Optibase Posts 1Q Profit

HERZLIYA, ISRAEL: Video compression specialist Optibase ended the first quarter of 2009 with net income of $2.9 million, or around 18 cents a share, on revenues of $3.6 million. During 1Q08, Optibase (NASDAQ: OBAS) posted a net loss of $2.9 million, or 21 cents a share, on $4 million in revenues.

The three months ending March 31, 2009, also included $4.8 million in income from the sale of the company’s piece of Scopus, picked up by Harmonic for $51 million in March. Optibase ended the quarter with $28.8 million in cash and equivalents, and shareholder equity of $38.3 million.

Optibase chief financial officer, Amir Philips said cost-cutting measures helped the company get through 1Q09, and backlog orders are expected to shore up 2Q.

“While we are encouraged by this backlog, we do not believe it is indicative of a significant change to the poor economic climate which thus far has not shown any significant signs of easing,” Phillips said.

Given the difficult climate, the company said it intends to diversify into fixed-income real estate in Central and Western Europe and North America.

“Due to the global financial crisis, the company’s board believes that the fixed-income real estate sector has become attractive and presents new business opportunities,” the company said in its 1Q announcement. The board of directors will meet in the coming weeks to seek a shareholder endorsement on the plan. Optibase shares traded at around $1.25 a share at mid-afternoon. -- Deborah D. McAdams