Q2 Revenues Increase 27% Year-over-Year Q2 Net Income $0.01 Per Share
ROSH HA'AYIN, Israel, Aug. 13, 2008 (PRIME NEWSWIRE) -- TTI Team Telecom International Ltd. (Nasdaq:TTIL) ('the Company'), a global supplier of Operations Support Systems (OSS) to communications service providers, today announced results for the second quarter ended June 30, 2008.
Total revenues for the second quarter were $14.3 million, compared with $11.3 million in the second quarter of 2007, and $13.0 million for the first quarter of 2008. Total operating expenses were $7.5 million, compared to $6.3 million in the second quarter of 2007 and $6.8 million in the first quarter of 2008. Revenues included a one-time gain of $1 million.
Operating income for the quarter was $531,000, compared with an operating income of $42,000 for the second quarter last year and operating income of $473,000 in the first quarter of 2008. Net income was $260,000, or $0.01 per basic and diluted share, compared to net income of $856,000, or $0.05 per basic share and $0.04 per diluted share in the second quarter of 2007, and net income of $873,000, or $0.05 per basic and diluted share for the first quarter of 2008.
Total Revenues for the six months ended June 30, 2008 were $27.3 million, compared to $22.0 million in the six months ended June 30, 2007. Total operating expenses for the period were $14.2 million compared to $12.1 million in the first six months of 2007.
Operating income for the six months ended June 30, 2008 was $1 million compared with an operating loss of $0.4 million in the comparable period in 2007. Net income was $1,133,000, or $0.06 per basic and diluted share, compared to net income of $814,000, or $0.04 per basic and diluted share for the first six months of 2007.
As of June 30, 2008, the Company had approximately $27 million in cash and liquid investments.
Meir Lipshes, CEO of TTI Telecom, commented, "Overall it was a successful quarter for TTI, having secured several new service agreements. This quarter we completed the implementation of two supervision systems for a large customer over environmental equipment as well as a 3G network."
Mr. Lipshes continued, saying, "We continue to see the effects of the American dollar's weakness compared to the Israeli shekel, as it is causing our operational expenses to continue to increase. Additionally, the American market's overall weakness also negatively impacts the Company's book to bill ratio."
Mr. Lipshes noted that TTI Telecom has implemented organizational changes that are companywide: "Our chief financial and chief operating officer, Eli Ofer, is leaving the Company. Mr. Shachar Ebel, the CTO of TTI Telecom, will now serve also as Chief Operating Officer, taking over the responsibility for worldwide day to day operation of the company. Mr. Asaf Shirazi, Vice President, Research and Development, will take on the responsibility for the professional services division and the Telesens subsidiary in addition to his R&D responsibilities."
Conference Call Information:
A conference call has been scheduled for 9:00 a.m. ET today, August 13, 2008, during which management will discuss the Company's performance for the quarter. To access the call, please dial (888) 694-4739 (International dialers can call (404) 665-9921) and give the access code: 59133134. The call can be accessed via live webcast through the Investor Relations section of the TTI Telecom web site, www.tti-telecom.com and at www.kcsa.com. A telephone replay of the call will also be available starting three hours after the completion of the call until 11:59 p.m. ET on September 13, 2008. To access the replay, please dial (800) 642-1687 (International dialers can call (706) 645-9291), participant code: 59133134. The webcast of the conference call will be archived on the TTI Telecom and KCSA web sites for 30 days.
About TTI Telecom:
TTI Team Telecom International Ltd. ("TTI Telecom") is a leading provider of next generation Operations Support Systems (OSS) to communications service providers worldwide. The company's Netrac portfolio delivers an automated, proactive and customer-centric approach to service assurance and network management.
Anchored by market-leading service assurance solutions -- Fault Management (FaM) and Performance Management (PMM) -- that give customers an end-to-end view of their network, TTI Telecom's Netrac enables service providers to reduce operating costs, enhance profitability and launch new, revenue-generating services more rapidly. Netrac is compatible with multiple technologies and industry standards, and is uniquely positioned to bridge legacy, next-generation, convergent, and IMS Networks. TTI Telecom's customer base consists of tier-one and tier-two service providers globally, including large incumbents in the Americas, Europe and Asia-Pacific.
