3rd Quarter Results

Orad Hi-Tec Systems
24 November 2005


Orad Hi-Tec Systems Ltd. ('Orad' or the 'Company')


Results for the nine month period and the quarter ended 30 September  2005


Orad Hi-Tec Systems Ltd. (Frankfurt - Prime Standard; London - AIM. Symbol:
OHT), a leading developer, marketer and distributor of state-of-the-art, 3D
graphical solutions for the broadcasting, advertising and visual simulation
markets, today announces its results for the third quarter and nine month period
of 2005.


Highlights
     
•    Revenues of $3.4 million in Q3 2005

•    Stable gross margin - 61% in Q3 2005

•    Positive cash flow of $1 million in Q3 2005

•    Backlog increased to $10 million

•    Strengthening presence in sport systems, mainly in Europe.


For further information:

Orad (www.orad.tv)
Avi Sharir- CEO                                             00 972 976 768 62

Shore Capital (London)
Graham Shore                                                00 44 20 7408 4090

Haubrok IR GmbH (Frankfurt)
Michael Kempkes                                             00 49 211 301 260


Orad Hi-Tec Systems Ltd ('Orad' or the 'Company')


Results for the nine month period and the quarter ended 30 September 2005


Chief Executive's Statement


Revenues for the third quarter of 2005 were $3.4 million, compared to $3.8
million in the second quarter of 2005 and $4.1 million in the third quarter of
2004. Gross margin in the third quarter of 2005 was 61%, compared to 52% in the
second quarter of 2005 and 64% in the third quarter of 2004. Net loss was $0.8
million, compared to the loss of $1million in the third quarter of 2004.

Avi Sharir, Orad's President and Chief Executive Officer, commented: During the
last quarter we participated in the IBC trade show where we introduced some new
products: a new graphic computer for broadcast systems, the HDVG, a new system
for sport, and the Trackvision, which has already been purchased by CANAL+ in a
substantial sale. We expect our product lines in High Definition and sport
systems to generate new revenue stream in the next quarters.

Revenues for the nine months of 2005 were $10.7 million, compared to $11.2
million for the first nine months of 2004. Operational expenses in the nine
months of 2005 decreased to $8.9 million, compared to $10.1 million in 2004. The
net loss was $3.1 million in the nine months of 2005, compared to $3.5 million
in 2005.


Operational Highlights for the third quarter of 2005:
     
•    Positive cash flow of $1 million

•    Increased revenue from broadcast systems

•    Backlog increased to $10 million

•    Strengthening the presence in sport systems, mainly in Europe.


Financial & Operational Highlights for the third quarter 2005 compared to second
quarter of 2005:

Revenues

Revenues for the third quarter of 2005 were $3.4 million, compared to $3.8
million in the second quarter of 2005, a decrease of 11%. However, sales of
broadcast systems increased by 15% from $2.9 million in Q2 2005 to $3.4 million
in Q3 2005.

Gross Margin

Gross margin in the third quarter of 2005 was 61%, compared to 52% in the second
quarter of 2005. The increase in gross margin is the result of improved sales
volumes of broadcast systems.

Research & Development

R&D expenses in the third quarter of 2005 were $0.5 million compared to $0.6
million in the second quarter of 2005.  The decrease of $0.1 million resulted
from one-time expenses recorded last quarter and reduced expenses as a result of
the participation in the Le-Match program.

Selling & Marketing

S&M expenses in the third quarter of 2005 decreased to $1.6 million, compared to
$1.9 million in the previous quarter, mainly as a result of a decrease in sales
related expenses.

General & Administrative

G&A expenses were $0.7 million in the third quarter of 2005, compared to $0.6
million in the second quarter of 2005, mainly as a result of an additional
provision for doubtful debts and the costs associated with the replacement of
the previous CFO.

Financial income (expenses)

Financial income arises primarily from exchange rate differences related to
non-US dollar balances and interest income earned on short-term deposits offset
by bank charges. Financial expenses for the third quarter of 2005 were $0.02
million, compared to financial expenses of $0.11 million in the second quarter
of 2005. This reflected exchange rate differences, resulting mainly from
devaluation of the Euro against the Dollar.

Net Loss

Net loss for the third quarter of 2005 amounted to $0.8 million, compared to
$1.3 million in the second quarter of 2005.

Net loss per share

Net loss per share for the third quarter of 2005 was 7 cents, compared to a net
loss per share of 12 cents for the second quarter of 2005.


Financial & Operational Highlights for the nine months and the quarter ended
September 30, 2005 compared to the same period in 2004:

Revenues

The revenues for the first nine months of 2005 were $10.7 million, compared to
$11.2 million for the first nine months of 2004, a decrease of 5%. The revenues
for the third quarter of 2005 were $3.4 million, compared to $4.1 million for
the third quarter of 2004, a decrease of 17%.

Gross Margin

Gross margin for the first nine months of 2005 was 56% and 61% for the third
quarter of 2005, compared to 61% in the first nine months of 2004 and 64% in the
third quarter of 2004. The change in gross margin changes in 2005 arose mainly
as a result of the lower margin of the Hong Kong Jockey Club project.

