Seeking Alpha
We cover over 5K calls/quarter
Profile| Send Message|
( followers)  

On Track Innovations Ltd. (NASDAQ:OTIV)

Q3 2013 Earnings Call

November 26, 2013 10:30 AM ET

Executives

Ofer Tziperman - CEO

Shay Tomer - CFO

Analysts

Marc Silk - Silk Investment Advisors

Edward Schwartz – Edward Schwartz Investments

Josh Smith

Robert Wolf

Operator

Good morning. Welcome to the OTI’s Third Quarter 2013 Conference Call. My name is Angel, and I will be your operator this morning. Joining us for today’s presentation are OTI’s CEO, Ofer Tziperman and CFO Shay Tomer. Before we conclude today’s call, I’ll provide the Company’s Safe Harbor statement with important cautions regarding the forward-looking statements made during this presentation as well as information about use of non-GAAP financial information in this call.

I would like to remind everyone that this presentation will be available for replay via a link available in the Investor Relations section of the Company’s website at www.otiglobal.com. Now, I would like to turn the call over to OTI’s CEO, Mr. Ofer Tziperman. Sir, please go ahead.

Ofer Tziperman

Welcome everyone and thank you very much for joining us today. Our results for the third quarter of 2013 were issued in a press release this morning and the copy of the release is available in the Investor Relations section of our website at www.otiglobal.com.

Our performance this quarter was in line with our expectations reflects our continued focus on adding new customers, establishing key relationships and penetrating our target markets. Our continued execution was evident from the top line growth and lower operating expenses during the quarter. Our progress is also highlighted by several key wins including multiple purchase orders for EasyFuel Plus as well as our largest purchase order to-date for our NFC readers which is valued at more than $10 million.

I will talk more about these wins and other operational highlight shortly. But first, I would like Shay to take us through the financial performance for the quarter. Shay?

Shay Tomer

Thank you, Ofer, and welcome, everyone. Given the first quarter, we entered into an assets purchase agreement with SuperCom for the sale of our SmartID division. Following a successful due diligence process by SuperCom, we will receive $10 million in secured cash after the closing with an additional $12.5 million subject to performance based milestones. It is important to note the results from the SmartID operation and the cash flow for the reporting periods are presented in the statement of operations and the statement of cash flows at discontinued operations separately from continuing operation.

Now to our financial results from continuing operation for the first quarter of 2013, ended September 30; revenue increased 27% to $6.8 million from $5.3 million in Q2 2012. The increase was mainly driven by a 133% increasing payment products revenues from our NFC readers sale to the U.S. market and the expansion of the mass transit project in Poland.

Now breaking down our total revenues by source and the expense of total revenue; payments revenue was $3.3 million or 49%, OEM revenue was $1.3 million or 19%, the volume (Ph) revenue was $1.1 million or 16%. Parking revenue was $500,000 or 7% and finally MediSmart and access control product revenue was $600,000 or 9% of total revenue.

Looking at Q3 revenue by geographic region and the portion of this region contribution to total revenue; Africa accounted for $1 million or 15%, Europe accounted for $3 million or 45%, North America accounted for $2 million or 29% and finally Israel accounted for $800,000 or 11% of our total revenues.

Our operating expenses in Q3 2013 totaled $733,000 compared to $5.5 million in the same period last year. It is important to note Q3 2013 operating expenses included $4.3 million in other operating income. This was mainly related to the writing off of the provision or termination recorded in Q4 2012, in accordance with the termination and settlement agreement signed with OTIs former Chairman and CEO, Oded Bashan and the Company's former President Ohad Bashan. The year-over-year decrease in operating expenses was also attributable to a lower headcount and reduced management cost.

We remain focused on tightly managing our expenses and overhead cost. Q3 2013 net income from continuing the operation totaled $2.1 million of $0.06 per share. This compares to a net loss of $2.6 million or $0.08 per share in Q3 2012. The improvement was due to the $4.3 million in other operating income as well as increased revenues and reduced operating expenses.

Adjusted EBITDA from continuing operations and on GAAP measure totaled $3 million, this was a significant improvement from an adjustment EBITDA loss from continuing operations of $2.2 million in Q3 2012

Now turning to the balance sheet. We had cash, cash equivalent and short-term investment of $9.7 million at September 30, 2013, which was unchanged from the balance at June 30, 2013. However, our cash balance at the end of Q3 does not reflect the 10 million we expect to receive on the divestiture of the SmartID division. This completes my financial summary, I would like to turn the call back over to Ofer to provide an overview of our operational activity and business outlook. Ofer.

