1. |
Press Release dated November 29, 2019 re TAT Technologies Ltd. Reports Third
Quarter 2019 Results.
|
Press Release
|
Source: TAT Technologies Limited
|
•
|
Revenues for Q3 2019 increased by 13% to
$26.1 million compared with $23.2 million in Q3 2018. Revenues for the nine-months period that ended on September 30, 2019 increased by 4% to $75.4
million compared with $72.4 million in the nine-months period that ended on September 30, 2018.
|
•
|
Gross profit for Q3 2019 increased by 40% to
$4.2 million (16.3% of revenues) compared with $3.0 million (13.1% of revenues) in Q3 2018. Gross profit for the nine-months period that ended on
September 30, 2019 increased by 27% to $11.2 million (14.8% of
revenues) compared with $8.8 million (12.2% of revenues) in the nine-months period that ended on September 30, 2018.
|
•
|
EBITDA for Q3 2019 increased by 100% to
$2.0 million compared with $1.0 million in Q3 2018. EBITDA for the
nine-months period that ended on September 30, 2019 increased by 380% to $4.8 million compared with $1.0 million in the nine-months period that ended on September 30, 2018.
|
•
|
GAAP net income was $0.16 million, or $0.02 per diluted share in Q3 2019 compared with a net loss of $0.5 million, or ($0.06) per diluted share in Q3 2018. GAAP net income was $0.34 million,
or $0.04 per diluted share in the nine-months period that ended on September 30, 2019 compared with a net loss of $2.7 million, or ($0.30) per diluted share in the nine-months period that ended on September 30, 2018.
|
September 30,
|
December 31,
|
|||||||
2019
|
2018
|
|||||||
(unaudited)
|
(audited)
|
|||||||
ASSETS
|
||||||||
CURRENT ASSETS:
|
||||||||
Cash and cash equivalents
|
$
|
16,815
|
$
|
15,950
|
||||
Accounts receivable, net
|
20,515
|
19,277
|
||||||
Other current assets and prepaid expenses
|
3,404
|
3,627
|
||||||
Inventory, net
|
41,686
|
38,605
|
||||||
Total current assets
|
82,420
|
77,459
|
||||||
NON-CURRENT ASSETS:
|
||||||||
Investment in affiliates
|
949
|
1,078
|
||||||
Funds in respect of employee rights upon retirement
|
1,372
|
2,253
|
||||||
Deferred income taxes
|
230
|
162
|
||||||
Intangible assets, net
|
810
|
911
|
||||||
Property, plant and equipment, net
|
21,213
|
21,424
|
||||||
Operating lease right of use assets
|
6,779
|
-
|
||||||
Total non-current assets
|
31,353
|
25,828
|
||||||
Total assets
|
$
|
113,773
|
$
|
103,287
|
||||
LIABILITIES AND EQUITY
|
||||||||
CURRENT LIABILITIES:
|
||||||||
Accounts payable
|
$
|
10,779
|
$
|
8,270
|
||||
Accrued expenses
|
7,946
|
6,411
|
||||||
Operating lease liabilities
|
1,331
|
-
|
||||||
Total current liabilities
|
20,056
|
14,681
|
||||||
NON CURRENT LIABILITIES:
|
||||||||
Other long-term liabilities
|
82
|
180
|
||||||
Liability in respect of employee rights upon retirement
|
1,736
|
2,648
|
||||||
Deferred income taxes
|
1,259
|
1,484
|
||||||
Operating lease liabilities
|
5,772
|
-
|
||||||
