ON TRACK INNOVATIONS LTD.
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(Registrant)
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By:
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/s/ Ofer Tziperman | |
Ofer Tziperman | |||
Chief Executive Officer | |||
Press Release
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Received a 30,000 unit order for OTI’s NFC and contactless payment readers from a leading provider of integrated technology solutions.
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ASEC S.A., OTI’s wholly owned subsidiary, was awarded three multi-million dollar projects as an e-ticketing operator for mass transit systems throughout Poland. The contract value of the three projects total more than $50 million over a five to ten year period.
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City of Portsmouth, N.H. implemented EasyPark, OTI’s cashless parking payment solution.
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Retained Global IP Law Group, a leading international IP-focused law firm, to lead OTI’s new intellectual property monetization campaign.
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Received favorable Markman hearing decision in patent infringement suit again T-Mobile USA.
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Strengthened leadership team with appointments of Dimitrios Angelis as chairman of the board, Shay Tomer as chief financial offer, Shlomi Eytan as chief sales and marketing officer, and Hanan Caspi as vice president of operations.
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Revenues in the second quarter of 2013 increased 19% to $9.2 million from $7.7 million in the same period last year.
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Gross margin in the second quarter of 2013 increased to 56.7% from 45.7% in the same period last year.
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Operating expenses in the second quarter of 2013 decreased 8% to $7.2 million from $7.9 million in the second quarter of 2012. The decrease was mainly attributable to lower headcount and reduced management costs.
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Net loss in the second quarter of 2013 improved to $2.3 million from $4.8 million in the same period last year.
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Adjusted EBITDA loss in the second quarter of 2013 totaled $1.5 million compared to an adjusted EBITDA loss of $3.5 million in the second quarter of 2012. The improvement was due to the increase in revenues and reduced operating expenses (see discussion about the presentation of adjusted EBITDA, a non-GAAP term, below).
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Cash and cash equivalents, and short-term investments at June 30, 2013 totaled $9.7 million. During the quarter, the company used cash to purchase equipment to support the expansion of its mass transit projects in Poland, and to repay short-term bank loans.
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June 30
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December 31
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2013
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2012
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(Unaudited)
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(Audited)
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Assets
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Current assets
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Cash and cash equivalents
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$ | 6,193 | $ | 9,304 | ||||
Short-term investments
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3,493 | 8,712 | ||||||
Trade receivables (net of allowance for doubtful
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accounts of $429 and $431 as of June 30, 2013
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and December 31, 2012, respectively)
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5,304 | 7,516 | ||||||
Other receivables and prepaid expenses
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4,036 | 5,349 | ||||||
Short term restricted deposit for employees benefit
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2,969 | 2,922 | ||||||
Inventories
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6,884 | 7,049 | ||||||
Total current assets
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28,879 | 40,852 | ||||||
Long term restricted deposit for employees benefit
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615 | 1,099 | ||||||
Severance pay deposits
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696 | 836 | ||||||
Property, plant and equipment, net
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13,465 | 13,074 | ||||||
Intangible assets, net
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602 | 656 | ||||||
Goodwill
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485 | 485 | ||||||
Total Assets
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$ | 44,742 | $ | 57,002 |
30 June
2013
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31 December
2012
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(Unaudited) |
(Audited)
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Liabilities and Equity
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Current Liabilities
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Short-term bank credit and current maturities
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of long-term bank loans
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$ | 4,004 | $ | 7,368 | ||||
Trade payables
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8,272 | 10,696 | ||||||
Accrued severance pay
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3,398 | 3,539 | ||||||
Other current liabilities
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9,027 | 10,971 | ||||||
Total current liabilities
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24,701 | 32,574 | ||||||
Long-Term Liabilities
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Long-term loans, net of current maturities
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3,277 | 2,224 | ||||||
Accrued severance pay
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1,756 | 2,032 | ||||||
Deferred tax liability
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47 | 53 | ||||||
Total long-term liabilities
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5,080 | 4,309 | ||||||
Total Liabilities
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29,781 | 36,883 | ||||||
Equity
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Shareholders' Equity
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Ordinary shares of NIS 0.1 par value: Authorized –
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50,000,000 shares as of June 30, 2013 and
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December 31, 2012; issued: 33,434,511 and 32,938,011
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shares as of June 30, 2013 and December 31, 2012,
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respectively; outstanding: 32,255,812 and 31,759,312 shares
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as of June 30, 2013 and December 31, 2012, respectively
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833 | 820 | ||||||
Additional paid-in capital
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211,233 | 210,853 | ||||||
Treasury shares at cost - 1,178,699 shares as of June 30,
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2013 and December 31, 2012.
