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29 May 2008 07:45
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Orad Hi-Tec Systems Ltd. ('Orad' or the 'Company')
Results for theĀ firstĀ quarter ofĀ 2008
RevenuesĀ up by 62%, net profits up by 714%
RecordĀ revenues and profits withĀ continuedĀ positive cash flow.Ā Ā
RevenuesĀ increasedĀ byĀ 62%Ā toĀ US$7.7Ā million compared toĀ US$Ā 4.7million in Q1/07 and byĀ 12% compared to Q4/07.Ā
Net profits increased byĀ 714% to US$Ā 952 thousandĀ compared to US$117Ā thousandĀ in Q1/07 and byĀ 35% compared to Q4/07.
Cash,Ā cash equivalentsĀ and restricted cashĀ increased toĀ US$14.5million
Gross marginĀ remained constant at 65%,Ā in line withĀ the average of 2007.Ā
Significant improvementĀ ofĀ sales in the Americas and continues successful penetration to the On-Air graphics market.Ā
"We are proud to present the results for the first quarter ofĀ 2008", said Avi Sharir President and CEO of Orad and continued: "We continue to see theĀ benefitsĀ of theĀ company'sĀ change inĀ strategy, to secureĀ growth inĀ sales and bookingĀ of theĀ On-Air graphics systems and improvement in North AmericanĀ market.Ā SinceĀ the beginning of 2008 the companyĀ hasĀ signed some high profile and high volume projects, such as the graphics systems for the Olympic Games with China's CCTV,Ā and projects withĀ CzechĀ national TV, MTV3Ā fromĀ FinlandĀ and others.Ā
The transition fromĀ standard definition toĀ high definitionĀ and the pressure to reduce production costsĀ is creatingĀ a demandĀ forĀ new virtual studios solutions.Ā SinceĀ the beginning of 2008, OradĀ hasĀ signed a uniqueĀ virtual studiosĀ contract with Canada's Global TV, with TVĀ Globo fromĀ Brazil,Ā the European ParliamentĀ and others. Part of the above mentionedĀ projects wereĀ realised during Q1 of 2008".
For further information:
|
Orad (www.orad.tv) Ehud Ben-Yair, CFO Ā |
+Ā 972 976 768 62 |
|
Edicto Investor Relations Dr. Sonke Knop, Frankfurt Germany Ā |
+ 49 608494859-1 |
|
Shore Capital (London) Graham ShoreĀ Ā |
+ 44 20 7408 4090 |
Ā Ā Orad Hi-Tec Systems Ltd ('Orad' or the 'Company')
Results for theĀ firstĀ quarterĀ of 2008
Financial and Operational highlights for theĀ first quarter ofĀ 2008Ā compared to the first quarter ofĀ 2008 and fourth quarter of 2007:
Revenues, net profit and cash status:
RevenuesĀ inĀ Q108Ā increased byĀ 62% toĀ US$7.7Ā million compared toĀ US$4.7million onĀ Q12007Ā andĀ byĀ 12%Ā compared Q4/07. This is mainly due to the strong back-log,Ā the on-goingĀ penetration to theĀ On-Ā AirĀ graphics market and the winning of severalĀ largeĀ contracts.Ā
Net profitĀ increased dramaticallyĀ byĀ 714%Ā to US$952 thousandĀ compared to Q1/07 and byĀ 35% compared to Q4/07.
In the firstĀ quarter Ā ofĀ 2008Ā cash,Ā cash equivalents and restrictedĀ cash increasedĀ toĀ US$14.5Ā million.
TheĀ table below reflectsĀ the trend in the lastĀ fiveĀ quarters:
|
(in thousand USD) |
Q1 7 |
Q2/07 |
Q3/07 |
Q4/07 |
Q1/08 |
|
Revenue |
4,743Ā |
5,193Ā |
6,128Ā |
6,876Ā |
7,668Ā |
|
Gross Profit |
3,221Ā |
3,602Ā |
3,917Ā |
4,354Ā |
5,005Ā |
|
Net profit |
117Ā |
332Ā |
621Ā |
706Ā |
952Ā |
|
Cash status |
10,629Ā |
11,443Ā |
13,306Ā |
14,050Ā |
14,543Ā |
Gross Margin
Gross margin for theĀ first quarterĀ ofĀ 2008 remained constant at 65% compared toĀ the average gross margin in 2007.Ā
Operational expenses:
OperationalĀ expensesĀ inĀ Q1/08Ā increased toĀ US$4.1 million compared toĀ US$3.1Ā millionĀ in Q1/07.Ā This is mainly due to the increase in the sales and marketing efforts resulting fromĀ increasingĀ territory coverage and the continuedĀ R&D effortĀ deployedĀ to release new applications to the market.Ā The decline inĀ the USD in all marketsĀ also put some pressure on the cost structure of theĀ Company. However, the company also benefits from the fact that most of its sales are in Europe.
