6-K 1 zk2025149.htm 6-K

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549


F O R M 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of November 2020

TAT TECHNOLOGIES LTD.
(Name of Registrant)

      P.O.BOX 80, Gedera 70750 Israel
(Address of Principal Executive Office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F ☒          Form 40-F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes ☐           No ☒

If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- ____________

TAT Technologies Ltd.

6-K Items

1.
Press Release dated November 12, 2020 re TAT Technologies Ltd. Reports Third Quarter 2020 Results.

2
ITEM 1

Press Release
Source: TAT Technologies Limited

TAT Technologies Reports Third Quarter 2020 Results

GEDERA, Israel, November 12, 2020 - TAT Technologies Ltd. (NASDAQ: TATT - News) (“TAT” or the “Company”), a leading provider of products and services to the commercial and military aerospace and ground defense industries, reported today its unaudited results for the three month and nine month periods ended September 30, 2020.

Key Financial Highlights:

•
Revenues for Q3 2020 were $16.8 million compared with $24.8 million in Q3 2019.  Revenues for the nine-month period that ended on September 30, 2020 were $58.8 million compared with $71.7 million in the nine-month period that ended on September 30, 2019.

•
Gross profit for Q3 2020 was $1.4 million (8.3% as a percentage of revenues) compared with $4.1 million (16.8% as a percentage of revenues) in Q3 2019.  Gross profit for the nine-month period that ended on September 30, 2020 was $7.5 million (12.7% as a percentage of revenues) compared with $11 million (15.3% as a percentage of revenues) in the nine-month period that ended on September 30, 2019.
 
•
Adjusted EBITDA for Q3 2020 was (0.3) million compared with $2.2 million in Q3 2019. Adjusted EBITDA for the nine-month period that ended on September30, 2020 was $2.2 million compared with $5.3 million in the nine-month period that ended on September 30, 2019.
 
•
Net loss was ($1.6) million, or loss of ($0.16) per diluted share in Q3 2020 compared with a net income of $0.15 million, or $0.02 per diluted share in Q3 2019. Net loss was ($3.4) million, or loss of ($0.37) per diluted share in the nine-month period that ended on September 30, 2020 compared with a net income of $0.3 million, or $0.04 per diluted share in the nine-month period that ended on September 30, 2019.
 
•
During Q3 2020 and the nine-month period that ended on September 30, 2020 TAT reported losses from discontinued operation of the JT8D engine blades coating in the amount of $0.1 million and $1.8 million, respectively.
 
Mr. Igal Zamir, CEO and President of TAT Technologies stated, “TAT reacted fast and effectively to the COVID 19 impact on the aerospace industry. In Q2 and Q3 of 2020 we adjusted the company’s cost structure to the reduction in revenues during such period. We will continue to proactively monitor our cost structure and cash flow as the industry continues to manage the pandemic and its impact. Our strong balance sheet with net cash of over $19 million provides us the flexibility to serve our customers and in the same time maintain business development activities.

 We are pleased that despite the pandemic, the company was able to continue its sales, marketing, and business development efforts with meaningful results. During the third quarter of 2020 we signed a 10- year contract with Honeywell for the repair of APU 331-2xx. This contract represents a substantial opportunity to increase our APU business. In order to support its execution, we will invest in machines and rotatable parts in the coming quarters to better support our clients.

In addition, we are proud that during the last six months we executed new, and renewed existing long-term agreements with MRO and OEM customers with potential aggregate revenues of $38 million for the coming years”

3
Non-GAAP Financial Measures

To supplement the consolidated financial statements presented in accordance with GAAP, the Company also presents Adjusted EBITDA.  The adjustments to the Company’s GAAP results are made with the intent of providing both management and investors a more complete understanding of the Company’s underlying operational results, trends and performance. Adjusted EBITDA is calculated as net income excluding the impact of: the Company's share in results of affiliated companies, share-based compensation, taxes on income, discontinued operation, financial (expenses) income, net, depreciation and amortization. Adjusted EBITDA, however, should not be considered as alternative to net income and operating income for the period and may not be indicative of the historic operating results of the Company; nor it is meant to be predictive of potential future results. Adjusted EBITDA is not measure of financial performance under generally accepted accounting principles and may not be comparable to other similarly titled measures for other companies. See reconciliation of Adjusted EBITDA in pages 13 below.

