- Non GAAP Operating Profit of $2.2 Million
- Gross Margin Increased to 54%
- Revenues Increased to $27.8 Million
ISELIN, N.J., Aug. 9, 2010 (GLOBE NEWSWIRE) -- On Track Innovations Ltd.(OTI) (Nasdaq:OTIV), a global leader in contactless microprocessor-based smart card solutions for homeland security, payments, petroleum payments and other applications, today announced its consolidated financial results for the first half ended June 30, 2010. Following are various financial figures that compare the first half of 2010 to 2009.
-
Total revenues of $27.8 million, an 86% increase from last year.
-
Revenues from Licensing and Transaction Fees of $1.8 million, a 50% increase from last year.
-
Gross margin increased to 54% vs. 51% last year.
-
Non-GAAP operating expenses of $13 million, a 15% increase compared to $11.2 million last year. GAAP operating expenses of $15.1 million, a 10% increase compared to $13.7 million last year.
-
Non-GAAP operating profit of $2.2 million, compared to operating loss of $3.6 million last year. GAAP operating profit of $27,000, compared to operating loss of $6.1 million last year.
- Strong balance sheet with cash, cash equivalents and short-term investments of $35.8 million as of June 30, 2010.
Oded Bashan, Chairman and CEO of OTI, said: "The financial results for the first half manifest the unique story of OTI: an excellent technology company with solid financial results. We are in a unique strategic position with proven track record, demonstrated growth potential and improved financial results, we are optimistic about the future for OTI. The successful execution of large scale projects strengthens our credibility, provides more opportunities in existing markets and in new ones, and further strengthens our pipeline for the next two to three years."
Mr. Bashan continued: "Our unique position increases the comfort level generated from the improved visibility of revenues and the growing number and size of opportunities we are working on, which enables us to increase our revenue guidance. We expect to maintain a similar level of revenues in the second half of the year, and we therefore increase the earlier provided revenue guidance for 2010 by 15% to $53-$55 million. We expect to maintain the already achieved non-GAAP operating profitability for the remainder of the year."
Discontinued Operations
During the fourth calendar quarter of 2009, the Company signed an agreement for the sale of the assets of OTI's subsidiary Millennium Card's Technology Ltd ("MCT") including the machinery and inlay production IP of OTI to SMARTRAC NV. Results for the discontinued operations have been separated and are presented separately for both 2009 and 2010 statements.
Use of Non-GAAP Financial Information
In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, OTI uses non-GAAP measures of gross profit, net income and earnings per share, which are adjustments from results based on GAAP to exclude non-cash equity-based compensation charges related to employees and non employees in accordance with the requirements of Accounting Standards Codification ("ASC") Topic 718 (originally issued as SFAS No. 123(R)) and ASC Subtopic 505-50 - Equity-Based Payments to Non-Employees (formerly EITF 96-18), amortization of intangible assets and results from discontinued operations. OTI management believes the non-GAAP financial information provided in this release provides meaningful supplemental information regarding our performance and enhances the understanding of the Company's on-going economic performance. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. Management uses both GAAP and non-GAAP information in evaluating and operating the business and as such deemed it important to provide all this information to investors. Reconciliations between GAAP measures and non-GAAP are provided later in this press release.
Conference call and Webcast Information
The Company has scheduled a conference call and simultaneous Web cast for August 9, 2010, at 9:00 AM ET to discuss operating results and future outlook. To participate, call: 1-888-668-9141 (U.S. toll free), 1-800-227-297 (Israel toll free). To listen to the Web cast, use the following link: http://www.otiglobal.com/Investors_Introduction
For those unable to participate, the teleconference will be available for replay until midnight August 16th, by calling U.S: 1-888-782-4291 on the web at: http://www.otiglobal.com/Investors_Introduction
About OTI
Established in 1990, OTI (Nasdaq:OTIV) designs, develops and markets secure contactless microprocessor-based smart card technology to address the needs of a wide variety of markets. Applications developed by OTI include product solutions for petroleum payment systems, homeland security solutions, electronic passports and IDs, payments, mass transit ticketing, parking and loyalty programs. OTI has a global network of regional offices to market and support its products. The company was awarded the Frost & Sullivan 2005 and 2006 Company of the Year Award in the field of smart cards.
