (448)       125       (233)      (549)
                     ---------  ---------  ---------  ---------  ---------
  Net cash provided
   by (used in)
   operating
   activities            2,196     (1,310)     1,342       (726)       593
                     ---------  ---------  ---------  ---------  ---------
CASH FLOWS FROM
 INVESTING ACTIVITIES:
  Purchase of property
   and equipment          (167)      (296)       (33)      (122)      (379)
  Amounts withdrawal
   (funded) in respect
   of accrued
   severance pay            33        (12)        25        (15)      (119)
  Acquisition of
   marketable
   debentures held-to-
   maturity                                                        (10,000)
  Withdrawal of
   long-term bank
   deposits                        20,000                20,000     30,000
  Proceeds from sale
   of property and
   equipment                78         36         68          7        162
                     ---------  ---------  ---------  ---------  ---------
  Net cash provided
   by (used in)
   investing
   activities              (56)    19,728         60     19,870     19,664
                     ---------  ---------  ---------  ---------  ---------
CASH FLOWS FROM FINANCING
 ACTIVITIES:
  Employee stock
   options exercised
   and paid                 91        111         10         51        149
  Dividend paid         (4,318)    (3,009)      (736)      (406)    (3,009)
                     ---------  ---------  ---------  ---------  ---------
  Net cash used
   in financing
   activities           (4,227)    (2,898)      (726)      (355)    (2,860)
                     ---------  ---------  ---------  ---------  ---------
INCREASE (DECREASE)
 IN CASH AND CASH
  EQUIVALENTS           (2,087)    15,520        676     18,789     17,397
BALANCE OF CASH AND
 CASH EQUIVALENTS AT
 BEGINNING OF PERIOD    27,571     10,174     24,808      6,905     10,174
                     ---------  ---------  ---------  ---------  ---------
BALANCE OF CASH AND
 CASH EQUIVALENTS
  AT END OF PERIOD   $  25,484  $  25,694  $  25,484  $  25,694  $  27,571
                     =========  =========  =========  =========  =========

SUPPLEMENTAL DISCLOSURE
 OF CASH FLOW AND NON
 CASH ACTIVITIES
 Cash paid during the
 year for income tax     $ 853       $ 22        $ 6       $ 12       $ 39
                     =========  =========  =========  =========  =========

Contact Information: For more information please contact: Andrea Dray MIND CTI Ltd. Tel: +972-4-993-6666

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