Elbit Systems Reports Second Quarter of 2017 Results

HAIFA, Israel, Aug.15, 2017 /PRNewswire/ -- Elbit Systems Ltd. (NASDAQ: ESLT and TASE: ESLT), (the "Company") the international high technology company, reported today its consolidated results for the quarter ended June 30, 2017.

In this release, the Company is providing US-GAAP results as well as additional non-GAAP financial data, which are intended to provide investors a more comprehensive understanding of the Company's business results and trends. Unless otherwise stated, all financial data presented is GAAP financial data.

Management Comment:

Bezhalel (Butzi) Machlis, President and CEO of Elbit Systems, commented: "Our results represent ongoing improvements in revenue, profit and especially backlog, which grew strongly, particularly the longer-term component. Our increased focus on sales and marketing in recent quarters, as well as R&D, is enabling us to take advantage of the growth in the opportunities we see in many of our end markets. Furthermore, the diversified portfolio of technologies and products as well as a worldwide balanced market presence reflected by the breakdown of revenue streams and backlog, provides for the potential of continuing the long-term trend of growth and profitability."

Second quarter 2017 results:

Revenues in the second quarter of 2017 were $818.3 million, as compared to $804.5 million in the second quarter of 2016.

Non-GAAP ((*)) gross profit amounted to $248.3 million (30.4% of revenues) in the second quarter of 2017, as compared to $244.0 million (30.3% of revenues) in the second quarter of 2016. GAAP gross profit in the second quarter of 2017 was $242.3 million (29.6% of revenues), as compared to $236.1 million (29.4% of revenues) in the second quarter of 2016.

Research and development expenses, net were $67.1 million (8.2% of revenues) in the second quarter of 2017, as compared to $67.2 million (8.4% of revenues) in the second quarter of 2016.

_____________

* see page 3

Marketing and selling expenses, net were $66.3 million (8.1% of revenues) in the second quarter of 2017, as compared to $60.3 million (7.5% of revenues) in the second quarter of 2016. The increase in marketing and selling expenses in the second quarter of 2017 was mainly related to the mix of countries and types of marketing activities for projects in which we invest our marketing efforts.

General and administrative expenses, net were $33.6 million (4.1% of revenues) in the second quarter of 2017, as compared to $38.7 million (4.8% of revenues) in the second quarter of 2016. The decrease in general and administrative expenses in the second quarter of 2017 resulted from revaluation of liabilities related to assets and activities acquired in prior years.

Non-GAAP((*)) operating income was $82.7 million (10.1% of revenues) in the second quarter of 2017, as compared to $80.5 million (10.0% of revenues) in the second quarter of 2016. GAAP operating income in the second quarter of 2017 was $75.3 million (9.2% of revenues), as compared to $69.9 million (8.7% of revenues) in the second quarter of 2016.

Financial expenses, net were $6.8 million in the second quarter of 2017, as compared to $5.5 million in the second quarter of 2016.

Taxes on income were $10.3 million (effective tax rate of 15.1%) in the second quarter of 2017, as compared to $14.3 million (effective tax rate of 22.2%) in the second quarter of 2016. The effective tax rate is affected by the mix of the tax rates in the various jurisdictions in which the Company's entities generate taxable income and the decrease of tax rates in Israel.

Equity in net earnings of affiliated companies and partnerships was $4.8 million (0.6% of revenues) in the second quarter of 2017, as compared to $4.4 million (0.5% of revenues) in the second quarter of 2016.

Net income attributable to non-controlling interests was $0.4 million in the second quarter of 2017, as compared to $0.5 million in the second quarter of 2016.

Non-GAAP((*)) net income attributable to the Company's shareholders in the second quarter of 2017 was $68.8 million (8.4% of revenues), as compared to $62.9 million (7.8% of revenues) in the second quarter of 2016. GAAP net income in the second quarter of 2017 was $62.6 million (7.6% of revenues), as compared to $54.1 million (6.7% of revenues) in the second quarter of 2016.

Non-GAAP((*)) diluted net earnings per share attributable to the Company's shareholders were $1.61 for the second quarter of 2017, as compared to $1.47 for the second quarter of 2016. GAAP diluted earnings per share in the second quarter of 2017 were $1.46, as compared to $1.27 for the second quarter of 2016.