For more information on OTI, visit www.otiglobal.com, the content of which is not part of this press release.
The On Track Innovations Ltd. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5736
Safe Harbor for Forward-Looking Statements:
This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other Federal securities laws. Whenever we use words such as "believe," "expect," "anticipate," "intend," "plan," "estimate" or similar expressions, we are making forward-looking statements. Because such statements deal with future events and are based on OTI's current expectations, they are subject to various risks and uncertainties and actual results, performance or achievements of OTI could differ materially from those described in or implied by the statements in this press release. Forward-looking statements include statements regarding our goals, beliefs, future growth strategies, objectives, products, plans, revenues target or current expectations. For example, among our forward-looking statements are the following:
- when we say that we are in a unique strategic position with proven track record, demonstrated growth potential and improved financial results
- when we say that we are optimistic about the future for OTI
- when we say that the successful execution of large scale projects strengthens our credibility, provides more opportunities in existing markets and in new ones, and further strengthens our pipeline for the next two to three years
- when we say that our unique position increases the comfort level generated from the improved visibility of revenues and the growing number and size of opportunities we are working on, which enables us to increase our revenue guidance
- when we say that we expect to maintain a similar level of revenues in the second half of the year
- or when we say that we therefore increase the earlier provided revenue guidance for 2010 by 15% to $53-$55 million, or when we say that we expect to maintain the already achieved non-GAAP operating profitability for the remainder of the year.
Forward-looking statements could be impacted by the effects of the protracted evaluation and validation periods in the U.S. and other markets for contactless payment cards, market acceptance of new and existing products and our ability to execute production on orders, as well as other risks and uncertainties, including those discussed in the "Risk Factors" section and elsewhere in our Annual Report on Form 20-F for the year ended December 31, 2009 and in subsequent filings with the Securities and Exchange Commission. Although we believe that the expectations reflected in such forward-looking statements are based on reasonable assumptions, we can give no assurance that our expectations will be achieved. Except as otherwise required by law, OTI disclaims any intention or obligation to update or revise any forward-looking statements, which speak only as of the date hereof, whether as a result of new information, future events or circumstances or otherwise.
|
ON TRACK INNOVATIONS LTD. CONDENSED CONSOLIDATED BALANCE SHEET |
|||
| (In thousands, except share and per share data) | |||
| June 30 | December 31 | ||
| 2010 | 2009 | ||
| (Unaudited) | (Audited) | ||
| Assets | |||
| Current assets | |||
| Cash and cash equivalents | $ 28,374 | $ 26,884 | |
| Short-term investments | 7,467 | 5,086 | |
| Trade receivables (net of allowance for doubtful | |||
| accounts of $2,750 and $2,777 as of June 30, 2010 | |||
| and December 31, 2009, respectively) | 3,866 | 6,595 | |
| Other receivables and prepaid expenses | 2,066 | 2,478 | |
| Inventories | 10,188 | 6,265 | |
| Total current assets | 51,961 | 47,308 | |
| Severance pay deposits fund | 1,109 | 1,112 | |
| Property, plant and equipment, net | 13,614 | 14,366 | |
| Intangible assets, net | 1,214 | 1,532 | |
| Assets related to discontinued operation and held for sale | 3,223 | 12,358 | |
