MIND C.T.I. LTD. – (Nasdaq:MNDO), a leading provider of
convergent end-to-end prepaid/postpaid billing and customer care
product based solutions for service providers as well as unified
communications analytics and call accounting solutions for
enterprises, today announced results for its second quarter ended
June 30, 2018.
The following will summarize our major
achievements in the second quarter of 2018, as well as our
business. Full financial results can be found in the Company News
section of our website at http://www.mindcti.com/company/news/ and
in our Form 6-K.
Financial
Highlights
- Revenues were $4.6 million, similar to $4.6 million in the
second quarter of 2017 and similar to $4.5 million in the first
quarter of 2018.
- Operating income was $1.3 million, or 28% of total revenues,
compared to $1.2 million or 27% of total revenues in the second
quarter of 2017 and similar to $1.3 million, or 28% of total
revenues in the first quarter of 2018.
- Net income was $1.2 million, or $0.06 per share, compared to
$1.9 million (Q2 2017 net income includes a one-time net capital
gain of $0.9 million from the sale of a subsidiary), or $0.10 per
share in the second quarter of 2017 and compared to $1.2 million,
or $0.06 per share in the first quarter of 2018.
- Multiple follow-on orders, including 3 significant ones.
- Cash flow from operating activities was $0.9 million, compared
to a negative $0.3 million in the second quarter of 2017 and
compared to $1.3 million in the first quarter of 2018.
Six Month Financial
Highlights
- Revenues were $9.1 million, compared to $9.0 million in the
first six months of 2017.
- Operating income was $2.6 million, or 28% of total revenues,
compared to $2.2 million or 24% of total revenues in the first six
months of 2017.
- Net income was $2.3 million, or $0.12 per share, compared to
$2.8 million (first half of 2017 net income includes a one-time net
capital gain of $0.9 million from the sale of a subsidiary), or
$0.14 per share in the first six months of 2017.
- Cash flow from operating activities in the first six months of
2018 was $2.3 million, compared to $0.3 million in the first six
months of 2017.
As of June 30, 2018, we had 216 employees,
compared with 248 as of June 30, 2017 and 228 as of March 31,
2018.
Monica Iancu, MIND CTI CEO, commented: “We are
pleased with the Q2 results and the strong flow of follow-on
orders. At the same time, we continue to be challenged by the
markets and by intense competition in the areas we are active in.
As previously mentioned, during our over twenty years of operation,
we have a few times experienced challenging periods and with
long-term planning ahead, we succeeded to maintain profitability
and create new opportunities. Thanks to our significant recurring
revenues, including a continuous stream of multiple follow-on
orders and the success of our new platform, we are able to
compensate in 2018 for the loss of one long-term major SaaS
customer and some small customers under maintenance agreements that
decided to exit their business, losses that we have already
announced in 2017. We continue to enhance our offering as well as
increase our marketing efforts.”
Financial Income and Cash
Position In the first half of 2018, we
encountered a financial expense due to calculated valuations of
cash and trade receivable balances in currencies other than the
U.S. dollar and that are dependent on exchange rates. In the first
half of 2017, we encountered significant financial income based on
the same reasons. Fluctuations in our financial income are the
result of interest we receive on our bank deposits and marketable
securities, but mainly from the significant oscillation of exchange
rates between the U.S. dollar and other currencies with which we
operate.
As previously announced, the Board declared on
February 22, 2018 a cash dividend of $0.30 per share before
withholding tax. The record date was March 8, 2018 and the payment
date was March 22, 2018. Tax was withheld at a rate of 20%.
The dividend declared and distributed was
approximately $5.8 million – approximately $4.6 million was paid to
the shareholders in March 2018 and approximately $1.2 million was
paid for the withholding tax to the Israeli Tax authority in April
2018.
Our cash position, including short and long-term
deposits and available-for-sale securities, was $14.1 million as of
June 30, 2018, compared to $15.3 million as of June 30, 2017.
Revenue Distribution for Q2
2018Revenues in the Americas represented 76%,
revenues in Europe represented 16% and revenues in the rest of the
world represented 8% of our total revenues.
Revenues from customer care and billing software
totaled $3.9 million, or 85% of total revenues, while revenues from
enterprise call accounting software totaled $0.6 million, or 15% of
total revenues.
Revenues from licenses were $0.5 million, or 10%
of total revenues, while revenues from maintenance and additional
services were $4.0 million, or 90% of total revenues.
Multiple
OrdersSimilar to previous quarters, our valued
customers showed their appreciation for our technology and support.
These valued customers continue to invest in upgrades to grow their
businesses and improve processes resulting in follow-on orders.
This quarter’s follow-on orders include a
significant upgrade to our MINDBill version 8 that will be
implemented within four to six quarters, new provisioning and
mediation projects, maintenance extensions, as well as specific
customizations and additional professional services.
Update on Pursuit of
AcquisitionsAs we previously announced, given our
strong cash position and our experienced organization, we believe
that we are well positioned and have the required resources to
respond to market needs and at the same time focus on targeting
potential acquisitions that could benefit our growth.
Lately we have reached different phases in such
processes. Being cautious and focused on acquiring only at
reasonable valuations and only targets that satisfy the criteria we
defined: proven revenues, complementary technology, geography and
expected accretion to earnings within a few quarters, we did not
close any deal but we continue our pursuit.
AGMAs
previously announced, MIND’s Annual General Meeting of Shareholders
will be held on Tuesday, August 14, 2018 at 10:00 A.M. (Israel
time), at the offices of the Company, Industrial Park, Building 7,
Yoqneam 2069202, Israel.
Shareholders of record at the close of business
on July 11, 2018 are entitled to vote at the Meeting. All
shareholders are cordially invited to attend the Meeting in person.
Proxy statements and proxy cards for use by shareholders that
cannot attend the meeting in person will be sent by mail to
shareholders that hold shares registered with the American Stock
Transfer & Trust Company, including shares held via DTC
members.
About MINDMIND
CTI Ltd. is a leading provider of convergent end-to-end billing and
customer care product based solutions for service providers as well
as unified communications analytics and call accounting solutions
for enterprises. MIND provides a complete range of billing
applications for any business model (license, managed service or
complete outsourced billing service) for Wireless, Wireline, Cable,
IP Services and Quad-play carriers. A global company, with over
twenty years of experience in providing solutions to carriers and
enterprises, MIND operates from offices in the United States,
Romania and Israel.
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.
For more information please
contact:Andrea DrayMIND CTI Ltd.Tel:
+972-4-993-6666investor@mindcti.com
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