The Company's backlog of orders for the quarter ended June 30, 2017 totaled $7,329 million, as compared to $6,818 million as of June 30, 2016. Approximately 72% of the current backlog is attributable to orders from outside Israel. Approximately 57% of the current backlog is scheduled to be performed during 2017 and 2018.

Operating cash flow provided in the six months ended June 30, 2017 was $2.7 million, as compared to $14.2 million used in the six months ended June 30, 2016.

_____________

* see page 3

Accounting policies update:

ASU 2014-09, "Revenue from Contracts with Customers" (ASC 606), will be effective for the Company beginning January 1, 2018. The Company is adopting ASC 606 effective January 1, 2018 and expects to do so using the modified retrospective method. However, a final decision regarding the adoption method has not been finalized at this time.

The Company has made progress toward completing the evaluation of the potential changes from adopting the new standard on its financial reporting and disclosures. The Company has evaluated the impact of the standard on its revenue streams and some of its significant representative contracts. The Company has significantly progressed in its assessment of the impact on its business processes, controls and systems. We are in the process of implementing changes to business processes, systems and internal controls required to implement and account for the new standard.

The adoption of the new standard may primarily impact the Company's contracts where revenue is currently recognized using the percentage-of-completion units-of-delivery method, with the possible resulting impact being revenue which may be recognized earlier in the performance period as it incurs costs, as opposed to when units are delivered. This change may also impact the Company's balance sheet presentation with a possible decrease in inventories, an increase in contract assets (i.e., unbilled receivables) and a net increase to retained earnings to primarily reflect the impact of converting units-of-delivery contracts to the cost-to-cost method for recognizing revenue and profits.

Our evaluation of the standard and its impact on the financial statements, contracts and required financial controls will continue through the adoption date, including any impacts related to new contracts awarded.

* Non-GAAP financial data:

The following non-GAAP financial data is presented to enable investors to have additional information on the Company's business performance as well as a further basis for periodical comparisons and trends relating to the Company's financial results. The Company believes such data provides useful information to investors by facilitating more meaningful comparisons of the Company's financial results over time. Such non-GAAP information is used by the Company's management to make strategic decisions, forecast future results and evaluate the Company's current performance. However, investors are cautioned that, unlike financial measures prepared in accordance with GAAP, non-GAAP measures may not be comparable with the calculation of similar measures for other companies.

The non-GAAP financial data includes reconciliation adjustments regarding non-GAAP gross profit, operating income, net income and diluted EPS. In arriving at non-GAAP presentations, companies generally factor out items such as those that have a non-recurring impact on the income statements, various non-cash items, significant effects of retroactive tax legislation and changes in accounting guidance and other items, which in management's judgment, are items that are considered to be outside of the review of core operating results.

In the Company's non-GAAP presentation, the Company made certain adjustments, as indicated in the table below.

These non-GAAP measures are not based on any comprehensive set of accounting rules or principles. The Company believes that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with the Company's results of operations, as determined in accordance with GAAP, and that these measures should only be used to evaluate the Company's results of operations in conjunction with the corresponding GAAP measures. Investors should consider non-GAAP financial measures in addition to, and not as replacements for or superior to, measures of financial performance prepared in accordance with GAAP.

                                                                    Reconciliation of GAAP to Non-GAAP (Unaudited) Supplemental Financial Data:
                                                                    ---------------------------------------------------------------------------

                                                                                              (US Dollars in millions)


                                  Six Months Ended 

    June 30,                 Three Months Ended 

     June 30,                    Year Ended
                                                                                                                              

    December 31,


                                    2017                      2016                 2017                      2016                           2016
                                    ----                      ----                 ----                      ----                           ----


    GAAP gross profit                       $463.5                                        $448.4                                                  $242.3             $236.1 $959.6

    Adjustments:
    ------------

    Amortization of
     purchased intangible
     assets                         11.7                             15.8                                    6.0                                      7.9       31.2


    Non-GAAP  gross profit                  $475.2                                        $464.2                                                  $248.3             $244.0 $990.8
                                            ======                                        ======                                                  ======             ====== ======

    Percent of revenues            30.3%                           30.4%                                 30.4%                                   30.3%     30.4%



    GAAP operating income                   $133.5                                        $133.2                                                   $75.3              $69.9 $299.0

