Year ended December 31,

Consolidated Statement of Operations

2000

2001

2002

2003

2004

(U.S. dollars in thousands)

Sales

–

8,235

8,704

12,493

23,597

Cost of Sales

–

6,322

6,708

9,649

17,627

Gross Profit

–

1913

1,996

2,844

5,970

Selling and marketing expenses

–

(575

)

(655

)

(946

)

(1,455

)

General and administrative expenses

(751

)

(1762

)

(1,471

)

(1,949

)

(2,741

)

Operating income (loss)

(751

)

(424

)

(130

)

(51

)

1,774

Other income

50

362

257

1,045

142

Impairment on long-term investment

(2,079

)

(1,390

)

–

–

(2,218

)

Impairment of available-for-sale marketable securities

–

–

–

–

(572

)

Financial income (expenses), net

285

(284

)

(191

)

(10

)

(388

)

Income (loss) before taxes on income

(2,495

)

(1,736

)

(64

)

984

(1,262

)

Taxes on income

–

88

378

195

332

Gain (loss) from continuing operations

(2,495

)

(1,824

)

(442

)

789

(1,594

)

Equity in earnings of an affiliate

–

–

–

481

6

Net income (loss)

(2,495

)

(1,824

)

(442

)

1,270

(1,588

)

Basic and diluted net earnings (loss) per share

(0.21

)

(0.13

)

(0.03

)

0.09

(0.12

)

Weighted average number of shares used in computing basic net earnings (loss) per share

11,862

13,521

13,600

13,600

13,600

Weighted average number of shares used in computing diluted net earning (loss) per share

11,862

13,521

13,600

13,600

13,600