Mti Wireless Regulatory News (MWE)

2 August 2012

MTI Wireless Edge Ltd

("MTI" or the "Company")

Financial results for the half year ended 30 June 2012

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 results for the six months ended 30 June 2012.

Highlights

·; Q2 revenue of US$3.3m was 3% up on the first quarter

·; Return to profitability with profit from operations of US$19k in Q2 (Q1 2012: loss of US$404k after US$300k litigation provision)

·; Revenue for six months of US$6.49m (H1 2011: US$7.44m)

·; Half year loss of US$385k (H1 2011: US$78k profit)

·; Cash, cash equivalents and marketable securities remained strong US$6.75m

Dov Feiner, Chief Executive Officer, commented:

"I am pleased to report that the Group has achieved some recovery in activity during the three months to 30 June after the disappointing loss of the first quarter. In particular we have seen strong demand for our high quality antennas for fixed broadband wireless applications where revenue increased by 10 per cent in the second quarter compared with the previous three months, helping the Group to attain an overall 3 per cent revenue increase.

"Commercial activities' revenue was slightly up, quarter on quarter, and the division achieved a profit of US$238k in the latest three months after a reported loss in the previous three which was a direct result of the provision on the IP litigation. Revenue from our Military business remained relatively subdued after the buoyant period of 2011 but there was an encouraging operating improvement with a reduced operating loss against the previous quarter.

"These figures highlight the fact that the cost saving measures we undertook during the second quarter are beginning to bear fruit with a two point rise in gross margins to 35 per cent in the latest quarter which produced a modest overall operating.

"We expect that the second half of 2012 will see further benefits flowing through from those cost reductions and, with further sales progress, the Board is optimistic about the Group's prospects. However, in the current worldwide economic environment, it is right to temper optimism with a good degree of caution."

Contacts:

About MTI Wireless Edge

MTI designs and manufactures flat panel antennas, largely supplied to international OEMs of fixed broadband wireless access systems. With over 30 years of technical `know-how', flexible high volume manufacturing capabilities and low failure rates, MTI's antennas now comprise approximately 25% of the global fixed broadband wireless antenna market. In addition, the Company has successfully developed products for new commercial applications as wireless systems become increasingly prevalent in new markets.

INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

The accompanying notes form an integral part of the financial statements.

INTERIM CONSOLIDATED STATEMENT OF

CHANGES IN EQUITY

For the Six months ended June 30, 2012:

The accompanying notes form an integral part of the financial statements.

INTERIM CONSOLIDATED STATEMENT OF

CHANGES IN EQUITY

For the Six months ended June 30, 2011:

The accompanying notes form an integral part of the financial statements.

INTERIM CONSOLIDATED STATEMENT OF

CHANGES IN EQUITY

For the year ended December 31, 2011:

The accompanying notes form an integral part of the financial statements.

INTERIM CONSOLIDATED STATEMENT OF

FINANCIAL POSITION

The accompanying notes form an integral part of the financial statements.

INTERIM CONSOLIDATED STATEMENT OF

FINANCIAL POSITION

The accompanying notes form an integral part of the financial statements.

NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

INTERIM CONSOLIDATED STATEMENTS OF

CASH FLOWS

The accompanying notes form an integral part of the financial statements.

 INTERIM CONSOLIDATED STATEMENTS OF

CASH FLOWS

Appendix A - Non-cash activities:

The accompanying notes form an integral part of the financial statements.

Note 1 - General:

A. Corporate information:

M.T.I Wireless Edge Ltd. (hereafter - the Company) is an Israeli corporation. It was incorporated under the Companies Act in Israel on December 30, 1998 as a wholly- owned subsidiary of M.T.I Computers and Software Services (1982) Ltd. (hereafter - the Parent Company) and commenced operations on July 1, 2000 and since March 2006, the Company's shares have been traded on the AIM Stock Exchange.

The formal address of the company is 11 Hamelacha Street, Afek industrial Park, Rosh-Ha'Ayin, Israel.

The Company is engaged in the development, design, manufacture and marketing of antennas and accessories.

B. Assets and Liabilities in foreign currencies

Henceforth are the details of the foreign currencies of the main currencies and the changes percentage in the reporting period:

Note 2 - Significant Accounting Policies:

The interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles for the preparation of financial statements for interim periods, as prescribed in International Accounting Standard No. 34 ("Interim Financial Reporting").

The interim consolidated financial information set out above does not constitute full year end accounts within the meaning of Israeli Companies Law. It has been prepared on a going concern basis in accordance with the recognition and measurement criteria of the International Financial Reporting Standards (IFRS). Statutory financial information for the financial year ended December 31, 2011 was approved by the board on February 16, 2012. The report of the auditors on those financial statements was unqualified. The interim consolidated financial statements as of June 30, 2012 have not been audited.

The interim consolidated financial information should be read in conjunction with the annual financial statements as of 31 December, 2011 and for the year ended on that date and with the notes thereto,

The significant accounting policies applied in the annual financial statements of the Company as of December 31, 2011 are applied consistently in these interim consolidated financial statements.

Note 3 - SEGMENTS:

The following table's present revenue and profit information regarding the Group's operating segments for the Six months ended June 30, 2012 and 2011, respectively and for the year ended December 31, 2011.

 (*) The Group cannot distinguish between Commercial and Military assets and liabilities, due to the fact that some of the assets and liabilities are used by both segments.

Note 4 -TRANSACTIONS WITH RELATED PARTIES:

The Parent Company and other related parties provide certain services to the Group as follows:

Compensation of key management personnel of the Group:

*) Including Management fees for the CEO, Directors Executive Management and other related parties

Note 4 -TRANSACTIONS WITH RELATED PARTIES (CONT.):

All Transactions are made at market value.

As of June 30, 2012 the parent company and related parties owe to the Group US $65,000 while in December 31, 2012 and in June 30, 2011 the Group owed to the parent group and related party US $5,000 and US $45,000 respectively. 

Note 5 - SIGNIFICANT EVENTS:

A. During the current and the previous quarter the Company used US$ 0.5 million out of US$ 4 million credit line from banking corporation.

B. Contingent liability:

Due to a hearing sessions held during May 2012 by the District Court in Mars lawsuit (as specified in note 24 to the Annual Report for December 31, 2011), the Company updated the provision recorded to the amount of US $310,000 as at June 30, 2012.

C. On June 21, the board announced the passing of Mr. Stewart Millman who served as independent external director of the company since 2006.