SOURCE: MIND CTI Ltd.

August 19, 2008 16:00 ET

MIND CTI Reports Q1 and Q2 2008 Results

Six Months Cash Flow From Operating Activities of $2.1 Million; AGM Resolutions Approved

YOQNEAM, ISRAEL--(Marketwire - August 19, 2008) - MIND CTI Ltd. (NASDAQ: MNDO), a leading provider of convergent end-to-end billing and customer care product based solutions for tier 2 and tier 3 carriers worldwide, today announced results for the first and second quarter of 2008.

Financial Highlights of Q1 2008

--  Revenues of $5.1 million, compared with $4.8 million in the first
    quarter of 2007.
--  Operating income was $315 thousand, or 6.2% of revenue, excluding
    amortization of intangible assets of $167 thousand and equity-based
    compensation expense of $46 thousand.
--  GAAP operating income was $102 thousand, or 2% of revenue.
--  Impairment of Auction Rate Securities was $962 thousand.
--  Net loss was $268 thousand or $0.01 per share, excluding amortization
    of intangible assets of $167 thousand and equity-based compensation expense
    of $46 thousand.
--  GAAP net loss was $481 thousand, or $0.02 per share compared with GAAP
    net income of $1,151 thousand or $0.05 per share in the first quarter of
    2007.
    

Financial Highlights of Q2 2008

--  Revenues of $5.1 million, compared with $4 million in the second
    quarter of 2007.
--  Operating income was $682 thousand, or 13.4% of revenue, excluding
    amortization of intangible assets of $166 thousand and equity-based
    compensation expense of $43 thousand.
--  GAAP operating income was $473 thousand, or 9.3% of revenue.
--  Impairment of Auction Rate Securities was $796 thousand.
--  Net loss was $87 thousand or $0.00 per share, excluding amortization
    of intangible assets of $166 thousand and equity-based compensation expense
    of $43 thousand.
--  GAAP net loss was $296 thousand, or $0.01 per share compared with GAAP
    net income of $508 thousand or $0.02 per share in the second quarter of
    2007.
    

Six Month Highlights

--  Revenues of $10.2 million, compared with $8.9 million in the first six
    months of 2007.
--  Expenses of $862 thousand relating to deferred revenues were deferred
    in the first six months of 2008.
--  Net loss was $355 thousand or $0.02 per share, excluding amortization
    of intangible assets of $333 thousand and equity-based compensation expense
    of $89 thousand.
--  GAAP net loss was $777 thousand, or $0.04 per share compared with GAAP
    net income of $1,659 thousand or $0.08 per share in the first six months of
    2007.
--  Cash flow from operating activities in first six months of 2008 was
    $2.1 million.
--  Cash and cash equivalents of $9.7 million on June 30, 2008.
--  Backlog expected to be billed by year-end as of June 30, 2008 is $6.4
    million.
    

The full financial results can be found in the "News" section on MIND's website, www.mindcti.com.

Revenue Distribution for Six Months 2008

Sales in the Americas represented 42% and sales in Europe represented 50% of total revenue. Revenue from our customer care and billing software totaled $8.7 million, while revenue from our enterprise call management software was $1.5 million. The revenue breakdown from our business lines of products was $3.5 million, or 34% from licenses, $3.4 million, or 33% from maintenance and $3.3 million, or 32% from services.

Auction Rate Securities

As previously announced, we continue to receive interest payments every month on the held security, which is now rated BBB by S&P and Ba1 with CreditWatch with negative implications by Moody's.

New Wins

In the second quarter MIND secured two new customers, one in the US and one in Europe, as well as a major upgrade of license from an existing customer. The win in the US is a six-year managed service contract with a regional mobile operator. The win in Europe is also a managed service contract with a small telecom reseller. The license upgrade from the existing customer includes the new MIND offering, the Point of Sale module as well as an upgrade of subscriber license.

Monica Eisinger, Chairperson and CEO, commented: "We continue to build for the long term, to execute on profitability and to win new business. MIND delivers an end-to-end solution that suits carrier specific needs. Our integrated Point of Sale module completes our platform that includes customer care, electronic bill presentment & payment, rating, billing, provisioning and mediation.

"MIND now offers a truly convergent, real-time solution across any line of business: voice, data, content, video; fixed, mobile, cable, satellite; prepaid and postpaid. We support automated business processes and sophisticated business models. Lately we encounter increased demand for our services and the long-term contracts help us build a strong backlog and increase our visibility."

The Company held its Annual General Meeting of Shareholders on August 18, 2008 and all the proposed resolutions were approved.

Conference Call Information

MIND will host a conference call on August 20, 2008 at 10:30 a.m., Eastern Time, to discuss the Company's six months 2008 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 end-to-end billing and customer care product based solutions for service providers as well as telecom expense management (call accounting) solutions for the enterprise market. MIND provides a complete range of billing applications for any business model (license, managed service or complete outsourced billing service) for Wireless, Wireline, VoIP and Quad-play carriers in more than 40 countries around the world.

A global company, with over ten years of experience in providing solutions to carriers and enterprises, MIND operates from offices in the United States, UK, Romania and Israel.

For more information, visit MIND at: www.mindcti.com.

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.

Contact Information

  • For more information please contact:
    Andrea Dray
    MIND CTI Ltd.
    Tel: +972-4-993-6666
    Email Contact