CIMATRON LIMITED

STATEMENTS OF CASH FLOWS

(US Dollars in thousands)

three months ended

March 31,

2013

2012

Cash flows from operating activities:

Net income 

$           604

$           843

Adjustments to reconcile net income 

   to net cash provided by (used in) operating activities:

Depreciation and amortization

293

337

Increase in accrued severance pay

86

218

Deferred taxes, net

(90)

(92)

Changes in assets and liabilities:

Increase in accounts receivable and prepaid expenses

(1,194)

(755)

Increase in inventory

-

(21)

Increase in deposits with insurance companies and severance pay fund

(110)

(118)

Increase in trade payables, accrued expenses and other liabilities

280

1,941

Net cash provided by (used in) operating activities

(131)

2,353

Cash flows from investing activities:

Proceeds from sale of property and equipment

7

-

Purchase of property and equipment

(49)

(63)

Net cash used in investing activities

(42)

(63)

Cash flows from financing activities:

Short-term bank credit

5,658

663

Long-term bank credit

-

(1)

Cash distribution to shareholders

(7,874)

-

Proceeds from issuance of shares upon exercise of options 

-

14

Net cash provided by (used in) financing activities

(2,216)

676

Net increase (decrease) in cash and cash equivalents

(2,389)

2,966

Effect of exchange rate changes on cash

(88)

151

Cash and cash equivalents at beginning of period

11,903

11,787

Cash and cash equivalents at end of period

$        9,426

$      14,904

Appendix A - Non-cash transactions

Purchase of property on credit

$              5

$              8