Ofer Tziperman

Thank you Shay. We continue to build on the momentum and traction we have established across all our core business segments, especially in our cash less payment solutions NFC and contactless reader segment. Regarding our NFC and contactless readers, last month we received certification from MasterCard for our WAVE device. WAVE is the industry's first audio jack plug in NFC payment solution, it is also the only such device to receive certification from a major payment company like MasterCard. We have already hit the ground running with the first commercial order in hand. Additionally, we demonstrated the WAVE product at the Cartes exhibition in Paris last week and received the significant amount of interest at the show.

Based on our patented NFC technology the WAVE dongle is device agnostic easily plugging into any smartphone, tablet or PC. It allows users to pay with their device while enjoying real-time benefits from loyalty programs and other incentives delivered by the corresponding application. WAVE’s open up a whole new world of mobile device applications while elevating the burden of a wallet full of credit cards. MasterCard certification provides essential validation of our technology platform and provides significant Greenfield opportunities for OTI.

We’re currently targeting large scale implementations with banking institutions and payment card providers as well as projects involving public transportation and loyalty and reward programs. We expect other major credit card association to follow suit and provide certification in the near future. NFC is becoming increasingly recognized as the fastest most efficient most versatile and secured method for payment transactions. MasterCard certification positions us to capitalize on the major industry shift.

Earlier this month we signed a major contract to supply NFC readers to one of our U.S. channel partners who serves the unattended retail market in North America. The agreement requires our partner to purchase more than $10 million in NFC readers over three-year’s term. The agreement covers multiple models of our Saturn 6500 NFC readers including our most advanced Saturn 6500 EM Plus which support EMV transactions. The Saturn 6500 NFC readers are the perfect solution for the unattended retail market. When integrated into kiosk or vending machines it presents customers with a quick and easy way to pay. This promotes more frequent purchases and drives revenue for the retailer.

This contract represents the largest single reader win for our company. It is the result of OTI’s strategic shift to focus on building our core contactless transaction and NFC technology business. This will also reflects the increasing traction for greater adoption of NFC. In fact compared to last year we have more doubled the number of readers we have shifted globally and expect total shipments to surpass 110,000 units this year. We are confident the adoption of our patented NFC solutions will continue to expand over the month and years ahead.

We also recently received the commercial order for our WAVE NFC payment solution to be deployed by consortium of regional banks in Hong Kong, Taiwan and Macau. The deployment was made through our new channel partner Tradelink Electronic Commerce, a Hong Kong based pioneer in ecommerce. Major channel partners like Tradelink help us rapidly gain access to new markets and regional banking networks. We expect this large scale deployment will serve as a model for adoption by potential customers looking to implement safe, secure and cost effective NFC solutions.

Earlier this month we formed strategic partnerships with ABnote a leading global card manufacturer and provider of financial and secure credential link solutions. ABnote will offer our WAVE device to enable NFC payment within ABnote’s mobile wallet offering. As an end-to-end turnkey solution, the NFC enabled solution provides comprehensive and affordable EMV mobile issuance. ABnote's wallet and OTI's WAVE device can be privately labeled and personalized with a payment card application as well as other services, including healthcare, transit, access control, and loyalty card applications.

It should also be noted that our WAVE solution is currently the cheapest and most convenient way to turn any non-NFC smartphone like an iPhone into an NFC enabled phone that can perform NFC secured payment transactions. Last week, we’ve received certification from ISIS for our line of Saturn NFC enabled sales terminal and software. For those unfamiliar with the initiative, ISIS is a multibillion dollar mobile commerce joint venture between AT&T Mobility, T-Mobile USA and Verizon Wireless.

ISIS granted approval for our readers for three years and will feature OTI’s readers on the ISIS corporate website and other marketing materials. ISIS launched its Mobile Wallet on November 14 throughout the United States. The ISIS Mobile Wallet allows consumers to pay using the mobile device by securely storing virtual versions of customers’ credit and prepaid cards as well as coupons and merchant loyalty cards. Shopper simply select payment card and tap their device on a NFC enabled point of sale terminal like our Saturn reader. ISIS Mobile Wallet transforms NFC enabled smartphones into virtual wallets eliminating the need for physical cards and paving the way towards a walletless world.