|
(in thousand USD) |
Q1/07 |
Q4/07 |
Q1/08 |
|
Research and Development |
776Ā |
961Ā |
964Ā |
|
Sales and Marketing |
1,904Ā |
2,195Ā |
2,471Ā |
|
General and Administrative |
491Ā |
663Ā |
745Ā |
|
Total Operating Expenses: |
3,171Ā |
3,819Ā |
4,180Ā |
CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands, except share and per share data
|
March 31, |
December 31, |
|||
|
2008 |
2007 |
|||
|
Unaudited |
||||
|
ASSETS |
||||
|
CURRENT ASSETS: |
||||
|
Cash and cash equivalents |
$13,454 |
$12,981 |
||
|
Restricted cash |
1,089 |
1,069 |
||
|
Trade receivables, netĀ |
2,585 |
1,869 |
||
|
Other accounts receivable and prepaid expenses |
1,582 |
1,163 |
||
|
InventoriesĀ |
2,963 |
2,920 |
||
|
Work in process, net of advances from customers |
- |
78 |
||
|
TotalĀ current assets |
21,673 |
20,080 |
||
|
SEVERANCE PAY FUND |
1,428 |
1,343 |
||
|
PROPERTY AND EQUIPMENT, NETĀ |
1,771 |
1,753 |
||
|
TotalĀ assets |
$24,872 |
$23,176 |
||
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
||||
|
CURRENT LIABILITIES: |
||||
|
Trade payables |
$2,447 |
$2,115 |
||
|
Deferred revenues |
1,964 |
2,280 |
||
|
Other accounts payable and accrued expenses |
6,276 |
5,718 |
||
|
TotalĀ current liabilitiesĀ |
10,687 |
10,113 |
||
|
ACCRUED SEVERANCE PAY |
2,065 |
1,950 |
||
|
TotalĀ liabilities |
12,752 |
12,063 |
||
|
SHAREHOLDERS' EQUITY: |
||||
|
Share CapitalĀ |
29 |
29 |
||
|
Additional paid-in capital |
75,530 |
75,475 |
||
|
Foreign currency translation adjustments |
(547) |
(547) |
||
|
Accumulated deficit |
(62,892) |
(63,844) |
||
|
TotalĀ shareholders' equity |
12,120 |
11,113 |
||
|
TotalĀ liabilities and shareholders' equity |
$24,872 |
$23,176 |
Ā Ā CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands, except share and per share data
Ā
|
Ā
|
Ā
|
Three months ended
March 31,
|
Ā
|
Year ended December 31,
|
||
|
Ā
|
Ā
|
2008
|
Ā
|
2007
|
Ā
|
2007
|
|
Ā
|
Ā
|
Unaudited
|
Ā
|
Ā
|
||
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
|
Revenues:
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
|
Sales
|
Ā
|
$7,668
|
Ā
|
$4,743
|
Ā
|
$22,940
|
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
|
Cost of sales
|
Ā
|
2,663
|
Ā
|
1,522
|
Ā
|
7,846
|
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
|
Gross profit
|
Ā
|
5,005
|
Ā
|
3,221
|
Ā
|
15,094
|
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
|
Operating expenses:
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
|
Research and development, netĀ
|
Ā
|
964
|
Ā
|
776
|
Ā
|
3,207
|
|
Sales and marketingĀ
|
Ā
|
2,471
|
Ā
|
1,904
|
Ā
|
8,474
|
|
General and administrativeĀ
|
Ā
|
745
|
Ā
|
491
|
Ā
|
2,207
|
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
|
TotalĀ operating expenses
|
Ā
|
4,180
|
Ā
|
3,171
|
Ā
|
13,888
|
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
|
Operating incomeĀ
|
Ā
|
825
|
Ā
|
50
|
Ā
|
1,206
|
|
Financial income, net
|
Ā
|
127
|
Ā
|
70
|
Ā
|
573
|
|
Other expenses, netĀ
|
Ā
|
-
|
Ā
|
3
|
Ā
|
(4)
|
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
|
Net incomeĀ
|
Ā
|
$952
|
Ā
|
$117
|
Ā
|
$1,775
|
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
|
Basic net earnings per share
|
Ā
|
$0.086
|
Ā
|
$0.01
|
Ā
|
$0.16
|
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
|
Weighted average number of shares used in computing basic net earnings per share (in thousands)
|
Ā
|
10,821
|
Ā
|
10,802
|
Ā
|
10,821
|
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
|
Diluted net earnings per share
|
Ā
|
$0.086
|
Ā
|
$0.01
|
Ā
|
$0.16
|
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
Ā
|
|
Weighted average number of shares used in computing diluted net earnings per share (in thousands)
|
Ā
|
11,084
|
Ā
|
10,971
|
Ā
|
10,982
|
Ā STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
U.S. dollars in thousands, except share data
|
Number of outstanding ordinary shares |
ShareĀ capital |
Additional paid-in capital |
Foreign currency translation adjustments |
Accumulated deficit |
Total |
|||||||
|
Ā |
||||||||||||
|
Balance as of January 1,Ā 2007 |
10,800,621 |
$28 |
$75,357 |
$(547) |
$(65,619) |
$9,219 |