    Adjustments:
    ------------

    Amortization of
     purchased intangible
     assets                         14.7                             21.2                                    7.4                                     10.6       41.2

    Gain from changes in
     holdings                          -                           (7.0)                                     -                                       -    (17.6)


    Non-GAAP operating
     income                                 $148.2                                        $147.4                                                   $82.7              $80.5 $322.6
                                            ======                                        ======                                                   =====              ===== ======

    Percent of revenues             9.5%                            9.7%                                 10.1%                                   10.0%      9.9%



    GAAP net income
     attributable to Elbit                  $108.2                                        $106.4                                                   $62.6              $54.1 $236.9
    Systems' shareholders

    Adjustments:
    ------------

    Amortization of
     purchased  intangible
     assets                         14.7                             21.2                                    7.4                                     10.6       41.2

    Capital gain                       -                           (3.9)                                     -                                       -     (3.9)

    Impairment of
     investments                       -                               -                                     -                                       -       2.5

    Gain from changes in
     holdings                          -                           (7.0)                                     -                                       -    (16.4)

    Related tax benefits           (2.5)                           (2.7)                                 (1.2)                                   (1.8)     (6.1)
                                    ----                                                                   ----                                               ----

    Non-GAAP  net income
     attributable to                        $120.4                                        $114.0                                                   $68.8              $62.9 $254.2
      Elbit Systems' shareholders


    Percent of revenues             7.7%                            7.5%                                  8.4%                                    7.8%      7.8%



    GAAP diluted net EPS                     $2.53                                         $2.49                                                   $1.46              $1.27  $5.54

    Adjustments, net                0.29                             0.18                                   0.15                                     0.20       0.41


    Non-GAAP diluted net
     EPS                                     $2.82                                         $2.67                                                   $1.61              $1.47  $5.95
                                             =====                                         =====                                                   =====              =====  =====

Recent Events:

On May 17, 2017, the Company announced that its U.S. subsidiary, Elbit Systems of America LLC., was awarded an approximately $166 million contract from a prime contractor to provide operator interface and computer processing capabilities for a U.S. Army platform. The contract will be performed primarily in Fort Worth, Texas, over a five-year period.

On May 24, 2017, the Company announced that it was awarded a $25 million contract for the supply of J-Music(TM) DIRCM (Direct Infrared Countermeasures) self-protection systems to an international organization. The contract will be performed over a three-year period.

On May 28, 2017, the Company announced that it was awarded a contract, in an amount of approximately $390 million, to supply an array of ground electronic intelligence capabilities to a European country. The contract, which includes various intelligence capabilities, as well as communications and command and control solutions, will be performed over a three-year period.

On June 21, 2017, the Company announced that it was awarded a contract of more than $20 million by an African-based customer to equip a VIP Gulfstream G650 aircraft with J-Music(TM) DIRCM systems that include Elbit Systems' advanced infrared-based Passive Airborne Warning System. The contract will be performed over a one-year period.

On July 5, 2017, the Company announced that one of its subsidiaries in Europe was awarded a contract from a European country, for the supply of thousands of advanced Electro-Optic systems for individual infantry soldiers, in a total amount of an approximately $35 million. The contract will be performed over a two-year period.

Dividend:

The Board of Directors declared a dividend of $0.44 per share for the second quarter of 2017. The dividend's record date is September 1, 2017. The dividend will be paid from income generated as Preferred Income (as defined under Israel tax laws), on September 18, 2017, net of taxes and levies, at the rate of 20%.

Conference Call:

The Company will be hosting a conference call today, Tuesday, August 15, 2017 at 9:00 a.m. Eastern Time. On the call, management will review and discuss the results and will be available to answer questions.

To participate, please call one of the teleconferencing numbers that follow. If you are unable to connect using the toll-free numbers, please try the international dial-in number.

US Dial-in Numbers: 1 888 407 2553
Canada Dial-in Numbers: 1 866 485 2399
UK Dial-in Number: 0 800 917 5108
ISRAEL Dial-in Number: 03 918 0610
INTERNATIONAL Dial-in Number: +972 3 918 0610

at: 9:00 am Eastern Time; 6:00 am Pacific Time; 2:00 pm UK Time; 4:00 pm Israel Time

This call will also be broadcast live on Elbit Systems' web-site at http://www.elbitsystems.com. An online replay will be available from 24 hours after the call ends.

