RA'ANANA, Israel and
RIVER EDGE, New Jersey,
Aug. 11, 2016 /PRNewswire/ -- Mer
Telemanagement Solutions Ltd. (MTS or the Company) (Nasdaq
Capital Market: MTSL), a global provider of software solutions for
online video advertising and telecommunications management, today
announced its financial results for the second quarter of 2016.
MTS's revenues for the second quarter of 2016 totaled
$3.4 million, compared with
$4.8 million in the second quarter of
2015 and $3.3 million in the first
quarter of 2016. On a GAAP basis, the Company recorded a net loss
for the second quarter of $(22,000),
or $(0.00) per diluted share,
compared with a net loss of $(248,000), or $(0.03) per diluted share, in the second quarter
of 2015, and a net loss of ($224,000)
or ($0.03) per diluted share in the
first quarter of 2016. On a non-GAAP basis (as described and
reconciled below), the Company posted net income for the second
quarter of $262,000, or $0.03 per diluted share, compared with net income
of $409,000, or $0.05 per diluted share, for the second quarter
of 2015.
Revenues for the six months ended June
30, 2016 were $6.7 million
compared with $6.6 million for the
comparable period in 2015. Net loss for the six months ended
June 30, 2016 was $(246,000) or ($0.03) per diluted share, compared with a net
loss of $(475,000) or ($0.08) per diluted share in the comparable
period in 2015. On a non-GAAP basis (as described and reconciled
below), net income for the six months ended June 30, 2016 was $294,000 or $0.04
per diluted share, compared with net income of $278,000, or $0.04
per diluted share, for the comparable period in 2015.
Commenting on the results, Orey
Gilliam, Chief Executive of MTS, said, "We saw an
improvement in our financial results as we continue to invest in
our technology to enhance our position in our markets.
"As in previous quarters, we invested in advertising technology
in the second quarter and moved forward with our plan to establish
Vexigo as a leader in the Video Advertising space. We are pleased
to report increased video advertising activity and growing business
around Vexigo's Visualizr, its mobile content aggregation and
monetization solution. Our current focus is to build out Vexigo's
products and technology.
"The telecommunications side of our business continues to
exhibit good performance, and we have added several new TEM and
cloud customers with long-term contracts. We are currently working
on enhancing our product lines and are exploring additional
technology expense management opportunities with our partners and
customers to address their evolving needs." concluded Gilliam.
As previously announced, during the first quarter, Vexigo's
former shareholders (who are now shareholders of MTS), agreed to
extend the schedule of outstanding payments due them in order to
improve the Company's working capital. On May 16, 2016, the Company's shareholders approved
a $700,000 equity investment in the
Company by the former Vexigo shareholders, two additional members
of the Company's Board and the Company's then acting CEO. Soon
after the investment was completed, the Company repaid $500,000 of the sum due to the former Vexigo
Shareholders.
In accordance with standard industry accounting policies, the
Company accounts for a portion of the Video Advertising revenues
and cost of revenues derived from third-party arrangements on a net
basis. If these revenues had been presented on a gross basis, Video
Advertising revenues and cost of revenues would have increased by
approximately $2.8 million in the
second quarter of 2016 and $4.9
million for the six months ended June
30, 2016, while gross profit would have remained unchanged.
If such revenues and cost of revenues were presented on a gross
basis this would increase both Video Advertising revenues and cost
of revenues by $305 thousand for the
six month period ended June 30, 2015
after the acquisition of Vexigo on April 1,
2015, with no change to gross profit.
Non-GAAP Financial Measures
This release includes revenues, cost of revenues, net income and
basic and diluted earnings per share calculated on a non-GAAP
basis. The non-GAAP revenues and cost of revenues measures include
revenues and cost of revenues associated with third-party
arrangements and the other non-GAAP measures exclude the following
items:
- M&A expenses related to the Vexigo acquisition
- Amortization of intangible assets, net of tax effects
- Stock-based compensation expenses
MTS's management believes that the presentation of non-GAAP
measures provides useful information to investors and management
regarding financial and business trends that relate to the
Company's operating results and cash generation capabilities. These
non-GAAP financial measures are not in accordance with, or an
alternative for, generally accepted accounting principles and
differ from non-GAAP financial measures used by other companies. In
addition, these non-GAAP financial measures are not based on any
comprehensive set of accounting rules or principles. To achieve an
accurate overall picture of the Company's results of operations,
MTS advises the reader to consider the non-GAAP financial measures
in conjunction with their corresponding GAAP measures.
About MTS
Mer Telemanagement Solutions Ltd. (MTS) provides video
advertising solutions for online and mobile platforms and
Telecommunications Management solutions and services.
MTS's subsidiary, Vexigo (www.vexigo.com), develops highly
sophisticated video advertising solutions for online and mobile
platforms, and uses them to offer advertising optimization services
to advertisers and website owners.