||||||
|
ComprehensiveĀ income: |
||||||||||||
|
NetĀ incomeĀ |
- |
- |
- |
- |
1,775 |
1,775 |
||||||
|
Issuance of sharesĀ upon exercise of employee share options |
19,929 |
1 |
22 |
- |
- |
23 |
||||||
|
Share based compensation |
- |
- |
96 |
- |
- |
96 |
||||||
|
Balance as of December 31,Ā 2007 |
10,820,550 |
29 |
75,475 |
Ā (547) |
Ā (63,844) |
11,113 |
||||||
|
Comprehensive income: |
||||||||||||
|
NetĀ income |
952 |
952 |
||||||||||
|
Issuance of shares upon exercise of employee share options |
||||||||||||
|
Share-based compensation |
- |
- |
55 |
- |
- |
55 |
||||||
|
Balance as of March 31,Ā 2008Ā (unaudited) |
10,820,550 |
29 |
75,530 |
(547) |
(62,892) |
12,120 |
||||||
|
Balance as ofĀ January 1, 2007 |
Ā Ā 10,800,621 |
28 |
75,357 |
(547) |
(65,619) |
9,219 |
||||||
|
Comprehensive income: |
||||||||||||
|
Net incomeĀ |
- |
- |
- |
- |
117 |
117 |
||||||
|
Issuance of sharesĀ upon exercise of employee share options |
1,500 |
*)Ā Ā Ā - |
3 |
- |
- |
3 |
||||||
|
Share-based compensation |
- |
- |
20 |
- |
- |
20 |
||||||
|
Balance as of March 31,Ā 2007Ā (unaudited) |
10,802,121 |
28 |
75,380 |
(547) |
(65,502) |
9,359 |
*) Represent an amount lower than $Ā 1.
CONSOLIDATED STATEMENTS OF CASH FLOWS
U.S. dollars in thousands
|
Three months ended March 31, |
Year ended December 31, |
||||||||||||
|
2008 |
2007 |
2007 |
|||||||||||
|
Unaudited |
|||||||||||||
|
Cash flows from operating activities: |
|||||||||||||
|
Net income |
$952 |
$117 |
$1,775 |
||||||||||
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|||||||||||||
|
Depreciation |
158 |
142 |
545 |
||||||||||
|
Share-based compensation |
55 |
20 |
96 |
||||||||||
|
Increase (decrease) in trade receivables, net |
(716) |
435 |
553 |
||||||||||
|
Decrease in other accounts receivable and prepaid expensesĀ |
(419) |
(122) |
(326) |
||||||||||
|
IncreaseĀ in inventoriesĀ |
(43) |
(21) |
(384) |
||||||||||
|
Decrease in work in process, net of advances from customers |
15 |
290 |
442 |
||||||||||
|
Increase (decrease) in trade payables |
332 |
(334) |
761 |
||||||||||
|
IncreaseĀ in other accounts payable and accrued expenses |
621 |
395 |
951 |
||||||||||
|
Increase in accrued severance pay, net |
30 |
29 |
121 |
||||||||||
|
IncreaseĀ (decrease)Ā in deferred revenues |
(316) |
81 |
439 |
||||||||||
|
Other |
- |
3 |
- |
||||||||||
|
Net cash provided by in operating activities |
669 |
1,035 |
4,973 |
||||||||||
|
Cash flows from investing activities: |
|||||||||||||
|
Purchase of property and equipmentĀ |
(176) |
(80) |
(656) |
||||||||||
|
Proceeds from sale of property and equipmentĀ |
- |
9 |
48 |
||||||||||
|
Decrease (increase) in restricted cash |
(20) |
(511) |
498 |
||||||||||
|
Net cash provided by (used) investing activities |
(196) |
(582) |
1,106 |
||||||||||
|
Cash flows from financing activities: |
|||||||||||||
|
Issuance of shares upon exercise of employees share options |
- |
3 |
23 |
||||||||||
|
Net cash provided by financing activities |
- |
3 |
23 |
||||||||||
|
Increase in cash and cash equivalents |
473 |
456 |
3,890 |
||||||||||
|
Cash and cash equivalents at the beginning of the period |
12,981 |
9,091 |
9,091 |
||||||||||
|
Cash and cash equivalents at the end of the period |
$13,454 |
$9,547 |
$12,981 |
||||||||||
|
Non-cash transactions: |
|||||||||||||
|
Classification between property and equipment, and inventories, net |
- |
- |
160 |
||||||||||
a. The Company's shares and options held by members of the Board of Directors and officers of the Company:
|
Number of |
Number of |
|||
|
OrdinaryĀ shares |
shareĀ options *) |
|||
|
Avi Sharir |
2,143,238 |
269,253 |
||
|
Moshe Nissim |
- |
40,000 |
||
|
Ehud Ben-Yair |
- |
60,000 |
||
|
Orna Nehustan |
- |
45,000 |
||
|
Dan Falk |
- |
20,000 |
||
|
Shimon Ravid |
- |
10,000 |
||
|
Uzi Peled |
- |
10,000 |
||
|
Daniel Furman |
753,300 |
10,000 |
||
|
Anat Segal |
- |
20,000 |
*) Each share option is convertible into one Ordinary share.
b. As of March 31,Ā 2008, the Company employsĀ 159Ā employees.
- - - - - - - - - - - - - - - - -
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