Eltek Reports 2020 Third Quarter Financial Results
PETACH-TIKVA, Israel, Nov. 18, 2020 /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, 2020.
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Mr. Eli Yaffe, Chief Executive Officer, commented: "We are pleased that our third quarter results reflect the continuing trend of improved results. We are gratified that despite the global Covid-19 pandemic and its related challenges, we were able to achieve continued profitability and improve our operating profit from $1.0 million in the first nine months of 2019 to $2.1 million in the first nine months of 2020."
"We are operating in a challenging business environment and making the necessary adjustments to increase revenues, maintain the trend of improved operating efficiencies and reach sustained profitability," concluded Mr. Yaffe.
Highlights of the Third Quarter of 2020 compared to the Third Quarter of 2019
-- Revenues for the third quarter of 2020 were $9.3 million consistent with our revenues in the third quarter of 2019; -- Gross profit increased from $1.75 million (18.9% of revenues) in the third quarter of 2019 to $1.82 million (19.7% of revenues) in the third quarter of 2020; -- Operating profit increased to $638,000 during the third quarter of 2020 as compared to operating profit of $568,000 in the third quarter of 2019; -- Net profit was $598,000, or $0.14 per fully diluted share in the third quarter of 2020 compared to net profit of $391,000, or $0.09 per fully diluted share, in the third quarter of 2019; -- EBITDA was $1.0 million in the third quarter of 2020 compared to EBITDA of $940,000 in the third quarter of 2019; -- Net cash provided by operating activities amounted to $873,000 in the third quarter of 2020 compared to net cash provided by operating activities of $1.4 million in the third quarter of 2019.
Highlights for the First Nine Months of 2020
-- Revenues for the first nine months of 2020 were $27.2 million compared to $26.2 million in the first nine months of 2019; -- Gross profit was $5.5 million (20.3% of revenues) compared to gross profit of $4.5 million (17.4% of revenues) in the first nine months of 2019; -- Operating profit was $2.1 million in the first nine months of 2020 compared to operating profit of $1.0 million in the first nine months of 2019; -- Other expenses were $10,000 in the first nine months of 2020 as compared to other income of $875,000 in the first nine months of 2019 which was attributable to an insurance payment related to a claim for damages incurred during 2018; -- Net profit was $1.8 million, or $0.42 per fully diluted share in the first nine months of 2020 compared to net profit of $1.4 million, or $0.40 per fully diluted share in the first nine months of 2019; -- EBITDA was $3.2 million in the first nine months of 2020 compared to EBITDA of $3.0 million in the first nine months of 2019; -- Net cash provided by operating activities amounted to $3.7 million in the first nine months of 2020 compared to net cash provided by operating activities of $2.7 million in the first nine months of 2019.
Conference Call
Today, Wednesday, November 18, 2020, 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: 03-9180644 International: +972-3-9180644 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.
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.
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, the impact of the Coronavirus on the economy and our operations, 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
(Tables follow)
Eltek Ltd. Consolidated Statements of Operations (In thousands US$, except per share data) Nine months ended Three months ended September 30, September 30, 2020 2019 2020 2019 Revenues 9,256 9,279 27,205 26,213 Costs of revenues (7,433) (7,524) (21,679) (21,663) Gross profit 1,823 1,755 5,527 4,550 Selling, general and administrative expenses (1,183) (1,187) (3,467) (3,541) R&D expenses, net (2) Operating profit 638 568 2,060 1,009 Financial expenses, net (19) (146) (158) (409) Other income, net (10) (2) (10) 875 Profit before income tax 609 420 1,892 1,475 Tax expenses (11) (29) (49) (51) Net Profit 598 391 1,842 1,424 Earnings per share Basic and diluted net profit per ordinary share 0.14 0.09 0.42 0.40 Weighted average number of ordinary shares 4,380 4,380 4,380 3,519 used to compute basic net profit per ordinary share (in thousands)
