REG - MTI Wireless Edge - 1st Quarter Results <Origin Href="QuoteRef">MWEE.L</Origin>

MTI Wireless EdgeAnnouncement

15/07/2015 17:32

RNS Number : 1227N
MTI Wireless Edge Limited
14 May 2015
14 May 2015
MTI Wireless Edge Ltd 
("MTI" or the "Company")
Financial results for the three months ended 31 March 2015
MTI Wireless Edge Ltd., (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 2015.
Highlights
 Continued increase in revenue and operational profit.
 Revenue increased by 1% to US$3.54m (Q1 2014: US$3.51m).
 Operational profit increased by 62% to US$141k (Q1 2014: US$87k).
 Dividend of US 0.68 cent per share paid on 2 April 2015.
 Shareholder's equity of US$17.9m (at December 31 2014: US$17.9m), equivalent to 22.4 pence per share.
 Acquisition of Mottech is progressing and closing is expected before end of May 2015.
Dov Feiner, Chief Executive Officer, commented: 
"I am pleased to announce that during this quarter the Company continued to increase its revenue and profits. We are especially pleased with the growth in our RFID line of products, which is driven by fleet management and toll roads solutions. We also continue to see interest and demand for our 80GHz line of products. However, we note some of our customers are suffering delays in implementing their solution into the market, but we remain confident in the long-term market opportunity for these multi-gigabit wireless internet backhaul solutions. 
"As announced on the 28 April 2015, the Company has entered into a conditional agreement to acquire Mottech, a provider of wireless control products and services. We expect to complete the acquisition within the next 30 days and the management team is planning the integration process. An announcement will be made when the acquisition completes." 
For further information please contact:
MTI Wireless Edge
Dov Feiner, CEO
Moni Borovitz, Financial Director
http://www.mtiwe.com/
+972 3 900 8900
Allenby Capital Limited
Nick Naylor
Alex Price
+44 20 3328 5656
About MTI Wireless Edge
MTI is engaged in the development, production and marketing of High Quality, Low Cost, Flat Panel Antennas for Commercial & for Military applications. Commercial applications such as: WiMAX, Wireless Networking, RFID readers & Broadband Wireless Access. With over 40 years' experience, supplying antennas 100KHz to 90GHz including directional antennas and Omni directional for outdoor and indoor deployments including Smart Antennas for WiMAX, Wi-Fi, Public Safety, RFID and for Base Stations and Terminals - Utility Market. Military applications includes a wide range of broadband, tactical and specialized communications antennas, antenna systems and DF arrays installed on numerous airborne, ground and naval, including submarine, platforms worldwide.
INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME 

Three months ended
March 31

Year ended December 31

2015

2014

2014

U.S. $ in thousands

Unaudited

Audited






Revenues
3,542

3,512

14,341
Cost of sales 
2,272

2,162

9,201






Gross profit
1,270

1,350

5,140
Research and development expenses
322

297

1,230
Distribution expenses
411

505

1,815
General and administrative expenses
396

461

1,755






Profit from operations
141

87

340
Finance expense
99

60

281
Finance income
3

24

94






Profit before income tax
45

51

153
Income tax benefit
(30)

(67)

(116)






Profit or loss
75

118

269
Other comprehensive income (net of tax effect):





Items not to be reclassified to profit or loss in subsequent periods:





Re-measurement of defined benefit plans
-

-

(29)






Total comprehensive income 
75

118

240












Profit or loss
Attributable to:





Owners of the parent
70

124

247
Non-controlling interest
5

(6)

22







75

118

269
Total comprehensive income 
Attributable to:





Owners of the parent
70

124

218
Non-controlling interest
5

(6)

22







75

118

240






Earnings per share(dollars per share)





Basic andDiluted
0.0014

0.0024

0.0048






Weighted average number of shares outstanding





Basic and Diluted
51,571,990

51,571,990

51,571,990






The accompanying notes form an integral part of the financial statements.

