on Track Innovations (OTIVF) 10-Q 14 Nov 16 2016 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Nov. 10, 2016
Document and Entity Information [Abstract]
Entity Registrant Name	ON TRACK INNOVATIONS LTD
Entity Central Index Key	1,021,604
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Type	10-Q
Document Period End Date	Sep. 30, 2016
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2,016
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		40,941,376

Interim Unaudited Condensed Con

Interim Unaudited Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015	[1]
Current assets
Cash and cash equivalents	$ 6,937	$ 5,450
Short-term investments	5,984	5,454
Trade receivables (net of allowance for doubtful accounts of $769 and $778 as of September 30, 2016 and December 31, 2015, respectively)	3,692	2,418
Other receivables and prepaid expenses	1,903	2,183
Inventories	2,704	3,330
Total current assets	21,220	18,835
Long-term restricted deposit for employees benefit	477	524
Severance pay deposits	328	455
Property, plant and equipment, net	6,292	8,668
Intangible assets, net	255	180
Total Assets	28,572	28,662
Current Liabilities
Short-term bank credit and current maturities of long-term bank loans	3,780	3,815
Trade payables	6,472	5,441
Other current liabilities	2,227	2,724
Total current liabilities	12,479	11,980
Long-Term Liabilities
Long-term loans, net of current maturities	1,435	2,359
Accrued severance pay	849	1,148
Deferred tax liability	407	352
Total long-term liabilities	2,691	3,859
Total Liabilities	15,170	15,839
Shareholders' Equity
Ordinary shares of NIS 0.1 par value: Authorized - 50,000,000 shares as of September 30, 2016 and December 31, 2015; issued: 42,120,075 and 42,014,673 shares as of September 30, 2016 and December 31, 2015, respectively; outstanding: 40,941,376 and 40,835,974 shares as of September 30, 2016 and December 31, 2015, respectively	1,057	1,055
Additional paid-in capital	224,214	225,925
Treasury shares at cost - 1,178,699 shares as of September 30, 2016 and December 31, 2015	(2,000)	(2,000)
Accumulated other comprehensive loss	(996)	(1,084)
Accumulated deficit	(208,873)	(209,254)
Total Shareholder's equity	13,402	14,642
Non-controlling interest		(1,819)
Total Equity	13,402	12,823
Total Liabilities and Equity	$ 28,572	$ 28,662
[1]	Assets and liabilities of the discontinued operation, that is mentioned in Note 1C(2), are not reclassified as held for sale as of December 31, 2015, due to immateriality.

Interim Unaudited Condensed Co3

Interim Unaudited Condensed Consolidated Balance Sheets (Parenthetical) $ in Thousands	Sep. 30, 2016USD ($)shares	Sep. 30, 2016₪ / shares	Dec. 31, 2015USD ($)shares	Dec. 31, 2015₪ / shares
Interim Unaudited Condensed Consolidated Balance Sheets [Abstract]
Allowance for doubtful accounts | $	$ 769		$ 778
Ordinary shares, par value | ₪ / shares		₪ 0.1		₪ 0.1
Ordinary shares, shares authorized	50,000,000		50,000,000
Ordinary shares, shares issued	42,120,075		42,014,673
Ordinary shares, shares outstanding	40,941,376		40,835,974
Treasury shares held	1,178,699		1,178,699

Interim Unaudited Condensed Co4

Interim Unaudited Condensed Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended				9 Months Ended
	Sep. 30, 2016		Sep. 30, 2015		Sep. 30, 2016	Sep. 30, 2015
Revenues
Sales	$ 3,463		$ 2,207	[1]	$ 10,409	$ 9,503	[1]
Licensing and transaction fees	2,133		1,195	[1]	4,569	3,540	[1]
Total revenues	5,596		3,402	[1]	14,978	13,043	[1]
Cost of revenues
Cost of sales	2,307		1,548	[1]	6,917	6,487	[1]
Cost of licensing	250				250
Total cost of revenues	2,557		1,548	[1]	7,167	6,487	[1]
Gross profit	3,039		1,854	[1]	7,811	6,556	[1]
Operating expenses
Research and development	604		781	[1]	2,072	2,596	[1]
Selling and marketing	1,300		1,523	[1]	3,974	4,688	[1]
General and administrative	784		1,025	[1]	2,576	3,336	[1]
Patent litigation and maintenance	3		351	[1]	37	802	[1]
Other expenses	83		408	[1]	83	918	[1]
Total operating expenses	2,774		4,088	[1]	8,742	12,340	[1]
Operating income (loss) from continuing operations	265		(2,234)	[1]	(931)	(5,784)	[1]
Financial expenses, net	(30)		(108)	[1]	(185)	(511)	[1]
Profit (loss) from continuing operations before taxes on income	235		(2,342)	[1]	(1,116)	(6,295)	[1]
Income tax	(28)		(35)	[1]	(60)	(38)	[1]
Net income (loss) from continuing operations	207		(2,377)	[1]	(1,176)	(6,333)	[1]
Net (loss) income from discontinued operations	(279)		391	[1]	1,525	538	[1]
Net (loss) income	(72)		(1,986)	[1]	349	(5,795)	[1]
Net loss (income) attributable to noncontrolling interest	5		(23)	[1]	32	3	[1]
Net (loss) income attributable to shareholders	$ (67)		$ (2,009)	[1]	$ 381	$ (5,792)	[1]
Basic and diluted net gain (loss) attributable to shareholders per ordinary share
From continuing operations	$ 0.01		$ (0.06)	[1]	$ (0.03)	$ (0.15)	[1]
From discontinued operations	(0.01)		0.01	[1]	0.04	0.01	[1]
Total		[2]	$ (0.05)	[1]	$ 0.01	$ (0.14)	[1]
Weighted average number of ordinary shares used in computing basic net (loss) income per ordinary share	40,914,258		40,874,474	[1]	40,895,268	40,868,252	[1]
Weighted average number of ordinary shares used in computing diluted net (loss) income per ordinary share	41,667,258		40,874,474	[1]	40,895,268	40,868,252	[1]
[1]	Reclassified to conform with the current period presentation, see Note 1C(2)
[2]	Less than $0.01 per ordinary share.

