August 7, 2008
MTS Announces Financial Results for the Three and Six Month Periods Ended June 30, 2008
RA'ANANA, Israel, August 7 /PRNewswire-FirstCall/ -- MTS - Mer Telemanagement Solutions Ltd. (Nasdaq Capital Market: MTSL), a global provider of business support systems (BSS) for comprehensive telecommunication management and customer care & billing (CC&B) solutions, today announced its financial results for the three and six month periods ended June 30, 2008.
Revenues for the second quarter of 2008 were $2.4 million, compared with $2.5 million for the same quarter last year. The Company's operating loss declined to $113,000 in the second quarter of 2008 compared to an operating loss of $2.7 million for the second quarter of 2007. Revenues for the six month period ended June 30, 2008 were $4.8 million, compared with $5.0 million for the comparable period in 2007.Net loss for the second quarter was $156,000 or ($0.02) per diluted share, compared with a net loss of $2.8 million or ($0.49) per diluted share in the second quarter of 2007. This decrease in our loss was mainly attributable to a $2.3 million impairment of goodwill and other intangible assets that the Company recorded during the second quarter of 2007 and due to our focus on reducing the Company's operating expenses. Net income for the six months ended June 30, 2008 quarter was $183,000 or $0.03 per diluted share, compared with a net loss of $3.4 million or ($0.59) per diluted share in the comparable period in 2007.
The Company ended the second quarter with approximately $1.3 million in cash and cash equivalents, including marketable securities.
"Even though the economic environment has entered a period of slowdown and the decline in the exchange rate between the US dollar and other major currencies has negatively affected our profit and loss statement, we were able to maintain our level of revenues and decrease our operating expenses significantly," said Eytan Bar, CEO of MTS. "We believe that we are on the right track to achieve improved operating results."
"We are committed to closely monitoring our operating expenses and reducing our overall costs as well as achieving revenue growth," continued Mr. Bar. "The Company has strengthened its main financial indicators and we intend to focus on our search for new opportunities and on expanding our core business," concluded Mr. Bar.
Mer Telemanagement Solutions Ltd. (MTS) is a worldwide provider of innovative solutions for comprehensive telecommunications expense management (TEM) used by enterprises, and for business support systems (BSS) used by information and telecommunication service providers. Since 1984, MTS Telecommunications' expense management solutions have been used by thousands of enterprises and organizations to ensure that their telecommunication services are acquired, provisioned, and invoiced correctly. In addition, the MTS's Application Suite has provided customers with a unified view of telecommunication usage, proactive budget control, personal call management, employee cost awareness and more.
MTS's solutions for Information and Telecommunication Service Providers are used worldwide by wireless and wireline service providers for interconnect billing, partner revenue management and for charging and invoicing their customers. MTS has pre-configured solutions to support emerging carriers of focused solutions (e.g. IPTV, VoIP, MVNO) to rapidly install a full-featured and scaleable solution. MTS's unique technology reduces integration risks and lessens revenue leakage by using the very same system to manage retail and wholesale business as well as supporting multiple business units. Total cost of ownership (TCO) is reduced by providing web-based customer self-care and provisioning.
Headquartered in Israel, MTS markets its solutions through wholly owned subsidiaries in the United States, Hong Kong, The Netherlands, and Brazil, as well as through OEM partnerships with Siemens, Phillips, NEC and other vendors. MTS shares are traded on the NASDAQ Capital Market (symbol MTSL). For more information please visit the MTS web site: http://www.mtsint.com/.
Forward-Looking and Cautionary Statements
Certain matters discussed in this news release are forward-looking statements that involve a number of risks and uncertainties including, but not limited to, risks in product development plans and schedules, rapid technological change, changes and delays in product approval and introduction, customer acceptance of new products, the impact of competitive products and pricing, market acceptance, the lengthy sales cycle, proprietary rights of the Company and its competitors, risk of operations in Israel, government regulations, dependence on third parties to manufacture products, general economic conditions and other risk factors detailed in the Company's filings with the United States Securities and Exchange Commission.