The nationwide launch marks a major milestone for the NFC industry in terms of universal adoption and strengthening the NFC ecosystem. A recent report from Strategy Analytics, a global research and consulting firm, projected that 115 million NFC handsets will be responsible for spending $48 billion via NFC phones by 2017. As the ISIS initiative gains momentum with the support of some of the world’s largest mobile operators and payment card companies, OTI is very well positioned with more than 20 years experience providing field proven NFC solutions to capitalize on this major sea change. We believe that with our certified line of NFC readers coupled with our new wave solution, we're very well positioned to play a central role in the emerging NFC market.

Moving on to our business segments, as far as our vehicle fueling segment, in our vehicle fueling segment we actually continue to make solid progress across all geographical markets, demonstrated by growing number of implementations. During the quarter, we received order for commercial quantities for EasyFuel Plus solution from Tokheim, one of the world's leading manufacturers and service providers of fuel dispensing and automation equipment. EasyFuel Plus has been integrated into Tokheim's point of sale controllers for implementation at commercial fleets and retail petroleum stations across 12 countries since we formed the partnership back in September 2010. The implementation for a prominent petroleum retailer is currently underway across four markets in Europe. EasyFuel Plus equipment for Tokheim alone has been supplied to more than 250 locations including more than 1000 nozzles and 7,500 vehicles to date. Our fully owned subsidiary and value added reseller OTI Africa manages the integration with Tokheim's point of sale controllers and the application business rules. The continued adoption of EasyFuel Plus technology demonstrates the increasing strength of our strategic partnership and Tokheim's ability to successfully demonstrate how our technology is secures and simplifies the payment processes. The demand for EasyFuel Plus has gained momentum as customers globally recognize the benefit of automated vehicle identification and the need for quality data. We envisage that our petroleum products will serve as one of the main growth engines for our business.

In early November, we received initial purchase order for EasyFuel Plus solution from several customers including a major global supply chain customer. The purchase order were valued at more than $1 million, the orders follow a successful pilot deployment of our EasyFuel Plus solution in the Middle East. The major development will be in a new country for Easy Fuel, bringing the total number of countries where EasyFuel is being used to 43. The solution includes OTI's packaged mobile browser and home based offering. The follow on orders reflect the continued adoption of our leading vehicle fueling solutions. It also reveals the increasing global demand for refueling automation and control, in fact with this order EasyFuel will have been deployed in 10 new countries this year. This has driven a 100% yield a year increase in sales of our mobile browsers and home based packaged offerings. These wins are examples of how the OTI's contactless and NFC technology can create and serve new innovative vertical payment products and solutions. Our team is working diligently to build on this momentum with a widening pipeline of growth opportunities including within its existing customer and partner relationships. As global demand for a vehicle refueling technologies builds, we're strongly positioned with industry leading solutions and the marquee customer base to expand market share and penetrating new countries. We are confident that our EasyFuel Plus will be adopted by other major market leaders.

In our parking segment we've focused on increasing our market share within existing markets and the introduction of our new EasyPark mobile. In the US market, we are encouraged by the traction we've gained with EasyPark, as the market awareness builds in the cities where EasyPark is deployed, we see a growing adoption of this innovative in vehicle parking meter, we also see a growing interest by more cities as they realize that EasyPark is the most economical solution for all participants. It allows cities and municipalities to retain all parking fees it collects without the need to pay for infrastructure or costly maintenance, it also allow drivers to pay only for the exact time used and save them from looking for coins or searching for a working meter. We're currently in advanced negotiations with several cities interested in deploying EasyPark and are confident we will be announcing new wins in the near future.

During the third quarter we introduced EasyPark mobile, with the first commercial implementation in Bermuda, EasyPark mobile is a complete cash less parking system comprised of a backend system and an option to start and stop parking session using a mobile device. The solution supports start and stop commands via SMS, interactive voice response and also via smartphone applications.

We have also integrated EasyPark mobile with an innovative solution developed by Anagog, a promising Israeli startup company. The solution allows to predict parking occupancy across the city and to provide the city with accurate and valuable statistical information on parking patterns throughout the city. The unique combination of the EasyPark in vehicle meter and EasyPark mobile provide us with a competitive advantage, which we plan to leverage in parking beats around the world.

The SmartID divestiture. As I mentioned, in August we signed a definitive agreement with SuperCom to sell our SmartID Division. The divestiture will allow us to increase OTI’s focus on our core contactless technology and NFC payment solutions where we possess competitive advantages like our expansive IP portfolio.

Last week we agreed to extend the due diligence period from the end of November to December 8. The short extension was mutually agreed upon due to the large volume and size of our SmartID contracts and deeds as well as the breadth and complexity of the IP asset SuperCom intends to purchase. As Shay said, we anticipate the SmartID transaction will close by year-end and we will keep you appraised of its progress.

