On-Track reinstated (again) to U.S. electronic passport tender 05.12.05 | 09:59 By Asaf Rothem On Track Innovations (Nasdaq: OTIV, Frankfurt: OT5), won its appeal and is again in the race to supply the American government with electronic passport technology.
A month ago, the company raised $22 million through a private placement of shares. Investors were charmed by its upbeat forecasts for the future and third-quarter revenue growth. Evidently they had forgiven OTI for being ousted from the U.S. tender back in August.
Now however the company has won its case in the Federal court in Washington, which reversed the decision to throw the Israeli company out of the Government Press Office tender process.
The court ruled that OTI should be restored immediately and that examination of its products should resume from the point it was left off.
OTI had been ousted from the race due to flaws in its final product. It had tried to appeal to the General Accounting Office in the past, to no avail.
This is not in fact the first time OTI has been thrown out of the race, and reinstated. In October 2004, the GPO declared four contenders for the final phase of the race, and OTI wasn't on the list. It appealed and in January was reinstated.
Market sources said at the time that OTI threatened to sue the GPO in court and Washington preferred to restore it to the tender process, rather than slow matters down with court hearings.
For the first nine months of 2005 OTI reported a 72% leap in revenues to $26.4 million, from $15.4 million for the same period of last year.
Third-quarter revenues doubled and more, rising by 120% to $12.1 million from $5.5 million for the same quarter of last year. Net loss for the first nine months of 2005 fell 4% to $6.8 million.
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