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AVT Announces Record Revenues for first half of the year

Press release from the issuing company

Hod-Hasharon, Israel, August 27, 2008 – Advanced Vision Technology Ltd., the world's leading supplier of automatic optical inspection and quality assurance systems for the printing industry, announces revenues for Q2 2008 of $ 16.9 million, an increase of 109.4% over the same period in 2007. H1 2008 revenues reach $ 34 million, an increase of 113.7% compared to the same period in 2007.
Graphics Microsystems, Inc. (GMI), acquired by AVT in October 2007, contributed $ 8.2 million to Q2 revenues. AVT product line revenues in Q2 2008 amounted to $8.7 million representing an increase of 8.3% of the revenues in Q2 of 2007.
Service revenues in the first six months of 2008 totalled $5.0 million (out of the total revenues of $34 million) 328% higher than H1 2007. The increase in service revenues is attributable to the significant contribution of GMI's product line and the continued increase in the number of service contracts signed during the quarter.  Service orders received during H1 of 2008 were $5.6 million 318% higher than in H1 2007. During the first six months of 2008 order booking totalled $32.3 million representing an increase of 72% over H1 2007 order booking of $18.8 million.
Operating income in the first six months of 2008 decreased by 20.6% from $ 2.5 million in 2007 to $ 2.0 million in the respective period of 2008. The decrease is attributable to the amortization of GMI intangibles and integration costs.  Proforma operating income (excluding amortization of GMI's intangible assets) increased in H1 2008 to $3.4 million, 35.9% higher than in H1 2007.
Net income for the first half of 2008 was $ 1.7 million compared with $3.5 million for H1 2007. The results of H1 2008 include amortization expense of intangible assets of $1.4 million.
Shlomo Amir, President and CEO of AVT: "The company's continuous growth is, in part, a result of the successful integration of GMI. The cooperation with GMI opened the door  to new market opportunities. The highlight of the second quarter was the largest show in the printing industry, DRUPA. During the DRUPA exhibition, AVT and GMI jointly introduced no less than 20 new solutions for the printing industry, and received orders from customers in Europe, Asia and North America. We demonstrated combined solutions including AVT automatic inspection for the commercial printing market and GMI spectral based in-line color solution for the packaging market. These solutions were enthusiastically received by the industry. Moreover, in May we completed the integration of the distribution organizations of AVT and GMI in EMEA (Europe, Middle-East and Africa), and both are now operating as AVT EMEA. This will enable efficient field operations, cost advantages, and we will effectively address joint market opportunities".