Interim Unaudited Condensed Co5

Interim Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended			9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015		Sep. 30, 2016	Sep. 30, 2015
Total comprehensive (loss) income:
Net (loss) income	$ (72)	$ (1,986)	[1]	$ 349	$ (5,795)	[1]
Foreign currency translation adjustments	110	(98)		88	(292)
Total comprehensive (loss) income	38	(2,084)		437	(6,087)
Comprehensive loss (income) attributable to the non-controlling interest	5	(23)		32	3
Total comprehensive (loss) income attributable to shareholders	$ 43	$ (2,107)		$ 469	$ (6,084)
[1]	Reclassified to conform with the current period presentation, see Note 1C(2)

Interim Unaudited Condensed Co6

Interim Unaudited Condensed Consolidated Statements of Changes in Equity - USD ($) $ in Thousands		Total		Share capital		Additional paid-in capital	Treasury Shares (at cost)	Accumulated other comprehensive Income (loss)	Accumulated deficit	Noncontrolling interest
Balance at Dec. 31, 2014		$ 19,883		$ 1,055		$ 224,234	$ (2,000)	$ (800)	$ (202,103)	$ (503)
Balance, shares at Dec. 31, 2014				41,996,602
Changes during the nine months period ended
Stock-based compensation related to options granted		369				369
Exercise of options and warrants			[1]		[1]
Exercise of options and warrants, shares				18,071
Foreign currency translation adjustments		(292)						(292)
Net (loss) income		(5,795)	[2]						(5,792)	(3)
Balance at Sep. 30, 2015		14,165		$ 1,055		224,603	(2,000)	(1,092)	(207,895)	(506)
Balance, shares at Sep. 30, 2015				42,014,673
Balance at Dec. 31, 2015		12,823	[3]	$ 1,055		225,925	(2,000)	(1,084)	(209,254)	(1,819)
Balance, shares at Dec. 31, 2015				42,014,673
Changes during the nine months period ended
Stock-based compensation		174			[1]	174
Stock-based compensation, shares	[4]			15,000
Exercise of options and warrants		37		$ 2		35
Exercise of options and warrants, shares				90,402
Increase in the ownership rate in subsidiaries	[5]	(69)				(1,920)				1,851
Foreign currency translation adjustments		88						88
Net (loss) income		349							381	(32)
Balance at Sep. 30, 2016		$ 13,402		$ 1,057		$ 224,214	$ (2,000)	$ (996)	$ (208,873)
Balance, shares at Sep. 30, 2016				42,120,075
[1]	Less than $1.
[2]	Reclassified to conform with the current period presentation, see Note 1C(2)
[3]	Assets and liabilities of the discontinued operation, that is mentioned in Note 1C(2), are not reclassified as held for sale as of December 31, 2015, due to immateriality.
[4]	See Note 8C.
[5]	See Note 1C(2)

Interim Unaudited Condensed Co7

Interim Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016		Sep. 30, 2015	[1]
Cash flows from continuing operating activities
Net loss from continuing operations	$ (1,176)		$ (6,333)
Adjustments required to reconcile net loss to net cash used in continuing operating activities:
Stock-based compensation related to options and shares issued to employees and others	174		369
Loss (gain) on sale of property and equipment	83		(8)
Accrued interest and linkage differences, net	19		30
Depreciation	911		918
Changes in operating assets and liabilities:
Accrued severance pay, net	(152)		(39)
Deferred tax, net	60		36
(Increase) decrease in trade receivables, net	(1,376)		1,885
(Increase) decrease in other receivables and prepaid expenses	(16)		133
Decrease (increase) in inventories	246		(267)
Increase in trade payables	1,024		445
(Decrease) increase in other current liabilities	(408)		194
Net cash used in continuing operating activities	(611)		(2,637)
Cash flows from continuing investing activities
Purchase of property and equipment	(185)		(1,117)
Proceeds from sale of property and equipment	1,779		31
Change in short-term investments, net	(502)		3,998
Investment in capitalized product costs	(139)		(153)
Investment in restricted deposit for employees benefit			(281)
Proceeds from restricted deposit for employees benefit	142		144
Net cash provided by continuing investing activities	1,095		2,622
Cash flows from continuing financing activities
Increase (decrease) in short-term bank credit, net	287		(783)
Proceeds from long-term bank loans	27		716
Repayment of long-term bank loans	(1,368)		(606)
Proceeds from exercise of options and warrants	37			[2]
Net cash used in continuing financing activities	(1,017)		(673)
Cash flows from discontinued operations
Net cash used in discontinued operating activities	(183)		(433)
Net cash provided by discontinued investing activities	2,152		387
Total net cash provided by (used in) discontinued operations	1,969		(46)
Effect of exchange rate changes on cash and cash equivalents	51		(198)
Increase (decrease) in cash and cash equivalents	1,487		(932)
Cash and cash equivalents at the beginning of the period	5,450	[3]	5,351
Cash and cash equivalents at the end of the period	6,937		4,419
Cash paid during the period for:
Interest paid	$ 148		$ 217
[1]	Reclassified to conform with the current period presentation, see Note 1C(2)
[2]	Less than $1.
[3]	Assets and liabilities of the discontinued operation, that is mentioned in Note 1C(2), are not reclassified as held for sale as of December 31, 2015, due to immateriality.

