-- Revenues of $4.66 million, a 15% increase over the third quarter of 2005. -- Operating income, excluding amortization of intangible assets and equity-based compensation expense of $677 thousand. -- Net income, excluding amortization of intangible assets and equity- based compensation expense, of $972 thousand or $0.05 per share. -- GAAP net income of $710 thousand or $0.03 per share. -- Cash flow from operating activities in Q3 2006 was $1.05 million. -- Strong cash position of approximately $37 million on September 30, 2006.Dividend Policy and Dividend Distribution In July 2003, the Board of Directors had adopted our dividend policy. We have since distributed dividends four times and we intend to continue to distribute cash dividends based on factors that include our cash position and our activities. Today, the Board of Directors resolved that the Company should seek the court approval formally required in order to enable a distribution for the year 2006 of approximately $4 million, which is similar to previous years' average. Under Israeli law, a company with insufficient retained earnings is required to obtain approval from the court for such a distribution in order to ensure that the Company's creditors are not harmed by the action. In view of the strong cash position of approximately $37 million, the Company expects to obtain such court approval within eight to twelve weeks, although there is no guarantee that such approval will not be delayed or denied. Prior to paying any dividend, which is still subject to specific Board approval, the Company will issue a press release announcing the exact dividend amount, record date and distribution date. "Given our strong cash position and our positive operating cash flow, we believe that our dividend policy enhances shareholders value," stated Monica. "We are well positioned and have the required resources to respond to potentially increasing market needs and at the same time we are focused on targeting potential acquisitions that could benefit the company growth." Conference Call Information MIND will host a conference call on October 31, 2006 at 8:30 a.m., Eastern Standard Time, to discuss the Company's third quarter 2006 results and other financial and business information. The call will be carried live on the Internet via www.fulldisclosure.com and the MIND website, www.mindcti.com. For those unable to listen to the live web cast, a replay will be available. About MIND MIND CTI Ltd. is a leading provider of convergent prepaid and postpaid end-to-end billing and customer care solutions for VoIP, Mobile, Wireline and Quad-play carriers worldwide. Since 1997, MIND has been a pioneer in enabling the VoIP technology for emerging and incumbent service providers. In August 2005, MIND acquired Sentori, Inc., a US based provider of customer care and billing solutions to wireless carriers and mobile virtual network operators (MVNOs). Sentori, Inc. brings over ten years of wireless experience staff and seven years of a wireless operational solution to carriers. A global company, MIND operates from offices in Europe, Israel and the United States. MIND employs over 300 IT professionals and serves customers in more than 40 countries around the world. For financial information, reports and presentations, please visit the Investor Relations site: http://www.mindcti.com/ir Cautionary Statement for Purposes of the "Safe Harbor" Provisions of the Private Securities Litigation Reform Act of 1995: All statements other than historical facts included in the foregoing press release regarding the Company's business strategy are "forward-looking statements." These statements are based on management's beliefs and assumptions and on information currently available to management. Forward-looking statements are not guarantees of future performance, and actual results may materially differ. The forward-looking statements involve risks, uncertainties, and assumptions, including the risks discussed in the Company's filings with the United States Securities Exchange Commission. The Company does not undertake to update any forward-looking information.
MIND C.T.I. LTD. CONDENSED CONSOLIDATED BALANCE SHEETS September 30 ------------------------ December 31, 2006 2005 2005 ----------- ----------- ----------- (Unaudited) (Audited) ------------------------ ----------- U.S. $ in thousands ------------------------------------- A s s e t s CURRENT ASSETS: Cash and cash equivalents $ 26,647 $ 10,984 $ 10,174 Accounts receivable: Trade 4,862 3,694 3,389 Other 931 716 739 Inventories 30 18 30 ----------- ----------- ----------- T o t a l current assets 32,470 15,412 14,332 LONG-TERM BANK DEPOSITS 10,000 30,000 30,000 OTHER LONG-TERM ASSETS 554 437 480 PROPERTY AND EQUIPMENT, net of accumulated depreciation and amortization 1,790 2,057 1,957 INTANGIBLE ASSETS, net of accumulated amortization 980 * 1,834 1,660 GOODWILL 6,966 * 6,966 6,966 ----------- ----------- ----------- T o t a l assets $ 52,760 $ 56,706 $ 55,395 =========== =========== =========== Liabilities and shareholders' equity CURRENT LIABILITIES: Accounts payable and accruals: Trade $ 594 $ 809 $ 686 Other 1,497 * 2,009 1,741 Deferred revenues 1,580 * 1,899 1,644 Advances from customers, net 171 * 2,715 790 ----------- ----------- ----------- T o t a l current liabilities 3,842 7,432 4,861 EMPLOYEE RIGHTS UPON RETIREMENT 1,215 1,098 1,049 ----------- ----------- ----------- T o t a l liabilities 5,057 8,530 5,910 ----------- ----------- ----------- SHAREHOLDERS' EQUITY: Share capital 53 53 53 Additional paid-in capital 59,510 59,399 59,399 Compensation in respect of options granted to employees 244 Accumulated deficit (12,104) (11,276) (9,967) ----------- ----------- ----------- T o t a l shareholders' equity 47,703 48,176 49,485 ----------- ----------- ----------- T o t a l liabilities and shareholders' equity $ 52,760 $ 56,706 $ 55,395 =========== =========== =========== * Reclassified. MIND C.T.I. LTD. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS Nine months Three months Year ended ended September 30 ended September 30 December ------------------ ------------------ 31, 2006 2005 2006 2005 2005 -------- -------- -------- -------- -------- (Unaudited) (Unaudited) (Audited) ------------------ ------------------ -------- U.S. $ in thousands ------------------------------------------------ REVENUES $ 14,985 $ 10,562 $ 4,659 $ 4,058 $ 15,601 COST OF REVENUES 4,482 2,691 1,392 1,084 4,015 -------- --------- --------- --------- ----------- GROSS PROFIT 10,503 7,871 3,267 2,974 11,586 RESEARCH AND DEVELOPMENT EXPENSES 4,715 3,561 1,389 1,452 5,086 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES: Selling 2,735 1,566 868 546 2,148 General and administrative 1,353 1,143 595 390 1,507 -------- --------- --------- --------- ----------- OPERATING INCOME 1,700 1,601 415 586 2,845 FINANCIAL INCOME (EXPENSES) - net * (749) 1,186 304 165 1,260 -------- --------- --------- --------- ----------- INCOME BEFORE TAXES ON INCOME 951 2,787 719 751 4,105 TAXES ON INCOME 79 34 9 9 43 -------- --------- --------- --------- ----------- NET INCOME $ 872 $ 2,753 $ 710 $ 742 $ 4,062 ======== ========= ========= ========= =========== EARNING PER SHARE- Basic and diluted $ 0.04 $ 0.13 $ 0.03 $ 0.03 $ 0.19 ======== ========= ========= ========= =========== WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES USED IN COMPUTATION OF EARNINGS PER ORDINARY SHARE - IN THOUSANDS: Basic 21,510 21,438 21,528 21,477 21,431 ======== ========= ========= ========= =========== Diluted 21,555 21,579 21,551 21,582 21,619 ======== ========= ========= ========= =========== * Financial expenses for the 9 months period ended September 30, 2006 include a loss from a premature withdrawal of long-term deposits in the amount of $1,330,000. MIND C.T.I. LTD. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS Nine months Three months Year ended ended September 30 ended September 30 December ------------------ ------------------ 31, 2006 2005 2006 2005 2005 -------- -------- -------- -------- -------- (Unaudited) (Unaudited) (Audited) ------------------ ------------------ -------- U.S. $ in thousands ------------------------------------------------ CASH FLOWS FROM OPERATING ACTIVITIES: Net Income $ 872 $ 2,753 $ 710 $ 742 $ 4,062 Adjustments to reconcile net income to net cash provided by or used in operating activities: Depreciation and amortization 1,149 668 334 330 987 Accrued severance pay 166 (8) 72 (20) (151) Capital gain on sale of property and equipment - net (9) (39) (1) (9) (38) Loss from withdrawal of long term deposits 1,330 Compensation in respect of options granted to employees 244 83 Changes in operating asset and liability items: Decrease (increase) in accounts receivable: Trade (1,473) (109) 20 (1,009) 196 Interest accrued on long-term bank deposits 242 29 242 Other (192) 71 25 24 48 Decrease in accounts payable and accruals: Trade (92) (574) (105) (446) (697) Other (244) (1,240) (87) (837) (1,510) Decrease (increase) in inventories 1 (12) Increase (decrease) in deferred revenues (64) (86) 168 79 (799) Decrease in advances from customers, net (619) (171) (1,467) -------- -------- -------- -------- -------- Net cash provided by (used in) operating activities 1,068 1,678 1,048 (1,116) 861 -------- -------- -------- -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property and equipment (339) (543) (43) (122) (589) Acquisition of subsidiary (a) (4,233) (4,233) (4,233) Amounts withdrawal (funded) in respect of accrued severance pay (74) 43 (62) 2 94 Investments in long-term bank deposits (10,000) (10,000) Withdrawal of long-term bank deposits 18,670 10,000 10,000 10,000 Proceeds from sale of property and equipment 46 175 10 57 175 -------- -------- -------- -------- -------- Net cash provided by (used in) investing activities 18,303 (4,558) (95) 5,704 (4,553) -------- -------- -------- -------- -------- CASH FLOWS FROM FINANCING ACTIVITIES: Employee stock options exercised and paid 111 320 42 322 Dividend paid (3,009) (5,143) (5,143) -------- -------- -------- -------- -------- Net cash provided by (used in) financing activities (2,898) (4,823) 42 (4,821) -------- -------- -------- -------- -------- INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 16,473 (7,703) 953 4,630 (8,513) BALANCE OF CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 10,174 18,687 25,694 6,354 18,687 -------- -------- -------- -------- -------- BALANCE OF CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 26,647 $ 10,984 $ 26,647 $ 10,984 $ 10,174 ======== ======== ======== ======== ======== MIND C.T.I. LTD. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS U.S. $ in thousands ------------- (a) Acquisition of subsidiary: Assets and liabilities of the subsidiary upon acquisition: Working capital (excluding cash and cash equivalents) $ (4,881) Property and equipment 277 Intangible assets 1,871 Goodwill 6,966 ------------- Cash paid - net $ 4,233 =============
Contact Information: For more information please contact: Andrea Dray Tel: 18882704056 Email Contact