Forward-looking statements in this release involve a number of risks and uncertainties including, but not limited to, product demand, pricing, market acceptance, changing economic conditions, risks in product and technology development, the effect of the Company's accounting policies as well as certain other risk factors which are detailed in the Company's SEC filings.
TTI TEAM TELECOM INTERNATIONAL LTD. STATEMENTS OF INCOME --------------------------------------------------------------------- (in thousands of U.S. dollars) Six months ended Three months ended June 30, June 30, ---------------------- ---------------------- 2007 2008 2007 2008 ---------- ---------- ---------- ---------- Revenues Product 12,351 17,428 6,570 8,966 Services 9,631 9,905 4,705 5,318 ---------- ---------- ---------- ---------- Total revenues 21,982 27,333 11,275 14,284 ---------- ---------- ---------- ---------- Cost of revenues: Product 5,925 8,238 2,918 4,417 Services 4,343 3,845 1,971 1,875 ---------- ---------- ---------- ---------- Total cost of revenues 10,268 12,083 4,889 6,292 ---------- ---------- ---------- ---------- Gross profit 11,714 15,250 6,386 7,992 ---------- ---------- ---------- ---------- Operating expenses: Research and development 4,345 5,950 2,146 2,948 Sales and marketing 3,503 4,980 1,768 2,560 General and administrative 4,241 3,316 2,430 1,953 ---------- ---------- ---------- ---------- Total operating expenses 12,089 14,246 6,344 7,461 ---------- ---------- ---------- ---------- Operating income (loss) (375) 1,004 42 531 Financial income (loss), net 1,019 383 438 (195) Other income 33 -- 33 -- ---------- ---------- ---------- ---------- Income before taxes on income 677 1,387 513 336 Taxes on income (137) 254 (343) 76 ---------- ---------- ---------- ---------- Net income 814 1,133 856 260 ========== ========== ========== ========== Net income attributed to preferred shares 126 176 133 40 ========== ========== ========== ========== Net income available to ordinary shares 688 957 723 220 ========== ========== ========== ========== Basic income per share attributable to Ordinary shareholders 0.04 0.06 0.05 0.01 ========== ========== ========== ========== Diluted income per share attributable to Ordinary shareholders 0.04 0.06 0.04 0.01 ========== ========== ========== ========== Weighted average number of shares used for computing net income per share to ordinary shareholders Basic 16,000,431 16,003,158 16,000,431 16,003,158 ========== ========== ========== ========== Diluted 16,102,663 16,003,158 16,158,882 16,003,158 ========== ========== ========== ========== TTI TEAM TELECOM INTERNATIONAL LTD. CONSOLIDATED BALANCE SHEET --------------------------------------------------------------------- (in thousands of U.S dollars) December 31, June 30, 2007 2008 ------- ------- ASSETS CURRENT ASSETS: Cash and cash equivalents 33,408 26,934 Short term deposits 98 -- Trade receivables 8,185 10,882 Unbilled receivables 3,155 4,066 Related parties 409 470 Other accounts receivable and prepaid expenses 3,192 1,935 ------- ------- Total current assets 48,447 44,287 ------- ------- LONG-TERM INVESTMENTS: Investment in affiliate 165 165 Severance pay fund 3,937 4,754 Advance on account of acquisition -- 1,000 ------- ------- Total long-term investments 4,102 5,919 ------- ------- PROPERTY AND EQUIPMENT Cost 26,612 28,772 Less - accumulated depreciation 20,567 21,113 ------- ------- Property and equipment, net 6,045 7,659 ------- ------- OTHER INTANGIBLE ASSETS, Net -- 271 ------- ------- Total assets 58,594 58,136 ======= ======= LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Trade payables 2,364 2,924 Related parties 3,932 466 Deferred revenues 4,666 4,533 Other accounts payable and accrued expenses 6,966 6,832 ------- ------- Total current liabilities 17,928 14,755 ------- ------- ACCRUED SEVERANCE PAY 5,651 6,882 ------- ------- Long term liability 1,579 1,859 ------- ------- SHAREHOLDERS' EQUITY: Share capital 2,595 2,595 Additional paid-in capital 75,038 75,110 Retained earnings (Accumulated deficit) (44,197) (43,065) ------- ------- Total shareholders' equity 33,436 34,640 ------- ------- 58,594 58,136 ======= =======