REG - MTI Wireless Edge - Results for the six months ended 30 June 2017 <Origin Href="QuoteRef">MWEE.L</Origin> - Part 1

MTI Wireless EdgeAnnouncement

08/08/2017 07:06

RNS Number : 3294N
MTI Wireless Edge Limited
08 August 2017
Dissemination of a Regulatory Announcement that contains inside information according to REGULATION (EU) No 596/2014 (MAR)
8 August 2017
MTI Wireless Edge Ltd
("MTI" or the "Company")
Financial results for the six months ended 30 June 2017
MTI Wireless Edge Ltd. (AIM: MWE), a market leader in the manufacture of flat panel antennas for fixed wireless broadband and a wireless irrigation solutions provider, today announces its unaudited results for the six months ended 30 June 2017.
Highlights: 
 Revenues increased by 13% year-on-year to $12.8m (H1 2016: $11.3m)
 Operating profit increased year-on-year by 79% of $0.9m (H1 2016: $0.5m)
 Profit before tax nearly tripled year-on-year to $1m (H1 2016: $0.35m)
 Earnings per share of 1.55 US cents (H1 2016: 0.45 US cents)
 Shareholder's equity grew during the period to $19.5m (31 December 2016: $18.9m), equivalent to 28.2 pence per share (converted at 1.31 US dollar/ British Pound)
 Cash at 30 June 2017 of $4.8m (30 June 2016: $4.9m)
Dov Feiner, CEO of MTI Wireless, commented:
"During the first half of 2017, we have continued to see growth in both segments of our business. In our wireless controller segment, via Mottech, we continue to see opportunities in various geographical areas, some of which we announced recently including in China, where we see traction from various sectors and territories. In the antenna segment we had a very good first half, in both the broadband access and RFID product lines, whilst in the military division we had good bookings and a good pipeline of opportunities, which provides us greater visibility of longer-term revenues. Given the current performance, order book and pipeline of opportunities in the antenna segment, we strongly believe that our growth will continue in 2017 and beyond." 
For further information please contact:
MTI Wireless Edge Ltd
Dov Feiner, CEO
Moni Borovitz, Financial Director
http://www.mtiwe.com/
+972 3 900 8900
Nomad and Joint Broker
Allenby Capital Limited
Nick Naylor
Alex Brearley
+44 20 3328 5656
Joint Broker
Peterhouse Corporate Finance Limited
Lucy Williams
Eran Zucker
+44 20 7469 0930
About MTI Wireless Edge
MTI is engaged in the development, production and marketing of high quality low cost, flat panel antennas for commercial and military applications. Commercial applications include: WiMAX, Wireless Networking, RFID readers and Broadband Wireless Access. With over 40 years' experience of supplying 100KHz to 90GHz antennas, 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 include 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.
Via its subsidiary, Mottech Water Solutions Ltd, MTI is also a leading provider of remote control solutions for water and irrigation applications based on Motorola's IRRInet state of the art control, monitoring and communication technologies. Mottech, headquartered in Israel, is the global prime distributor of Motorola for the IRRInet remote control solutions serving its customers worldwide through its subsidiaries and a global network of local distributers and representatives. It utilizes over 25 years of experience in providing its customers with remote control and management systems which ensure constant, reliable and accurate water usage, while reducing operational costs and maintenance costly expenses. Mottech's activities are focused on the market segments of agriculture, water distribution, Municipal and Commercial Landscape and Wastewater and Storm water Reuse. 
INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME 
Six month period
ended June 30,
Year ended December 31,
2017
2016
2016
U.S. $ in thousands
Unaudited
Revenues
12,758
11,325
23,276
Cost of sales
7,896
7,067
14,728
Gross profit
4,862
4,258
8,548
Research and development expenses
461
574
1,079
Distribution expenses
1,912
1,819
3,346
General and administrative expenses
1,610
1,375
2,640
Profit from operations
879
490
1,483
Finance expense
101
163
334
Finance income
205
22
57
Profit before income tax
983
349
1,206
Income tax expense 
111
104
222
Profit 
872
245
984
Other comprehensive income (loss)net of tax:
Items that will not be reclassified to profit or loss:
Re-measurement of defined benefit plans
-
-
(16)
-
-
(16)
Items that may be reclassified to profit or loss:
Adjustment arising from translation of financial statements of foreign operations
31
177
121
31
177
121
Total other comprehensive income
31
177
105
Total comprehensive income 
903
422
1,089
Profit attributable to:
Owners of the parent
811
232
936
Non-controlling interest
61
13
48
872
245
984
Total comprehensive income attributable to:
Owners of the parent
842
409
1,041
Non-controlling interest
61
13
48
903
422
1,089
Earningsper share(dollars)
Basic 
0.0155
0.0045
0.0181
Diluted
0.0153
0.0044
0.0178
Weighted average number of shares outstanding
Basic 
52,346,974
51,621,990
51,687,853
Diluted
53,167,096
52,616,775
52,575,593
The accompanying notes form an integral part of the financial statements.