With regard to our intellectual property, OTI’s world class technology and solutions are supported by Extensive Intellectual Property portfolio. Our engineers have built an IP portfolio that consist of more than two dozen U.S. issued and pending patents, as well as numerous patents in Israel, Europe and Asia. During the third quarter we were issued two new patents for various technologies.

In our lawsuit against T-Mobile USA in August, the U.S. District Court for the Southern District of New York denied T-Mobile’s request for reconsideration of the Markman decision in our patent infringement lawsuit, alleging that NFC enabled phones sold by T-Mobile USA infringe on our innovations. We are proceeding with a preparation towards a jury trial that will likely take place next time [ph].

We believe the Court’s recent decisions help to validate the value of our IP and support our view that OTI’s O43 patent is fundamental to NFC form technology. The O43 patent is part of our Extensive Intellectual Property portfolio encompassing product application, software platform, system and product architecture and product concepts in the field of NFC; contactless payments, petroleum and parking solutions.

As far as rebranding. Those of you who visited our corporate website recently have probably noticed our rebranding. This is another step in refocusing OTI around cashless payment solutions with a fresh and modern website that matches our new and innovative solutions. I’d like to thank those of you who sent us positive feedback since the launch.

In summary, I would like to emphasize three additional points. First, we continue to make strong progress executing on our strategic plans, focused on our core business of providing cashless payment solutions and monetizing our related IP. Secondly, we continue to effectively manage cost and further optimize our expense structure. These initiatives have allowed us to decrease our operating cash flow and we expect further improvements in the last quarter. Our optimized operational structure will allow us to more effectively leverage our core competencies and ultimately drive sustainable profitability.

Lastly, our expectations for the future remain high as we built upon the momentum we have established and we see a widening pipeline of growth opportunities, particularly within our new customer and partner relationships. As global demand for NFC based technologies continues to build, we are well positioned with industry leading solutions and a growing customer base. We believe these key factors and strong tail-wind will help us expand our market share and drive revenue growth.

Now with that, we are ready to open the call for your questions. Operator, please provide the appropriate instructions.

Question-And-Answer Session

Operator

Thank you. (Operator Instructions). Our first question comes from the line of Marc Silk from Silk Investment Advisors. Please go ahead.

Marc Silk - Silk Investment Advisors

The first one is, I had trouble hearing, you think that if the T-Mobile case goes to trial, it’s going to be in summer of 2014?

Ofer Tziperman

Yes.

Marc Silk - Silk Investment Advisors

Next question is, just can you confirm with me when the Bashan Poison Pill will expire?

Ofer Tziperman

Can you repeat please, Marc?

Marc Silk - Silk Investment Advisors

Basically can you tell me when the Poison Pill will expire?

Ofer Tziperman

I don’t think that, Shay, the Poison Pill expiration date?

Shay Tomer

I’m not sure.

Ofer Tziperman

I’m not sure we have different formation in front of us right now, Marc.

Marc Silk - Silk Investment Advisors

And lastly, on NFC it’s obvious the direction that OTI is taking. So, when I see something like Starbucks when you can purchase something that’s at their stores, go around NFC and something line an open table, which in addition to getting reservations, now you’re going to be able to pay through an application, why don’t you give the investors maybe an anecdote of why you think NFC is going to be a big part of this, because I think when you keep hearing about specific apps for payments and in the Cloud and we want to see kind of your vision of where NFC, if there is a future in NFC, which I expect there will be.

Ofer Tziperman

Absolutely, this is why we are here. I think that’s a very good question, Marc, well thank you for that. In fact there is a game of control right now within the mobile payment market. On one hand we see NFC solutions that are being introduced by giants like the mobile carriers. On the other hand we see other players that are trying to pull share Cloud base solutions. I think that both are going to coexist. There are pros and cons to each type of payment method. But one thing is quite clear. There is no other solution that is as fast as and as secured as NFC.

From a several applications point of view, like mass transportation and other applications that require fast transaction, no Cloud based solution can ever match with these results. So, this is one reason why NFC is going to be key in any mix of payment solutions. On the other hand we see players like Google for example that are trying to use NFC, but in a very creative way by removing the need for a secured element from the phone to the Cloud.

From our point of view actually this doesn’t really matter too much. As long as everybody understand that the final verification or identification of the user requires a top end goal type of operation, I think that serves the explanation of why we believe that eventually NFC will prevail.