| Total Assets | $ 71,121 | $ 76,676 | |
| ON TRACK INNOVATIONS LTD. | ||
| CONDENSED CONSOLIDATED BALANCE SHEET | ||
| (In thousands, except share and per share data) | ||
| June 30 | December 31 | |
| 2010 | 2009 | |
| (Unaudited) | (Audited) | |
| Liabilities and Shareholders' Equity | ||
| Current Liabilities | ||
| Short-term bank credit and current maturities | ||
| of long-term bank loans | $ 5,799 | $ 6,255 |
| Trade payables | 10,483 | 9,649 |
| Other current liabilities | 17,534 | 16,174 |
| Total current liabilities | 33,816 | 32,078 |
| Long-Term Liabilities | ||
| Long-term loans, net of current maturities | 5,064 | 2,642 |
| Accrued severance pay | 3,417 | 3,373 |
| Deferred tax liability | 102 | 120 |
| Total long-term liabilities | 8,583 | 6,135 |
| Total Liabilities | 42,399 | 38,213 |
| Liabilities related to discontinued operation | 776 | 8,495 |
| Commitments and Contingencies | ||
| Equity | ||
| Shareholders' Equity | ||
| Ordinary shares of NIS 0.1 par value: Authorized – | ||
| 50,000,000 shares as of June 30, 2010 and December 31, 2009; | ||
| issued and outstanding 24,684,905 and 23,946,316 shares | ||
| as of June 30, 2010 and December 31, 2009, respectively | 591 | 571 |
| Additional paid-in capital | 189,357 | 187,473 |
| Accumulated other comprehensive income (loss) | (239) | 570 |
| Treasury shares at cost – 235,436 and 0 shares as of June 30, 2010 | ||
| and December 31, 2009, respectively | (497) | -- |
| Accumulated deficit | (161,200) | (158,623) |
| Shareholder's equity | 28,012 | 29,991 |
| Noncontrolling interest | (66) | (23) |
| Total Equity | 27,946 | 29,968 |
| Total Liabilities and Shareholders' Equity | $ 71,121 | $ 76,676 |
| ON TRACK INNOVATIONS LTD. | ||||
| NON GAAP CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS | ||||
| (In thousands, except share and per share data) | ||||
| Six months ended June 30 | Three months ended June 30 | |||
| 2010 | 2009 | 2010 | 2009 | |
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |
| Revenues | ||||
| Sales | $ 26,001 | $ 13,769 | $ 12,461 | $ 5,813 |
| Licensing and transaction fees | 1,799 | 1,200 | 925 | 743 |
| Total revenues | 27,800 | 14,969 | 13,386 | 6,556 |
| Cost of revenues | ||||
| Cost of sales | 12,654 | 7,280 | 6,502 | 3,180 |
| Total cost of revenues | 12,654 | 7,280 | 6,502 | 3,180 |
| Gross profit | 15,146 | 7,689 | 6,884 | 3,376 |
| Operating expenses | ||||
| Research and development | 3,200 | 2,895 | 1,666 | 1,514 |
| Selling and marketing | 6,036 | 5,170 | 2,479 | 2,238 |
| General and administrative | 3,718 | 3,181 | 1,748 | 1,545 |
| Total operating expenses | 12,954 | 11,246 | 5,893 | 5,297 |
| Operating profit (loss) | 2,192 | (3,557) | 991 | (1,921) |
| Financial expense, net | (575) | (368) | (30) | (572) |
| Profit (loss) before taxes on income | 1,617 | (3,925) | 961 | (2,493) |
| Taxes on income | (155) | 42 | (73) | 19 |
| Net profit (loss) | 1,462 | (3,883) | 888 | (2,474) |
| Net loss attributable to noncontrolling interest | 47 | 141 | 38 | 97 |
| Net profit (loss) attributable to shareholders | $ 1,509 | $ (3,742) | $ 926 | $ (2,377) |
| Basic and diluted net profit (loss) attributable | ||||
| to shareholders per ordinary share | $ 0.06 | $ (0.17) | $ 0.04 | $ (0.11) |
| Weighted average number of ordinary | ||||
| shares used in computing basic | ||||
| Net profit (loss) per ordinary share | 24,310,558 | 22,027,070 | 24,465,199 | 22,266,869 |
| Weighted average number of ordinary | ||||
| shares used in computing diluted | ||||
| Net profit (loss) per ordinary share | 26,269,717 | 22,027,070 | 26,424,358 | 22,266,869 |
Adjustments from results based on GAAP to exclude:
(a) The effect of stock-based compensation related to employees and non employees in accordance with ASC Topic 718 (originally issued as SFAS No. 123(R)) and ASC Subtopic 505-50 (formerly EITF 96-18).