INTERIM CONSOLIDATEDSTATEMENT OF 
CHANGES IN EQUITY
For the three months period ended March 31 2015:

Attributed to owners of the parent


Share capital

Additional paid-in capital

Capital Reserve
for share-based
payment
transactions

Retained earnings

Total attributable to owners of the parent

Non-controlling interest 

Total equity

U.S. $ in thousands














Balance at January 1 2015 (Audited)
109

14,945

286 

2,287

17,627

216

17,843














Changes during the three months
 ended March 31 2015 (Unaudited):













Comprehensive income for the period 
-

-

-

70

70

5

75
Share based payment 
-

-

6

-

6

-

6














Balance at March 31 2015 (Unaudited)
109

14,945

292

2,357

17,703

221

17,924














The accompanying notes form an integral part of the financial statements.
INTERIM CONSOLIDATEDSTATEMENT OF 
CHANGES IN EQUITY
For the three months period ended March 31 2014:

Attributed to owners of the parent


Share capital

Additional paid-in capital

Capital Reserve
for share-based
payment
transactions

Retained earnings

Total attributable to owners of the parent

Non-controlling interest 

Total equity

U.S. $ in thousands














Balance at January 1 2014 (Audited)
109

14,945

259

2,420

17,733

194

17,927














Changes during the three months 
 ended March 31 2014 (Unaudited):













Comprehensive income (loss) for the period 
-

-

-

124

124

(6)

118
Share based payment 
-

-

6

-

6

-

6














Balance at March 31 2014 (Unaudited)
109

14,945

265

2,544

17,863

188

18,051














The ac companying notes form an integral part of the financial statements.
INTERIM CONSOLIDATEDSTATEMENT OF 
CHANGES IN EQUITY
For the year ended December 31, 2014:

Attributable to owners of the parent


Share capital

Additional paid-in capital

Capital Reserve from share-based payment transactions

Retained earnings

Total attributable to owners of the parent

Non-controlling interest

Total equity

U.S. $ in thousands
 
Audited














Balance at January 1 2014
109

14,945

259 

2,420

17,733

194

17,927














Changes during 2014:













Income for the year
-

-
-
247 
247
22
269
Other comprehensive income 
-
-
-
(29)
(29)
-
(29)














Total comprehensive income for the year
-

-
-
218
218
22
240
Dividend paid
-

-

-

(351)

(351)

-

(351)
Share based payment 
-
-
27
-
27
-
27
Balance as at December 31 2014
109
14,945
286 
2,287
17,627
216
17,843














The ac companying notes form an integral part of the financial statements.

INTERIM CONSOLIDATED STATEMENT OF 
FINANCIAL POSITION 

31.03.2015

31.03.2014

31.12.2014

U.S. $ in thousands

Unaudited

Audited
ASSETS





CURRENT ASSETS:





Cash and cash equivalents 
3,275

687

2,918
Other current financial assets
2,872

5,753

3,728
Trade receivables
5,145

5,382

5,012
Other receivables
857

562

771
Currenttax receivables
138

164

143
Inventories
2,844
3,139

2,941







15,131
15,687

15,513












NON-CURRENT ASSETS:





Long-term prepaid expenses
10

32

12
Property, plant and equipment
5,127

5,330

5,209
Investment property
1,230

1,265

1,240
Deferred tax assets
404

293

368
Goodwill
406
406

406







7,177
7,326

7,235














Total assets
22,308
23,013

22,748






The accompanying notes form an integral part of the financial statements.

INTERIM CONSOLIDATED STATEMENT OF 
FINANCIAL POSITION 

31.03.2015

31.03.2014

31.12.2014

U.S. $ In thousands

Unaudited

Audited
LIABILITIES AND SHAREHOLDERS' EQUITY





CURRENT LIABILITIES:





Current maturities and short term Loans
270

562

270
Trade payables
1,682

1,682

1,906
Other accounts payables
784

777

1,019







2,736

3,021

3,195






NON- CURRENTLIABILITIES:





Loans from banks
1,276

1,529

1,345
Employee benefits
372

330

365
Provisions 
-

82

-







1,648

1,941

1,710






Total liabilities
4,384

4,962

4,905






EQUITY 





Equity attributable to owners of the parent





Share capital 
109

109

109
Additional paid-in capital
14,945

14,945

14,945
Capital reserve from share-based payment transactions
292

265

286
Retained earnings
2,357

2,544

2,287







17,703

17,863

17,627






Non-controlling interest
221

188

216






Total equity 
17,924

18,051

17,843









Total equity and liabilities
22,308

23,013

22,748






May 10 2015

Date of approval of financial statements

Moshe Borovitz Finance Director
Dov Feiner 
Chief Executive Officer
Zvi Borovitz 
Non-executive Chairman
The accompanying notes form an integral part of the financial statements.
INTERIM CONSOLIDATED STATEMENTS OF 
CASH FLOWS