Eltek Ltd. Consolidated Balance Sheets (In thousands US$) September 30, December 31, 2020 2019 Assets Current assets Cash and cash equivalents 2,651 1,628 Receivables: Trade, net of provision for doubtful accounts 6,402 7,480 Other 1,719 145 Inventories 3,552 3,735 Prepaid expenses 151 530 Total current assets 14,475 13,518 Long term assets Restricted deposits 58 - Severance pay fund 60 60 Operating lease right of use assets 1,745 2,490 Total long term assets 1,863 2,550 Fixed assets, less accumulated depreciation 6,658 6,761 Total Assets 22,996 22,829 Liabilities and Shareholder's equity Current liabilities Short-term credit and current maturities of long-term debts 214 2,120 Short-term credit from related party 2,906 3,472 Accounts payable: Trade 4,851 4,673 Other 3,315 3,118 Short-term operating lease liabilities 1,170 1,383 Total current liabilities 12,456 14,766 Long-term liabilities Long term debt, excluding current maturities 1,372 387 Employee severance benefits 296 268 Deferred tax liabilities 64 45 Long-term operating lease liabilities 558 1,094 Total long-term liabilities 2,290 1,794 Equity Ordinary shares, NIS 3.0 par value authorized 10,000,000 3,964 3,964 shares, issued and outstanding 4,380,268 Additional paid-in capital 18,583 18,583 Cumulative foreign currency translation adjustments 2,527 2,479 Capital reserve 1,054 963 Accumulated deficit (17,878) (19,720) Shareholders' equity 8,250 6,269 Total liabilities and shareholders' equity 22,996 22,829
Eltek Ltd. Unaudited Non-GAAP EBITDA Reconciliations (In thousands US$) Non-GAAP EBITDA Reconciliations Nine months ended Three months ended September 30, September 30, 2020 2019 2020 2019 Unaudited Unaudited GAAP Net Income 598 391 1,842 1,424 Add back items: --- Financial expenses, net 19 146 158 409 Income tax expense 11 29 49 51 Depreciation and amortization 390 374 1,176 1,118 Non-GAAP EBITDA 1,018 940 3,226 3,002
Eltek Ltd. Consolidated Statement of Cash flow (In thousands US$) Three months ended Nine months ended September 30, September 30, 2020 2019 2020 2019 Cash flows from operating activities: Net Income 598 391 1,842 1,424 Adjustments to reconcile net profit to net cash flows provided by operating activities: Depreciation and amortization 391 371 1,177 1,119 Capital gain on disposal of fixed assets, net (16) (16) Stock-based compensation 48 26 91 87 Transaction with controlling shareholder 15 44 Revaluation of long term loans (2) (12) 2 (36) Increase in deferred tax liabilities 6 18 427 400 1,272 1,214 Decrease in operating lease right-of-use assets (1) (1) (5) (11) Decrease (increase) in trade receivables 949 886 1,098 (712) Decrease (increase) in other receivables and prepaid expenses (1,077) (224) (890) 655 Decrease (increase) in inventories (50) 211 198 98 Increase (decrease) in trade payables 397 (102) 27 92 Increase in other liabilities and accrued expenses (357) (188) 181 (55) Increase (decrease) in employee severance benefits, net (13) 23 27 14 (152) 605 636 81 Net cash provided by operating activities 873 1,396 3,750 2,719 Cash flows from investing activities: Purchase of fixed assets (348) (293) (802) (543) Restricted deposits (1) (58) Net cash used in investing activities (349) (293) (860) (543) Cash flows from financing activities: Short- term bank credit, net (1,163) (921) (1,928) (4,315) Proceeds from short- term shareholder loan 557 Repayment of short- term shareholder loan (571) Issuance of ordinary shares in rights offering, net 3,298 Repayment of long-term loans from bank (37) (220) (145) (675) Proceeds from long-term loans 557 1,141 558 Repayment of credit from fixed asset payables (87) (94) (391) (289) Net cash used in financing activities (1,287) (678) (1,894) (866) Effect of translation adjustments 7 27 27 (13) Net increase (decrease) in cash and cash equivalents (756) 452 1,023 1,297 Cash and cash equivalents at beginning of the period 3,407 1,837 1,628 992 Cash and cash equivalents at period end 2,651 2,289 2,651 2,289
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SOURCE Eltek Ltd.