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(2,000 | ) | (2,000 | ) | ||||
Accumulated other comprehensive income (loss)
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(173 | ) | 36 | |||||
Accumulated deficit
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(194,410 | ) | (189,131 | ) | ||||
Total Shareholder’s equity
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15,483 | 20,578 | ||||||
Non-controlling interest
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(522 | ) | (459 | ) | ||||
Total Equity
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14,961 | 20,119 | ||||||
Total Liabilities and Equity
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$ | 44,742 | $ | 57,002 |
Six months ended
June 30
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Three months ended
June 30
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2013
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2012
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2013
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2012
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(Unaudited)
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(Unaudited)
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(Unaudited)
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(Unaudited)
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Revenues
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Sales
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$ | 15,606 | $ | 17,865 | $ | 8,057 | $ | 6,523 | ||||||||
Licensing and transaction fees
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2,227 | 2,475 | 1,149 | 1,213 | ||||||||||||
Total revenues
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17,833 | 20,340 | 9,206 | 7,736 | ||||||||||||
Cost of revenues
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Cost of sales
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8,351 | 10,526 | 3,984 | 4,204 | ||||||||||||
Total cost of revenues
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8,351 | 10,526 | 3,984 | 4,204 | ||||||||||||
Gross profit
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9,482 | 9,814 | 5,222 | 3,532 | ||||||||||||
Operating expenses
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Research and development
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3,864 | 4,426 | 2,092 | 2,083 | ||||||||||||
Selling and marketing
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5,261 | 7,030 | 2,600 | 3,396 | ||||||||||||
General and administrative
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4,588 | 5,096 | 2,521 | 2,369 | ||||||||||||
Amortization of intangible assets
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53 | 102 | 28 | 53 | ||||||||||||
Total operating expenses
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13,766 | 16,654 | 7,241 | 7,901 | ||||||||||||
Operating loss
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(4,284 | ) | (6,840 | ) | (2,019 | ) | (4,369 | ) | ||||||||
Financial expense, net
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(869 | ) | (494 | ) | (269 | ) | (398 | ) | ||||||||
Loss before taxes on income
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(5,153 | ) | (7,334 | ) | (2,288 | ) | (4,767 | ) | ||||||||
Taxes on income
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(190 | ) | (91 | ) | (17 | ) | (70 | ) | ||||||||
Net loss
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(5,343 | ) | (7,425 | ) | (2,305 | ) | (4,837 | ) | ||||||||
Net loss attributable to noncontrolling interest
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64 | 36 | 31 | 2 | ||||||||||||
Net loss attributable to shareholders
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$ | (5,279 | ) | $ | (7,389 | ) | $ | (2,274 | ) | $ | (4,835 | ) |
Basic and diluted net loss attributable to shareholders per ordinary share
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$ | (0.16 | ) | $ | (0.23 | ) | $ | (0.07 | ) | $ | (0.15 | ) | ||||
Weighted average number of ordinary shares used in
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computing basic and diluted net loss per ordinary share
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32,467,881 | 32,069,223 | 32,495,334 | 32,073,103 |
Six months ended June 30
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Three months ended June 30
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2013
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2012
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2013
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2012
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(Unaudited)
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(Unaudited)
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(Unaudited)
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(Unaudited)
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Net Loss
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$ | (5,343 | ) | $ | (7,425 | ) | $ | (2,305 | ) | $ | (4,837 | ) | ||||
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Financial expenses
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869 | 494 | 269 | 398 | ||||||||||||
Depreciation
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787 | 755 | 387 | 369 | ||||||||||||
Taxes on income