Total non-current liabilities
|
8,849
|
4,312
|
||||||
Total liabilities
|
28,905
|
18,993
|
||||||
EQUITY:
|
||||||||
Share capital
|
2,809
|
2,809
|
||||||
Additional paid-in capital
|
65,526
|
65,535
|
||||||
Treasury stock at cost
|
(2,088
|
)
|
(2,088
|
)
|
||||
Accumulated other comprehensive income (loss)
|
34
|
(206
|
)
|
|||||
Retained earnings
|
18,587
|
18,244
|
||||||
Total shareholders' equity
|
84,868
|
84,294
|
||||||
Total liabilities and shareholders' equity
|
$
|
113,773
|
$
|
103,287
|
Three months ended
|
Nine months ended
|
Year ended
|
||||||||||||||||||
September 30,
|
December 31,
|
|||||||||||||||||||
2019
|
2018
|
2019
|
2018
|
2018
|
||||||||||||||||
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
||||||||||||||||
Revenues:
|
||||||||||||||||||||
Products
|
$
|
5,725
|
$
|
5,543
|
$
|
17,924
|
$
|
18,539
|
$
|
23,151
|
||||||||||
Services
|
20,351
|
17,642
|
57,454
|
53,835
|
70,027
|
|||||||||||||||
26,076
|
23,185
|
75,378
|
72,374
|
93,178
|
||||||||||||||||
Cost of goods:
|
||||||||||||||||||||
Products
|
4,853
|
5,752
|
15,037
|
18,733
|
23,807
|
|||||||||||||||
Services
|
16,983
|
14,399
|
49,166
|
44,838
|
60,980
|
|||||||||||||||
21,836
|
20,151
|
64,203
|
63,571
|
84,787
|
||||||||||||||||
Gross Profit
|
4,240
|
3,034
|
11,175
|
8,803
|
8,391
|
|||||||||||||||
Operating expenses:
|
||||||||||||||||||||
Research and development, net
|
46
|
(35
|
)
|
95
|
460
|
553
|
||||||||||||||
Selling and marketing
|
1,329
|
1,171
|
3,803
|
3,806
|
4,913
|
|||||||||||||||
General and administrative
|
2,031
|
1,987
|
5,833
|
6,733
|
8,559
|
|||||||||||||||
Other loss
|
-
|
(1
|
)
|
-
|
(1
|
)
|
(4
|
)
|
||||||||||||
3,406
|
3,122
|
9,731
|
10,998
|
14,021
|
||||||||||||||||
Operating income (loss)
|
834
|
(88
|
)
|
1,444
|
(2,195
|
)
|
(5,630
|
)
|
||||||||||||
Financial expenses, net
|
(159
|
)
|
(58
|
)
|
(543
|
)
|
(39
|
)
|
(102
|
)
|
||||||||||
Income (loss) before taxes on income (tax benefit)
|
675
|
(146
|
)
|
901
|
(2,234
|
)
|
(5,732
|
)
|
||||||||||||
Taxes on income (tax benefit)
|
453
|
356
|
419
|
326
|
(1,464
|
)
|
||||||||||||||
Income (loss) before equity investment
|
222
|
(502
|
)
|
482
|
(2,560
|
)
|
(4,268
|
)
|
||||||||||||
Share in results of affiliated companies
|
(65
|
)
|
(42
|
)
|
(139
|
)
|
(102
|
)
|
(140
|
)
|
||||||||||
Net income (loss)
|
$
|
157
|
$
|
(544
|
)
|
$
|
343
|
$
|
(2,662
|
)
|
$
|
(4,408
|
)
|
|||||||
Basic and diluted income (loss) per share
|
||||||||||||||||||||
Net income (loss) per share
|
$
|
0.02
|
$
|
(0.06
|
)
|
$
|
0.04
|
$
|
(0.30
|
)
|
$
|
(0.5
|
)
|
|||||||
Weighted average number of shares outstanding
|
||||||||||||||||||||
Basic
|
8,874,696
|
8,874,696
|
8,874,696
|
8,861,567
|
8,864,885
|
|||||||||||||||
Diluted
|
8,874,696
|
8,874,696
|
8,874,696
|
8,861,567
|
8,864,885
|
Three months ended
|
Nine months ended
|
Year ended
|
||||||||||||||||||
September 30,
|
December 31,
|
|||||||||||||||||||