Organization and Basis of Prese

Organization and Basis of Presentation	9 Months Ended
	Sep. 30, 2016
Organization and Basis of Presentation [Abstract]
Organization and Basis of Presentation	Note 1 - Organization and Basis of Presentation A. Description of business On Track Innovations Ltd. (the “Company”) was founded in 1990, in Israel. The Company and its subsidiaries (together the “Group”) are principally engaged in the field of design and development of cashless payment solutions. The Company’s shares are listed for trading on the NASDAQ Capital Market (formerly listed on the NASDAQ Global Market until April 13, 2016). B. Interim Unaudited Financial Information The accompanying unaudited consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements and therefore should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. In the opinion of management, all adjustments considered necessary for a fair presentation, consisting of normal recurring adjustments, have been included. Operating results for the nine month period ended September 30, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016. Use of Estimates: The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the assets, liabilities, revenue, costs, expenses and accumulated other comprehensive income/(loss) that are reported in the Interim Consolidated Financial Statements and accompanying disclosures. These estimates are based on management’s best knowledge of current events, historical experience, actions that the Company may undertake in the future and on various other assumptions that are believed to be reasonable under the circumstances. As a result, actual results may be different from these estimates. C. Divestiture of operations 1. In December 2013, the Company completed the sale of certain assets, subsidiaries and intellectual property ("IP") relating to its Smart ID division to SuperCom Ltd. (“SuperCom”). Accordingly the results and the cash flows of these operations for all reporting periods are presented in the statements of operations and in the statements of cash flows, respectively, as discontinued operations separately from continuing operations. During the nine month period ended September 30 2016, and 2015, the Company recorded profit from contingent consideration that derived from the SmartID division divesture (see also Note 6). 2. On September 14, 2016, the Company completed the sale of certain assets and IP relating to its Parking segment (the “Parking Business”) to Atrinet Ltd for a non-material amount. Accordingly the results and the cash flows of these operations for all reporting periods are presented in the statements of operations and in the statements of cash flows, respectively, as discontinued operations separately from continuing operations (see also Note 6). All prior periods’ information has been reclassified to conform with the current period’s presentation. Prior to the foregoing sale of assets and IP, the Company bought outthe minority interest in its subsidiaries that operated the Parking Business in consideration of $69. D. Other expenses Other operating expenses presented in the statement of operations for the nine and three months ended September 30, 2015 consist of compensation expenses related to the termination of employment of the Company’s former Chief Executive Office (“CEO”), Mr. Ofer Tziperman. following his resignation from the Company and its subsidiaries on February 10, 2015, and compensation expenses related to the termination of employment of the former CEO of the U.S. subsidiary on August 3, 2015. On May 7, 2016, the Company entered into an agreement pursuant to which the Company agreed to sell its headquarters building in Rosh Pina, Israel, to a third party for a consideration of NIS 7,000 and will lease back the portion of the building necessary for its current operations. The leaseback period is two years and the annual rent is approximately $130. The Company has the right to extend the lease by two additional one year periods on the same terms. On September 4, 2016, the sale of the building was completed. As a result of the sale, the Company recorded a loss of $83 under other operating expenses presented in the statement of operations for the nine and three months ended September 30, 2016.

Significant Accounting Policies

Significant Accounting Policies	9 Months Ended
	Sep. 30, 2016
Significant Accounting Policies [Abstract]
Significant Accounting Policies	Note 2 – Significant Accounting Policies These interim unaudited condensed consolidated financial statements have been prepared according to the same accounting policies as those discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. Additional significant accounting policies In accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (hereinafter – “ASC”) Topic 260 “Earnings per Share”, including potential common shares in the denominator of a diluted per-share computation for continuing operations always will result in an antidilutive per-share amount when an entity has a loss from continuing operations or a loss from continuing operations available to common stockholders (that is, after any preferred dividend deductions). Although including those potential common shares in the other diluted per-share computations may be dilutive to their comparable basic per-share amounts, no potential common shares shall be included in the computation of any diluted per-share amount when a loss from continuing operations exists, even if the entity reports net income. Recent accounting pronouncements 1 On March 30, 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-09, “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”. This ASU simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The ASU, among others, allows an entity to elect as an accounting policy either to continue to estimate the total number of awards for which the requisite service period will not be rendered (as currently required) or to account for forfeitures when they occur. This entity-wide accounting policy election only applies to service conditions. For performance conditions, the entity continues to assess the probability that such conditions will be achieved. An entity must also disclose its policy election for forfeitures. The new standard is effective for annual reporting periods beginning after December 15, 2016, including interim periods within those annual reporting periods, with early adoption permitted. The Company is currently evaluating the effect ASU 2016-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected an accounting policy for forfeitures under this new ASU. 2 In connection with other recent accounting pronouncements and the Company’s assessment of the impacts they will have on the ongoing financial reporting, see Note 2Z in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015.

Other Receivables and Prepaid E

Other Receivables and Prepaid Expenses	9 Months Ended
	Sep. 30, 2016
Other Receivables and Prepaid Expenses [Abstract]
Other Receivables and Prepaid Expenses	Note 3 - Other Receivables and Prepaid Expenses September 30, December 31, 2016 2015 Government institutions $ 211 $ 463 Prepaid expenses 541 624 Receivables under contractual obligations to be transferred to others * 436 533 Other receivables 715 563 $ 1,903 $ 2,183 * The Company’s subsidiary in Poland is required to collect certain fees that are to be transferred to local authorities.