About TAT Technologies LTD
 
TAT Technologies Ltd. is a leading provider of services and products to the commercial and military aerospace and ground defense industries. TAT operates under four segments: (i) Original equipment manufacturing (“OEM”) of heat transfer solutions and aviation accessories through its Gedera facility; (ii) MRO services for heat transfer components and OEM of heat transfer solutions through its Limco subsidiary; (iii) MRO services for aviation components through its Piedmont subsidiary; and (iv) Overhaul and coating of jet engine components through its Turbochrome subsidiary. TAT controlling shareholders is the FIMI Private Equity Fund.

TAT’s activities in the area of OEM of heat transfer solutions and aviation accessories primarily include the design, development and manufacture of (i) broad range of heat transfer solutions, such as pre-coolers heat exchangers and oil/fuel hydraulic heat exchangers, used in mechanical and electronic systems on board commercial, military and business aircraft; (ii) environmental control and power electronics cooling systems installed on board aircraft in and ground applications; and (iii) a variety of other mechanical aircraft accessories and systems such as pumps, valves, and turbine power units.

TAT’s activities in the area of MRO Services for heat transfer components and OEM of heat transfer solutions primarily include the MRO of heat transfer components and to a lesser extent, the manufacturing of certain heat transfer solutions. TAT’s Limco subsidiary operates an FAA-certified repair station, which provides heat transfer MRO services for airlines, air cargo carriers, maintenance service centers and the military.

TAT’s activities in the area of MRO services for aviation components include the MRO of APUs, landing gears and other aircraft components. TAT’s Piedmont subsidiary operates an FAA-certified repair station, which provides aircraft component MRO services for airlines, air cargo carriers, maintenance service centers and the military.

TAT’s activities in the area of overhaul and coating of jet engine components includes the overhaul and coating of jet engine components, including turbine vanes and blades, fan blades, variable inlet guide vanes and afterburner flaps.

4
For more information of TAT Technologies Ltd., please visit our web-site:
www.tat-technologies.com

Contact:
Mr. Ehud Ben-Yair
Chief Financial Officer
Tel: 972-8-862-8503
ehudb@tat-technologies.com

Safe Harbor for Forward-Looking Statements

This press release contains forward-looking statements which include, without limitation, statements regarding possible or assumed future operation results. These statements are hereby identified as "forward-looking statements" for purposes of the safe harbor provided by the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties that could cause our results to differ materially from management's current expectations. Actual results and performance can also be influenced by other risks that we face in running our operations including, but are not limited to, general business conditions in the airline industry, changes in demand for our services and products, the timing and amount or cancellation of orders, the price and continuity of supply of component parts used in our operations, the change of control that will occur on the sale by the receiver of the Company’s shares held by our previously controlling stockholders, and other risks detailed from time to time in the Company's filings with the Securities Exchange Commission, including, its annual report on form 20-F and its periodic reports on form 6-K. These documents contain and identify other important factors that could cause actual results to differ materially from those contained in our projections or forward-looking statements. Stockholders and other readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. We undertake no obligation to update publicly or revise any forward-looking statement.

5
TAT TECHNOLOGIES AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEET
(In thousands)

 
September 30,
    
December 31,
  
   
2020
      
2019 (*)

   
(unaudited)
    
(audited)
  
ASSETS
              
CURRENT ASSETS:
              
Cash and cash equivalents
  
$
24,106
    
$
15,959
  
Accounts receivable, net
    
13,657
      
20,311
  
Other current assets and prepaid expenses
    
3,449
      
2,605
  
Inventory, net
    
40,100
      
43,327
  
Assets belong to discontinued operation
    
-
      
1,839
  
                 
Total current assets
    
81,312
      
84,041
  
                 
 NON-CURRENT ASSETS:                
   Restricted deposit
    
165
      
-
  
 Investment in affiliates
    
777
      
956
  
Funds in respect of employee rights upon retirement
    
1,164
      
1,404
  
 Deferred income taxes
    
-
      
228
  
Intangible assets, net
    
1,604
      
777
  
Property, plant and equipment, net
    
19,884
      
20,605
  
Operating lease right of use assets
    
7,320
      
6,664
  
                 
Total non-current assets
    
30,914
      
30,634
  
                 
Total assets
  
$
112,226
    
$
114,675
  
                 
LIABILITIES AND EQUITY
                
                 
CURRENT LIABILITIES:
                
Accounts payable
    
8,118
      
11,823
  
Accrued expenses
    
6,313
      
7,393
  
Deferred income (government grant)
    
265
      
-
  
Operating lease liabilities
    
1,635
      
1,330
  
Liabilities belong to discontinued operation
    
260
      
158
  
                 
Total current liabilities
    
16,591
      
20,704
  
                 
NON CURRENT LIABILITIES:
                