2019
|
2018
|
2019
|
2018
|
2018
|
||||||||||||||||
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
||||||||||||||||
Net income (loss)
|
||||||||||||||||||||
Other comprehensive income
|
$
|
157
|
$
|
(544
|
)
|
$
|
343
|
$
|
(2,662
|
)
|
$
|
(4,408
|
)
|
|||||||
Net unrealized income (losses) from derivatives
|
72
|
16
|
358
|
(332
|
)
|
(672
|
)
|
|||||||||||||
Reclassification adjustments for gains (losses) included in net income and inventory
|
(104
|
)
|
123 |
(118
|
)
|
165
|
331
|
|||||||||||||
Total other comprehensive income (loss)
|
$
|
125
|
$
|
(405
|
)
|
$
|
583
|
$
|
(2,829
|
)
|
$
|
(4,749
|
)
|
TAT Technologies Ltd. Shareholders
|
||||||||||||||||||||||||||||
Share capital
|
Accumulated
|
|||||||||||||||||||||||||||
Number of shares issued
|
Amount
|
Additional paid-in capital
|
other comprehensive income (loss)
|
Treasury shares
|
Retained earnings
|
Total equity
|
||||||||||||||||||||||
BALANCE AT DECEMBER 31, 2016 (audited)
|
9,102,917
|
$
|
2,797
|
$
|
64,760
|
$
|
(73
|
)
|
$
|
(2,088
|
)
|
$
|
23,256
|
$
|
88,652
|
|||||||||||||
CHANGES DURING THE YEAR ENDED DECEMBER 31, 2017 (audited):
|
||||||||||||||||||||||||||||
Comprehensive income
|
-
|
-
|
-
|
208
|
-
|
2,396
|
2,604
|
|||||||||||||||||||||
Share based compensation expenses
|
-
|
-
|
174
|
-
|
-
|
-
|
174
|
|||||||||||||||||||||
Exercise of option
|
19,584
|
5
|
139
|
-
|
-
|
-
|
144
|
|||||||||||||||||||||
Dividend distributed
|
-
|
-
|
-
|
-
|
-
|
(3,000
|
)
|
(3,000
|
)
|
|||||||||||||||||||
BALANCE AT DECEMBER 31, 2017 (audited)
|
9,122,501
|
$
|
2,802
|
$
|
65,073
|
$
|
135
|
$
|
(2,088
|
)
|
$
|
22,652
|
$
|
88,574
|
||||||||||||||
CHANGES DURING THE YEAR ENDED DECEMBER 31, 2018 (audited):
|
||||||||||||||||||||||||||||
Comprehensive loss
|
-
|
-
|
-
|
(341
|
)
|
-
|
(4,408
|
)
|
(4,749
|
)
|
||||||||||||||||||
Share based compensation expenses
|
-
|
-
|
272
|
-
|
-
|
-
|
272
|
|||||||||||||||||||||
Exercise of options
|
26,668
|
7
|
190
|
-
|
-
|
-
|
197
|
|||||||||||||||||||||
BALANCE AT DECEMBER 31, 2018 (audited)
|
9,149,169
|
$
|
2,809
|
$
|
65,535
|
$
|
(206
|
)
|
$
|
(2,088
|
)
|
$
|
18,244
|
$
|
84,294
|
TAT Technologies Ltd. Shareholders
|
||||||||||||||||||||||||||||
Share capital
|
Accumulated
|
|||||||||||||||||||||||||||
Number of shares issued
|
Amount
|
Additional paid-in capital
|
other comprehensive income (loss)
|
Treasury shares
|
Retained earnings
|
Total equity
|
||||||||||||||||||||||
BALANCE AT DECEMBER 31, 2018 (audited)
|
9,149,169
|
$
|
2,809
|
$
|
65,535
|
$
|
(206
|
)
|
$
|
(2,088
|
)
|
$
|
18,244
|
$
|
84,294
|
|||||||||||||
CHANGES DURING THE NINE MONTHS ENDED SEPTEMBER 30, 2019 (unaudited):
|
||||||||||||||||||||||||||||
Comprehensive income
|
-
|
-
|
-
|
240
|
-
|
343
|
583
|
|||||||||||||||||||||
Share based compensation income
|
-
|
-
|
(9
|
)
|
-
|
-
|
-
|
(9
|
)
|
|||||||||||||||||||
BALANCE AT SEPTEMBER 30, 2019 (unaudited)
|
9,149,169
|
$
|
2,809