I hope it answers the question, Marc.

Operator

(Operator Instructions). And your next question comes from the line of Edward Schwartz from Edward Schwartz Investments. Please go ahead.

Edward Schwartz – Edward Schwartz Investments

Regarding the SuperCom deal, you talked about $10 million of secured cash. Could you give some clarity, what is secured cash?

Ofer Tziperman

Actually, subject to what was already released about the bill, what we can say is that the according to the payment terms, we will get an initial amount of $10 million that will be paid partially in cash at closing and partially at the short term after closing, backed with sufficient guaranties.

Edward Schwartz – Edward Schwartz Investments

So the balance sheet on the closing will not show $19 million cash. It will show something like $14 million, $15 million and a short term note?

Ofer Tziperman

I’m not sure, I followed you. Can you please repeat?

Edward Schwartz – Edward Schwartz Investments

The balance sheet after closing will show cash equivalents of approximately $14 million, $15 million and a $5 million short term note?

Ofer Tziperman

Ed, I'm sorry, we cannot refer for the exact amount. It will be cash at closing but generally you are right, some of the $10 million relate to our cash balance and the rest will join later.

Edward Schwartz – Edward Schwartz Investments

Now on the 043 patent, couple of years ago OTI got a licensing agreement with an unknown source. Was this also on the 043 patent? They signed the licensing agreement with unknown source. Is this also the 043 patent?

Ofer Tziperman

The 043 patent is included in that deal, that’s correct, yes, but we cannot refer any names et cetera at this point.

Edward Schwartz – Edward Schwartz Investments

That is correct. Okay. Now regarding your patents, according to the U.S. Patent website, it shows 18 patents granted to On Track, 18 U.S. patents. I know previous management has talked about patents pending. Could you give us a ballpark figure of how many patents pending you have before the U.S. Patent Office?

Ofer Tziperman

I don’t have the exact number in front of me but all together I think that we have something like 24 patents and patent pending. And as I’ve mentioned earlier, we have been granted in the last quarter two new patents. Another one is already allowed. So this is basically with reply to your question about the specific numbers.

Edward Schwartz – Edward Schwartz Investments

Okay and of the patent pendings, how many of those would be over three years old?

Ofer Tziperman

I am not sure I have this information in front of me right now.

Edward Schwartz – Edward Schwartz Investments

Okay, you can get back to me at a future time. That will be perfect.

Operator

And your next question will come from the line of Josh Smith. Please go ahead.

Josh Smith

Quick question to ask you, actually two questions. Given your comments on the 043 patents, do you think it applies to companies beyond T-Mobile?

Ofer Tziperman

Well, at this point in time, the tentative answer is yes but we don’t want to expand on anything with regard to the T-Mobile case more than we are actually publishing as you can appreciate this is in a middle of trial. So we’re prohibited of providing any further information.

Josh Smith

Okay cool and then also you’ve done a great job in reducing your EBITDA loss. Just wondering if you think it’s realistic that in 2014 you’ll become EBITDA positive?

Ofer Tziperman

I think that that’s a fair question. First of all we’re very optimistic about the financial future of the company and the goal obviously is to become profitable as soon as possible. But since the management change took place, we did not really release any specific forecast including not any specific time for moving into profitability, but I think that you can see the improvement we have demonstrated in the last three quarters and we have an ongoing effort to reduce the Company’s expenses and we also started to demonstrate increasing revenues with the new deals, partnerships and the products. So we believe this will improve further in 2014.

Josh Smith

And also do you think there will be any incremental expenses due to changing your listing?

Ofer Tziperman

I am not sure I understand the question.

Josh Smith

Are you guys going to be listed on the NASDAQ going forward or are you changing your listing or your reporting requirements for 2014?

Ofer Tziperman

You mean by becoming a domestic issuer rather than foreign issuer? Joshua, I’m not sure I follow the question, can you please elaborate.

Josh Smith

As you become an U.S. filer, so I was just wondering there should be any incremental expenses associated with that?

Ofer Tziperman

No, not that we expect anything special. Shay?

Shay Tomer

Well, we will have some expenses but almost expense expected the material expenses with this regard.

Operator

(Operator Instructions) And your next question comes from the line of Robert Wolf. Please go ahead.

Robert Wolf

I was just wondering if your view is that NFC will continue to be offered on the most popular cell phones?

Ofer Tziperman

Yes, absolutely. From what we see right now, the major forces that are driving in this direction, first and foremost the mobile carriers around the world. They actually see the NFC as one of the most important growth engines for them moving forward, especially after they have been removed from the application stores and therefore the directive to handset manufactures to include NFC within the devices. So that’s the first reason.

The other reason is the handset manufacturers themselves who also want to be part of the mobile payment game and for sure they control the handset and therefore they would like to add NFC. And finally NFC is a communication method, it's far more than just a payment method, and this is something that is overlooked by many people. NFC is going to be used not only for payments. It is also used to passing information peer to peer between two mobile phones. It is also used for gaming and therefore we don't see any option but eventually NFC is going to be in every mobile phone like you have a GPS and like you have some other command centers.

Robert Wolf

So my next question is whether you have plans to work directly with carriers and with the handset manufactures themselves?

Ofer Tziperman

As far as the carriers are concerned, absolutely yes, and we haven't published anything. So I cannot go into more details. But definitely they are part of our potential customers. As far as the handset manufacturers, at this point in time we do not have any direct relationships, other than some case in the past which is not relevant for this specific initiative.

Operator

At this time this concludes our question and answer session and I would now like to turn the call back over to Ofer Tziperman for closing remarks.

Ofer Tziperman

Thank you everyone for joining us on our call today. I specially want to thank our investors for their continued support and patience as we continue to build OTI into a global leader in cashless payment solutions. We look forward to updating you on our next call. Operator.

Operator

Before we conclude, I would like to provide OTI's Safe Harbor statement with some important cautions regarding forward looking statements made during this call as follows as well as the statement regarding use of non-GAAP financial information. All statements made by management during this call that are not based on historical facts are forward looking statements within the meaning if the United States Private Securities Litigation Reform Act of 1995 and the provisions of Section 27-A of the Securities Act of 1933 as amended and Section 21-E of the Securities Exchange Act of 1934 as amended.

Whenever we use words such as believe, expect, anticipates, intends, plan, estimates, or similar expressions, we are making forward-looking statements. Because such statements deal with future events and are based on OTI’s current expectations, they are subject to certain risks and uncertainties and actual performance or achievements of OTI could differ materially from those described in or implied by these statements in this call.

For example, forward-looking statements include statements regarding the timing of closing, receipt of consideration and amounts of consideration from the sale of the SmartID division to SuperCom. If such transaction is closed at all, future reduction of operating expenses, future profitability, total shipments of NFC solutions before the end of 2013, future expansions of such sales, future pipeline, new wins and growth opportunities, growth engines as well as the role OTI will play in the NFC market in the future.

Forward-looking statements could be impacted by the effects of protracted evaluation, validation periods in the U.S. and other markets for contactless payment cards. Market acceptance of new and existing products, and our ability to execute production on orders, as well as other risks and uncertainties, including those discussed in the Risk Factors section and elsewhere in our Annual Report on Form 20-F for the year ended December 31, 2012 and in subsequent filings with the Securities and Exchange Commission.

Although we believe that the expectations reflected in such forward-looking statements are based on reasonable assumptions, we can give no assurance that our expectations will be achieved. Except as otherwise required by law, OTI disclaims any intention or obligation to update or revise any forward-looking statements, which speak only as of the date hereof, whether as a result of new information, future events or circumstances, or otherwise.

This call contains certain non-GAAP measurements, namely adjusted EBITDA from continuing operations. Adjusted EBITDA continuing operations represents earnings before interest tax, income tax, depreciation and amortization, and further eliminates the effect of share based compensation expense.

The Company believes that adjusted EBITDA from continuing operations should be considered in evaluating the Company’s operations, since they provide a clear indication the Company’s operating results. This measure should be considered in addition to the results prepared in accordance with U.S. GAAP. It should not be considered as substitutes for U.S. GAAP results. The non GAAP measures included in this call have been reconciled to U.S. GAAP results in the tables in the press release issued at the end of last month.

Lastly, as discussed in the press release relating to this call, the financial results for the first, second and third quarter of 2012 that were previously published during 2012 were prepared in accordance with IFRS. The financial results for any period in 2012 that are mentioned in this call were prepared in accordance with U.S. GAAP. Finally, I would like to remind everyone that a recording of today’s call will be available for replay via a link available in the Investor Relations section of the Company’s website at www.otiglobal.com.

Thank you for joining us today for our presentation and you may now disconnect.

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.

THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.

If you have any additional questions about our online transcripts, please contact us at: transcripts@seekingalpha.com. Thank you!

Source: On Track Innovations' CEO Discusses Q3 2013 Results - Earnings Call Transcript
This Transcript
All Transcripts