   Long-term loans
    
4,841
      
-
  
   Other long-term liabilities
    
-
      
62
  
Liability in respect of employee rights upon retirement
    
1,451
      
1,751
  
Deferred income taxes
    
1,256
      
1,100
  
Operating lease liabilities
    
5,990
      
5,688
  
                 
 Total non-current liabilities
    
13,538
      
8,601
  
                 
Total liabilities
  
$
30,129
    
$
29,305
  
                 
EQUITY:
                
Share capital
    
2,809
      
2,809
  
Additional paid-in capital
    
65,683
      
65,573
  
Treasury stock at cost
    
(2,088
)
    
(2,088
)
Accumulated other comprehensive income
    
19
      
26
  
Retained earnings
    
15,674
      
19,050
  
Total shareholders' equity
    
82,097
      
85,370
  
                 
Total liabilities and shareholders' equity
  
$
112,226
    
$
114,675
  

*Reclassified due to discontinued operation

6

•       TAT TECHNOLOGIES AND ITS SUBSIDIARIES
 
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except share and per share data)

   
Three months ended
    
Nine months ended
    
Year ended
  
   
September 30,
    
December 31,
  
   
2020
      
2019(*)

   
2020
      
2019(*)

   
2019(*)

   
(Unaudited)
    
(Unaudited)
    
(Unaudited)
    
(Unaudited)
    
(Audited)
  
                                       
Revenues:
                                      
Products
  
$
4,822
    
$
5,725
    
$
18,157
    
$
17,924
    
$
25,019
  
Services
    
11,995
      
19,059
      
40,667
      
53,770
      
72,460
  
     
16,817
      
24,784
      
58,824
      
71,694
      
97,479
  
                                         
Cost of goods:
                                        
Products
    
4,383
      
4,853
      
16,156
      
15,037
      
21,557
  
Services
    
11,036
      
15,757
      
35,179
      
45,668
      
60,622
  
     
15,419
      
20,610
      
51,335
      
60,705
      
82,179
  
Gross Profit
    
1,398
      
4,174
      
7,489
      
10,989
      
15,300
  
                                         
Operating expenses:
                                        
Research and development, net
    
62
      
39
      
131
      
96
      
113
  
Selling and marketing
    
920
      
1,225
      
2,986
      
3,549
      
4,929
  
General and administrative
    
1,813
      
1,860
      
5,542
      
5,362
      
7,654
  
     
2,795
      
3,124
      
8,659
      
9,007
      
12,696
  
Operating income (loss)
    
(1,397
)
    
1,050
      
(1,170
)
    
1,982
      
2,604
  
                                         
Financial expenses, net
    
(177
)
    
(144
)
    
(248
)
    
(517
)
    
(422
)
Other expenses
    
-
      
-
      
(21
)
    
-
      
-
  
                                         
Income (loss) before taxes on income (tax benefit)
    
(1,574
)
    
906
      
(1,439
)
    
1,465
      
2,182
  
                                         
Taxes on income (tax benefit)
    
(180
)
    
469
      
(48
)
    
464
      
631
  
                                         
Income (loss) before equity investment
    
(1,394
)
    
437
      
(1,391
)
    
1,001
      
1,551
  
                                         
Share in results of affiliated companies
    
(62
)
    
(65
)
    
(179
)
    
(139
)
    
(132
)
                                         
Net income (loss) from continued operation
  
$
(1,456
)
  
$
372
    
$
(1,570
)
  
$
862
    
$
1,419
  
                                         
Loss from discontinued operation before income taxes
    
(60
)
    
(230
)
    
(391
)
    
(564
)
    
(655
)
Loss on disposal of discontinued operation before income taxes
    
(60
)
    
-
      
(1,415
)
    
-
      
-
  
Benefit from income taxes
    
-
      
15
      
-
      
45
      
42
  
Net loss from discontinued operation
  
$
(120
)
  
$
(215
)
  
$
(1,806
)
    
(519
)
  
$
(613
)
                                         
Net income (loss)
  
$
(1,576
)
  
$
157
    
$
(3,376
)
  
$
343
    
$
806
  

                                       
Basic and diluted income (loss) per share
                                        
                                         
Net income (loss) per share from continued operation
  
$
(0.16
)
  
$
0.04
    
$
(0.17
)
  
$
0.1
    
$
0.18
  
Net loss per share from discontinued operation
  
$
0
    
$
(0.02
)
  
$
(0.2
)
  
$
(0.06
)
  
$
(0.07
)
Net income (loss) per share
  
$
(0.16
)
  