Research & Development

Research and development (R&D) expenses were $1.8 million in the first nine
months of 2005, compared to $2.2 million in the first nine months of 2004. The
decrease is mainly the result of measures taken by the Company to increase
efficiency and consolidate the R&D efforts of subsidiaries with complementary
technologies, as well as cost reductions from other organizational changes and
reduced costs as a result of participating in the Le-Match European program. R&D
expenses in the third quarter of 2005 were $0.5 million compared to $0.8 million
in the third quarter of 2004.

Selling & Marketing

Selling and Marketing (S&M) expenses were $5.2 million in the first nine months
of 2005, compared to $6.2 million in the first nine months of 2004, a decrease
of $1 million resulting from non-recurring  expenses in 2004 connected to
organizational changes. S&M expenses in the third quarter of 2005 were $1.6
million, compared to $2.2 million in the third quarter of 2004.

General & Administrative

General & Administrative (G&A) expenses were $1.9 million in the first nine
months of 2005, compared to $1.7 million in the first nine months of 2004. G&A
expenses in the third quarter of 2005 were $0.7 million, compared to $0.6
million in the third quarter of 2004. In both cases the increase arises mainly
from an increase in the allowance for bad debts.

Financial income (expenses)

Financial income (expenses) consists primarily of exchange rate differences
related to non-US dollar balances and interest income earned on short-term
deposits offset by bank charges. Financial expenses for the first nine months of
2005 were $0.3 million, compared to financial expenses of $0.1 million in the
first nine months of 2003. Financial income for the third quarter of 2004 was
$0.05 million, compared to financial expenses of $0.04 million in the third
quarter of 2004. The financial expenses in 2005 derived mainly from exchange
rate differences resulting from changes in the Euro compared to the Dollar.

Other Expenses

Other expenses in the first nine months of 2004 amounted to $0.1 million, mainly
because of costs related to the share transfer agreement of Orad's subsidiary in
Hong Kong under which Orad became sole owner of the company. In 2005 the Company
did not record any other expenses.

Net Loss

Net loss for the first nine months of 2005 was $3.1 million, compared to $3.5
million for the first nine months of 2004.

Net loss for the third quarter of 2005 was $0.8 million, compared to $1 million
for the third quarter of 2004. The decrease in losses is the result of the cost
reduction measures taken by the Company.

Net loss per share

Net loss per share for the third quarter of 2005 was 7 cents, compared to a net
loss per share of 10 cents for the third quarter of 2004.. Net loss per share
for the first nine months of 2005 was 29 cents, compared to a net loss per share
of 33 cents for the first nine months of 2004.

Cash Position

As of September 30, 2005, cash and short-term bank deposits amounted $5 million,
compared to $4 million at the end of the second quarter of 2005.


Contact:

Orad Hi-Tec Systems Ltd.
Ehud Ben-yair
Chief Financial Officer
PO Box 2177
Kfar Saba 44425, Israel
Tel: [phone] ext. 578
Fax: [phone]
E-Mail: : [e-mail]
www.orad.tv


CONSOLIDATED BALANCE SHEETS

U.S. dollars in thousands

                                                                             December 31,         September 30,
                                                                                 2004                 2005
                                                                                                    Unaudited
ASSETS

CURRENT ASSETS:
Cash and cash equivalents                                                  $         4,752      $         4,464
Restricted cash                                                            750                  500
Trade receivables, net                                                     4,106                2,596
Other accounts receivables and prepaid expenses                            910                  925
Inventories                                                                3,646                3,146
Contracts in progress, net of advances                                     1,111                838

Total current assets                                                       15,275               12,469

SEVERANCE PAY FUND                                                         773                  794

PROPERTY AND EQUIPMENT, NET                                                2,195                2,006

Total assets                                                               $       18,243       $       15,269

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:
Trade payables                                                             $         1,761      $         1,569
Deferred revenues                                                          741                  1,028
Other accounts payable and accrued expenses                                3,280                3,295

Total current liabilities                                                  5,782                5,892

ACCRUED SEVERANCE PAY                                                      1,103                1,135

SHAREHOLDERS' EQUITY:
Share Capital                                                              28                   28
Additional paid-in capital                                                 75,241               75,272
Accumulated other comprehensive loss                                       (547)                (547)
Accumulated deficit                                                        (63,364)             (66,511)

Total shareholders' equity                                                 11,358               8,242

Total liabilities and shareholders' equity                                 $       18,243       $       15,269



CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands, except share and per share data



                       Year ended         Nine months ended             Three months ended
                      December 31,          September 30,                 September 30,
                          2004         2004              2005       2004                2005
                                                            Unaudited

Revenues:

Product sales         $ 15,728    $  11,157           $ 9,770     $ 4,065              $ 3,407
                             
Long term                     -        -                  916          -                   -
contracts

Total revenues           15,728   11,157               10,686      4,065               3,407

Cost of products
sales                     6,188    4,373                3,805      1,462               1,330
Cost of long
term contracts                -        -                  847          -                   -


Total cost of
revenues                  6,188    4,373                4,652      1,462               1,330

