OTI Reports Strong First Quarter 2010 Financial Results
* Non-GAAP Operating Profit of $1.2 Million
* Gross Margin Increased to 57%
* Revenues Increased to $14.4 Million
* Cash, Cash Equivalents and Short-Term Investments of $40.4 Million as of March 31
* Gross Margin Increased to 57%
* Revenues Increased to $14.4 Million
* Cash, Cash Equivalents and Short-Term Investments of $40.4 Million as of March 31
On Track Innovations Ltd. (OTI) (Nasdaq:OTIV), a global leader in contactless microprocessor-based smart card solutions for homeland security, payments, petroleum payments and other applications, today announced its consolidated financial results for the first quarter ended March 31, 2010. Following are various financial figures that compare the first quarter of 2010 to 2009.
* Strong balance sheet with cash, cash equivalents and short-term investments of $40.4 million as of March 31, 2010.
* Total revenues of $14.4 million, a 71% increase from last year.
* Gross margin increased to 57% vs. 51% last year.
* Non-GAAP operating expenses of $7.1 million, a 19% increase compared to $5.9 million last year. GAAP operating expenses of $8.2 million, a 14% increase compared to $7.2 million last year.
* Non-GAAP operating profit of $1.2 million, compared to operating loss of $1.6 million last year. GAAP operating profit of $75,000, compared to operating loss of $2.9 million last year.
* Net cash provided by continuing operating activities of $9.5 million.
Oded Bashan, Chairman and CEO of OTI, said: "In the first quarter we were able to significantly increase revenues and gross margin, improve our cash flow position and achieve operating profit. These excellent results are the outcome of a lengthy, calculated process, of reorganization and strategy shift that we have been implementing in the past two years. We are focusing on projects that provide high gross margin, we implemented a cost cutting program, mainly in R&D and G&A, we increased our marketing and sales efforts, and we made a strategic decision to exit the non profitable card manufacturing business through the sale of MCT assets."
* Strong balance sheet with cash, cash equivalents and short-term investments of $40.4 million as of March 31, 2010.
* Total revenues of $14.4 million, a 71% increase from last year.
* Gross margin increased to 57% vs. 51% last year.
* Non-GAAP operating expenses of $7.1 million, a 19% increase compared to $5.9 million last year. GAAP operating expenses of $8.2 million, a 14% increase compared to $7.2 million last year.
* Non-GAAP operating profit of $1.2 million, compared to operating loss of $1.6 million last year. GAAP operating profit of $75,000, compared to operating loss of $2.9 million last year.
* Net cash provided by continuing operating activities of $9.5 million.
Oded Bashan, Chairman and CEO of OTI, said: "In the first quarter we were able to significantly increase revenues and gross margin, improve our cash flow position and achieve operating profit. These excellent results are the outcome of a lengthy, calculated process, of reorganization and strategy shift that we have been implementing in the past two years. We are focusing on projects that provide high gross margin, we implemented a cost cutting program, mainly in R&D and G&A, we increased our marketing and sales efforts, and we made a strategic decision to exit the non profitable card manufacturing business through the sale of MCT assets."
Discontinued Operations
During the fourth quarter of 2009, the Company signed an agreement for the sale of the assets of OTI's subsidiary Millennium Card's Technology Ltd. ("MCT") including the machinery and inlay production IP of OTI to SMARTRAC NV. Results for the discontinued operations have been separated and are presented separately for both 2009 and 2010 statements.About OTI
Established in 1990, OTI (Nasdaq:OTIV) designs, develops and markets secure contactless microprocessor-based smart card technology to address the needs of a wide variety of markets. Applications developed by OTI include product solutions for petroleum payment systems, homeland security solutions, electronic passports and IDs, payments, mass transit ticketing, parking and loyalty programs. OTI has a global network of regional offices to market and support its products. The company was awarded the Frost & Sullivan 2005 and 2006 Company of the Year Award in the field of smart cards.
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