Eltek Reports 2019 Third Quarter Financial Results
PETACH-TIKVA, Israel, Nov. 20, 2019 /PRNewswire/ -- Eltek Ltd. (NASDAQ: ELTK), a global manufacturer and supplier of technologically advanced solutions in the field of printed circuit boards, announced today its financial results for the quarter ended September 30, 2019.
Mr. Eli Yaffe, Chief Executive Officer, commented: "We are pleased with our growth in revenues and profitability in the third quarter's results. The improved results are a consequence of the implementation of our previously announced turnaround plan."
Highlights of the Third Quarter of 2019 compared to the Third Quarter of 2018
-- Revenues for the third quarter of 2019 were $9.3 million compared to
revenues of $8.5 million in the third quarter of 2018;
-- Gross profit increased from $973,000 (11.4% of revenues) in the third
quarter of 2018 to $1.8 million (19.1% of revenues) in the third quarter
of 2019;
-- Operating profit was $568,000 this quarter as compared to an operating
loss of $307,000 in the third quarter of 2018;
-- Net profit was $391,000, or $0.09 per fully diluted share in the third
quarter of 2019 compared to a net loss of $463,000, or ($0.23) per fully
diluted share, in the third quarter of 2018;
-- EBITDA was $940,000 in the third quarter of 2019 compared to EBITDA of
$109,000 in the third quarter of 2018;
-- Net cash provided by operating activities amounted to $1.4 million in
the third quarter of 2019 compared to net cash provided by operating
activities of $164,000 in the third quarter of 2018.
Highlights for the First Nine Months of 2019
-- Revenues for the first nine months of 2019 were $26.2 million compared
to $26.1 million in the first nine months of 2018;
-- Gross profit was $4.5 million (17.4% of revenues) compared to gross
profit of $2.0 million (7.6% of revenues) in the first nine months of
2018;
-- Operating profit was $1.0 million compared to an operating loss of $1.7
million in the first nine months of 2018;
-- Other Income was $875,000 in the first nine months of 2019 compared to
nil in the first nine months of 2018;
-- Net profit was $1.4 million, or $0.40 per fully diluted share compared
to a net loss of $2.0 million, or ($0.97) per fully diluted share in the
first nine months of 2018;
-- EBITDA was $3.0 million in the first nine months of 2019, compared to
negative EBITDA of $373,000 in the first nine months of 2018;
-- Net cash provided by operating activities amounted to $2.7 million
compared to net cash used in operating activities of $950,000 in the
first nine months of 2018.
Use of Non-GAAP Financial Information
The Company reports financial results in accordance with U.S. GAAP and herein provides some non-GAAP measures, including EBITDA. These non-GAAP measures are not in accordance with, nor are they a substitute for, GAAP measures. These non-GAAP measures are intended to supplement the Company's presentation of its financial results that are prepared in accordance with GAAP. The Company uses the non-GAAP measures presented to evaluate and manage the Company's operations internally. The Company is also providing this information to assist investors in performing additional financial analysis. Reconciliation between the company's results on a GAAP and non-GAAP basis is provided in a table below.
Conference Call
Today, Wednesday, November 20, 2019, at 8:30 a.m. Eastern Time, Eltek will conduct a conference call to discuss the results. The call will feature remarks by Eli Yaffe, Chief Executive Officer and Alon Mualem, Chief Financial Officer.
To participate, please call the following teleconference numbers. Please allow for additional time to connect prior to the call:
United States: 1-888-668-9141
Israel: 03-9180609
International: +972-3-9180609
At:
8:30 a.m. Eastern Time
5:30 a.m. Pacific Time
15:30 p.m. Israel Time
A replay of the call will be available through the Investor Info section on Eltek's corporate website at http://www.nisteceltek.com approximately 24 hours after the conference call is completed and will be archived for 30 days.
About Eltek
Eltek - "Innovation Across the Board", is a global manufacturer and supplier of technologically advanced solutions in the field of printed circuit boards (PCBs), and is the Israeli leader in this industry. PCBs are the core circuitry of most electronic devices. Eltek specializes in the manufacture and supply of complex and high quality PCBs, HDI, multilayered and flex-rigid boards for the high-end market. Eltek is ITAR compliant and has AS-9100 and NADCAP Electronics certifications. Its customers include leading companies in the defense, aerospace and medical industries in Israel, the United States, Europe and Asia.
Eltek was founded in 1970. The Company's headquarters, R&D, production and marketing center are located in Israel. Eltek also operates through its subsidiaries in North America and in Europe and by agents and distributors in Europe, India, South Africa and South America.
For more information, visit Eltek's web site at www.nisteceltek.com.
Forward Looking Statement:
Certain matters discussed in this news release are forward-looking statements that involve a number of risks and uncertainties including, but not limited to statements regarding expected results in future quarters, risks in product and technology development and rapid technological change, product demand, the impact of competitive products and pricing, market acceptance, the sales cycle, changing economic conditions and other risk factors detailed in the Company's Annual Report on Form 20-F and other filings with the United States Securities and Exchange Commission.
Investor Contact:
Alon Mualem
Chief Financial Officer
alonm@nisteceltek.com
+972-3-9395023
Eltek Ltd.