(b) The effect of amortization of intangible assets.
(c) The effect of discontinued operation.
| ON TRACK INNOVATIONS LTD. | ||||
| GAAP CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS | ||||
| (In thousands, except share and per share data) | ||||
| Six months ended June 30 | Three months ended June 30 | |||
| 2010 | 2009 | 2010 | 2009 | |
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |
| Revenues | ||||
| Sales | $ 26,001 | $ 13,769 | $ 12,461 | $ 5,813 |
| Licensing and transaction fees | 1,799 | 1,200 | 925 | 743 |
| Total revenues | 27,800 | 14,969 | 13,386 | 6,556 |
| Cost of revenues | ||||
| Cost of sales | 12,665 | 7,308 | 6,507 | 3,193 |
| Total cost of revenues | 12,665 | 7,308 | 6,507 | 3,193 |
| Gross profit | 15,135 | 7,661 | 6,879 | 3,363 |
| Operating expenses | ||||
| Research and development | 4,017 | 4,036 | 1,969 | 2,072 |
| Selling and marketing | 6,657 | 5,521 | 2,924 | 2,447 |
| General and administrative | 4,147 | 3,649 | 1,891 | 1,799 |
| Amortization of intangible assets | 287 | 515 | 143 | 251 |
| Total operating expenses | 15,108 | 13,721 | 6,927 | 6,569 |
| Operating profit (loss) | 27 | (6,060) | (48) | (3,206) |
| Financial expense, net | (575) | (368) | (30) | (572) |
| Loss before taxes on income | (548) | (6,428) | (78) | (3,778) |
| Taxes on income | (155) | 42 | (73) | 19 |
| Net loss from continuing operations | (703) | (6,386) | (151) | (3,759) |
| Net loss from discontinued operations | (1,921) | (2,512) | (1,980) | (1,305) |
| Net loss | (2,624) | (8,898) | (2,131) | (5,064) |
| Net loss attributable to noncontrolling interest | 47 | 141 | 38 | 97 |
| Net loss attributable to shareholders | $ (2,577) | $ (8,757) | $ (2,093) | $ (4,967) |
| Basic and diluted net loss attributable to | ||||
| shareholders per ordinary share | ||||
| From continuing operations | $ (0.03) | $ (0.29) | $ (0.01) | $ (0.16) |
| From discontinued operations | $ (0.08) | $ (0.11) | $ (0.08) | $ (0.06) |
| $ (0.11) | $ (0.40) | $ (0.09) | $ (0.22) | |
| Weighted average number of ordinary | ||||
| shares used in computing basic and | ||||
| diluted net loss per ordinary share | 24,310,558 | 22,027,070 | 24,465,199 | 22,266,869 |
| ON TRACK INNOVATIONS LTD. | |||
| RECONCILIATION BETWEEN GAAP TO NON-GAAP | |||
| UNAUDITED STATEMENT OF OPERATIONS | |||
| (In thousands, except share and per share data) | |||
|
GAAP |
Six months ended June 30, 2010 Adjustments |
Non-GAAP |
|
| Revenues | |||
| Sales | $ 26,001 | -- | $ 26,001 |
| Licensing and transaction fees | 1,799 | -- | 1,799 |
| Total revenues | 27,800 | -- | 27,800 |
| Cost of Revenues | |||
| Cost of sales | 12,665 | (11) (a) | 12,654 |
| Total cost of revenues | 12,665 | (11) | 12,654 |
| Gross profit | 15,135 | 11 | 15,146 |
| Operating Expenses | |||
| Research and development | 4,017 | (817) (a) | 3,200 |
| Selling and marketing | 6,657 | (621) (a) | 6,036 |
| General and administrative | 4,147 | (429) (a) | 3,718 |
| Amortization of intangible assets | 287 | (287) (b) | -- |
| Total operating expenses | 15,108 | (2,154) | 12,954 |
| Operating profit | 27 | 2,165 | 2,192 |
| Financial expenses, net | (575) | -- | (575) |
| Profit (loss) before taxes on income | (548) | 2,165 | 1,617 |