MTS's telecommunications business provides innovative products
and services for enterprises in the areas of telecom expense
management (TEM), enterprise mobility management (EMM), mobile
virtual network operators/enablers (MVNO/MVNE) and IOT/M2M
enablement for mobile service providers.
Headquartered in Israel, MTS
markets its solutions through wholly-owned subsidiaries in
Israel, the U.S and Hong Kong, as well as through distribution
channels. For more information please visit the MTS web site:
www.mtsint.com.
Certain matters discussed in this news release are
forward-looking statements that involve a number of risks and
uncertainties including, but not limited to, risks in product
development plans and schedules, rapid technological change,
changes and delays in product approval and introduction, customer
acceptance of new products, the impact of competitive products and
pricing, market acceptance, the lengthy sales cycle, proprietary
rights of the Company and its competitors, risk of operations in
Israel, government regulations,
dependence on third parties to manufacture products, general
economic conditions and other risk factors detailed in the
Company's filings with the United States Securities and Exchange
Commission.
Company
Contact:
Alon Mualem
CFO
Tel: +972-9-7777-540
Email: Alon.Mualem@mtsint.com
CONSOLIDATED BALANCE
SHEETS
|
U.S. dollars in
thousands
|
|
|
|
|
|
|
|
June
30,
|
|
December
31,
|
|
|
2016
|
|
2015
|
ASSETS
|
|
|
|
|
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
3,405
|
|
$
3,444
|
Restricted
cash
|
|
475
|
|
231
|
Restricted marketable
securities
|
|
136
|
|
134
|
Trade receivables,
net
|
|
4,286
|
|
4,485
|
Other accounts receivable and prepaid
expenses
|
|
194
|
|
103
|
|
|
|
|
|
Total current
assets
|
|
8,496
|
|
8,397
|
|
|
|
|
|
LONG-TERM
ASSETS:
|
|
|
|
|
Severance pay
fund
|
|
712
|
|
668
|
|
|
|
|
|
|
|
|
|
|
PROPERTY AND EQUIPMENT,
NET
|
|
185
|
|
160
|
|
|
|
|
|
|
|
|
|
|
OTHER
ASSETS:
|
|
|
|
|
Goodwill
|
|
8,298
|
|
8,298
|
Other intangible assets,
net
|
|
4,249
|
|
4,461
|
|
|
|
|
|
Total other
assets
|
|
12,547
|
|
12,759
|
|
|
|
|
|
Total
assets
|
|
$
21,940
|
|
$
21,984
|
CONSOLIDATED BALANCE
SHEETS
|
|
U.S. dollars in
thousands (except share and per share
data)
|
|
|
|
|
|
|
|
|
|
June
30,
|
|
December
31,
|
|
|
|
2016
|
|
2015
|
|
LIABILITIES AND SHAREHOLDERS'
EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
|
Trade
payables
|
|
$
3,318
|
|
$
3,297
|
|
Deferred
revenues
|
|
1,967
|
|
1,826
|
|
Accrued expenses and other
liabilities
|
|
2,524
|
|
2,205
|
|
Liabilities related to Vexigo
acquisition
|
|
1,400
|
|
1,300
|
|
Liabilities of discontinued
operations
|
|
105
|
|
105
|
|
|
|
|
|
|
|
Total current
liabilities
|
|
9,314
|
|
8,733
|
|
|
|
|
|
|
|
LONG-TERM
LIABILITIES
|
|
|
|
|
|
Accrued severance
pay
|
|
875
|
|
798
|
|
Liabilities related to Vexigo
acquisition
|
|
4,411
|
|
5,624
|
|
Deferred tax liability
(*)
|
|
615
|
|
680
|
|
|
|
|
|
|
|
Total long-term
liabilities
|
|
5,901
|
|
7,102
|
|
|
|
|
|
|
|
COMMITMENTS AND CONTINGENT
LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY:
|
|
|
|
|
|
Share
capital
|
|
23
|
|
21
|
|
Additional paid-in
capital
|
|
26,468
|
|
25,648
|
|
Treasury
shares
|
|
(29)
|
|
(29)
|
|
Accumulated other comprehensive
loss
|
|
(8)
|
|
(8)
|
|
Accumulated
deficit
|
|
(19,729)
|
|
(19,483)
|
|
|
|
|
|
|
|
Total shareholders'
equity
|
|
6,725
|
|
6,149
|
|
|
|
|
|
|
|
Total liabilities and shareholders'
equity
|
|
$
21,940
|
|
$
21,984
|
|
|
|
|
|
|
|
(*)
Reclassified
|
|
|
|
|
|
CONSOLIDATED STATEMENTS
OF OPERATIONS
|
|
U.S. dollars in
thousands (except share and per share
data)
|
|
|
|
|
|
|
|
|
|
Six months
ended
|
|
Three months
ended
|
|
|
|
June
30,
|
|
June
30,
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
Services
|
|
$
2,909
|
|
$
2,682
|
|
$
1,478
|
|
$
1,334
|
|
Product
sales