Other Current Liabilities

Other Current Liabilities	9 Months Ended
	Sep. 30, 2016
Other Current Liabilities [Abstract]
Other Current Liabilities	Note 4 - Other Current Liabilities September 30, December 31, 2016 2015 Employees and related expenses $ 616 $ 1,065 Accrued expenses 1,178 1,101 Customer advances 268 283 Other current liabilities 165 275 $ 2,227 $ 2,724

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2016
Commitments and Contingencies [Abstract]
Commitments and Contingencies	Note 5 - Commitments and Contingencies A. Legal claims 1. In June 2013, prior to the Company's divestiture of its SmartID division, Merwell Inc. (“Merwell”) filed a claim against the Company before an agreed-upon arbitrator alleging breach of contract in connection with certain commissions claimed to be owed to Merwell with respect to the division’s activities in Tanzania. These activities, along with all other activities of the SmartID division, were later assigned to and assumed by SuperCom in its purchase of the division. SuperCom undertook to indemnify the Company and hold it harmless against any liabilities the Company may incur in connection with Merwell’s consulting agreement and the arbitration. An arbitration decision was issued on February 21, 2016, awarding Merwell approximately $855 for outstanding commissions, subject to further evaluation. The arbitration decision is being appealed and is thus not yet ripe for enforcement. Regardless, as mentioned above, SuperCom is liable for all costs and liabilities arising out of this claim. Therefore, the financial statements do not include any provision for this claim. 2. On October 3, 2013, a financial claim was filed against the Company and its then French subsidiary, Parx France (in this paragraph, together, the “Defendants”), in the Commercial Court of Paris, France (in this paragraph, the “Court”). The sum of the claim is Euro 1,500 (approximately $1,671), and is based on the allegation that the plaintiff sustained certain losses in connection with Defendants not granting the plaintiff exclusive marketing rights to distribute and operate the Defendants’ PIAF Parking System in Paris and the Ile of France. The Company filed an initial memorandum of defense rejecting the plaintiff’s allegations and claims. A technical hearing regarding this matter is scheduled for November 26, 2016. Based on the advice of counsel, the Company currently believes that it has no material obligations to the plaintiff and that there is no need for a provision for the claim. B. Guarantees As of September 30, 2016, the Company has granted performance guarantees and guarantees to secure customer advances in the sum of $327. The expiration dates of the guarantees range from January 2017 to June 2019. C. Restrictive covenants On September 19, 2016, the Company received a definitive release from Bank Leumi L’Israel from any financial and restrictive covenants.

Discontinued Operations

Discontinued Operations	9 Months Ended
	Sep. 30, 2016
Discontinued operations [Abstract]
Discontinued operations	Note 6 – Discontinued operations As described in Note 1C, the Company divested its SmartID division and its Parking Business. Each of these activities is presented as discontinued operations for all reporting periods. During the nine month periods ended September 30, 2016 and September 30, 2015, the Company recorded profit from contingent consideration in the amount of $2,139 and $848, respectively, derived from the Smart ID division divesture. This profit is presented below as ‘other income, net’ within income from discontinued operations for the nine months ended September 30, 2016 and September 30, 2015. The ‘other income, net’, that is presented within income from discontinued operations for the three months and nine months ended September 30, 2016, includes loss in amount of $136 which derives from the Parking Business divesture, including transaction costs. Three months ended Nine months ended 2016 2015 2016 2015 Revenues 184 353 768 1,103 Expenses (327 ) (423 ) (1,246 ) (1,413 ) Other income (expenses), net (136 ) 461 2,003 848 Net (loss) profit from discontinued operations (279 ) 391 1,525 538

Fair Value of Financial Instrum

Fair Value of Financial Instruments	9 Months Ended
	Sep. 30, 2016
Fair Value of Financial Instruments [Abstract]
Fair Value of Financial Instruments	Note 7 - Fair Value of Financial Instruments The Company's financial instruments consist mainly of cash and cash equivalents, short-term interest bearing investments, accounts receivable, restricted deposits for employee benefits, accounts payable and short-term and long-term loans. Fair value for the measurement of financial assets and liabilities is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. The Company utilizes a valuation hierarchy for disclosure of the inputs for fair value measurement. This hierarchy prioritizes the inputs into three broad levels as follows: ● Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date. ● Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. ● Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date. By distinguishing between inputs that are observable in the market place, and therefore more objective, and those that are unobservable and therefore more subjective, the hierarchy is designed to indicate the relative reliability of the fair value measurements. A financial asset or liability's classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The Company, in estimating fair value for financial instruments, used the following methods and assumptions: The carrying amounts of cash and cash equivalents, short-term interest bearing investments, trade receivables, short-term bank credit and trade payables are equivalent to, or approximate their fair value due to the short-term maturity of these instruments. The carrying amounts of variable interest rate long-term loans are equivalent or approximate to their fair value as they bear interest at approximate market rates. As of September 30, 2016, the fair value of bank loans with fixed interest rates did not differ materially from the carrying amount. As of September 30, 2016, the Company held approximately $5,984 of short-term bank deposits (as of December 31, 2015, $5,454). Short-term deposits in the amount of $1,548 have been pledged as security in respect of guarantees granted in respect of performance guarantees, loans and credit lines received from a bank (as of December 31, 2015, $2,254) and cannot be pledged to others or withdrawn without the consent of the bank.