$
0.02
    
$
(0.37
)
  
$
0.04
    
$
0.11
  
                                         
Weighted average number of shares outstanding
                                        
Basic
    
8,874,696
      
8,874,696
      
8,874,696
      
8,874,696
      
8,864,885
  
Diluted
    
8,874,696
      
8,874,696
      
8,874,696
      
8,874,696
      
8,864,885
  

*Reclassified due to discontinued operation

7
TAT TECHNOLOGIES AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands)

   
Three months ended
    
Nine months ended
    
Year ended
  
   
September 30,
    
December 31,
  
   
2020
    
2019
    
2020
    
2019
    
2019
  
   
(Unaudited)
    
(Unaudited)
    
(Unaudited)
    
(Unaudited)
    
(Audited)
  
                               
Net income (loss)
  
$
(1,576
)
  
$
157
    
$
(3,376
)
  
$
343
    
$
806
  
Other comprehensive income
                                        
Net unrealized income (loss) from derivatives
    
(33
)
    
72
      
(7
)
    
358
      
372
  
Reclassification adjustments for gains (losses) included in net income and inventory
    
-
      
(104
)
    
5
      
(118
)
    
(140
)
       Total other comprehensive income (loss)
  
$
(1,609
)
  
$
125
    
$
(3,378
)
  
$
583
    
$
1,038
  
8

TAT TECHNOLOGIES AND ITS SUBSIDIARIES
 
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(In thousands, except share data)

   
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, 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 income
    
-
      
-
      
-
      
(341
)
    
-
      
(4,408
)
    
(4,749
)
Share based compensation expenses
    
-
      
-
      
272
      
-
      
-
      
-
      
272
  
 Exercise of option
    
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
  
CHANGES DURING THE YEAR ENDED DECEMBER 31, 2019 (audited):
                                                        
Comprehensive loss
    
-
      
-
      
-
      
232
      
-
      
806
      
1038
  
 Share based compensation expenses
    
-
      
-
      
38
      
-
      
-
      
-
      
38
  
BALANCE AT DECEMBER 31, 2019 (audited)
    
9,149,169
    
$
2,809
    
$
65,573
    
$
26
    
$
(2,088
)
  
$
19,050
    
$
85,370
  
CHANGES DURING THE NINE MONTHS ENDED SEPTEMBER 30, 2020 (unaudited):
                                                        
Comprehensive (loss)
    
-
      
-
      
-
      
(7
)
    
-
      
(3,376
)
    
(3,383
)
 Share based compensation expenses
    
-
      
-
      
110
      
-
      
-
      
-
      
110
  
BALANCE AT SEPTEMBER 30, 2020 (unaudited)
    
9,149,169
    
$
2,809
    
$
65,683
    
$
19
    
$
(2,088
)
  
$
15,674
    
$
82,097
  

9
TAT TECHNOLOGIES AND ITS SUBSIDIARIES
 
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

   
Three months ended
    
Nine months ended
    
Year ended
  
   
September 30,
    
December 31,
  
   
2020
      
2019(*)

   
2020
      
2019(*)

   
2019(*)

   
(Unaudited)
    
(Unaudited)
    
(Unaudited)
    
(Unaudited)
    
(Audited)
  
CASH FLOWS FROM OPERATING ACTIVITIES:
                                      
Net income (loss)
  
$
(1,576
)
  
$
157
    
$
(3,376
)
  
$
343
    
$
806
  
Net income (loss) from continued operations
    
(1,456
)
    
372
      
(1,570
)
    
862
      
1,419
  
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
                                        
                                         
Depreciation and amortization
    
1,079
      
1,077
      
3,107
      
3,185
      
4,292
  
Loss (gain) from change in fair value of derivatives
    
(14
)
    
(38
)
    
7
      
(293
)
    
(311
)
Provision for doubtful accounts
    
(73
)
    
-
      
133
      
-
      
38
  
Share in results of equity investment of affiliated Company
    
62
      
65
      
179
      
139
      
132
  
Share based compensation
    
33
      
36
      
110
      
(9
)
    
38
  
Non cash finance expense
    
57
      
107
      
(48
)
    
324
      
354
  
Liability in respect of employee rights upon retirement
    
(159
)
    
(134
)
    
(300
)
    
(912
)
    
(897
)
Deferred income taxes, net
    
441
      
(115
)
    
384
      
(293
)
    
(450
)
Deferred revenues (government grant)
    
(794
)
    
-
      
265
      
-
      
-
  
Changes in operating assets and liabilities:
                                        