Consolidated Statements of Operations
(In thousands US$, except per share data)
Three months
ended Nine months ended
September 30, September 30,
2019 2018 2019 2018
Revenues 9,279 8,503 26,213 26,112
Costs of revenues (7,524) (7,530) (21,663) (24,118)
Gross profit 1,755 973 4,550 1,994
Selling, general and administrative expenses (1,187) (1,280) (3,541) (3,648)
R&D expenses, net - (1)
---
Operating profit (loss) 568 (307) 1,009 (1,655)
Financial expenses, net (146) (132) (409) (264)
Other income, net (2) 875 -
Profit (loss) before income tax 420 (439) 1,475 (1,919)
Tax expenses (29) (24) (51) (57)
Net Profit (loss) 391 (463) 1,424 (1,976)
Earnings per share
Basic and diluted net profit (loss) per ordinary share 0.09 (0.23) 0.40 (0.97)
Weighted average number of ordinary shares used
to compute basic and diluted net profit (loss) per
ordinary share (in thousands) 4,380 2,029 3,519 2,029
Eltek Ltd.
Consolidated Balance Sheets
(In thousands US$)
September 30,
December 31,
2019 2018
Assets
Current assets
Cash and cash equivalents 2,289 992
Receivables: Trade, net of provision for doubtful accounts 6,852 5,682
Other 195 868
Inventories 3,785 3,611
Prepaid expenses 412 292
Total current assets 13,533 11,445
Long term assets
Severance pay fund 59 53
Long term prepaid expenses 39
Operating lease right of use assets 2,750
Total long term assets 2,809 92
Fixed assets, less accumulated depreciation 6,795 6,623
Total Assets 23,137 18,160
Liabilities and Shareholder's equity
Current liabilities
Short-term credit and current maturities of long-term debts 2,123 6,606
Short-term credit from related party 3,446 2,668
Accounts payable: Trade 4,755 4,108
Other 3,579 3,377
Short-term operating lease liabilities 1,368
Total current liabilities 15,271 16,759
Long-term liabilities
Long term debt, excluding current maturities 436 308
Employee severance benefits 244 211
Long-term operating lease liabilities 1,362
Total long-term liabilities 2,042 519
Equity
Ordinary shares, NIS 3.0 par value authorized 10,000,000 3,964 1,985
shares, issued and outstanding 2,028,552
Additional paid-in capital 18,583 17,270
Cumulative foreign currency translation adjustments 2,435 2,340
Capital reserve 932 800
Accumulated deficit (20,090) (21,513)
Shareholders' equity 5,824 882
Total liabilities and shareholders' equity 23,137 18,160
Eltek Ltd.
Unaudited Non-GAAP EBITDA Reconciliations
(In thousands US$)
Non-GAAP EBITDA Reconciliations Three months ended Nine months ended
September 30, September 30,
2019 2018 2019 2018
Unaudited Unaudited
GAAP net Income (loss) 391 (463) 1,424 (1,976)
Add back items:
---
Financial expenses, net 146 132 409 264
Income tax expense 29 24 51 57
Depreciation and amortization 374 416 1,118 1,282
Non-GAAP EBITDA 940 109 3,002 (373)
Eltek Ltd.
Consolidated Statement of Cash flow
(In thousands US$)
Three months ended Nine months ended
September 30, September 30,
2019 2018 2019 2018
Cash flows from operating activities:
Net Income (loss) 391 (463) 1,423 (1,976)
Adjustments to reconcile net loss to net
cash flows provided by operating activities:
Depreciation and amortization 371 416 1,119 1,282
Stock-based compensation 26 88
Transaction with controlling shareholder 15 44
Revaluation of long term loans (12) (1) (36) 23
400 415 1,215 1,305
Changes in operating leases, net (1) (11)
Decrease (increase) in trade receivables 886 1,016 (712) (474)
Decrease in other receivables and prepaid expenses (224) (538) 655 313
Decrease (increase) in inventories 211 253 98 (661)
Increase (decrease) in trade payables (102) (440) 92 645
Increase (decrease) in other liabilities and accrued expenses (188) (84) (55) (134)
Increase (decrease) in employee severance benefits, net 23 5 14 32
605 212 81 (279)
Net cash provided by (used in) operating activities 1,396 164 2,719 (950)
Cash flows from investing activities:
Purchase of fixed assets (293) (86) (543) (196)
Net cash used in investing activities (293) (86) (543) (196)
Cash flows from financing activities:
Short- term bank credit, net (921) 113 (4,315) 956
Short- term shareholder loan 275 557 1,431
Issuance of ordinary shares in rights offering, net 3,298
Repayment of long-term loans from bank (220) (225) (675) (689)
Proceeds from long-term loans 557 558
Repayment of credit from fixed asset payables (94) (74) (289) (233)
Net cash provided by (used in) financing activities (678) 89 (866) 1,465
Effect of translation adjustments 27 43 (13) (5)
Net increase (decrease) in cash and cash equivalents 452 210 1,297 314
Cash and cash equivalents at beginning of the period 1,837 991 992 887
Cash and cash equivalents at period end 2,289 1,201 2,289 1,201
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SOURCE Eltek Ltd.