Three months ended
March 31

Year ended December 31


2015

2014

2014


U.S. $ in thousands


Unaudited

Audited
Cash Flows from Operating Activities:













Profitfor the period

75

118

269
Adjustments to reconcile net income to 
net cash provided by operating activities:






Depreciation 

127

112

451
Loss (Gain) from short-term investments

22

(22)

(37)
Equity settled share-based payment expense

6

6

27
Finance expenses, net

20

23

87
Income tax

(30)

(67)

(116)
Changes in operating assets and liabilities:






Decrease (increase) in inventories 

97

(48)

150
Decrease (increase) in trade receivables

(133)

(23)

347
Increase in other accounts receivables and prepaid expenses

(84)

(7)

(196)
Increase (decrease) in trade and other accounts payables

(468)

(261)

162
Increase in employee benefits, net

7

14

20
Decrease in provisions

-

(30)

(40)
Interest paid

(20)

(23)

(87)
Income tax received (paid)

(1)

1

(4)
Net cash generated in operating activities

(382)

(207)

1,033














The accompanying notes form an integral part of the financial statements.


INTERIM CONSOLIDATED STATEMENTS OF 
CASH FLOWS


Three months ended
March 31

Year ended December 31


2015

2014

2014


U.S. $ in thousands


Unaudited

Audited
Cash Flows From Investing Activities:






Sale (purchase) of short-term investment, net

833

22

2,053
Purchase of property, plant and equipment

(26)

(54)

(276)







Net cash generated (used in) investing activities

807

(32)

1,777














Cash Flows From Financing Activities:






Short-term Loan paid

-

-

(292)
Long-term Loan received 

-

-

31
Dividend paid to the owners of the parent

-

-

(351)
Repayment of long-term loan from banks

(68)

(66)

(272)







Net cash used in financing activities

(68)

(66)

(884)














Increase (decrease) in cash and 
cash equivalents during the period 

357

(305)

1,926
Cash and cash equivalents
at the beginning of the period 

2,918

992

992







Cash and cash equivalents
at the end of the period 

3,275

687

2,918







Appendix A - Non-cash transactions:


Three months 
ended March 31

Year ended December 31


2015

2014

2014


U.S. $ in thousands


Unaudited

Audited







Purchase of property and equipment 
against trade payables

20

40

11







The accompanying notes form an integral part of the financial statements.

Note 1 - General:
A.  Corporate information:
M.T.I Wireless Edge Ltd. (hereafter - the "Company") is an Israeli corporation. It was incorporated under the Companies Act in Israel on December 31 1998 as a wholly-owned subsidiary of M.T.I Computers and Software Services (1982) Ltd. (hereafter - the "Parent Company") and commenced operations on July 1 2000. Since March 2006, the Company's shares have been traded on London's AIM Market.
The formal address of the Company is 11 Hamelacha Street, Afek Industrial Park, Rosh-Ha'Ayin, Israel.
The Company is engaged in the development, design, manufacture and marketing of antennas and accessories.
B.  Foreign currencies: 
Henceforth are the details of the main foreign currency information and the changes in the exchange rate percentage in the reporting period:

March 31
December 31

2015

2014
2014





NIS (in Dollar per 1 NIS)
0.251

0.287
0.257
Three months ended 
March 31
Year ended December 31

2015

2014
2014

%

%
%
NIS 
(2.29)

(0.45)
(10.72)
Note 2 - Significant Accounting Policies: 
The interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles for the preparation of financial statements for interim periods, as prescribed in International Accounting Standard No. 34 ("Interim Financial Reporting").
The interim consolidated financial information set out above does not constitute full year end accounts within the meaning of Israeli Companies Law. It has been prepared on the going concern basis in accordance with the recognition and measurement criteria of the International Financial Reporting Standards ("IFRS"). Statutory financial information for the financial year ended December 31 2014 was approved by the board on February 19 2015. The report of the auditors on those financial statements was unqualified. The interim consolidated financial statements as of March 31 2015 have not been audited.
The interim consolidated financial information should be read in conjunction with the annual financial statements as of 31 December 2014 and for the year ended on that date and with the notes thereto. The significant accounting policies applied in the annual financial statements of the Company as of December 31 2014 are applied consistently in these interim consolidated financial statements.
Note 3 - operating SEGMENTS:
The following table's present revenue and profit information regarding the Company's operating segments for the Three months ended March 31, 2015 and 2014, respectively, and for the year ended December 31 2014.
Three monthsended March 31 2015(Unaudited)