Gross profit              9,540    6,784                6,034      2,603               2,077

Operating
expenses:

Research and
development, net          2,844    2,177                1,789        764                 541
Sales and            
marketing                 8,224    6,179                5,168      2,179               1,612
General and
administrative            2,388    1,739                1,921        626                 711

Total operating
expenses                 13,456   10,095                8,878      3,569               2,864

Operating loss            3,916    3,311                2,844        966                 787

Financial income                                  
(expenses), net             189      (43)                (303)        50                 (19)
Other income
(expenses), net            (148)    (139)                   -       (124)                  2

Net loss                $ 3,875  $ 3,493                $ 3,147     $ 1,040            $ 804
                             

Basic and diluted        $ 0.36    $ 0.33                 $ 0.29     $ 0.10            $ 0.07
net loss per
share

Weighted average
number of shares
used in computing
basic and diluted        
net loss per share
(in thousands)           10,698   10,679               10,779     10,679              10,779




STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
U.S. dollars in thousands





                         Number of    Share      Additional Accumulated   Accumulated  Total
                         outstanding  capital    paid-in    other         deficit
                         Ordinary                capital    comprehensive
                         shares                             loss

Balance as of
January 1, 2004          10,650,726   $ 28       $ 75,107   $ (547)       $ (59,489)   $ 15,099

Comprehensive loss:
                                                 
Net loss                 -            -          -          -             (3,875)      (3,875)
Total comprehensive
loss                                                                                   (3,875)
Compensation expenses 
in respect of share 
options whose terms
have been modified       -            -          38         -             -            38
Issuance of shares 
upon exercise of
employees'
share options            100,000      *) -       96         -             -            96

Balance as of
December 31,
2004                     10,750,726   28         75,241     (547)         (63,364)     11,358

Issuance of
earn-out
shares                   28,645       *) -       31         -             -            31
Comprehensive loss:

Net loss for
the period               -            -          -          -             (3,147)      (3,147)
Total comprehensive
loss                     -            -          -          -             -            (3,147)

Balance as of
September 30,                                                                          
2005 (unaudited)         10,779,371   28         75,272     (547)         (66,511)     8,242

Balance as of
January 1, 2004          10,650,726   $ 28       $ 75,107   $ (547)       $ (59,489)   $ 15,099

Comprehensive loss:

Net loss for the 
period                                -          -          -             (3,493)      (3,493)
Total comprehensive
loss                                  -          -          -             -            (3,493)
Compensation expenses 
in respect of share 
options whose terms
have been modified                    -          38         -             -            38

Balance as of
September 30,
2004 (unaudited)         10,650,726   $ 28       $ 75,145   $ (547)       $ (62,982)   $ 11,644


*)         Represent an amount lower than $1.



CONSOLIDATED STATEMENTS OF CASH FLOWS
U.S. dollars in thousands

                                                                   Year ended             Nine months ended
                                                                  December 31,              September 30,
                                                                      2004               2004            2005
                                                                                              Unaudited
CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss                                                        $ (3,875)            $ (3,493)       $ (3,147)
Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation                                                    1,091                911             490
Compensation expenses in respect of share options whose         38                   38              -
terms have been modified
Decrease (increase) in trade receivables, other accounts        938                  963             1,598
receivables and prepaid expenses
Decrease (increase) in inventories                              234                  (79)            275
Decrease (increase) in contracts in progress, net of            229                  337             273
advances
Decrease in trade payables, other accounts payable and          (592)                (735)           (166)
accrued expenses and accrued severance pay, net
Increase (decrease) in deferred revenues                        217                  (151)           287
Other                                                           28                   17              27

Net cash used in operating activities                           (1,692)              (2,192)         (363)

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchase of property and equipment                              (298)                (269)           (201)
Proceeds from sale of property and equipment                    88                   66              26
Decrease (increase) in restricted cash                          (227)                23              250

Net cash used in investing activities                           (437)                (180)           75

CASH FLOWS FROM FINANCING ACTIVITIES:

Payment of long-term loan                                       (16)                 (16)            -
Issuance of shares upon exercise of employees' share options    96                   -               -

Net cash used in financing activities                           80                   (16)            -

Decrease in cash and cash equivalents                           (2,049)              (2,388)         (288)
Balance of cash and cash equivalents at beginning of period     6,801                6,801           4,752

Balance of cash and cash equivalents at end of period           $  4,752             $ 4,413         $ 4,464



SUPPLEMENTARY INFORMATION

     
a.   Company's shares and options held by members of the board of directors
     and officers of the Company:
                                          Number of                     Number of
                                        Ordinary shares               share options *)

Avi Sharir                                 1,306,238                     184,932

Moshe Nissim                               -                             56,428

Ehud Ben-Yair                              -                             25,000

Orna Nehustan                              -                             20,000

Yehuda Bronicki                            -                             10,000

Amos Horev                                 -                             10,000

Dan Falk                                   -                             10,000

Anat Segal                                 -                             10,000


*)       Each share option is convertible into one Ordinary share.

b.       As of September 30, 2005, the Company employs 113 employees.


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