INTERIM CONSOLIDATEDSTATEMENT OF 
CHANGES IN EQUITY

For the Six month period ended June 30, 2017 (Unaudited):
Attributed to owners of the parent
Share capital
Additional paid-in capital
Capital Reserve
for share-based
payment
transactions
Adjustment arising from translation of financial statements of foreign operations
Retained earnings
Total attributable to owners of the parent
Non-controlling interest 
Total equity
U.S. $ in thousands
Balance at January 1, 2017
109
14,964
323
44
3,468
18,908
324
19,232
Changes during the six month period
 ended June 30, 2017:
Comprehensive income
Profit for the period
-
-
-
-
811
811
61
872
Other comprehensive income
Translation differences
-
-
-
31
-
31
-
31
Total comprehensive income for the period
-
-
-
31
811
842
61
903
Exercise of options to share capital
(*)
14
(*)
-
-
14
-
14
Dividend 
3
280
-
-
(518)
(235)
-
(235)
Share based payment
-
-
14
-
-
14
-
14
Balance at June 30, 2017 
112
15,258
337
75
3,761
19,543
385
19,928
(*) less than one thousand dollars 
The accompanying notes form an integral part of the financial statements.
INTERIM CONSOLIDATEDSTATEMENT OF 
CHANGES IN EQUITY (CONT.)

For the Six month period ended June 30, 2016 (Unaudited):
Attributed to owners of the parent
Share capital
Additional paid-in capital
Capital Reserve
for share-based
payment
transactions
Adjustment arising from translation of financial statements of foreign operations
Retained earnings
Total attributable to owners of the parent
Non-controlling interest 
Total equity
U.S. $ in thousands
Balance at January 1, 2016 
109
14,945
304 
(77)
3,116
18,397
266
18,663
Changes during the six month period
 ended June 30, 2016:
Comprehensive income
Profit for the period
-
-
-
-
232
232
13
245
Other comprehensive income
Translation differences
-
-
-
177
-
177
-
177
Total comprehensive income for the period
-
-
-
177
232
409
13
422
Share issuance to non-controlling interest in subsidiary
-
(10)
-
-
-
(10)
10
-
Exercise of options to share capital
(*)
22
(1)
-
-
21
-
21
Dividend paid
-
-
-
-
(568)
(568)
-
(568)
Share based payment
-
-
5
-
-
5
-
5
Balance at June 30, 2016 
109
14,957
308
100
2,780
18,254
289
18,543
(*) less than one thousand dollars 
The accompanying notes form an integral part of the financial statements.
INTERIM CONSOLIDATEDSTATEMENT OF 
CHANGES IN EQUITY (CONT.)
For the year ended December 31, 2016:
Attributable to owners of the parent
Share capital
Additional paid-in capital
Capital Reserve from share-based payment transactions
Adjustment arising from translation of financial statements of foreign operations
Retained earnings
Total attributable to owners of the parent
Non-controlling interest
Total equity
U.S. $ in thousands
Balance as at January 1, 2016
109
14,945
304
(77)
3,116
18,397
266
18,663
Changes during 2016:
Comprehensive income
Profit for the year
-
-
-
-
936
936
48
984
Other comprehensive income
Re measurements on defined benefit plans
-
-
-
-
(16)
(16)
-
(16)
Translation differences
-
-
-
121
-
121
-
121
Total comprehensive income for the year
-
-
-
121
920
1,041
48
1,089
Share issuance to non-controlling interest in subsidiary
-
(10)
-
-
-
(10)
10
-
Exercise of options to share capital
(*)
29
(1)
-
-
28
-
28
Dividend paid
-
-
-
-
(568)
(568)
-
(568)
Share based payment 
-
-
20
-
-
20
-
20
Balance as at December 31, 2016
109
14,964
323
44
3,468
18,908
324
19,232
(*) less than one thousand dollars 
The accompanying notes form an integral part of these financial statements.