Equity

Equity	9 Months Ended
	Sep. 30, 2016
Equity [Abstract]
Equity	Note 8 – Equity A. Stock option plans During the nine months ended September 30, 2016 and September 30, 2015, 270,000 and 135,000 options were granted, respectively. The vesting period for the options ranges from one year to four years. The exercise prices for the options range from $0.44 to $1.68. Those options expire up to five years after the date of the grant. Any options which are forfeited or cancelled before expiration become available for future grants under the Company’s option plan. The fair value of each option granted to employees and non-employees during the nine months ended September 30, 2016 and September 30, 2015, for which the exercise price was greater than par value, was estimated on the date of grant, using the Black-Scholes model and the following assumptions: 1. Dividend yield of zero percent for all periods. 2. Risk-free interest rate of 1.03% and 1.21% for grants during the nine months ended September 30, 2016 and September 30, 2015, respectively, based on U.S. Treasury yield curve in effect at the time of grant. 3. Estimated expected lives of 3.56 and 3.5 years for grants during the nine months ended September 30, 2016 and September 30, 2015, respectively, using the simplified method. 4. Expected average volatility of 72% and 69% for grants during the nine months ended September 30, 2016 and September 30, 2015, respectively, which represent a weighted average standard deviation rate for the price of the Company's Ordinary Shares on the NASDAQ Global Market and NASDAQ Capital Market. The Company’s options activity (including options to non-employees) during the nine months ended September 30, 2016 and options outstanding and options exercisable as of December 31, 2015 and September 30, 2016, are summarized in the following table: Number of Weighted options average exercise outstanding price per share Outstanding – December 31, 2015 1,601,379 $ 1.71 Options granted 270,000 0.76 Options expired or forfeited (461,448 ) 2.07 Options exercised (54,260 ) 0.68 Outstanding – September 30, 2016 1,355,671 1.44 Exercisable as of: December 31, 2015 799,473 $ 1.85 September 30, 2016 701,018 $ 1.78 The weighted average fair value of options granted during the nine months ended September 30, 2016 and during the nine months ended September 30, 2015 is $0.41 and $0.82, respectively, per option. The aggregate intrinsic value of outstanding options as of September 30, 2016 and December 31, 2015 is approximately $174 and $8, respectively. The aggregate intrinsic value of exercisable options as of September 30, 2016 and December 31, 2015 is approximately $26 and $8, respectively. The following table summarizes information about options outstanding and exercisable (including options to non-employees) as of September 30, 2016: Options outstanding Options Exercisable Number Weighted Number Weighted outstanding average Weighted Outstanding average Weighted as of remaining Average As of remaining Average Range of September 30, contractual Exercise September 30, contractual Exercise exercise price 2016 life (years) Price 2016 life (years) Price $ 0.44-0.90 630,000 4.05 $ 0.76 111,667 3.08 $ 0.81 1.08-1.20 133,000 0.45 1.09 133,000 0.45 1.09 1.46 50,000 1.80 1.46 50,000 1.80 1.46 1.67-1.76 65,000 2.40 1.69 35,000 1.66 1.70 2.32-2.36 437,671 2.43 2.34 351,351 2.40 2.34 $ 3.03 40,000 2.98 $ 3.03 20,000 2.98 $ 3.03 1,355,671 2.98 701,018 2.08 As of September 30, 2016, there was approximately $270 of total unrecognized compensation cost related to non-vested stock-based compensation arrangements. That cost is expected to be recognized over a weighted-average period of approximately 1 year. During the nine months ended September 30, 2016 and September 30, 2015, the Company recorded stock-based compensation expenses in the amount of $174 and $369, respectively, in accordance with ASC 718 “Compensation-Stock Compensation.” B. Warrants During the nine months ended September 30, 2016, 281,369 warrants expired and 36,142 warrants were converted to ordinary shares. As of September 30, 2016 there are no remaining outstanding warrants. C. During the nine months ended September 30, 2016, the Company issued 15,000 ordinary shares to one of its consultants. The expenses that are recognized due to this issuance are immaterial and the issuance is presented within ‘stock based compensation’ in the statement of changes in equity for the nine months ended September 30, 2016.

Operating segments

Operating segments	9 Months Ended
	Sep. 30, 2016
Operating segments [Abstract]
Operating segments	Note 9 - Operating segments For the purposes of allocating resources and assessing performance in order to improve profitability, the Company's chief operating decision maker ("CODM") examines two segments which are the Company's strategic business units: (1) Retail and Mass Transit Ticketing; and (2) Petroleum. In addition to its two reportable segments, certain products for the medical industry and other secure smart card solutions are classified under the Company’s "Other" segment. Prior to its divestiture of the Parking Business as noted in Notes 1C and 6 above, the CODM examined a third reportable segment consisting of the Company’s Parking acitivites. In light of the aforementioned divestiture, the previously reported parking segment has been eliminated with the corresponding expenses and revenues reported as Discontinued Operations. The strategic business unit's allocation of resources and evaluation of performance are managed separately. The CODM does not examine assets or liabilities for those segments and therefore they are not presented. Information regarding the results of each reportable segment is included below based on the internal management reports that are reviewed by the CODM. Three months ended September 30, 2016 Petroleum Retail and Mass Transit Ticketing Other Consolidated Revenues $ 1,056 $ 3,891 (**) $ 649 $ 5,596 Reportable segment gross profit * 638 2,238 326 3,202 Reconciliation of reportable segment gross profit to gross profit for the period Depreciation (161 ) Stock-based compensation (2 ) *Gross profit for the period $ 3,039 Three months ended September 30, 2015 Petroleum Retail and Mass Transit Ticketing Other Consolidated Revenues $ 1,013 $ 1,588 $ 801 $ 3,402 Reportable segment gross profit * 598 999 454 2,051 Reconciliation of reportable segment gross profit to gross profit for the period Depreciation (190 ) Stock-based compensation (7 ) Gross profit for the period $ 1,854 Nine months ended September 30, 2016 Petroleum Retail and Mass Transit Ticketing Other Consolidated Revenues $ 2,996 $ 10,029 (**) $ 1,953 $ 14,978 Reportable segment gross profit * 1,836 5,568 968 8,372 Reconciliation of reportable segment gross profit to profit for the period Depreciation (559 ) Stock-based compensation (2 ) Gross profit for the period $ 7,811 Nine months ended September 30, 2015 Petroleum Retail and Mass Transit Ticketing Other Consolidated Revenues $ 3,108 $ 8,303 $ 1,632 $ 13,043 Reportable segment gross profit * 1,800 4,463 873 7,136 Reconciliation of reportable segment gross profit to profit for the period Depreciation (545 ) Stock-based compensation (35 ) Gross profit for the period $ 6,556 * Gross profit as reviewed by the CODM, represents gross profit, adjusted to exclude depreciation and stock-based compensation. ** The revenues from retail and mass transit ticketing segment for the three months and nine months ended September 30, 2016 include revenues derived from a litigation settlement with a perpetual license agreement. Those revenues are presented within revenues from ‘licensing and transaction fees’ in the statements of operations.