|
$
|
65,526
|
$
|
34
|
$
|
(2,088
|
)
|
$
|
18,587
|
$
|
84,868
|
||||||||||||||
Share capital
|
Accumulated
|
|||||||||||||||||||||||||||
Number of shares issued
|
Amount
|
Additional paid-in capital
|
other comprehensive income (loss)
|
Treasury shares
|
Retained earnings
|
Total equity
|
||||||||||||||||||||||
BALANCE AT JULY 1, 2019 (unaudited)
|
9,149,169
|
$
|
2,809
|
$
|
65,490
|
$
|
66
|
$
|
(2,088
|
)
|
$
|
18,430
|
$
|
84,707
|
||||||||||||||
CHANGES DURING THE THREE MONTHS ENDED SEPTEMBER 30, 2019 (unaudited):
|
||||||||||||||||||||||||||||
Comprehensive income
|
-
|
-
|
-
|
(32
|
)
|
-
|
157
|
125
|
||||||||||||||||||||
Share based compensation income
|
-
|
-
|
36
|
-
|
-
|
-
|
36
|
|||||||||||||||||||||
BALANCE AT SEPTEMBER 30, 2019 (unaudited)
|
9,149,169
|
$
|
2,809
|
$
|
65,526
|
$
|
34
|
$
|
(2,088
|
)
|
$
|
18,587
|
$
|
84,868
|
Three months ended
|
Nine months ended
|
Year ended
|
||||||||||||||||||
September 30,
|
December 31,
|
|||||||||||||||||||
2019
|
2018
|
2019
|
2018
|
2018
|
||||||||||||||||
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
||||||||||||||||||||
Net income (loss)
|
$
|
157
|
$
|
(544
|
)
|
$
|
343
|
$
|
(2,662
|
)
|
$
|
(4,408
|
)
|
|||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
||||||||||||||||||||
Depreciation and amortization
|
1,097
|
1,048
|
3,245
|
422
|
4,185
|
|||||||||||||||
Loss (gain) from change in fair value of derivatives
|
(38
|
)
|
35
|
(293
|
)
|
(347
|
)
|
382
|
||||||||||||
Provision for doubtful accounts
|
-
|
(474
|
)
|
-
|
102
|
(347
|
)
|
|||||||||||||
Share in results of equity investment of affiliated Company
|
65
|
42
|
139
|
165
|
140
|
|||||||||||||||
Share based compensation
|
36
|
46
|
(9
|
)
|
422
|
272
|
||||||||||||||
Non cash finance expense
|
107
|
-
|
324
|
-
|
-
|
|||||||||||||||
Liability in respect of employee rights upon retirement
|
(134
|
)
|
16
|
(912
|
)
|
(287
|
)
|
(587
|
)
|
|||||||||||
Deferred income taxes, net
|
(115
|
)
|
181
|
(293
|
)
|
126
|
(102
|
)
|
||||||||||||
Changes in operating assets and liabilities:
|
||||||||||||||||||||
Decrease (increase) in trade accounts receivable
|
1,965
|
2,015
|
(1,238
|
)
|
5,036
|
6,814
|
||||||||||||||
Decrease (increase) in other current assets and prepaid expenses
|
487
|
172
|
1,743
|
(576
|
)
|
(1,575
|
)
|
|||||||||||||
Decrease (increase) in inventory
|
(1,043
|
)
|
(569
|
)
|
(3,165
|
)
|
(481
|
)
|
161
|
|||||||||||
Increase (decrease) in trade accounts payable
|
56
|
1,042
|
2,590
|
10
|
(969
|
)
|
||||||||||||||
Increase (decrease) in accrued expenses
|
1,193
|
151
|
1,535
|
(1,741
|
)
|
(1,920
|
)
|
|||||||||||||
Increase (decrease) in other long-term liabilities
|
(20
|
)
|
(25
|
)
|
(98
|
)
|
54
|
34
|
||||||||||||
Net cash provided by operating activities
|
$
|
3,813
|
$
|
3,136
|
$
|
3,911
|
$
|
2,906
|
$
|
2,080
|
||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
||||||||||||||||||||