|
|
608
|
|
880
|
|
405
|
|
395
|
|
Video
Advertising
|
|
3,214
|
|
3,088
|
|
1,504
|
|
3,088
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenues
|
|
6,731
|
|
6,650
|
|
3,387
|
|
4,817
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
revenues:
|
|
|
|
|
|
|
|
|
|
Services
|
|
1,399
|
|
1,200
|
|
698
|
|
706
|
|
Product
sales
|
|
287
|
|
259
|
|
143
|
|
144
|
|
Video
Advertising
|
|
1,315
|
|
1,896
|
|
535
|
|
1,896
|
|
|
|
|
|
|
|
|
|
|
|
Total cost of
revenues
|
|
3,001
|
|
3,355
|
|
1,376
|
|
2,746
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
3,730
|
|
3,295
|
|
2,011
|
|
2,071
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Research and
development
|
|
1,092
|
|
764
|
|
573
|
|
482
|
|
Selling and
marketing
|
|
1,128
|
|
1,064
|
|
551
|
|
503
|
|
General and
administrative
|
|
1,681
|
|
1,936
|
|
841
|
|
1,256
|
|
|
|
|
|
|
|
|
|
|
|
Total operating
expenses
|
|
3,901
|
|
3,764
|
|
1,965
|
|
2,241
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit
(loss)
|
|
(171)
|
|
(469)
|
|
46
|
|
(170)
|
|
Financial income (expenses),
net
|
|
6
|
|
51
|
|
(28)
|
|
28
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before taxes on
income
|
|
(165)
|
|
(418)
|
|
18
|
|
(142)
|
|
Taxes on
income
|
|
81
|
|
99
|
|
40
|
|
99
|
|
Net loss from continuing
operations
|
|
(246)
|
|
(517)
|
|
(22)
|
|
(241)
|
|
Net income (loss) from discontinued
operations
|
|
-
|
|
42
|
|
-
|
|
(7)
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss
|
|
$
(246)
|
|
$
(475)
|
|
$
(22)
|
|
$
(248)
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted loss per Ordinary
share
|
|
$
(0.03)
|
|
$
(0.08)
|
|
$
(0.00)
|
|
$
(0.03)
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of Ordinary shares used
in
|
|
|
|
|
|
|
|
|
|
computing basic and diluted net loss per
share
|
|
8,119,776
|
|
6,300,720
|
|
8,353,207
|
|
7,929,658
|
|
RECONCILIATION OF GAAP
TO NON-GAAP RESULTS
|
|
U.S. dollars in
thousands (except share and per share
data)
|
|
|
|
|
|
|
|
|
|
Six months
ended
|
|
Three months
ended
|
|
|
|
June
30,
|
|
June
30,
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
GAAP
revenues
|
|
6,731
|
|
6,650
|
|
3,387
|
|
4,817
|
|
Net basis adjustment of Video Advertising
revenues
|
|
4,866
|
|
305
|
|
2,817
|
|
305
|
|
Non-GAAP
Revenues
|
|
11,597
|
|
6,955
|
|
6,204
|
|
5,122
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Cost of
revenues
|
|
3,001
|
|
3,355
|
|
1,376
|
|
2,746
|
|
Net basis adjustment of Video Advertising cost of
revenues
|
|
4,866
|
|
305
|
|
2,817
|
|
305
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Cost of
Revenues
|
|
7,867
|
|
3,660
|
|
4,193
|
|
3,051
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net
loss
|
|
(246)
|
|
(475)
|
|
(22)
|
|
(248)
|
|
M&A expenses related to the acquisition of Vexigo
Ltd.
|
|
-
|
|
424
|
|
-
|
|
389
|
|
Stock-based compensation
expenses
|
|
122
|
|
54
|
|
75
|
|
35
|
|
Amortization of intangible
assets
|
|
418
|
|
275
|
|
209
|
|
233
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net
income
|
|
$
294
|
|
$
278
|
|
$
262
|
|
$
409
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP basic and diluted net loss per ordinary
share
|
|
$
(0.03)
|
|
$
(0.08)
|
|
$
(0.00)
|
|
$
(0.03)
|
|
Non-GAAP basic and diluted net income per ordinary
share
|
|
$
0.04
|
|
$
0.04
|
|
$
0.03
|
|
$
0.05
|
|
Weighted average number of ordinary shares used
in
|
|
|
|
|
|
|
|
|
|
computing non-GAAP basic net income per
share
|
|
8,119,776
|
|
6,300,720
|
|
8,353,207
|
|
7,929,658
|
|
Weighted average number of ordinary shares used
in
|
|
|
|
|
|
|
|
|
|
computing non-GAAP diluted net income per
share
|
|
8,119,776
|
|
6,358,406
|
|
8,353,207
|
|
8,013,350
|
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/mts-announces-second-quarter-2016-financial-results-300312363.html
SOURCE Mer Telemanagement Solutions Ltd. (MTS)