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RiT Technologies Reports Q4 and Full Year 2005 Results Thursday February 2, 8:02 am ET 2005: Revenues Up 51% to $27.9M, 4 Profitable Quarters
TEL AVIV, Israel, February 2 /PRNewswire-FirstCall/ -- RiT Technologies (NASDAQ: RITT - News), the pioneer and world-leading provider of intelligent physical layer solutions, today announced financial results for the fourth quarter and full year ended December 31, 2005.
<b>Revenues for the fourth quarter of 2005 were $7,071,000, an increase of 25% compared with $5,651,000 for the fourth quarter of 2004. Net income for the quarter was $225,000, or $0.02 per basic share ($0.01 per diluted share), the Company's 4th consecutive profitable quarter, compared with a net loss of ($193,000), or ($0.01) per share (basic and diluted) for the fourth quarter of 2004.</b>
Revenues for the full year 2005 were $27,852,000, an increase of 51% compared with $18,427,000 for 2004. Net income for the period was $1,403,000, or $0.10 per basic share ($0.09 per diluted share), compared with a net loss of ($2,975,000), or ($0.27) per share (basic and diluted), for 2004.
Commenting on the results, Mr. Doron Zinger, RiT's President and CEO, said, "2005 was a strong year for RiT with 51% revenue growth, gross margin above 53% and four consecutive profitable quarters. These results were well above our projections, due partially to the receipt of several large Carrier sales. Our focus during the year has been to strengthen our ability to generate a steadily growing flow of orders, and to use that as a foundation for healthy, consistent and profitable growth.
"Towards this end, we made significant progress during 2005. We instituted various activities during the year which have strengthened our relationships with major customers and OEM partners and enhanced our internal sales capabilities. On The Enterprise side, our current focus is to begin addressing emerging opportunities in India and China, and to take full advantage of the explosive growth of worldwide datacenter building activity. On the Carrier side, we have expanded the number of 'live' opportunities in the sales pipeline and have begun accelerating the rate at which they turn into sales. To fuel our long-term growth, we continue aggressive development of all our product lines, and expect to launch a next-generation Carrier product later in the year."
Mr. Zinger concluded, "Looking ahead, given the 'spikes' of our Carrier business, it remains difficult to forecast our future revenues. We are nevertheless budgeting for a profitable 2006 for both sides of the business with gross margin above 50%."
The Company will host a conference call to discuss these results today, Thursday February 2nd, at 10:00 A.M. Eastern Time/ 17:00 Israel time. To participate, please call +1-866-229-7198 from the US (toll free), or +972-3-918-0600 International. A replay of the call will be available beginning at 12 noon ET on the day of the call for 14 days by calling +1-866-276-1002 from the US (toll free), or +972-3-925-5940 from the rest of the world.
The call will also be available through a simultaneous webcast. To participate in the webcast of the call, please log-in about 5-10 minutes prior to the start of the call as follows:
Note: Participants in the webcast may submit questions to be addressed in the conference call in advance by email to: simonag*rit.co.il
About RiT Technologies
RiT is a leading provider of physical network infrastructure control and management solutions. Deployed in the networks of many of the world's largest carriers and enterprises, its pioneering, fast-ROI products have proven their ability to simplify service deployment and provisioning, enhance troubleshooting accuracy, reduce infrastructure maintenance costs, enhance physical layer security and enable cost-effective service qualification and verification.
RiT is a member of the RAD group, a world leader in communications solutions. For more information, please visit our website: www.rittech.com
In this press release, all statements that are not purely about historical facts, including, but not limited to, those in which we use the words "believe," "anticipate," "expect," "plan," "intend," "estimate", "forecast", "target" and similar expressions, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. While these forward-looking statements represent our current judgment of what may happen in the future, actual results may differ materially from the results expressed or implied by these statements due to numerous important factors, including, but not limited to, those described under the heading "Risk Factors" in our most recent Annual Report filed with the Securities and Exchange Commission (SEC) on Form 20-F, which may be revised or supplemented in subsequent reports filed with the SEC. These factors include, but are not limited to, the following: our ability to raise additional financing, if required; the continued development of market trends in directions that benefit our sales; our ability to maintain and grow our revenues; our dependence upon independent distributors, representatives and strategic partners; our ability to develop new products and enhance our existing products; the availability of third-party components used in our products; the economic condition of our customers; the impact of government regulation; and the economic and political situation in Israel. We are under no obligation, and expressly disclaim any obligation, to update the forward-looking statements in this press release, whether as a result of new information, future events or otherwise.
COMPANY Simona Green CONTACT: VP Finance +972-3-766-4249 simonag*rit.co.il
RiT TECHNOLOGIES LTD. CONSOLIDATED STATEMENTS OF OPERATIONS (U.S GAAP) (U.S dollars in thousands, except per share data)
For the three For the twelve months ended months ended December 31, December 31, (Unaudited) (Audited)
Operating expenses: Research and 1,018 1,012 4,212 3,767 development, gross Less - - - 119 286 royalty-bearing participation Research and 1,018 1,012 4,093 3,481 development, net
Sales and 2,022 1,623 7,624 6,165 marketing General and 430 551 2,007 1,719 administrative Total operating 3,470 3,186 13,724 11,365 expenses
Operating 178 (212) 1,205 (3,004) income (loss) Financial 47 19 198 29 income, net
Net income 225 (193) 1,403 (2,975) (loss)
Basic net income (loss) per ordinary share 0.02 (0.01) 0.10 (0.27)
Diluted net income (loss) per ordinary share 0.01 (0.01) 0.09 (0.27)
Weighted average number of ordinary shares used to compute basic net income (loss) per ordinary share 14,374,659 13,980,484 14,288,900 11,174,865
Weighted average number of ordinary shares used to compute diluted net income (loss) per ordinary share 15,395,506 13,980,484 15,459,384 11,174,865
RiT TECHNOLOGIES LTD. CONSOLIDATED BALANCE SHEETS (U.S GAAP) (U.S dollars in thousands)
December 31, December 31, 2005 2004 (Audited) (Audited) Assets Current Assets Cash and cash equivalents 7,222 7,773 Marketable securities 506 531 Trade receivables, net 4,725 4,376 Other current assets 741 1,016 Inventories 5,101 6,548 Total Current Assets 18,295 20,244
Assets held for severance benefits 1,751 1,578
Property and Equipment Cost 2,544 3,458 Less - accumulated depreciation 1,875 3,048 669 410 Total Assets 20,715 22,232
Liabilities and Shareholders' Equity Current Liabilities Short-term bank credits - 2,467 Trade payables 3,270 4,871 Other payables and accrued expenses 2,680 2,425 Total Current Liabilities 5,950 9,763
Long-term Liability Liability in respect of employees' severance benefits 2,253 2,069 Total Liabilities 8,203 11,832
Shareholders' Equity Share capital 383 374 Treasury Stock (27) (27) Additional paid-in capital 31,335 30,610 Accumulated other comprehensive loss (39) (14) Accumulated deficit (19,140) (20,543) Total Shareholders' Equity 12,512 10,400 Total Liabilities and Shareholders' 20,715 22,232 Equity
-------------------------------------------------------------------------------- Source: RiT Technologies Ltd
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