Alternatively, for two days following the call, investors will be able to dial a replay number to listen to the call. The dial-in numbers are:

1 888 782 4291 (US and Canada) or +972 3 925 5904 (Israel and International).

About Elbit Systems

Elbit Systems Ltd. is an international high technology company engaged in a wide range of defense, homeland security and commercial programs throughout the world. The Company, which includes Elbit Systems and its subsidiaries, operates in the areas of airborne, land and naval systems, command, control, communications, computers, intelligence surveillance and reconnaissance ("C4ISR"), unmanned aircraft systems, advanced electro-optics, electro-optic space systems, EW suites, signal intelligence systems, data links and communications systems and radios. The Company also focuses on the upgrading of existing platforms, developing new technologies for defense, homeland security and commercial aviation applications and providing a range of support services, including training and simulation systems.

For additional information, visit: www.elbitsystems.com or follow us on Twitter.

Attachments:

Consolidated balance sheets
Consolidated statements of income
Consolidated statements of cash flow
Consolidated revenue distribution by areas of operation and by geographical regions

    Company Contact:                                  IR Contact:

    Joseph Gaspar, Executive VP & CFO                 Ehud Helft

    Tel:  +972-4-8316663                              Kenny Green

    j.gaspar@elbitsystems.com                         GK Investor Relations

    Dalia Rosen, VP, Head of Corporate Communications Tel: 1-646-201-9246

    Tel: +972-4-8316784                               elbitsystems@gkir.com

    dalia.rosen@elbitsystems.com

    Elbit Systems Ltd.
    ------------------

This press release contains forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1943, as amended) regarding Elbit Systems Ltd. and/or its subsidiaries (collectively the Company), to the extent such statements do not relate to historical or current fact. Forward-looking statements are based on management's expectations, estimates, projections and assumptions. Forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. These statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Therefore, actual future results, performance and trends may differ materially from these forward-looking statements due to a variety of factors, including, without limitation: scope and length of customer contracts; governmental regulations and approvals; changes in governmental budgeting priorities; general market, political and economic conditions in the countries in which the Company operates or sells, including Israel and the United States among others; differences in anticipated and actual program performance, including the ability to perform under long-term fixed-price contracts; and the outcome of legal and/or regulatory proceedings. The factors listed above are not all-inclusive, and further information is contained in Elbit Systems Ltd.'s latest annual report on Form 20-F, which is on file with the U.S. Securities and Exchange Commission. All forward-looking statements speak only as of the date of this release. The Company does not undertake to update its forward-looking statements.

Elbit Systems Ltd., its logo, brand, product, service and process names appearing in this Press Release are the trademarks or service marks of Elbit Systems Ltd. or its affiliated companies. All other brand, product, service and process names appearing are the trademarks of their respective holders. Reference to or use of a product, service or process other than those of Elbit Systems Ltd. does not imply recommendation, approval, affiliation or sponsorship of that product, service or process by Elbit Systems Ltd. Nothing contained herein shall be construed as conferring by implication, estoppel or otherwise any license or right under any patent, copyright, trademark or other intellectual property right of Elbit Systems Ltd. or any third party, except as expressly granted herein.

(FINANCIAL TABLES TO FOLLOW)

                                ELBIT SYSTEMS LTD.

                            CONSOLIDATED BALANCE SHEETS
                            ---------------------------

                           (In thousands of US Dollars)


                             June 30                    December 31,

                                 2017                              2016
                                 ----                              ----

                            Unaudited                      Audited
                            ---------                      -------

    Assets
    ------

    Current assets:

    Cash and
     cash
     equivalents                          $149,483                          $222,810

    Short-term
     bank
     deposits
     and
     marketable
     securities                21,903                              22,252

    Trade and
     unbilled
     receivables,
     net                    1,349,799                           1,232,591

    Other
     receivables
     and
     prepaid
     expenses                 156,955                             102,979

     Inventories,
     net of
     customers
     advances                 893,458                             840,266

    Total
     current
     assets                 2,571,598                           2,420,898
                            ---------                           ---------


    Investments
     in
     affiliated
     companies
     and
     partnerships             171,434                             180,962

