Interim Management Statement

11 April 2012

BATM Advanced Communications Limited

Interim Management Statement

BATM Advanced Communications Limited ("BATM" or the "Company") (LSE: BVC), a leading designer and producer of telecom systems and medical laboratory diagnostic and sterilisation systems, is today issuing its Interim Management Statement for the period from 1 January 2012 to 31 March 2012.

Current trading update 

Total revenues in the first quarter of 2012 (Q1) were $24.9 million, slightly ahead of our plan, and compared with $27.4 million on a like for like basis for the equivalent period in 2011, which excludes revenues from the discontinued legacy telecom business.

During the first quarter of the year the sales mix was 52% from the Telecoms division and 48% from the Medical division compared to 66% and 34% respectively in the first quarter of 2011. Gross margin was lower during the first quarter of 2012 than over the same period of 2011 as a result of a higher mix of Medical sales but nonetheless met the company's internal targets. Significant improvement in gross margin was achieved in the Medical division over the same period last year despite the fact that we are still in the early stages of production in our diagnostic division.

Financial position 

The Company's balance sheet remains strong and at March 31 the effective cash balance stood at $42.7 million, a decrease of $4.2 million compared to the position at December 31 2011, mainly as a result of repayment of a long term loan that is expected to generate a one off gain of approximately $0.7 million.

Telecom Division

Our Telecom division is, following its re-organisation, making progress in line with our previous guidance. New customers are being won worldwide as the division focuses on being a key supplier to next generation telecoms networks.

Medical Division

The Medical division continues to make significant progress in gaining validation for its products and in growing its market presence. This progress can be evidenced by our recent announcement that the Company had received CE certification for its Detect HIV 4th Generation Total Screening Kit, which proved 100% accurate in independent testing.

The improved margins that we reported have been demonstrated in all three areas of operations: diagnostics, sterilisation and distribution. This is in line with our long term target to increase our operating margins in the Medical division to the levels of our Telecom division.

Outlook BATM has achieved its goals for the first quarter and significant progress has been made in the Medical Division.

Despite the challenging commercial macro environment we believe we are on track to achieve our strategic, operating and financial targets for the full year and remain cautiously optimistic regarding the outlook for both of our divisions in the medium term.

- Ends -

Enquiries

BATM Advanced Communications +972 9866 2525   

Dr Zvi Marom, Chief Executive

Ofer Bar-Ner, CFO

Threadneedle Communications 020 7653 9850

Josh Royston / Graham Herring

FinnCap 020 7220 0500

Marc Young

Shore Capital 020 7408 4090 

Pascal Keane