INTERIM CONSOLIDATED STATEMENT OF 
FINANCIAL POSITION 
30.06.2017
30.06.2016
31.12.2016
U.S. $ in thousands
Unaudited
ASSETS
CURRENT ASSETS:
Cash and cash equivalents 
4,786
4,862
4,428
Trade receivables
9,525
8,131
8,159
Other receivables
792
909
706
Currenttax receivables
586
331
455
Inventories
4,605
3,893
4,910
20,294
18,126
18,658
NON-CURRENT ASSETS:
Long term prepaid expenses
39
49
48
Property, plant and equipment
5,328
5,562
5,453
Investment property
619
640
630
Deferred tax assets
617
475
500
Intangible assets
267
375
321
Goodwill 
573
573
573
7,443
7,674
7,525
Total assets
27,737
25,800
26,183
The accompanying notes form an integral part of the financial statements.
INTERIM CONSOLIDATED STATEMENT OF 
FINANCIAL POSITION 
30.06.2017
30.06.2016
31.12.2016
U.S. $ In thousands
Unaudited
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Current maturities and short term bank credit and loans
1,018
799
802
Trade payables
2,621
2,155
2,285
Other accounts payables
2,247
1,786
1,792
Currenttax payables
143
20
3
6,029
4,760
4,882
NON- CURRENTLIABILITIES:
Loans from banks, net of current maturities
1,321
2,017
1,664
Employee benefits, net
459
388
405
Other liabilities
-
92
-
1,780
2,497
2,069
Total liabilities
7,809
7,257
6,951
EQUITY 
Equity attributable to owners of the parent
Share capital 
112
109
109
Additional paid-in capital
15,258
14,957
14,964
Capital reserve from share-based payment transactions
337
308
323
Translation differences
75
100
44
Retained earnings
3,761
2,780
3,468
19,543
18,254
18,908
Non-controlling interest
385
289
324
Total equity 
19,928
18,543
19,232
Total equity and liabilities
27,737
25,800
26,183
August 7, 2017
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
Six months period
ended June 30,
Year ended December 31,
2017
2016
2016
U.S. $ in thousands
Unaudited
Cash Flows from Operating Activities:
Profitfor the period
872
245
984
Adjustments for:
Depreciation and amortization
326
312
635
Loss (gain) from investments in financial assets
133
(10)
(57)
Equity settled share-based payment expense
14
5
20
Finance expenses, net
56
64
122
Income tax expense 
111
104
222
Changes in operating assets and liabilities:
Decrease (increase) in inventories 
372
551
(466)
Decrease (increase) in trade receivables
(1,409)
102
19
Decrease (increase) in other accounts receivables and prepaid expenses
(34)
368
572
Increase in trade and other accounts payables
4
700
44
105
Increase in employee benefits, net
54
1
2
Interest paid
(56)
(64)
(122)
Income taxpaid
(215)
(553)
(837)
Net cash provided by operating activities
924
1,169
1,199
The accompanying notes form an integral part of the financial statements.
INTERIM CONSOLIDATED STATEMENTS OF 
CASH FLOWS (cont.)
Six months period
ended June 30,
Year ended December 31,
2017
2016
2016
U.S. $ in thousands
Unaudited
Cash Flows From Investing Activities:
Sale of investments in financial assets, net
-
2,142
2,142
Purchase of property, plant and equipment
(119)
(146)
(314)
Net cash provided by (used in) investing activities
(119)
1,996
1,828
Cash Flows From Financing Activities:
Exercise of share options
14
21
28
Dividend paid to the owners of the parent
(235)
(568)
(568)
Short term loan received from banks
166
-
-
Long term loan received from banks
-
-
87
Repayment of long-term loan from banks
(426)
(403)
(793)
Net cash used in financing activities
(481)
(950)
(1,246)
Increase in cash and 
cash equivalents during the period 
324
2,215
1,781
Cash and cash equivalents
at the beginning of the period 
4,428
2,634
2,634
Exchange differences on balances of cash andcash equivalents
34
13
13
Cash and cash equivalents
at the end of the period 
4,786
4,862
4,428
Appendix A - Non-cash transactions:
Six months period
ended June 30,
Year ended December 31,
2017
2016
2016
U.S. $ in thousands
Unaudited
Purchase of property, plant and equipment 
 against trade payables
6
23
5
Scrip dividend (Note 5 B)
283
-
-
The accompanying notes form an integral part of the financial statements.