    Long-term
     trade and
     unbilled
     receivables              174,998                             189,688

    Long-term
     bank
     deposits
     and other
     receivables               25,832                              15,917

    Deferred
     income
     taxes, net                80,894                              79,639

    Severance
     pay fund                 293,838                             264,253

                              746,996                             730,459
                              -------                             -------


    Property,
     plant and
     equipment,
     net                      488,212                             474,109
                              -------                             -------

    Goodwill
     and other
     intangible
     assets,
     net                      763,964                             726,398
                              -------                             -------

    Total
     assets                             $4,570,770                        $4,351,864
                                        ==========                        ==========



    Liabilities and Equity
    ----------------------

    Short-term
     bank
     credit and
     loans                                $111,543                            $5,027

    Current
     maturities
     of long-
     term loans
     and Series
     A Notes                   93,811                             228,956

    Trade
     payables                 490,127                             514,106

    Other
     payables
     and
     accrued
     expenses                 871,287                             828,716

    Customer
     advances
     in excess
     of costs
     incurred
     on
     contracts
     in
     progress                 422,044                             347,393

                            1,988,812                           1,924,198
                            ---------                           ---------


    Long-term
     loans, net
     of current
     maturities               119,997                                 475

    Series A
     Notes, net
     of current
     maturities               125,818                             171,066

    Employee
     benefit
     liabilities              407,023                             376,115

    Deferred
     income
     taxes and
     tax
     liabilities,
     net                       66,762                              60,098

    Customer
     advances
     in excess
     of costs
     incurred
     on
     contracts
     in
     progress                 153,533                             174,529

    Other long-
     term
     liabilities               58,551                              78,142

                              931,684                             860,425
                              -------                             -------


    Elbit
     Systems
     Ltd.'s
     equity                 1,641,746                           1,559,840

    Non-
     controlling
     interests                  8,528                               7,401

    Total
     equity                 1,650,274                           1,567,241
                            ---------                           ---------

    Total
     liabilities
     and equity                         $4,570,770                        $4,351,864
                                        ==========                        ==========

                                                                                                             ELBIT SYSTEMS LTD.

                                                                                                      CONSOLIDATED STATEMENTS OF INCOME
                                                                                                      ---------------------------------

                                                                                     (In thousands of US Dollars, except for share and per share amount)


                                                            Six Months Ended                         Three Months Ended 

     June 30,                         Year Ended
                                                                                                                                                             

    December 31,

                                                               June 30,


                                                   2017                         2016                        2017                     2016                                2016
                                                   ----                         ----                        ----                     ----                                ----

                                                              Unaudited                                   Unaudited                                 Audited


    Revenues                                               $1,567,487                                  $1,525,721                                          $818,299                        $804,510 $3,260,219

    Cost of revenues                          1,104,009                      1,077,344                                 575,971                               568,375             2,300,636
                                              ---------                      ---------                                 -------                               -------             ---------

    Gross profit                                463,478                        448,377                                 242,328                               236,135               959,583


    Operating expenses:
    -------------------

    Research and
     development, net                           125,506                        123,236                                  67,069                                67,189               255,792

    Marketing and selling,
     net                                        132,068                        121,326                                  66,291                                60,330               271,037

    General and
     administrative, net                         72,369                         77,616                                  33,645                                38,672               151,353

    Other operating
     income, net                                      -                       (7,032)                                      -                                    -             (17,575)
                                                    ---                                                                  ---

    Total operating
     expenses                                   329,943                        315,146                                 167,005                               166,191               660,607

    Operating income                            133,535                        133,231                                  75,323                                69,944               298,976
                                                -------                        -------                                  ------                                ------               -------


    Financial expenses,
     net                                       (15,478)                       (7,194)                                (6,833)                              (5,475)             (23,742)

    Other income, net                                37                          3,910                                       5                                    13                 3,967

    Income before income
     taxes                                      118,094                        129,947                                  68,495                                64,482               279,201
                                                -------                        -------                                  ------                                ------               -------


    Taxes on income                            (15,572)                      (26,956)                               (10,321)                             (14,286)             (45,617)

                                                102,522                        102,991                                  58,174                                50,196               233,584
                                                -------                        -------                                  ------                                ------               -------