Investment in affiliated company
|
-
|
-
|
(10
|
)
|
-
|
(26
|
)
|
|||||||||||||
Funds in respect of employee rights upon retirement
|
-
|
-
|
(22
|
)
|
(22
|
)
|
(22
|
)
|
||||||||||||
Proceeds from sale of property and equipment
|
-
|
-
|
-
|
7
|
7
|
|||||||||||||||
Purchase of property and equipment
|
(1,287
|
)
|
(1,177
|
)
|
(3,014
|
)
|
(3,362
|
)
|
(4,270
|
)
|
||||||||||
Maturities of short-term deposits
|
-
|
-
|
470
|
|||||||||||||||||
Cash flows used in investing activities
|
$
|
(1,287
|
)
|
$
|
(1,177
|
)
|
$
|
(3,046
|
)
|
$
|
(3,377
|
)
|
$
|
(3,841
|
)
|
|||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
||||||||||||||||||||
Exercise of options
|
-
|
95
|
-
|
197
|
197
|
|||||||||||||||
Cash flows provided by financing activities
|
$
|
-
|
$
|
95
|
$
|
-
|
$
|
197
|
$
|
197
|
||||||||||
Net increase (decrease) in cash and cash equivalents
|
2,525
|
2,054
|
865
|
(274
|
)
|
(1,564
|
)
|
|||||||||||||
Cash and cash equivalents at beginning of period
|
14,290
|
15,186
|
15,950
|
17,514
|
17,514
|
|||||||||||||||
Cash and cash equivalents at end of period
|
$
|
16,815
|
$
|
17,240
|
$
|
16,815
|
$
|
17,240
|
$
|
15,950
|
Three months ended
|
Nine months ended
|
Year ended
|
||||||||||||||||||
September 30,
|
September 30,
|
December 31,
|
||||||||||||||||||
2019
|
2018
|
2019
|
2018
|
2018
|
||||||||||||||||
Net income (loss)
|
$
|
157
|
$
|
(544
|
)
|
$
|
343
|
$
|
(2,662
|
)
|
$
|
(4,408
|
)
|
|||||||
Adjustments:
|
||||||||||||||||||||
Share in results of equity investment of affiliated companies
|
65
|
42
|
139
|
102
|
140
|
|||||||||||||||
Taxes on income (tax benefit)
|
453
|
356
|
419
|
326
|
(1,464
|
)
|
||||||||||||||
Financial expenses, net
|
159
|
58
|
543
|
39
|
102
|
|||||||||||||||
Depreciation and amortization
|
1,145
|
1,048
|
3,341
|
3,085
|
4,185
|
|||||||||||||||
Share based compensation
|
36
|
46
|
(9
|
)
|
165
|
272
|
||||||||||||||
Adjusted EBITDA
|
$
|
2,015
|
$
|
1,006
|
$
|
4,776
|
$
|
1,055
|
$
|
(1,173
|
)
|
In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which requires lessees to recognize leases on-balance sheet and disclose key information about leasing arrangements. The
new standard establishes a right-of-use (ROU) model that requires a lessee to recognize a ROU assets and lease liabilities on the balance sheet. Leases will be classified as finance or operating, with classification affecting the pattern and
classification of expense recognition in the statement of operations. The Company adopted the new standard on January 1, 2019 using the modified retrospective transition method and did not restate comparative periods. The new standard
provides a number of optional practical expedients in transition. The Company recognizes the lease expenses in the consolidated statements of Operations on a straight-line basis over the lease period.
|
|
TAT TECHNOLOGIES LTD.
(Registrant)
By: /s/ Ehud Ben-Yair
Ehud Ben-Yair
Chief Financial Officer
|