MTI WIRELESS EDGE LTD. 
(An Israeli Corporation)
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
Note 1 - General:
Corporate information:
M.T.I Wireless Edge Ltd. (hereafter - the "Company", or collectively with its subsidiaries, the "Group") is an Israeli corporation. The Company was incorporated under the Companies Act in Israel on December 30, 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 the AIM market of the London Stock Exchange.
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.
Via its subsidiary, Mottech Water solutions Ltd. (hereafter "Mottech"), the Company is also a leading provider of remote control solutions for water and irrigation applications based on Motorola's IRRInet state of the art control, monitoring and communication technologies.
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, 2016 was approved by the board on February 15, 2017. The report of the auditors on those financial statements was unqualified. 
The interim consolidated financial statements as of June 30, 2017 have not been audited.
The interim consolidated financial information should be read in conjunction with the annual financial statements as of December 31, 2016 and for the year then ended and with the notes thereto. The significant accounting policies applied in the annual financial statements of the Company as of December 31, 2016 are applied consistently in these interim consolidated financial statements.
Note 3 - operating SEGMENTS:
The following tables present revenue and profit information regarding the Group's operating segments for the six months period ended June 30, 2017 and 2016 respectively, and for the year ended December 31, 2016.
Six months periodended June 30, 2017(Unaudited)
Antennas
Water Solutions
Total
U.S. $ in thousands
Revenue
External
6,579
6,179
12,758
Total
6,579
6,179
12,758
Segment profit 
175
704
879
Finance income, net
104
Profit before income tax
983
Other
Depreciation and amortization
298
28
326
Six months periodended June 30, 2016 (Unaudited)
Antennas
Water Solutions
Total
U.S. $ in thousands
Revenue
External
5,304
6,021
11,325
Total
5,304
6,021
11,325
Segment profit (loss)
(345)
835
490
Finance expense, net
(141)
Profit before income tax
349
Other
Depreciation and amortization
288
24
312
Note 3 - operating SEGMENTS (CONT.):
Year ended December 31, 2016 
Antennas
Water Solutions
Total
U.S. $ in thousands
Revenue
External
11,427
11,849
23,276
Total
11,427
11,849
23,276
Segment profit (loss) 
(108)
1,591
1,483
Unallocated corporate expenses
Finance expense, net
(277)
Profit before income tax
1,206
Other
Depreciation and amortization
591
44
635
Note 4 - TRANSACTIONS AND BALANCES WITH RELATED PARTIES: 
The following transactions occurred with the Parent Company and other related parties: 
Six months periodended 
 June 30,
Year ended December 31,
2017
2016
2016
U.S. $ in thousands
Unaudited
Purchased Goods
103
105
369
Management Fee
221
185
428
Services Fee
130
124
249
Leaseincome
(36)
(36)
(72)
Compensation of key management personnel of the Group:
Six months periodended 
 June 30,
Year ended December 31,
2017
2016
2016
U.S. $ in thousands
Unaudited
Short-term employee benefits *)
417
353
810
*) Including Management fees for the CEO, Directors, Executive Management and other related parties.
All Transactions were made at market value. 
Note 4- TRANSACTIONS AND BALANCES WITH RELATED PARTIES (CONT.):
Balances with related parties:
As at
30.06.2017
30.06.2016
31.12.2016
U.S. $ in thousands
Unaudited
Other accounts payables
293
90
207
Note 5 - SIGNIFICANT EVENTS:
A. During January and June 2017, employees exercised options over 120,000 shares in exchange for a total consideration of approximately $14,000.
B. On April 4, 2017, the Company paid a dividend of 1 US cent per share totaling approximately $235,000 and in addition, 1,022,328 new ordinary shares were issued to qualifying shareholders that chose the scrip dividend alternative.
C. During June 2017 Mottech agreed to establish a joint venture company in China ("Mottech China") with Omega Technologies LTD ("OTL"), which is an existing third-party sales representative for Mottech's water irrigation solutions in China. Mottech China will be 60% owned by Mottech. In addition to supporting Mottech's activities, it is intended that Mottech China will also sell additional third party products that are complementary to Mottech's equipment which are currently being sold by OTL in China.

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