MUNICH,Germany/ROSH PINA, Israel, Aug. 9, 2001 (PRIMEZONE),OTI (GER:OT5 ), the global provider of contact-less smart card technology and product solutions, today announced financial results for the quarter ended June 30, 2001. With significant increases in both revenue and gross profit and reduction of 22% in operating expenses in the last three consecutive quarters, strengthening company expectations to become profitable for the fourth quarter of this year.
Financial Highlights: 1H 2001:
--sum-- Revenues for 1H2001 up 86% to US $9.33 million (1H2000: U.S.$5.02 million).
--sum-- Gross profit ahead 98% to $4.97 million (1H2000: $2.51 million).
--sum-- Operating loss increased by 19% to $4.4 million (1H2000: $3.7 million).
--sum-- Net loss for 1H2001 up 10% to $4.68 million (1H2000: $4.25 million).
--sum-- Loss per share was even at $0.29 (1H2000: $0.29).
--sum-- Cash, cash equivalents, and short-term investments at the end of 1H2001 totaled $14.40 million, with total assets of $40.62 million (1H2000: $17.48 million and $40.65 million, respectively).
Financial Highlights: 2Q 2001:
A significant decrease in operating loss which resulted in a decrease of 61% to $1.2 million in the second quarter in 2001 from $3.2 million in the first quarter in 2001, and a decrease in operating expenses of 22% for the last three consecutive quarters to a level of $ 4.3 million for the second quarter of 2001 from a level of $5.5 million in the fourth quarter of 2000.
These results presents the company's clear trend towards becoming profitable.
The decrease in operating loss is a result of the company's efforts and investments made in infrastructure and research & development, which enabled us to reach this level of expenses. These are planned expenses and are in line with OTI's expansion strategy. Strategic partnerships and new projects developed during the second quarter continue the company's move toward profitability, including the Michael Jackson Fan Club card with P-Card System, the expansion of the Rip Griffin Travel Centers with SmartStop to nationwide, and further development with BP throughout Africa. These results are in line with the company's expectations to break even and reach profitability in 4Q 2001.
Major developments during 2Q 2001:
--sum--The Michael Jackson Fan Card was launched, the first card in a series of cards based on OTI, P-Card and Mega-Access's smart card solution for identification, payment and loyalty, with a first shipment of 250,000 cards.
--sum--EasyPark Ltd. signed an agreement with Ahuzot Hahof, which manages the parking solution on behalf of the City of Tel Aviv, the largest metropolis in Israel, to expand the EasyPark program in Tel Aviv to include parking payment for parking lots and to implement a complementary system utilizing a SmartID Sticker to manage vehicle registration and parking permits.
--sum--OTI Africa has entered into a distribution agreement with BureauFax Technologies (BFT), a leading payment systems integrator in Nigeria and a key player in launching smart cards in that country.
--sum--OTI Africa has received orders from BP Zambia and BP Tanzania to install 26 FuelMaster stations servicing commercial customers to their networks. Thousands of additional vehicles are expected to be installed as a result. Additionally, both companies will install systems on-site for a number of prominent fleet customers, enabling them to use FuelMaster for refueling both at home and on the road.
--sum--OTI announced the expansion of the truck stop industry's first multi-application smart card in all Rip Griffin Travel Centers across the southern United States, as a result of the success of the Terrell, Texas showcase implementation, in operation since Aug. 2000.
"We are continuing to grow and meet projections," said Oded Bashan, President and CEO of OTI. "Our operating expenses have decreased to $4.3 million, with a clear direction to become profitable for the fourth quarter of this year. We have launched additional products that strengthen our position as the technology leader in our marketplace."
For a detailed financial review of 2Q 2001 the Quarterly Report is available at the company's Website, www.oti.co.il.
About OTI
Established in 1990, OTI (On Track Innovations) designs and develops contact-less microprocessor-based smart card technology to address the needs of a wide variety of markets. Applications developed by OTI include product solutions for mass transit, parking, gas management systems, loyalty schemes, ID and secure campuses. OTI has regional offices in the US, Europe, Asia Pacific, and Africa to market and support its products. The company was awarded the prestigious ESCAT Award for smart card innovation in both 1998 and 2000. Visit OTI on the Internet at www.oti.co.il.
The full text report can be found by visiting the following link: http://reports.huginonline.com/830118/92644.pdf
This press release contains forward-looking statements, which reflect management's best judgment based on factors currently known. Such statements are subject to certain risks and uncertainties, which could cause actual results to differ materially from those in the statements included in this press release. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof.