ECtel Reports Record Revenues and Earnings in First Quarter

Revenue Increased by 38%. Net Income Increased by 63%.



Apr 24, 2001, 01:00 ET from ECtel Ltd.

    PETAH TIKVA, Israel, April 24 /PRNewswire Interactive News Release/ --
 ECtel Ltd. (Nasdaq:   ECTX), a leading developer and provider of fraud
 prevention, Quality of Service (QoS) and network performance monitoring and
 billing mediation solutions for telecom service providers worldwide, today
 reported operating results for the first quarter ended March 31, 2001.
 
     Highlights
                                      Q1 2001       Q1 2000       % Change
                                       $'000         $'000
 
     Revenues                          18,210       13,176          +38%
     Gross Profit                      10,820        7,339          +47%
     Net Income (1)                     3,617        2,223          +63%
     Diluted EPS (1)                     0.21         0.13          +62%
     (1) Excluding stock-based compensation
 
     Revenues for the first quarter ended March 31, 2001 rose 38% to
 $18.2 million from $13.2 million in the first quarter of 2000.  Gross profit
 in the first quarter increased by 47% to $10.8 million compared with
 $7.3 million for the same period last year.  Operating income (excluding
 stock-based compensation) increased by 48% to $3.4 million compared with
 $2.3 million in the same period last year.  Stock-based compensation for the
 first quarter of 2001 was $672,000 compared with $682,000 for the first
 quarter of 2000.  Net income (excluding stock-based compensation) advanced by
 63% to $3.6 million or $ 0.21 per fully diluted share, up from $2.2 million or
 $0.13 per fully diluted share for the corresponding quarter last year.
     "I am pleased to report these record first quarter results," said Aharon
 Shech, President and CEO of ECtel.  "ECtel has continued to grow both top and
 bottom line indicators by substantial amounts.  The growth in sales for the
 quarter was achieved this time by the strong growth in Fraud Prevention
 Solutions and Government Systems.  Of particular note, more than 40% of
 revenues came from our existing client base.
     "We see a lot of opportunities for our fraud prevention solutions, as
 companies focus more than ever on cutting costs and improving efficiency, in
 order to remain competitive in the face of uncertain market conditions.   The
 attraction of ECtel's range of solutions is that they can have a direct impact
 on the bottom-line of a telecommunications service provider.  More now than
 ever, companies cannot afford the effects of telecommunications-based fraud, a
 problem that is increasingly commonplace and advanced.
     "Consequently, we are seeing particular demand for Fraudview(TM) and
 increasing global recognition based on the superiority of our Fraud Prevention
 Solutions.  Furthermore, I am particularly pleased to announce that we have
 received a significant repeat order for Fraudview(TM), from a major
 telecommunications service provider in Latin America.  This repeat order
 represents an expansion of a contract won last year.
     "Our strategy continues to be concentrated on increasing our market share
 and geographic reach in all markets.  As well as implementing this strategy,
 we are placing further focus on winning large customer accounts.  Furthermore,
 we have continued with our commitment to invest in research & development
 initiatives during the period.  This is focusing on the development of ECtel
 solutions for next generation networks (NGN), in the areas of fraud
 prevention, QoS and mediation.
     "As part of our on-going growth, we have continued to recruit skilled
 professionals during the period to support us.  Further recruitment
 initiatives will play a central part of ECtel's growth strategy during the
 year."
     Mr. Shech concluded, "ECtel continues to be the world leader in the
 provision of fraud prevention and Quality of Service solutions and this is
 illustrated by yet another sound set of financial results."
 
     ECtel management cordially invites you to participate in our interactive
 conference call on Tuesday, April 24, 2001 at 10:00 am ET; 9:00 am CT; and
 7:00 am PT.
     If you wish to participate, please call the conference center
 approximately 10 minutes prior to conference time.  We invite you to dial:
 
     In the United States:  800-450-0819
     In Israel:  800-262-424
     In the United Kingdom: 0-800-169-9043
     In Germany: 0-800-180-2235
     All Other International Callers: ++1-(612) 332-0637
 
     A digitalized replay of the teleconference will be available from 12:00 pm
 ET April 24, 2001 through 11:59 pm ET May 1st, 2001.  Please dial
 
     In the United States:  800-475-6701 Access Code: 564334
     In Israel: 03-925-5933 Access Code: 4334
     All Other International Callers: ++1-(320) 365-3844 Access Code: 564334
 
     ECtel Ltd
     As the leader in networks monitoring technology, ECtel Ltd. develops and
 markets solutions that enable telecommunications service providers to monitor
 the quality of service over voice, data, cellular and VOIP networks; to detect
 and prevent telecommunications fraud, such as cellular fraud, calling card
 fraud and premium rate services fraud; and to enable billing mediation
 applications for traffic that is transported across networks of other service
 providers.  All products are proprietary in-house developed state-of-the-art
 technologies in the areas of SS7 signaling analysis, data management and DSP
 algorithms and can be incorporated in one platform.  For more information on
 ECtel, we invite you to visit our web site at http://www.ectel.com.
 
     Certain statements contained in this release contain forward-looking
 information with respect to plans, projections or future performance of the
 Company, the occurrence of which involves certain risks and uncertainties,
 including, but not limited to, product and market acceptance risks, the impact
 of competitive pricing, product development, commercialization and
 technological difficulties and other risks detailed in the Company's filings
 with the Securities and Exchange Commission.
 
 
                                   ECtel Ltd.
                       Consolidated Statements of Income
                    $ in thousands except per share amounts
 
                                                   Three months ended March 31,
                                                        2000           2001
                                                            (Unaudited)
 
     Revenues                                          13,176         18,210
 
     Cost of revenues                                   5,837          7,390
 
     Gross profit                                       7,339         10,820
 
     Research and development costs -- net              1,726          2,649
     Selling and marketing expenses                     2,515          3,574
     General and administrative expenses                  666          1,215
     Goodwill amortization                                142             --
     Stock-based compensation                             682            672
 
     Operating income                                   1,608          2,710
 
     Financial income, net                              (409)          (501)
     Other income, net                                      0            (6)
 
     Income before taxes on income                      2,017          3,217
 
     Taxes on income                                      428            191
 
     Net income before Cumulative effect of
      change in accounting principles                   1,589          3,026
 
     Cumulative effect of change in
      accounting principles                                 0             34
 
 
     Net income                                         1,589          2,992
 
     Basic earnings per share                            0.10           0.18
 
     Number of shares outstanding used             16,087,500     16,298,500
      to compute basic earnings per share
 
     Diluted earnings per share                          0.09           0.17
 
     Weighted average number of shares
      outstanding used to compute diluted
       earnings per share                          17,319,500     17,494,369
 
 
 
     Adjusted net income                                2,223          3,617
 
     Adjusted basic earnings per share                   0.14           0.22
 
     Adjusted diluted earnings per share                 0.13           0.21
 
     Note: The above presentation of adjusted net income and adjusted net
 earnings per share (basic or diluted) has been adjusted to exclude non-cash
 charges for stock-based compensation.
     Neither adjusted net income nor adjusted earnings per share (basic or
 diluted) is a measurement of financial performance under generally accepted
 accounting principles.
 
                                   ECtel Ltd.
                          Consolidated Balance Sheets
                                 $ in thousands
 
                                                    December 31,     March 31,
                                                        2000           2001
                                                     (Audited)      (Unaudited)
     Assets
     Current assets:
 
     Cash and cash equivalents                         41,735         37,826
     Receivables:
      Trade                                            22,210         26,101
      Other                                             1,345          1,658
     Parent and fellow subsidiary companies             1,597          2,382
     Recoverable costs and estimated
      earnings, not yet billed                          6,535          9,968
     Inventories                                        5,417          5,066
 
     Total current assets                              78,839         83,001
 
     Long-term deposits and receivables,
      net of current maturities                         2,752          2,078
 
     Property, plant and equipment
     Cost                                               7,152          7,900
     Less -- accumulated depreciation                   2,869          3,155
 
                                                        4,283          4,745
 
     Other assets                                           8            561
 
     Total assets                                      85,882         90,385
 
 
                                   ECtel Ltd.
                          Consolidated Balance Sheets
                                 $ in thousands
 
 
                                                     December 31,     March 31,
                                                        2000            2001
                                                      (Audited)      (Unaudited
 
     Liabilities and shareholders' equity
 
     Current liabilities:
 
     Trade payables                                     4,682          4,383
     Other payables and accrued liabilities            13,172         14,219
 
     Total current liabilities                         17,854         18,602
 
     Long-term liabilities:
     Liability for employee severance benefits, net       677            681
 
     Total liabilities                                 18,531         19,283
 
     Shareholders' equity :
     Share capital                                        196            197
     Capital surplus                                   52,384         53,142
     Retained earnings                                 14,771         17,763
 
                                                       67,351         71,102
 
     Total Liabilities and shareholders' equity        85,882         90,385
 
                     MAKE YOUR OPINION COUNT -- Click Here
                http://tbutton.prnewswire.com/prn/11690X69438807
 
 

SOURCE ECtel Ltd.
    PETAH TIKVA, Israel, April 24 /PRNewswire Interactive News Release/ --
 ECtel Ltd. (Nasdaq:   ECTX), a leading developer and provider of fraud
 prevention, Quality of Service (QoS) and network performance monitoring and
 billing mediation solutions for telecom service providers worldwide, today
 reported operating results for the first quarter ended March 31, 2001.
 
     Highlights
                                      Q1 2001       Q1 2000       % Change
                                       $'000         $'000
 
     Revenues                          18,210       13,176          +38%
     Gross Profit                      10,820        7,339          +47%
     Net Income (1)                     3,617        2,223          +63%
     Diluted EPS (1)                     0.21         0.13          +62%
     (1) Excluding stock-based compensation
 
     Revenues for the first quarter ended March 31, 2001 rose 38% to
 $18.2 million from $13.2 million in the first quarter of 2000.  Gross profit
 in the first quarter increased by 47% to $10.8 million compared with
 $7.3 million for the same period last year.  Operating income (excluding
 stock-based compensation) increased by 48% to $3.4 million compared with
 $2.3 million in the same period last year.  Stock-based compensation for the
 first quarter of 2001 was $672,000 compared with $682,000 for the first
 quarter of 2000.  Net income (excluding stock-based compensation) advanced by
 63% to $3.6 million or $ 0.21 per fully diluted share, up from $2.2 million or
 $0.13 per fully diluted share for the corresponding quarter last year.
     "I am pleased to report these record first quarter results," said Aharon
 Shech, President and CEO of ECtel.  "ECtel has continued to grow both top and
 bottom line indicators by substantial amounts.  The growth in sales for the
 quarter was achieved this time by the strong growth in Fraud Prevention
 Solutions and Government Systems.  Of particular note, more than 40% of
 revenues came from our existing client base.
     "We see a lot of opportunities for our fraud prevention solutions, as
 companies focus more than ever on cutting costs and improving efficiency, in
 order to remain competitive in the face of uncertain market conditions.   The
 attraction of ECtel's range of solutions is that they can have a direct impact
 on the bottom-line of a telecommunications service provider.  More now than
 ever, companies cannot afford the effects of telecommunications-based fraud, a
 problem that is increasingly commonplace and advanced.
     "Consequently, we are seeing particular demand for Fraudview(TM) and
 increasing global recognition based on the superiority of our Fraud Prevention
 Solutions.  Furthermore, I am particularly pleased to announce that we have
 received a significant repeat order for Fraudview(TM), from a major
 telecommunications service provider in Latin America.  This repeat order
 represents an expansion of a contract won last year.
     "Our strategy continues to be concentrated on increasing our market share
 and geographic reach in all markets.  As well as implementing this strategy,
 we are placing further focus on winning large customer accounts.  Furthermore,
 we have continued with our commitment to invest in research & development
 initiatives during the period.  This is focusing on the development of ECtel
 solutions for next generation networks (NGN), in the areas of fraud
 prevention, QoS and mediation.
     "As part of our on-going growth, we have continued to recruit skilled
 professionals during the period to support us.  Further recruitment
 initiatives will play a central part of ECtel's growth strategy during the
 year."
     Mr. Shech concluded, "ECtel continues to be the world leader in the
 provision of fraud prevention and Quality of Service solutions and this is
 illustrated by yet another sound set of financial results."
 
     ECtel management cordially invites you to participate in our interactive
 conference call on Tuesday, April 24, 2001 at 10:00 am ET; 9:00 am CT; and
 7:00 am PT.
     If you wish to participate, please call the conference center
 approximately 10 minutes prior to conference time.  We invite you to dial:
 
     In the United States:  800-450-0819
     In Israel:  800-262-424
     In the United Kingdom: 0-800-169-9043
     In Germany: 0-800-180-2235
     All Other International Callers: ++1-(612) 332-0637
 
     A digitalized replay of the teleconference will be available from 12:00 pm
 ET April 24, 2001 through 11:59 pm ET May 1st, 2001.  Please dial
 
     In the United States:  800-475-6701 Access Code: 564334
     In Israel: 03-925-5933 Access Code: 4334
     All Other International Callers: ++1-(320) 365-3844 Access Code: 564334
 
     ECtel Ltd
     As the leader in networks monitoring technology, ECtel Ltd. develops and
 markets solutions that enable telecommunications service providers to monitor
 the quality of service over voice, data, cellular and VOIP networks; to detect
 and prevent telecommunications fraud, such as cellular fraud, calling card
 fraud and premium rate services fraud; and to enable billing mediation
 applications for traffic that is transported across networks of other service
 providers.  All products are proprietary in-house developed state-of-the-art
 technologies in the areas of SS7 signaling analysis, data management and DSP
 algorithms and can be incorporated in one platform.  For more information on
 ECtel, we invite you to visit our web site at http://www.ectel.com.
 
     Certain statements contained in this release contain forward-looking
 information with respect to plans, projections or future performance of the
 Company, the occurrence of which involves certain risks and uncertainties,
 including, but not limited to, product and market acceptance risks, the impact
 of competitive pricing, product development, commercialization and
 technological difficulties and other risks detailed in the Company's filings
 with the Securities and Exchange Commission.
 
 
                                   ECtel Ltd.
                       Consolidated Statements of Income
                    $ in thousands except per share amounts
 
                                                   Three months ended March 31,
                                                        2000           2001
                                                            (Unaudited)
 
     Revenues                                          13,176         18,210
 
     Cost of revenues                                   5,837          7,390
 
     Gross profit                                       7,339         10,820
 
     Research and development costs -- net              1,726          2,649
     Selling and marketing expenses                     2,515          3,574
     General and administrative expenses                  666          1,215
     Goodwill amortization                                142             --
     Stock-based compensation                             682            672
 
     Operating income                                   1,608          2,710
 
     Financial income, net                              (409)          (501)
     Other income, net                                      0            (6)
 
     Income before taxes on income                      2,017          3,217
 
     Taxes on income                                      428            191
 
     Net income before Cumulative effect of
      change in accounting principles                   1,589          3,026
 
     Cumulative effect of change in
      accounting principles                                 0             34
 
 
     Net income                                         1,589          2,992
 
     Basic earnings per share                            0.10           0.18
 
     Number of shares outstanding used             16,087,500     16,298,500
      to compute basic earnings per share
 
     Diluted earnings per share                          0.09           0.17
 
     Weighted average number of shares
      outstanding used to compute diluted
       earnings per share                          17,319,500     17,494,369
 
 
 
     Adjusted net income                                2,223          3,617
 
     Adjusted basic earnings per share                   0.14           0.22
 
     Adjusted diluted earnings per share                 0.13           0.21
 
     Note: The above presentation of adjusted net income and adjusted net
 earnings per share (basic or diluted) has been adjusted to exclude non-cash
 charges for stock-based compensation.
     Neither adjusted net income nor adjusted earnings per share (basic or
 diluted) is a measurement of financial performance under generally accepted
 accounting principles.
 
                                   ECtel Ltd.
                          Consolidated Balance Sheets
                                 $ in thousands
 
                                                    December 31,     March 31,
                                                        2000           2001
                                                     (Audited)      (Unaudited)
     Assets
     Current assets:
 
     Cash and cash equivalents                         41,735         37,826
     Receivables:
      Trade                                            22,210         26,101
      Other                                             1,345          1,658
     Parent and fellow subsidiary companies             1,597          2,382
     Recoverable costs and estimated
      earnings, not yet billed                          6,535          9,968
     Inventories                                        5,417          5,066
 
     Total current assets                              78,839         83,001
 
     Long-term deposits and receivables,
      net of current maturities                         2,752          2,078
 
     Property, plant and equipment
     Cost                                               7,152          7,900
     Less -- accumulated depreciation                   2,869          3,155
 
                                                        4,283          4,745
 
     Other assets                                           8            561
 
     Total assets                                      85,882         90,385
 
 
                                   ECtel Ltd.
                          Consolidated Balance Sheets
                                 $ in thousands
 
 
                                                     December 31,     March 31,
                                                        2000            2001
                                                      (Audited)      (Unaudited
 
     Liabilities and shareholders' equity
 
     Current liabilities:
 
     Trade payables                                     4,682          4,383
     Other payables and accrued liabilities            13,172         14,219
 
     Total current liabilities                         17,854         18,602
 
     Long-term liabilities:
     Liability for employee severance benefits, net       677            681
 
     Total liabilities                                 18,531         19,283
 
     Shareholders' equity :
     Share capital                                        196            197
     Capital surplus                                   52,384         53,142
     Retained earnings                                 14,771         17,763
 
                                                       67,351         71,102
 
     Total Liabilities and shareholders' equity        85,882         90,385
 
                     MAKE YOUR OPINION COUNT -- Click Here
                http://tbutton.prnewswire.com/prn/11690X69438807
 
 SOURCE  ECtel Ltd.