Significant Accounting Polici17

Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2016
Significant Accounting Policies [Abstract]
Additional significant accounting policies	Additional significant accounting policies In accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (hereinafter – “ASC”) Topic 260 “Earnings per Share”, including potential common shares in the denominator of a diluted per-share computation for continuing operations always will result in an antidilutive per-share amount when an entity has a loss from continuing operations or a loss from continuing operations available to common stockholders (that is, after any preferred dividend deductions). Although including those potential common shares in the other diluted per-share computations may be dilutive to their comparable basic per-share amounts, no potential common shares shall be included in the computation of any diluted per-share amount when a loss from continuing operations exists, even if the entity reports net income.
Recent accounting pronouncements	Recent accounting pronouncements 1 On March 30, 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-09, “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”. This ASU simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The ASU, among others, allows an entity to elect as an accounting policy either to continue to estimate the total number of awards for which the requisite service period will not be rendered (as currently required) or to account for forfeitures when they occur. This entity-wide accounting policy election only applies to service conditions. For performance conditions, the entity continues to assess the probability that such conditions will be achieved. An entity must also disclose its policy election for forfeitures. The new standard is effective for annual reporting periods beginning after December 15, 2016, including interim periods within those annual reporting periods, with early adoption permitted. The Company is currently evaluating the effect ASU 2016-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected an accounting policy for forfeitures under this new ASU. 2 In connection with other recent accounting pronouncements and the Company’s assessment of the impacts they will have on the ongoing financial reporting, see Note 2Z in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015.

Other Receivables and Prepaid18

Other Receivables and Prepaid Expenses (Tables)	9 Months Ended
	Sep. 30, 2016
Other Receivables and Prepaid Expenses [Abstract]
Schedule of Other Receivables and Prepaid Expenses	September 30, December 31, 2016 2015 Government institutions $ 211 $ 463 Prepaid expenses 541 624 Receivables under contractual obligations to be transferred to others * 436 533 Other receivables 715 563 $ 1,903 $ 2,183 * The Company’s subsidiary in Poland is required to collect certain fees that are to be transferred to local authorities.

Other Current Liabilities (Tabl

Other Current Liabilities (Tables)	9 Months Ended
	Sep. 30, 2016
Other Current Liabilities [Abstract]
Summary of Other Current Liabilities	September 30, December 31, 2016 2015 Employees and related expenses $ 616 $ 1,065 Accrued expenses 1,178 1,101 Customer advances 268 283 Other current liabilities 165 275 $ 2,227 $ 2,724

Discontinued Operations (Tables

Discontinued Operations (Tables)	9 Months Ended
	Sep. 30, 2016
Discontinued operations [Abstract]
Schedule of Net (Loss) Profit from Discontinued Operations	Three months ended Nine months ended 2016 2015 2016 2015 Revenues 184 353 768 1,103 Expenses (327 ) (423 ) (1,246 ) (1,413 ) Other income (expenses), net (136 ) 461 2,003 848 Net (loss) profit from discontinued operations (279 ) 391 1,525 538

Equity (Tables)

Equity (Tables)	9 Months Ended
	Sep. 30, 2016
Equity [Abstract]
Schedule of Stock Option Activity	Number of Weighted options average exercise outstanding price per share Outstanding – December 31, 2015 1,601,379 $ 1.71 Options granted 270,000 0.76 Options expired or forfeited (461,448 ) 2.07 Options exercised (54,260 ) 0.68 Outstanding – September 30, 2016 1,355,671 1.44 Exercisable as of: December 31, 2015 799,473 $ 1.85 September 30, 2016 701,018 $ 1.78
Summary of Options Outstanding and Exercisable	Options outstanding Options Exercisable Number Weighted Number Weighted outstanding average Weighted Outstanding average Weighted as of remaining Average As of remaining Average Range of September 30, contractual Exercise September 30, contractual Exercise exercise price 2016 life (years) Price 2016 life (years) Price $ 0.44-0.90 630,000 4.05 $ 0.76 111,667 3.08 $ 0.81 1.08-1.20 133,000 0.45 1.09 133,000 0.45 1.09 1.46 50,000 1.80 1.46 50,000 1.80 1.46 1.67-1.76 65,000 2.40 1.69 35,000 1.66 1.70 2.32-2.36 437,671 2.43 2.34 351,351 2.40 2.34 $ 3.03 40,000 2.98 $ 3.03 20,000 2.98 $ 3.03 1,355,671 2.98 701,018 2.08

Operating segments (Tables)