    Equity in net earnings
     of affiliated                                6,418                          4,429                                   4,822                                 4,409                 5,224
    companies and partnerships


    Net income                                               $108,940                                    $107,420                                           $62,996                         $54,605   $238,808
                                                             --------                                    --------                                           -------                         -------

    Less: net income
     attributable to non-                         (716)                       (1,002)                                  (412)                                (514)              (1,899)
    controlling interests


    Net income
     attributable to Elbit                                   $108,224                                    $106,418                                           $62,584                         $54,091   $236,909
    Systems Ltd.'s shareholders





    Earnings per share attributable to Elbit Systems Ltd.'s shareholders:
    ---------------------------------------------------------------------

    Basic net earnings per
     share                                                      $2.53                                       $2.49                                             $1.46                           $1.27      $5.54
                                                                =====                                       =====                                             =====                           =====      =====

    Diluted net earnings
     per share                                                  $2.53                                       $2.49                                             $1.46                           $1.27      $5.54
                                                                =====                                       =====                                             =====                           =====      =====



    Weighted average number of shares (in thousands)
    -----------------------------------------------

    Shares used in
     computation of basic                        42,749                         42,739                                  42,749                                42,743                42,742
    earnings per share


    Shares used in
     computation of
     diluted                                     42,753                         42,750                                  42,755                                42,752                42,752
    earnings per share

                                                                      ELBIT SYSTEMS LTD.

                                                             CONSOLIDATED STATEMENTS OF CASH FLOW
                                                             ------------------------------------

                                                                 (In thousands of US dollars)


                                                      Six Months Ended 

     June 30,                     Year Ended
                                                                                                        

    December 31,


                                                    2017                               2016                       2016
                                                    ----                               ----                       ----

                                                              Unaudited                              Audited


    CASH FLOWS FROM OPERATING ACTIVITIES

    Net income                                              $108,940                                           $107,420             $238,808

    Adjustments to reconcile net income to net
     cash provided by operating activities:

    Depreciation and
     amortization                                 56,360                               59,038                               122,888

    Write-off impairment on
     marketable securities                             -                                   -                                   86

    Stock-based compensation                          13                                   43                                    70

    Amortization of Series A
     Notes premium and
     related issuance costs,
     net                                            (46)                                (46)                                 (92)

    Deferred income taxes and
     reserve, net                                  1,960                                7,693                                 2,683

    Gain on sale of property,
     plant and equipment                         (1,970)                             (3,810)                              (3,347)

    Loss (gain) on sale and
     revaluation of
     investments                                     204                              (6,617)                             (16,734)

    Equity in net earnings of
     affiliated companies and
     partnerships, net of                        (4,303)                             (4,429)                              (1,728)
        dividend received (*)

    Changes in operating assets and
     liabilities, net of amounts acquired:

    Increase in short and
     long-term trade
     receivables and prepaid
     expenses                                  (157,407)                           (178,535)                             (297,439)

    Increase in inventories,
     net                                        (50,203)                            (32,789)                              (8,040)

    Increase (decrease) in
     trade payables, other
     payables and accrued
     expenses                                   (17,381)                              95,696                               253,413

    Severance, pension and
     termination indemnities,
     net                                          12,850                                3,372                                   315

    Increase (decrease) in
     advances received from
     customers                                    53,654                             (61,208)                             (82,881)


    Net cash provided by
     (used in) operating
     activities                                    2,671                             (14,172)                              208,002
                                                   -----                              -------                               -------

    CASH FLOWS FROM INVESTING ACTIVITIES

    Purchase of property,
     plant and equipment and
     other assets                               (55,416)                            (68,131)                            (124,221)

    Acquisition of
     subsidiaries and
     business operations                        (25,440)                                   -                                    -

    Investments in affiliated
     companies and other
     companies                                     (678)                            (17,483)                             (19,277)

    Deconsolidation of
     subsidiary                                        -                             (1,538)                              (1,538)

    Proceeds from sale of
     property, plant and
     equipment                                     3,597                                8,908                                15,745

    Proceeds from sale of
     investments                                  12,067                                    -                                    -

    Investment in long-term
     deposits                                      (499)                               (109)                                (417)

    Proceeds from sale of
     long-term deposits                              172                                  268                                   894

    Investment in short-term
     deposits and marketable
     securities                                 (26,858)                            (23,417)                             (25,622)

