Q1 Results

8 May 2007 07:02

MTI Wireless Edge Limited08 May 2007 MTI WIRELESS EDGE LTD FINANCIAL RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2007 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 three months ended 31 March 2007. Highlights •Revenue increased by 39% year on year to US$4.7m (Q1 2006: US$3.4m) •Profit before tax up 53% year on year to US$944k (Q1 2006: US$617k) •Net profits improved by 47% year on year to US$855k (Q1 2006: US$583k) •Gross profit margin of 42% •Net cash at 31 March 2007 of $13.4m •Cash flow from operating activities of $1M Dov Feiner, Chief Executive Officer, commented:"The Board is pleased to deliver a seventeenth consecutive quarter of growth.The first quarter of the year has shown continued solid trading with the Groupperforming in line with management's expectations. The current military backlogand sales have already surpassed the whole of 2006 while the overall companyorder book and prospects remain fully consistent with our expectations for theyear as a whole - as a result we look forward to the rest of the year withconfidence. "Our markets remain strong with good demand for WiMax compliant antennas as wellas growing interest for our radio frequency identification (RFID), providing theCompany with a wider product offering. Our ability to provide high specificationtechnology to our military customers as well as catering to the growing needs ofour other clients has enabled us to maintain our dominant position in thewireless fixed broadband market. Contacts:MTI Wireless Edge +972 3 900 8900Dov Feiner, CEOMoni Borovitz, Financial Director Blue Oar Securities 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 three months ended Year ended March 31, 2007 December 31, 2006 U.S. $ in thousands Revenues 4,722 16,463Cost of sales 2,750 9,159 Gross profit 1,972 7,304Research and developmentexpenses 332 1,121Selling and marketingexpenses 546 1,783General and administrativeexpenses 275 1,088 Operating profit 819 3,312Financial expenses 32 102Financial income 157 574 Profit before taxation 944 3,784Tax on profit 89 161 Net profit 855 3,623 Earnings per share:Basic 0.0159 0.0736 Diluted 0.0156 0.0708 Weighted average number of sharesoutstanding:Basic 53,779,998 49,262,202 Diluted 54,735,714 51,182,578 BALANCE SHEET 31.3.2007 31.12.2006 U.S. $ in thousandsASSETSCURRENT ASSETS:Cash and cash equivalents 2,488 2,167Short-term investments 10,925 11,133Trade receivables 5,100 5,154Other receivables 248 206Inventories 2,034 1,724 Total current assets 20,795 20,384 LONG TERM PREPAID EXPENSES 31 32 PROPERTY AND EQUIPMENT, NET 1,563 1,435 OTHER ASSETS, NET 481 475 22,870 22,326 31.3.2007 31.12.2006 U.S. $ in thousands LIABILITIES AND SHAREHOLDERS' EQUITYCURRENT LIABILITIES:Current maturities of long-term loans 87 87Trade payables 3,003 2,470Other accounts payables 1,112 1,047 Total current liabilities 4,202 3,604 LONG-TERM LIABILITIES:Liabilities to banks - 22Accrued severance pay 242 231 242 253 SHAREHOLDERS' EQUITYShare capital 115 115Additional paid-in capital 16,357 16,357Retained earnings 1,954 1,997 Total shareholders' equity 18,426 18,469 22,870 22,326 STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY For the three months ended March 31, 2007: Share Additional Retained Total capital paid-in earnings capital U.S. $ in thousands Balance at January 1,2007 115 16,35 1,997 18,469 Changes during the threemonths ended March 31, 2007:Profit for the year - - 855 855Dividend distributed - - (898) (898) Balance at March 31, 2007 115 16,357 1,954 18,426 For the year ended December 31, 2006: Share Additional Retained earnings/ Total capital paid-in (accumulated deficit) capital U.S. $ in thousands Balance at January 1,2006 2 7,561 374 7,937 Changes during 2006:Profit for the year - - 3,623 3,623Issuance of share capital *- 79 - 79Share capital as a result of split 80 (80) - -Additional capitalraised in AIM listing 33 8,797 - 8,830 Divided distributed - - (2,000) (2,000) Balance at December 31, 2006 115 16,357 1,997 18,469 * Less than 1 thousands dollar. STATEMENTS OF CASH FLOWS For the three months ended Year ended March 31, 2007 December 31, 2006 U.S. $ in thousands Cash Flows from Operating Activities:Net profit 855 3,623Adjustments to reconcile net income to net cash provided by operating activities:Depreciation and amortization 73 281Gain from short-term investments (152) (340)Deferred taxes (6) (13)Issuance of share capital - 79Changes in operating assets and liabilities: Decrease (increase) in inventories (310) (716)Decrease (increase) in trade receivables 54 (1,749)Decrease (increase) in other accountsreceivables for short and long term (41) 43Increase (decrease) in trade payables 477 789Increase (decrease) in other accounts payables 62 446Severance pay, net 11 57 Net cash provided by operating activities 1,023 2,500 STATEMENTS OF CASH FLOWS For the three months ended Year ended March 31, 2007 December 31, 2006 U.S. $ in thousands Cash Flows From Investing Activities:Sale (purchase) of short-term investment,net 360 (10,793)Purchase of property and equipment (142) (263) Net cash (used in) provided by investing activities 218 (11,056) Cash Flows From Financing Activities:Dividend distributed (898) (2,000)Issue of ordinary shares - 8,830Repayment of long-term loans (22) (87) Net cash (used in) provided by financing activities (920) 6,743 INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 321 (1,813)CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 2,167 3,980 CASH AND CASH EQUIVALENTS AT END OF PERIOD 2,488 2,167 NOTES TO THE FINANCIAL STATEMENTS Note 1 - General: MTI Wireless Edge Ltd. (hereafter - the Company) is an Israeli corporation. Itwas incorporated on December 30, 1998 as a wholly - owned subsidiary of M.T.I.Computers & Software Services (1982) Ltd. (hereafter - the Parent Company) andcommenced operations on July 1, 2000 and since March 2006, the Company's shareshave been traded on the AIM Stock Exchange. The Company is engaged in the development, design, manufacture and marketing ofantennas. Note 2 - Significant Accounting Policies: The significant accounting policies applied in the annual financial statementsof the Company as of December 31, 2006 are applied consistently in these interimconsolidated financial statements. The Company prepares its financial statements in accordance with theinternational reporting standards. This information is provided by RNS The company news service from the London Stock Exchange