| Taxes on income | (155) | -- | (155) |
| Net profit (loss) from continuing operation | (703) | 2,165 | 1,462 |
| Net loss from discontinued operation | (1,921) | 1,921 (c) | -- |
| Net profit (loss) | $ (2,624) | $4,086 | $ 1,462 |
| Net loss attributable to noncontrolling interest | 47 | -- | 47 |
| Net profit (loss) attributable to shareholders | $ (2,577) | $4,086 | $ 1,509 |
|
Basic and diluted net profit (loss) attributable to shareholders per ordinary share |
|||
| From continuing operation | $ (0.03) | $ 0.09 | $ 0.06 |
| From discontinued operation | $ (0.08) | $0.08 | -- |
|
Weighted average number of ordinary shares used in computing basic net profit (loss) per ordinary share |
24,310,558 | 24,310,558 | |
|
Weighted average number of ordinary shares used in computing diluted net profit (loss) per ordinary share |
26,269,717 | 26,269,717 | |
(a) The effect of stock-based compensation related to employees and non employees in accordance with ASC Topic 718 (originally issued as SFAS No. 123(R)) and ASC Subtopic 505-50 (formerly EITF 96-18).
(b) The effect of amortization of intangible assets.
(c) The effect of discontinued operation.
| ON TRACK INNOVATIONS LTD. | |||
| RECONCILIATION BETWEEN GAAP TO NON-GAAP | |||
| UNAUDITED STATEMENT OF OPERATIONS | |||
| (In thousands, except share and per share data) | |||
|
GAAP |
Three months ended June 30, 2010 Adjustments |
Non-GAAP |
|
| Revenues | |||
| Sales | $ 12,461 | -- | $ 12,461 |
| Licensing and transaction fees | 925 | -- | 925 |
| Total revenues | 13,386 | -- | 13,386 |
| Cost of Revenues | |||
| Cost of sales | 6,507 | (5) (a) | 6,502 |
| Total cost of revenues | 6,507 | (5) | 6,502 |
| Gross profit | 6,879 | 5 | 6,884 |
| Operating Expenses | |||
| Research and development | 1,969 | (303) (a) | 1,666 |
| Selling and marketing | 2,924 | (445) (a) | 2,479 |
| General and administrative | 1,891 | (143) (a) | 1,748 |
| Amortization of intangible assets | 143 | (143) (b) | -- |
| Total operating expenses | 6,927 | (1,034) | 5,893 |
| Operating profit (loss) | (48) | 1,039 | 991 |
| Financial expenses, net | (30) | -- | (30) |
| Profit (loss) before taxes on income | (78) | 1,039 | 961 |
| Taxes on income | (73) | -- | (73) |
| Net profit (loss) from continuing operation | (151) | 1,039 | 888 |
| Net loss from discontinued operation | (1,980) | 1,980 (c) | -- |
| Net profit (loss) | $ (2,131) | $3,019 | $ 888 |
| Net loss attributable to noncontrolling interest | 38 | -- | 38 |
| Net profit (loss) attributable to shareholders | $ (2,093) | $3,019 | $ 926 |
|
Basic and diluted net profit (loss) attributable to shareholders per ordinary share |
|||
| From continuing operation | $ (0.01) | $ 0.05 | $ 0.04 |
| From discontinued operation | $ (0.08) | $ 0.08 | -- |
|
Weighted average number of ordinary shares used in computing basic net profit (loss) per ordinary share |
24,465,199 | 24,465,199 | |
|
Weighted average number of ordinary shares used in computing diluted net profit (loss) per ordinary share |
26,424,358 | 26,424,358 | |
(a) The effect of stock-based compensation related to employees and non employees in accordance with ASC Topic 718 (originally issued as SFAS No. 123(R)) and ASC Subtopic 505-50 (formerly EITF 96-18).