Commercial

Military

Total


$'000
Revenue






External

2,700

842

3,542







Total

2,700

842

3,542














Segment income 

64

77

141














Finance expense, net





(96)







Profit before income tax





45







Other






Depreciation and other non-cash expenses

111

16

127







Three monthsended March 31 2014 (Unaudited)








Commercial

Military

Total


$'000
Revenue






External

2,662

850

3,512







Total

2,662

850

3,512














Segment income (loss)

24

63

87







Unallocated corporate expenses






Finance expense, net





(36)







Profit before income tax





51







Other






Depreciation and other non-cash expenses

99

8

112







Note 3- operating SEGMENTS (CONT.):
Yearended December 31 2014 (audited)




Commercial

Military

Total


$'000
Revenue






External

11,323

3,018

14,341







Total

11,323
3,018
14,341














Segment profit 

171

140

311







Unallocated corporate expenses






Unallocated income 





29







Finance expense, net





(187)







Profit before income tax





153







Other






Depreciation 

394

57

451







Note 4 -TRANSACTIONS WITH RELATED PARTIES: 
The Parent Company and other related parties provide certain services to the Group as follows:


Three monthsended 
 March 31

Year ended December 31


2015

2014

2014


U.S. $ in thousands


Unaudited

Audited
Purchased Goods

31

95

301 
Management Fee

91

99

387 
Services Fee

53

52

208 
Leaseincome

(30)

(30)

(120)
Compensation of key management personnel of the Group:


Three monthsended 
 March 31

Year ended December 31


2015

2014

2014


U.S. $ in thousands


Unaudited

Audited
Short-term employee benefits *)

179

173

717







*) Including Management fees for the CEO, Director executive management and other related parties.
All Transactions are made at market value. 

31.03.2015

31.03.2014

31.12.2014

U.S. $ In thousands

Unaudited

Audited
Related parties
34

32

25
Note 5 - SIGNIFICANT EVENTS:
a. On April 4 2015, the Company paid a dividend of 0.68 cents per share totalling approximately US$351,000.
b. On April 28 2015 the Company announced that it has entered into a conditional share purchase agreement to acquire 100% of Mottech, a provider of wireless control products and services, for a consideration of up to 18.55 million New Israeli Shekels ("NIS") (approximately US$4.75 million) from which 15.5 million NIS (US$4 million) will be paid upon closing and the remainder by April 2018 based on the financial performance of Mottech in 2016 and 2017 (the "Acquisition").
Mottech is a global distributor and integrator of Motorola's wireless control solutions, which includes a portfolio of radio-enabled sensors and switches managed by control software. Mottech primarily operates in the water-management sector and has developed proprietary wireless management solutions for commercial irrigation, municipal water authorities and water distributors. A typical solution reduces costs for the client, for example Mottech provides a commercial farm irrigation system that monitors the local environment, weather and soil sensors in real-time and Mottech's propriety software automatically operates irrigation and fertilizer pump stations to optimize these critical costs for the farm. 
Mottech was set up in May 2014 and acquired its business and assets at the same time from the Israeli court. The assets had been placed in the Israeli court following the previous owner going into administration as result of business failure at a subsidiary which is not part of Mottech or its business today.
During the period from May to December 2014 Mottech's audited accounts show revenue of 26.5 million NIS (US$6.6 million) from distributing Motorola's wireless control products, system integration and management and maintenance services. Mottech is headquartered in Israel, and has 60 employees worldwide, including subsidiaries in South Africa, Australia and the US. Subject to satisfaction of the relevant conditions, the Acquisition is scheduled to complete in May 2015. 
The Acquisition is conditional, inter alia on:
 The approval of Israeli antitrust controller;
 The receipt of Motorola approval for the Acquisition;
 The warranties given by Mottech and its owners to the Company in respect of the Mottech business remaining true and accurate as at completion of the Acquisition;
 There being no material adverse change in the financial and trading position or prospects of the Mottech business before completion of the Acquisition; and
 The approval of Mottech's banks.
The Acquisition is to be funded out of MTI's existing cash resources and new bank facilities to be put in place.

This information is provided by RNS
The company news service from the London Stock Exchange
  END
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