CONSOLIDATED BALANCE SHEETS U.S. dollars in thousands June 30, December 31, 2008 2007 Unaudited Audited ASSETS CURRENT ASSETS: Cash and cash equivalents $ 1,065 $ 1,437 Marketable securities 221 169 Trade receivables (net of allowance for bad debt of $ 720 as of June 30, 2008 and $ 882 as of December 31, 2007) 1,320 1,172 Unbilled receivables 117 129 Other accounts receivable and prepaid expenses 246 544 Other investments - 221 Inventories 76 66 Total current assets 3,045 3,738 LONG- TERM ASSETS: Severance pay fund 776 730 Other investments 44 3 Deferred income taxes 123 123 Total long-term assets 943 856 PROPERTY AND EQUIPMENT, NET 236 283 OTHER ASSETS: Goodwill 2,796 2,796 Other intangible assets, net 708 805 Total other assets 3,504 3,601 Total assets $ 7,728 $ 8,478 CONSOLIDATED BALANCE SHEETS U.S. dollars in thousands June 30, December 31, 2008 2007 Unaudited Audited LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Short term bank credit and current maturities of bank loan $ 119 $ 606 Trade payables 277 447 Accrued expenses and other liabilities 2,358 3,309 Deferred revenues 1,247 1,390 Total current liabilities 4,001 5,752 LONG-TERM LIABILITIES - accrued severance pay 1,189 1,157 SHAREHOLDERS' EQUITY: Share capital - Ordinary shares of NIS 0.01 par value - Authorized: 12,000,000 shares at December 31, 2007 and June 30, 2008; Issued: 5,784,645 at December 31, 2007 and 6,534,645 at June 30, 2008; Outstanding: 5,773,845 at December 31, 2007 and 6,523,845 at June 30, 2008. 19 17 Additional paid-in capital 16,964 16,201 Treasury shares (10,800 Ordinary shares) (29) (29) Accumulated other comprehensive income 33 12 Accumulated deficit (14,449) (14,632) Total shareholders' equity 2,538 1,569 Total liabilities and shareholders' equity $ 7,728 $ 8,478 CONSOLIDATED STATEMENTS OF OPERATIONS U.S. dollars in thousands (except share and per share data) Six months ended Three months ended June 30, June 30, 2008 2007 2008 2007 Unaudited Unaudited Revenues: Products sales $ 2,918 $ 3,070 $ 1,391 $ 1,553 Services 1,905 1,881 1,024 952 Total revenues 4,823 4,951 2,415 2,505 Cost of revenues: Products sales 723 856 327 467 Services 333 525 203 286 Total cost of revenues 1,056 1,381 530 753 Gross profit 3,767 3,570 1,885 1,752 Operating expenses: Research and development 1,412 1,448 688 562 Selling and marketing 1,016 1,639 482 803 General and administrative 1,477 1,519 828 821 Impairment of goodwill and other intangible assets - 2,312 - 2,312 Total operating expenses 3,905 6,918 1,998 4,498 Operating loss (138) (3,348) (113) (2,746) Financial income (expenses), net (61) (13) (43) 2 Capital gain on sale of other investment 382 - - - Income (loss) before taxes on income 183 (3,361) (156) (2,744) Taxes on income - - - - Income (loss) before equity in earnings of affiliate 183 (3,361) (156) (2,744) Equity in earnings of affiliate - (26) - (58) Net income (loss) $ 183 $ (3,387) $ (156) $ (2,802) Net income (loss) per share: Basic and diluted net income (loss) per Ordinary share $ 0.03 $ (0.59) $ (0.02) $ (0.49) Weighted average number of Ordinary shares used in computing basic and diluted net income (loss) per share 6,350,768 5,773,845 6,523,845 5,773,845 Contacts: Company: Alon Mualem CFO Tel: +972-9-762-1733 Email: [email protected]
Mer Telemanagement Solutions Ltd.
CONTACT: Contacts: Company: Alon Mualem, CFO, Tel: +972-9-762-1733,Email: [email protected]