(b) The effect of amortization of intangible assets.
(c) The effect of discontinued operation.
|
ON TRACK INNOVATIONS LTD. RECONCILIATION BETWEEN GAAP TO NON-GAAP UNAUDITED STATEMENT OF OPERATIONS (In thousands, except share and per share data) |
|||
|
GAAP |
Six months ended June 30, 2009 Adjustments |
Non-GAAP |
|
| Revenues | |||
| Sales | $ 13,769 | -- | $ 13,769 |
| Licensing and transaction fees | 1,200 | -- | 1,200 |
| Total revenues | 14,969 | -- | 14,969 |
| Cost of Revenues | |||
| Cost of sales | 7,308 | (28) (a) | 7,280 |
| Total cost of revenues | 7,308 | (28) | 7,280 |
| Gross profit | 7,661 | 28 | 7,689 |
| Operating Expenses | |||
| Research and development | 4,036 | (1,141) (a) | 2,895 |
| Selling and marketing | 5,521 | (351) (a) | 5,170 |
| General and administrative | 3,649 | (468) (a) | 3,181 |
| Amortization of intangible assets | 515 | (515) (b) | -- |
| Total operating expenses | 13,721 | (2,475) | 11,246 |
| Operating loss | (6,060) | 2,503 | (3,557) |
| Financial expenses, net | (368) | -- | (368) |
| Loss before taxes on income | (6,428) | 2,503 | (3,925) |
| Taxes on income | 42 | -- | 42 |
| Net loss from continuing operation | (6,386) | 2,503 | (3,883) |
| Net loss from discontinued operation | (2,512) | 2,512 (c) | -- |
| Net loss | $ (8,898) | $5,015 | $ (3,883) |
| Net loss attributable to noncontrolling interest |
141 |
-- |
141 |
| Net loss attributable to shareholders | $ (8,757) | $5,015 | $ (3,742) |
|
Basic and diluted net loss attributable to shareholders per ordinary share |
|||
| From continuing operation | $ (0.29) | $ 0.12 | $ (0.17) |
| From discontinued operation | $ (0.11) | $ 0.11 | -- |
|
Weighted average number of ordinary shares used in computing basic and diluted net loss per ordinary share |
22,027,070 | 22,027,070 | |
(a) The effect of stock-based compensation related to employees and non employees in accordance with ASC Topic 718 (originally issued as SFAS No. 123(R)) and ASC Subtopic 505-50 (formerly EITF 96-18).
(b) The effect of amortization of intangible assets.
(c) The effect of discontinued operation.
| ON TRACK INNOVATIONS LTD. | |||
| RECONCILIATION BETWEEN GAAP TO NON-GAAP | |||
| UNAUDITED STATEMENT OF OPERATIONS | |||
| (In thousands, except share and per share data) | |||
|
GAAP |
Three months ended June 30, 2009 Adjustments |
Non-GAAP |
|
| Revenues | |||
| Sales | $ 5,813 | -- | $ 5,813 |
| Licensing and transaction fees | 743 | -- | 743 |
| Total revenues | 6,556 | -- | 6,556 |
| Cost of Revenues | |||
| Cost of sales | 3,193 | (13) (a) | 3,180 |
| Total cost of revenues | 3,193 | (13) | 3,180 |
| Gross profit | 3,363 | 13 | 3,376 |
| Operating Expenses | |||
| Research and development | 2,072 | (558) (a) | 1,514 |
| Selling and marketing | 2,447 | (209) (a) | 2,238 |
| General and administrative | 1,799 | (254) (a) | 1,545 |
| Amortization of intangible assets | 251 | (251) (b) | -- |
| Total operating expenses | 6,569 | (1,272) | 5,297 |
| Operating loss | (3,206) | 1,285 | (1,921) |
| Financial expenses, net | (572) | -- | (572) |
| Loss before taxes on income | (3,778) | 1,285 | (2,493) |
| Taxes on income | 19 | -- | 19 |
| Net loss from continuing operation | (3,759) | 1,285 | (2,474) |
| Net loss from discontinued operation | (1,305) | 1,305 (c) | -- |
| Net loss | $ (5,064) | $2,590 | $ (2,474) |
| Net loss attributable to noncontrolling interest |
97 |
-- |
97 |
| Net loss attributable to shareholders | $ (4,967) | $2,590 | $ (2,377) |
|
Basic and diluted net loss attributable to shareholders per ordinary share |
|||
| From continuing operation | $ (0.16) | $ 0.05 | $ (0.11) |
| From discontinued operation | $ (0.06) | $ 0.06 | -- |
|
Weighted average number of ordinary shares used in computing basic and diluted net loss per ordinary share |
22,266,869 | 22,266,869 | |
(a) The effect of stock-based compensation related to employees and non employees in accordance with ASC Topic 718 (originally issued as SFAS No. 123(R)) and ASC Subtopic 505-50 (formerly EITF 96-18).