Operating segments (Tables)	9 Months Ended
	Sep. 30, 2016
Operating segments [Abstract]
Schedule of Information Regarding Results of Each Reportable Segment	Three months ended September 30, 2016 Petroleum Retail and Mass Transit Ticketing Other Consolidated Revenues $ 1,056 $ 3,891 (**) $ 649 $ 5,596 Reportable segment gross profit * 638 2,238 326 3,202 Reconciliation of reportable segment gross profit to gross profit for the period Depreciation (161 ) Stock-based compensation (2 ) *Gross profit for the period $ 3,039 Three months ended September 30, 2015 Petroleum Retail and Mass Transit Ticketing Other Consolidated Revenues $ 1,013 $ 1,588 $ 801 $ 3,402 Reportable segment gross profit * 598 999 454 2,051 Reconciliation of reportable segment gross profit to gross profit for the period Depreciation (190 ) Stock-based compensation (7 ) Gross profit for the period $ 1,854 Nine months ended September 30, 2016 Petroleum Retail and Mass Transit Ticketing Other Consolidated Revenues $ 2,996 $ 10,029 (**) $ 1,953 $ 14,978 Reportable segment gross profit * 1,836 5,568 968 8,372 Reconciliation of reportable segment gross profit to profit for the period Depreciation (559 ) Stock-based compensation (2 ) Gross profit for the period $ 7,811 Nine months ended September 30, 2015 Petroleum Retail and Mass Transit Ticketing Other Consolidated Revenues $ 3,108 $ 8,303 $ 1,632 $ 13,043 Reportable segment gross profit * 1,800 4,463 873 7,136 Reconciliation of reportable segment gross profit to profit for the period Depreciation (545 ) Stock-based compensation (35 ) Gross profit for the period $ 6,556 * Gross profit as reviewed by the CODM, represents gross profit, adjusted to exclude depreciation and stock-based compensation. ** The revenues from retail and mass transit ticketing segment for the three months and nine months ended September 30, 2016 include revenues derived from a litigation settlement with a perpetual license agreement. Those revenues are presented within revenues from ‘licensing and transaction fees’ in the statements of operations.

Organization and Basis of Pre23

Organization and Basis of Presentation (Details) - USD ($) $ in Thousands	Sep. 14, 2016	May 07, 2016	Sep. 30, 2016	Sep. 30, 2015	[1]	Sep. 30, 2016	Sep. 30, 2015	[1]
Organization and Basis of Presentation (Textual)
Company bought minority interest in subsidiaries	$ 69
Lease agreement		On May 7, 2016, the Company entered into an agreement pursuant to which the Company agreed to sell its headquarters building in Rosh Pina, Israel, to a third party for a consideration of NIS 7,000 and will lease back the portion of the building necessary for its current operations.
Lease agreement terms		2 years
Annual rent		$ 130
Lease agreement terms extend		1 year
Other operating expenses			$ 83	$ 408		$ 83	$ 918
[1]	Reclassified to conform with the current period presentation, see Note 1C(2)

Other Receivables and Prepaid24

Other Receivables and Prepaid Expenses (Details) - USD ($) $ in Thousands		Sep. 30, 2016	Dec. 31, 2015
Other Receivables and Prepaid Expenses [Abstract]
Government institutions		$ 211	$ 463
Prepaid expenses		541	624
Receivables under contractual obligations to be transferred to others	[1]	436	533
Other receivables		715	563
Total other receivables and prepaid expenses		$ 1,903	$ 2,183	[2]
[1]	The Company's subsidiary in Poland is required to collect certain fees that are to be transferred to local authorities.
[2]	Assets and liabilities of the discontinued operation, that is mentioned in Note 1C(2), are not reclassified as held for sale as of December 31, 2015, due to immateriality.

Other Current Liabilities (Deta

Other Current Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Other Current Liabilities [Abstract]
Employees and related expenses	$ 616	$ 1,065
Accrued expenses	1,178	1,101
Customer advances	268	283
Other current liabilities	165	275
Total other current liabilities	$ 2,227	$ 2,724	[1]
[1]	Assets and liabilities of the discontinued operation, that is mentioned in Note 1C(2), are not reclassified as held for sale as of December 31, 2015, due to immateriality.

Commitments and Contingencies (

Commitments and Contingencies (Details) € in Thousands, $ in Thousands	Oct. 03, 2013USD ($)	Oct. 03, 2013EUR (€)	Jun. 30, 2013USD ($)	Sep. 30, 2016USD ($)
Commitments and Contingencies (Textual)
Guarantees to secure customer advances				$ 327
Guarantees expiration dates description				The expiration dates of the guarantees range from January 2017 to June 2019.
Merwell Inc [Member]
Commitments and Contingencies (Textual)
Outstanding commissions arbitration			$ 855
French Subsidiary [Member]
Commitments and Contingencies (Textual)
Financial claim field	$ 1,671	€ 1,500

Discontinued Operations (Detail

Discontinued Operations (Details) - USD ($) $ in Thousands	3 Months Ended			9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015		Sep. 30, 2016	Sep. 30, 2015
Discontinued operations [Abstract]
Revenues	$ 184	$ 353		$ 768	$ 1,103
Expenses	(327)	(423)		(1,246)	(1,413)
Other income (expenses), net	(136)	461		2,003	848
Net (loss) profit from discontinued operations	$ (279)	$ 391	[1]	$ 1,525	$ 538	[1]
[1]	Reclassified to conform with the current period presentation, see Note 1C(2)

Discontinued Operations (Deta28

Discontinued Operations (Details Textual) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Discontinued Operations (Textual)
Profit from contingent consideration			$ 2,139	$ 848
Other income, net	$ (136)	$ 461	$ 2,003	$ 848

Fair Value of Financial Instr29

Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Fair Value of Financial Instruments (Textual)
Short-term bank deposits	$ 5,984	$ 5,454	[1]
Short-term bank deposit pledged as security	$ 1,548	$ 2,254
[1]	Assets and liabilities of the discontinued operation, that is mentioned in Note 1C(2), are not reclassified as held for sale as of December 31, 2015, due to immateriality.

