OTI Turnaround Advances, With Strong FY 2010 Results, Improvement in all Fundamentals, Showing Non-GAAP Operating Profitability. Trend Expected to Continue in 2011
Press Release Source: On Track Innovations Ltd. On Monday March 28, 2011, 8:00 am
•Revenues Increased by 71% from $31.4 Million to $53.6 Million
•Non-GAAP Operating Profit of $2.8 Million
•Gross Margin Increased to 54%
ISELIN, N.J., March 28, 2011 (GLOBE NEWSWIRE) -- On Track Innovations Ltd., (OTI) (Nasdaq:OTIV - News), a global leader in contactless smart card solutions, today announced that as previously forecasted, its planned turnaround is proceeding apace, with results of operations, revenues and gross margins all increasing substantially during the year ended December 31, 2010 while maintaining similar level of operating expenses as in 2009. The following are various financial figures that compare fiscal year of 2010 to 2009.
•Total revenues of $53.6 million, a 71% increase compared to $31.4 million last year.
•Revenues from Licensing and Transaction Fees of $4.0 million, a 37% increase compared to $2.9 million last year.
•Gross margin increased to 54% vs. 47% last year.
•Non-GAAP operating expenses of $26.1 million, an 8% increase compared to $24.1 million last year. GAAP operating expenses of $30.1 million, a 5% increase compared to $28.7 million last year.
•Non-GAAP operating profit of $2.8 million, compared to non-GAAP operating loss of $9.4 million last year. GAAP operating loss was $1.2 million, a 92% decrease compared to $14.1 million last year.
•Strong balance sheet with cash, cash equivalents and short-term investments of $24.0 million as of December 31, 2010. This amount does not include the proceeds from the public offering of February 2011.
Oded Bashan, Chairman and CEO of OTI, said: "In 2010, we demonstrated our strategy of focusing on unique products and turnkey solutions, in the fields of SmartID, payments, parking and petroleum, with improvement in all fundamentals - higher gross margin, increased level of revenues, all while maintaining similar level of operating expenses."
Mr. Bashan continued: "We are opening 2011 in a unique position - we are financially stronger after a successful raise of about $16.9 million in net proceeds, and after successful 2010, where we have presented improved results, solid non-GAAP profitability and advancements in our planned turnaround. The successful execution of large scale projects, the introduction of new products to existing markets, the further establishment of strategic channel partners are all significant contributors to our success and are expected to further strengthen our pipeline of opportunities, resulting in another successful financial year. We expect revenues in 2011 to be heavily back-loaded and grow to $55-$60 million. We also expect 2011 to be operating profitable on a non-GAAP basis as a result of our expectation to become profitable in the second half of 2011."
Discontinued Operations
During the fourth calendar quarter of 2009, the Company signed an agreement for the sale of the assets of OTI's subsidiary Millennium Card's Technology Ltd ("MCT") including the machinery and inlay production IP of OTI to SMARTRAC NV. Results for the discontinued operations have been separated and are presented separately for both 2009 and 2010 financial statements.
ON TRACK INNOVATIONS LTD.
CONDENSED CONSOLIDATED BALANCE SHEET
(In thousands, except share and per share data)
at the end of the year $ 26,884 $ 15,409
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