3rd Quarter Results

6 Nov 2006 07:01

MTI Wireless Edge Limited06 November 2006 MTI WIRELESS EDGE LTD FINANCIAL RESULTS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2006 MTI Wireless Edge Ltd., (ticker: MWE) ('MTI' or 'the Company'), a market leader in the manufacture of flat panel antennas for fixed wireless broadband, today announces its unaudited interim results for the nine months ended 30 September 2006, its fifteenth consecutive quarter of revenue growth. Highlights •Revenue increased by 40% year on year to US$11.8m (Q3 2005: US$8.4m) •Gross profit up 51% to US$5.2m (Q3 2005: US$3.4m) with gross margin of 44.2% (Q3 2005: 40.8%) •Net profits improved by 94% to US$ 2.4m (Q3 2005: US$1.2m) with net margin increased to 20.4% (Q3 2005: 14.7%) •Basic earnings per share up 28% to 5.0c (Q3 2005: 3.9c) •Intention to pay out approximately 25 per cent. of net profit as dividend for the full financial year Dov Feiner, Chief Executive Officer, commented: "The third quarter of the yearhas seen MTI build and improve upon the excellent growth announced at the halfyear. With three months of the year remaining, we have already surpassed ourperformance for the whole of 2005 at a revenue, gross profit and net profitlevel, with continued margin improvement. Our contracted but as yet unfulfilledorder book remains healthy giving further confidence of a very successful resultfor our first full year as a public limited company. "The fixed wireless broadband market continues to grow and importantly, some 30%of our units sold in the first nine months of the year have been WiMax compliantantennas. Research suggests that there will continue to be strong growth in bothour key markets of broadband wireless and radio frequency identification andtherefore MTI is well placed for continued profitable growth." Contacts: MTI Wireless Edge +972 3 900 8900Dov Feiner, CEOMoni Borovitz, Financial Director Corporate Synergy Plc +44 20 7448 4400Luke AhernDavid Seal Threadneedle Communications +44 207 936 9605Graham HerringJosh Royston About MTI Wireless Edge MTI designs and manufactures flat panel antennas, largely supplied tointernational OEMs of fixed broadband wireless access systems. With over 30years of technical "know-how", flexible high volume manufacturing capabilitiesand low failure rates, MTI's antennas now comprise approximately 25% of theglobal fixed broadband wireless antenna market. In addition, the Company hassuccessfully developed products for new commercial applications as wirelesssystems become increasingly prevalent in new markets. PROFIT AND LOSS STATEMENT For the nine months Year ended ended September 30 December 31 2006 2005 2005 ----------------------- --------- U.S. $ in thousands ----------------------- --------- Revenues 11,757 8,423 11,694Cost of sales 6,559 4,989 6,780 Gross profit 5,198 3,434 4,914Research and developmentexpenses 875 636 855Selling and marketing expenses 1,291 914 1,237General and administrativeexpenses 798 594 779 Operating profit 2,234 1,290 2,043Financial expenses (income),net (274) (12) 164 Profit before taxation 2,508 1,302 1,879Tax on profit 106 65 130 Net profit 2,402 1,237 1,749 Earnings per share:Basic 0.0503 * 0.0393 * 0.0556 Diluted 0.0480 * 0.0326 * 0.0461 Weighted average number of sharesoutstanding:Basic 47,734,124 *31,470,000 *31,470,000 Diluted 50,029,108 *37,932,000 *37,932,000 * Restated due to split of the company's ordinary share in a ratio of 3000 newshares for each 1 ordinary share, prior of the IPO in the AIM. BALANCE SHEET At 30 At 30 At 31 September September December 2006 2005 2005 -------- --------- -------- U.S. $ In thousands -------- --------- -------- ASSETSCURRENT ASSETS: Cash and cashequivalents 2,266 3,548 3,980Short-terminvestments 10,902 - -Tradereceivables 4,455 3,240 3,405Otherreceivables 213 145 265Inventories 1,598 1,187 1,008 Total currentassets 19,434 8,120 8,658 LONG TERMPREPAIDEXPENSES 28 30 26 PROPERTY ANDEQUIPMENT, NET 1,401 1,424 1,441 OTHER ASSETS,NET 462 406 450 21,325 9,980 10,575 At 30 At 30 At 31 September September December 2006 2005 2005 -------- --------- -------- U.S. $ In thousands -------- --------- --------LIABILITIES ANDSHAREHOLDERS' EQUITYCURRENT LIABILITIES: Current maturities oflong-term loans 85 87 87Trade payables 2,712 1,865 1,669Other accountspayables 1,013 304 599 Total currentliabilities 3,810 10,375 2,355 LONG-TERM LIABILITIES:Liabilities to banks 46 130 109Accrued severance pay 221 169 174 267 299 283 SHAREHOLDERS' EQUITYShare capital 115 2 2Additional paid-incapital 16,357 7,561 7,561Retained earnings 776 (138) 374 Total shareholders'equity 17,248 7,245 7,937 21,325 9,980 10,575 STATEMENTS OF CASH FLOWS For the nine months ended Year ended September 30 December 31 ------------------------- --------- 2006 2005 2005 -------- -------- --------- U.S. $ in thousands ------------------------- --------- Cash Flows from OperatingActivities:Net profit 2,402 1,237 1,749Adjustments to reconcile net income to net cash providedby operating activities:Compensation expensesresulting from optionsgranted to employees - 73 73 Depreciationand amortization 207 206 272Gain from short-terminvestments (313) (509) (58)Deferred taxes (14) - (51)Severance pay, net 47 7 12Issuance ofshare capital 79 - -Changes in operating assets andliabilities:Decrease (increase) ininventories (590) 130 309Increase in tradereceivables (1,050) (1,013) (1,178)Decrease (increase) inother accounts receivablesfor short and long term 52 88 (21) Increase (decrease) intrade payables 1,051 104 (128)Increase (decrease) inother accounts payables 414 (174) 121 Net cash provided by(used in) operatingactivities 2,285 599 1,100 STATEMENTS OF CASH FLOWS For the nine months ended Year ended September 30 December 31 ---------------------- --------- 2006 2005 2005 -------- -------- --------- U.S. $ in thousands ---------------------- --------- Cash Flows From InvestingActivities:Sale (purchase) ofshort-term investment (10,589) 2,095 2,095Purchase of property andequipment (175) (64) (112) Net cash (used in) providedby investingactivities (10,764) 2,031 1,983 Cash Flows From FinancingActivities:Dividend distributed (2,000) - -Additional capital raisedin Aim Listing, net 8,830 - -Repayment of long-termloans (65) (66) (87) Net cash usedin financingactivities 6,765 (66) (87) INCREASE (DECREASE) INCASH AND CASH EQUIVALENTS (714) 2,564 2,996 CASH AND CASH EQUIVALENTS ATBEGINNING OF PERIOD 3,980 984 984 CASH AND CASHEQUIVALENTS AT 2,266 3,548 3,980END OF PERIOD This information is provided by RNS The company news service from the London Stock Exchange