Yoqneam, Israel, August 7, 2007
MIND CTI Reports Second Quarter 2007 Results
Cash Flow from Operating Activities of $1.34 Million
MIND CTI Ltd. (NasdaqGM: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.
(tables to follow)
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MIND C.T.I LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
|
June 30 |
December 31,
|
|
|
|
|
2007 |
2006 |
2006
|
|
|
|
|
|
(Unaudited) |
(Audited)
|
|
|
|
|
U.S. $ in
thousands |
|
|
|
|
| A s s e t s |
|
|
|
| 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
|
|
|
|
|
| T o t a l current assets |
30,707 |
31,562 |
33,376 |
| INVESTMENTS AND OTHER NON CURRENT ASSETS:
|
|
|
|
| Marketable debentures |
10,000 |
|
10,000 |
| Long term bank deposits |
|
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
|
|
|
|
|
| T o t a l 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
|
|
|
|
|
| T o t a l current liabilities |
3,756 |
4,037 |
4,450 |
| EMPLOYEE RIGHTS UPON RETIREMENT |
1,466 |
1,397 |
1,482 |
|
|
|
|
| T o t a l 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) |
|
|
|
|
| T o t a l shareholders' equity |
45,422 |
46,910 |
47,859 |
|
|
|
|
| T o t a l liabilities and shareholders' equity
|
$
50,644 |
$
52,344 |
$
53,791 |
|
|
|
|
|
|
|
|
I
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MIND C.T.I LTD.
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
|
Six months
ended June 30
|
Three months
ended June
30 |
Year ended
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. |
II
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MIND C.T.I LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS
|
Six months
ended June
30 |
Three months
ended June
30 |
Year ended
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
|
|
|
|
|
|
|
|
|
|
|
|
|
III
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