Equity (Details)

Equity (Details) - $ / shares	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Number of options outstanding
Outstanding - Beginning Balance	1,601,379
Options granted	270,000	135,000
Options expired or forfeited	(461,448)
Options exercised	(54,260)
Outstanding - Ending Balance	1,355,671
Exercisable	701,018		799,473
Weighted average exercise price per share
Outstanding - Beginning Balance	$ 1.71
Options granted	0.76
Options expired or forfeited	2.07
Options exercised	0.68
Outstanding - Ending Balance	1.44
Exercisable	$ 1.78		$ 1.85

Equity (Details 1)

Equity (Details 1)	9 Months Ended
	Sep. 30, 2016$ / sharesshares
Range of exercise price
Lower limit	$ 0.44
Upper limit	$ 1.68
Options outstanding
Number outstanding | shares	1,355,671
Weighted average remaining contractual life	2 years 11 months 23 days
Options exercisable
Number outstanding | shares	701,018
Weighted average remainging cotractual life	2 years 29 days
0.44-0.90 [Member]
Range of exercise price
Lower limit	$ 0.44
Upper limit	$ 0.90
Options outstanding
Number outstanding | shares	630,000
Weighted average remaining contractual life	4 years 18 days
Weighted average exercise price	$ 0.76
Options exercisable
Number outstanding | shares	111,667
Weighted average remainging cotractual life	3 years 29 days
Weighted average exercise price	$ 0.81
1.08-1.20 [Member]
Range of exercise price
Lower limit	1.08
Upper limit	$ 1.20
Options outstanding
Number outstanding | shares	133,000
Weighted average remaining contractual life	5 months 12 days
Weighted average exercise price	$ 1.09
Options exercisable
Number outstanding | shares	133,000
Weighted average remainging cotractual life	5 months 12 days
Weighted average exercise price	$ 1.09
1.46 [Member]
Range of exercise price
Lower limit	1.46
Upper limit	$ 1.46
Options outstanding
Number outstanding | shares	50,000
Weighted average remaining contractual life	1 year 9 months 18 days
Weighted average exercise price	$ 1.46
Options exercisable
Number outstanding | shares	50,000
Weighted average remainging cotractual life	1 year 9 months 18 days
Weighted average exercise price	$ 1.46
1.67-1.76 [Member]
Range of exercise price
Lower limit	1.67
Upper limit	$ 1.76
Options outstanding
Number outstanding | shares	65,000
Weighted average remaining contractual life	2 years 4 months 24 days
Weighted average exercise price	$ 1.69
Options exercisable
Number outstanding | shares	35,000
Weighted average remainging cotractual life	1 year 7 months 28 days
Weighted average exercise price	$ 1.70
2.32-2.36 [Member]
Range of exercise price
Lower limit	2.32
Upper limit	$ 2.36
Options outstanding
Number outstanding | shares	437,671
Weighted average remaining contractual life	2 years 5 months 5 days
Weighted average exercise price	$ 2.34
Options exercisable
Number outstanding | shares	351,351
Weighted average remainging cotractual life	2 years 4 months 24 days
Weighted average exercise price	$ 2.34
3.03 [Member]
Range of exercise price
Lower limit	3.03
Upper limit	$ 3.03
Options outstanding
Number outstanding | shares	40,000
Weighted average remaining contractual life	2 years 11 months 23 days
Weighted average exercise price	$ 3.03
Options exercisable
Number outstanding | shares	20,000
Weighted average remainging cotractual life	2 years 11 months 23 days
Weighted average exercise price	$ 3.03

Equity (Details Textual)

Equity (Details Textual) - USD ($) $ / shares in Units, $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015		Dec. 31, 2015
Equity [Abstract]
Options granted	270,000	135,000
Lower limit	$ 0.44
Upper limit	$ 1.68
Risk-free interest rate	1.03%	1.21%
Estimated expected lives	P3Y6M22D	P3Y6M
Expected average volatility	72.00%	69.00%
Weighted average fair value of options granted	$ 0.41	$ 0.82
Aggregate intrinsic value of outstanding options	$ 174			$ 8
Aggregate intrinsic value of exercisable options	26			$ 8
Unrecognized compensation cost	$ 270
Unrecognized compensation cost, period for recognition	1 year
Share-based Compensation	$ 174	$ 369	[1]
Issued ordinary shares of stock based compensation	15,000
warrants expired	281,369
Warrant exercised	36,142
Vesting period description	The vesting period for the options ranges from one year to four years. The exercise prices for the options range from $0.44 to $1.68. Those options expire up to five years after the date of the grant.
[1]	Reclassified to conform with the current period presentation, see Note 1C(2)

Operating segments (Details)

Operating segments (Details) - USD ($) $ in Thousands		3 Months Ended				9 Months Ended
		Sep. 30, 2016		Sep. 30, 2015		Sep. 30, 2016		Sep. 30, 2015
Segment Reporting Information [Line Items]
Revenues		$ 5,596		$ 3,402	[1]	$ 14,978		$ 13,043	[1]
Reportable segment gross profit	[2]	3,202		2,051		8,372		7,136
Reconciliation of reportable segment gross profit to gross profit for the period
Depreciation		(161)		(190)		(559)		(545)
Stock-based compensation		2		7		2		35
Gross profit		3,039		1,854	[1]	7,811		6,556	[1]
Petroleum [Member]
Segment Reporting Information [Line Items]
Revenues		1,056		1,013		2,996		3,108
Reportable segment gross profit	[2]	638		598		1,836		1,800
Retail and Mass Transit Ticketing [Member]
Segment Reporting Information [Line Items]
Revenues		3,891	[3]	1,588		10,029	[3]	8,303
Reportable segment gross profit	[2]	2,238		999		5,568		4,463
Other [Member]
Segment Reporting Information [Line Items]
Revenues		649		801		1,953		1,632
Reportable segment gross profit	[2]	$ 326		$ 454		$ 968		$ 873
[1]	Reclassified to conform with the current period presentation, see Note 1C(2)
[2]	Gross profit as reviewed by the CODM, represents gross profit, adjusted to exclude depreciation and stock-based compensation.
[3]	The revenues from retail and mass transit ticketing segment for the three months and nine months ended September 30, 2016 include revenues derived from a litigation settlement with a perpetual license agreement. Those revenues are presented within revenues from licensing and transaction fees' in the statements of operations.

Operating segments (Details Tex

Operating segments (Details Textual)	9 Months Ended
	Sep. 30, 2016Segments
Operating Segments (Textual)
Reportable segments	2