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Eltek Reports 2020 Third Quarter Financial Results
[November 18, 2020]

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.

 

Eltek Logo

 

 

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)











 

Three months ended


Nine 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
used to compute basic net profit per ordinary
share (in thousands)

4,380


4,380


4,380


3,519


 

 

 

 

 

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
shares, issued and outstanding 4,380,268


3,964


3,964

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


 

Three months ended


Nine 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












 

Cision View original content:http://www.prnewswire.com/news-releases/eltek-reports-2020-third-quarter-financial-results-301175887.html

SOURCE Eltek Ltd.


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