(b) The effect of amortization of intangible assets.
(c) The effect of discontinued operation.
| ON TRACK INNOVATIONS LTD. | |||
| CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS | |||
| (In thousands, except share and per share data) | |||
| Six months ended June 30 | |||
| 2010 | 2009 | ||
| (Unaudited) | (Unaudited) | ||
| Cash flows from operating activities | |||
| Net loss from continuing operations | $(703) | $(6,386) | |
| Adjustments required to reconcile net loss to | |||
| net cash provided by (used in) operating activities: | |||
| Stock-based compensation related to options and shares issued | |||
| to employees and others | 1,878 | 1,988 | |
| Gain on sale of property and equipment | (11) | -- | |
| Amortization of intangible assets | 287 | 515 | |
| Depreciation | 727 | 671 | |
| Accrued severance pay, net | 47 | (230) | |
| Accrued interest on short term investments and linkage differences on long-term loans | 115 | (11) | |
| Decrease in deferred tax liability | (18) | (43) | |
| Decrease (increase) in trade receivables, net | 2,584 | (122) | |
| Decrease (increase) in other receivables and prepaid expenses | 290 | (877) | |
| increase in inventories | (4,298) | (257) | |
| Increase (decrease) in trade payables | 1,363 | (553) | |
| Increase in other current liabilities | 1,458 | 206 | |
| Net cash provided by (used in) continuing operating activities | 3,719 | (5,099) | |
| Cash flows from investing activities | |||
| Purchase of property and equipment | (1,275) | (553) | |
| Purchase of available-for-sale securities | (3,543) | (514) | |
| Proceeds from maturity of available-for-sale securities | 1,185 | 1,372 | |
| Other, net | 10 | -- | |
| Net cash provided by (used in) continuing investing activities | (3,623) | 305 | |
| Cash flows from financing activities | |||
| Increase (decrease) in short-term bank credit, net | (533) | 936 | |
| Proceeds from long-term bank loans | 3,616 | 368 | |
| Repayment of long-term bank loans | (454) | (257) | |
| Payments to acquire treasury shares | (497) | -- | |
| Proceeds from receipt on account of shares and exercise of options and | |||
| warrants, net | 26 | 250 | |
| Net cash provided by continuing financing activities | 2,158 | 1,297 | |
| Cash flows from discontinued operations | |||
| Net cash used in discontinued operating activities | (1,600) | (1,890) | |
| Net cash provided by discontinued investing activities | 1,121 | -- | |
| Total net cash used in discontinued activities | (479) | (1,890) | |
| Effect of exchange rate changes on cash | (285) | 54 | |
| Increase (decrease) in cash and cash equivalents | 1,490 | (5,333) | |
| Cash and cash equivalents at the beginning of the year | 26,884 | 27,196 | |
| Cash and cash equivalents at the end of the year | 28,374 | 21,863 | |