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190 | 91 | 17 | 70 | ||||||||||||
Amortization expenses
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53 | 102 | 28 | 53 | ||||||||||||
TOTAL EBITDA
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$ | (3,444 | ) | $ | (5,983 | ) | $ | (1,604 | ) | $ | (3,947 | ) | ||||
Stock based compensation
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$ | 154 | $ | 724 | $ | 70 | $ | 414 | ||||||||
TOTAL ADJUSTED EBITDA
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$ | (3,290 | ) | $ | (5,259 | ) | $ | (1,534 | ) | $ | (3,533 | ) |
Six months ended June 30
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2013
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2012
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(Unaudited)
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(Unaudited)
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Cash flows from operating activities
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Net loss
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$ | (5,343 | ) | $ | (7,425 | ) | ||
Adjustments required to reconcile net loss to
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net cash used in operating activities:
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Stock-based compensation related to options and shares issued
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to employees and others
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154 | 724 | ||||||
Amortization of intangible assets
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53 | 102 | ||||||
Depreciation
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787 | 755 | ||||||
Gain on sale of fixed assets
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(11 | ) | - | |||||
Changes in operating assets and liabilities:
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Accrued severance pay, net
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(157 | ) | 631 | |||||
Accrued interest and linkage differences
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69 | 29 | ||||||
Decrease in deferred tax liability
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(6 | ) | (6 | ) | ||||
Decrease in trade receivables, net
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2,147 | 5,377 | ||||||
Decrease (Increase) in other receivables and prepaid expenses
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1,099 | (374 | ) | |||||
Decrease in inventories
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87 | 581 | ||||||
Decrease in trade payables
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(1,881 | ) | (1,501 | ) | ||||
Decrease in other current liabilities
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(1,893 | ) | (210 | ) | ||||
Net cash used in continuing operating activities
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(4,895 | ) | (1,317 | ) | ||||
Cash flows from investing activities
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Purchase of property and equipment
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(1,656 | ) | (249 | ) | ||||
Purchase of short term investments and long term restricted deposit
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(296 | ) | (7,185 | ) | ||||
Acquisition of business operations
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- | (100 | ) | |||||
Proceeds from restricted deposit for employee benefit
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306 | - | ||||||
Proceeds from maturity and sale of short term investments
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5,542 | 10,843 | ||||||
Proceeds from sale of fixed assets
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11 | - | ||||||
Net cash provided by investing activities
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3,907 | 3,309 | ||||||
Cash flows from financing activities
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Decrease in short-term bank credit, net
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(2,438 | ) | (418 | ) | ||||
Proceeds from long-term bank loans
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1,398 | 273 | ||||||
Repayment of long-term bank loans
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(1,210 | ) | (1,300 | ) | ||||
Proceeds from exercise of options and warrants, net
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239 | 9 | ||||||
Net cash used in financing activities
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(2,011 | ) | (1,436 | ) | ||||
Cash flows from discontinued operations
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Net cash used in discontinued operating activities
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- | (150 | ) | |||||
Total net cash used in discontinued activities
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- | (150 | ) | |||||
Effect of exchange rate changes on cash
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(112 | ) | (4 | ) | ||||
Increase (decrease) in cash and cash equivalents
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(3,111 | ) | 402 | |||||
Cash and cash equivalents at the beginning of the period
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9,304 | 12,517 | ||||||
Cash and cash equivalents at the end of the period
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$ | 6,193 | $ | 12,919 |