    Proceeds from sale of
     short-term deposits and
     marketable securities                        27,159                               26,106                                36,619
                                                  ------                               ------

    Net cash used in
     investing activities                       (65,896)                            (75,396)                            (117,817)
                                                 -------                              -------                              --------

    CASH FLOWS FROM FINANCING ACTIVITIES

    Proceeds from exercise of
     options                                          63                                  470                                   505

    Repayment of long-term
     loans                                     (140,782)                            (24,790)                             (48,250)

    Proceeds from long-term
     loans                                       118,550                                    -                                    -

    Repayment of Series A
     Notes                                      (55,532)                            (55,532)                             (55,532)

    Dividends paid                              (37,649)                            (34,224)                             (68,447)

    Change in short-term
     bank credit and loans,
     net                                         105,248                               60,003                                 5,027
                                                 -------                               ------

    Net cash used in
     financing activities                       (10,102)                            (54,073)                            (166,697)
                                                 -------                              -------                              --------

    Net decrease in cash and
     cash equivalents                           (73,327)                           (143,641)                              (76,512)

    Cash and cash equivalents
     at the beginning of the
     year                                        222,810                              299,322                               299,322
                                                 -------                              -------

    Cash and cash equivalents
     at the end of the period                               $149,483                                           $155,681             $222,810
                                                            ========                                           ========             ========


    * Dividend received from
     affiliated companies and
     partnerships                                             $2,115                                $                 -              $3,496
                                                              ======                              ===               ===              ======

                                                                                            ELBIT SYSTEMS LTD.

                                                                                         DISTRIBUTION OF REVENUES
                                                                                         ------------------------


    Consolidated Revenues by Areas of Operation:
    --------------------------------------------


                                                 Six Months Ended June 30,                           Three Months Ended June 30,

                                                         2017                          2016                                   2017                     2016

                                      $ millions             %              $ millions      %               $ millions               %  $ millions           %
                                      ----------            ---             ----------     ---              ----------              --- ----------          ---

    Airborne
     systems                               592.9                       37.8                  594.7                             39.0              302.6           37.0 310.8  38.6

    C4ISR systems                          552.6                       35.3                  528.4                             34.6              273.5           33.4 307.0  38.2

    Land systems                           203.5                       13.0                  226.2                             14.8              124.6           15.2  87.8  10.9

    Electro-optic
     systems                               169.6                       10.8                  123.3                              8.1               93.2           11.4  69.9   8.7

    Other (mainly
     non-defense                            48.9                        3.1                   53.1                              3.5               24.4            3.0  29.0   3.6
    engineering and
     production services)


    Total                                1,567.5                      100.0                1,525.7                            100.0              818.3          100.0 804.5 100.0
                                         =======                      =====                =======                            =====              =====          ===== ===== =====

    Consolidated Revenues by Geographical Regions:
    ----------------------------------------------


                                              Six Months Ended June 30,                         Three Months Ended June 30,
                                              -------------------------                         ---------------------------

                                                      2017                          2016                                2017                     2016

                                 $ millions               %              $ millions      %            $ millions               %  $ millions           %
                                 ----------              ---             ----------     ---           ----------              --- ----------          ---

    Israel                            335.0                         21.4                  323.4                          21.2              167.6           20.5 180.3  22.4

    North
     America                          401.8                         25.6                  396.3                          26.0              208.8           25.5 218.1  27.1

    Europe                            364.9                         23.3                  260.9                          17.1              203.1           24.8 146.6  18.2

    Asia-
     Pacific                          328.9                         21.0                  418.8                          27.4              162.7           19.9 206.1  25.6

    Latin
     America                           93.0                          5.9                   96.7                           6.3               58.6            7.2  33.6   4.2

    Other
     countries                         43.9                          2.8                   29.6                           2.0               17.5            2.1  19.8   2.5
                                       ----                                               ----                           ---               ----            ---  ----   ---

    Total                           1,567.5                        100.0                1,525.7                         100.0              818.3          100.0 804.5 100.0
                                    =======                        =====                =======                         =====              =====          ===== ===== =====

View original content:http://www.prnewswire.com/news-releases/elbit-systems-reports-second-quarter-of-2017-results-300504426.html

SOURCE Elbit Systems Ltd