Decrease (increase) in trade accounts receivable
    
787
      
1,714
      
7,027
      
(1,510
)
    
(2,037
)
Decrease (increase) in other current assets and prepaid expenses
    
(729
)
    
486
      
(605
)
    
1,743
      
2,500
  
Decrease (increase) in inventory
    
1,674
      
(1,314
)
    
3,039
      
(3,531
)
    
(5,740
)
Increase (decrease) in trade accounts payable
    
307
      
82
      
(2,913
)
    
2,722
      
3,349
  
Increase (decrease) in accrued expenses
    
(995
)
    
1,193
      
(1,080
)
    
1,535
      
982
  
Decrease in other long-term liabilities
    
-
      
(20
)
    
(62
)
    
(98
)
    
(118
)
Net cash provided by operating activities
  
$
220
    
$
3,511
    
$
7,673
    
$
3,864
    
$
3,551
  
CASH FLOWS FROM INVESTING ACTIVITIES:
                                        
Investment in affiliated company
    
-
      
-
      
-
      
(10
)
    
(10
)
Funds in respect of employee rights upon retirement
    
-
      
-
      
-
      
(22
)
    
-
  
Proceeds from sale of property and equipment
    
-
      
-
      
(22
)
    
-
      
-
  
Increase in long-term deposits
    
(2
)
            
(165
)
    
-
      
-
  
Purchase of property and equipment
    
(1,253
)
    
(1,287
)
    
(3,012
)
    
(2,980
)
    
(3,269
)
Purchase of intangible assets
    
(950
)
            
(950
)
                
Cash flows used in investing activities
  
$
(2,205
)
  
$
(1,287
)
  
$
(4,149
)
  
$
(3,012
)
  
$
(3,279
)
CASH FLOWS FROM FINANCING ACTIVITIES:
                                        
  Proceeds from long-term loans received
    
-
      
-
      
4,841
      
-
      
-
  
Cash flows provided by financing activities
  
$
-
    
$
-
    
$
4,841
    
$
-
    
$
-
  
                                         
Cash flows from discontinued operations:
                                        
Net loss from discontinued operation
  
$
(120
)
  
$
(215
)
  
$
(1,806
)
    
(519
)
  
$
(613
)
Net cash provided by operating activities
    
175
      
516
      
1,588
      
566
      
484
  
Net cash used in investing activities
    
-
      
-
              
(34
)
    
(134
)
Net cash used in discontinued operations
  
$
55
    
$
301
    
$
(218
)
    
13
    
$
(263
)
                                         
Net increase (decrease) in cash and cash equivalents
    
(1,930
)
    
2,525
      
8,147
      
865
      
9
  
Cash and cash equivalents at beginning of period
    
26,036
      
14,290
      
15,959
      
15,950
      
15,950
  
Cash and cash equivalents at end of period
  
$
24,106
    
$
16,815
    
$
24,106
    
$
16,815
    
$
15,959
  

*Reclassified due to discontinued operation

10
TAT TECHNOLOGIES AND ITS SUBSIDIARIES
 
 RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA (NON-GAAP) (UNAUDITED)
(In thousands)

   
Three months ended
    
Nine months ended
    
Year ended
  
   
September 30,
    
September 30,
    
December 31,
  
   
2020
      
2019(*)

   
2020
      
2019(*)

   
2019(*)

                                       
Net income (loss)
  
$
(1,576
)
  
$
157
    
$
(3,376
)
  
$
343
    
$
806
  
Adjustments:
                                        
Share in results of equity investment of affiliated companies
    
62
      
65
      
179
      
139
      
132
  
Taxes on income (tax benefit)
    
(180
)
    
469
      
(48
)
    
464
      
631
  
Financial expenses, net
    
177
      
144
      
250
      
517
      
422
  
Other expenses
    
-
      
-
      
21
      
-
      
-
  
Depreciation and amortization
    
1,060
      
1,144
      
3,250
      
3,322
      
4,394
  
                                         
Net loss from discontinued operations
    
120
      
215
      
1,806
      
519
      
613
  
Share based compensation
    
33
      
36
      
110
      
(9
)
    
38
  
Adjusted EBITDA
  
$
(304
)
  
$
2,230
    
$
2,192
    
$
5,295
    
$
7,036
  

*Reclassified due to discontinued operation

11
SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 
TAT TECHNOLOGIES LTD.
  
   
(Registrant)
  
       

By:
/s/ Ehud Ben-Yair  
    Ehud Ben-Yair  
    Chief Financial Officer  

Date: November 12, 2020

12