PETACH-TIKVA, Israel,
April 17, 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 fourth
quarter and full year ended December
31, 2018.
Mr. Eli Yaffe, Chief
Executive Officer, commented:
"As recently announced, we established a new leadership team to
implement our turnaround plan. We identified the products that were
underpriced and declined such orders in order to increase
profitability, which resulted in a reduced loss in 2018. During the
fourth quarter this resulted in an initial reduction in sales
volume, but we believe that this will improve our on-time delivery
performance, increase customer satisfaction and build additional
sales that will return us to profitability."
In March 2019, the Company issued
at no charge to the holders of our ordinary shares subscription
rights to purchase up to an aggregate of 3,380,920 shares, such
that each shareholder received five subscription rights for every
three ordinary shares owned on the record date, at a price of
$1.464 per share. Our shareholders
purchased 2,351,701 ordinary shares, for an aggregate of
$3.4 million. The proceeds from the
offering are strengthening our working capital and will be used to
reduce our line of credit, as well as for general corporate
purposes, including the possible investment in plant and
equipment.
"I see significant potential for Eltek in the high-end PCB
market with our skilled engineers and experienced management. I am
optimistic that we will be able to capitalize on our strengths,
return the Company to profitability and renew our position as a
leading high-end PCB manufacturer," Mr. Yaffe concluded.
Highlights of the Full Year of 2018 compared to the Full Year
of 2017
- Revenues for the full year of 2018 amounted to
$33.9 million compared to revenues of
$32.8 million in
2017.
- Gross profit was $2.6
million (7.7% of revenues) in 2018 compared to gross profit
of $1.3 million (4.1% of revenues) in
2017.
- Operating loss was $2.1
million in 2018 compared to an operating loss of
$3.4 million in 2017.
- Net loss was $2.6
million or $1.28 per fully
diluted share in 2018, compared to a net loss of $3.8 million or $1.86 per fully diluted share in 2017.
- EBITDA was a negative $421,000 in 2018 compared to a negative
$1.3 million in 2017.
- Net cash used in operating activities amounted to
$813,000 in 2018 compared to
$3.4 million used
in operating activities in 2017.
- Cash and cash equivalents as of December 31, 2018 were $992,000, compared to $887,000 as of December
31, 2017.
Highlights of the Fourth Quarter of 2018 compared to the
Fourth Quarter of 2017
- Revenues for the fourth quarter of 2018 were
$7.8 million compared to revenues of
$9.1 million in the fourth quarter of
2017.
- Gross profit was $603,000 (7.7% of revenues) in the fourth quarter
of 2018 compared to a loss of $740,000 (8.1% of revenues) in the fourth quarter
of 2017.
- Operating loss was $416,000 in the fourth quarter of 2018 compared
to an operating loss of $568,000 in
the fourth quarter of 2017.
- Net loss was $631,000
or $0.31 per fully diluted share in
the fourth quarter of 2018 compared to a net loss of $669,000 or $0.33
per fully diluted share in the fourth quarter of 2017.
- EBITDA was a negative $43,000 in the fourth quarter of 2018 compared to
a negative $131,000 in the
fourth quarter of 2017.
- Net cash provided from operating activities amounted to
$136,000 in the fourth quarter of
2018 compared to $775,000 of cash used in operating activities
in the fourth quarter of 2017.
Nasdaq Continued Listing Status
On October 2, 2018, we received
notification from Nasdaq advising us that as of October 1, 2018, we did not maintain
stockholders' equity of $2.5 million,
nor did we meet the alternatives of market value of listed
securities or net income from continuing operations, and therefore
were not in compliance with the stockholders' equity listing rule.
On December 7, 2018, we received a
notice from Nasdaq advising that we had been granted an extension
of time until March 31, 2019 to
regain compliance with the stockholders' equity requirement. As a
result of the receipt of approximately $2.5
million prior to March 31,
2019 from the recently completed rights offering, we
regained compliance with Listing Rule 5550(b)(1) and our shares
continue to be listed on the NASDAQ Capital Market. Nasdaq has
advised us that it will continue to monitor our ongoing compliance
with the shareholders' equity requirement and, if at the time of
our next periodic report we do not evidence compliance, we may be
subject to delisting.
Conference Call:
Today, Wednesday, April 17, 2019,
at 8:30 a.m. Eastern Time, Eltek will
conduct a conference call to discuss the results. The call will
feature remarks by Mr. Eli Yaffe,
Chief Executive Officer and Mr. 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
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 has ITAR, AS-9100 and NADCAP Electronics
permits and its customers include top of the line 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, and
R&D, production and marketing center is located in Israel. Eltek operates also through its
subsidiaries in North America and
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.
Safe Harbor for Forward Looking Statements:
This press release contains express or implied forward-looking
statements within the Private Securities Litigation Reform Act of
1995 and other U.S Federal securities laws, 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 in subsequent filings with the United States
Securities and Exchange Commission. Except as otherwise required by
law, Eltek is under no obligation to (and expressly disclaims any
such obligation to) update or alter its forward-looking statements
whether as a result of new information, future events or
otherwise.
|
Eltek
Ltd.
|
|
Consolidated
Statements of Operations
|
|
(In thousands US$,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Twelve months
ended
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
2018
|
2017
|
|
2018
|
|
2017
|
|
|
|
|
|
|
|
|
Revenues
|
|
7,827
|
9,091
|
|
33,939
|
|
32,754
|
|
|
Costs of
revenues
|
|
(7,224)
|
(8,352)
|
|
(31,342)
|
|
(31,427)
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
603
|
740
|
|
2,597
|
|
1,327
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
|
(1,022)
|
(1,305)
|
|
(4,669)
|
|
(4,704)
|
|
|
|
|
|
|
|
|
|
|
|
R&D expenses,
net
|
|
3
|
(3)
|
|
-
|
|
(41)
|
|
|
|
|
|
|
|
|
|
|
|
Operating
loss
|
|
(416)
|
(568)
|
|
(2,072)
|
|
(3,418)
|
|
|
|
|
|
|
|
|
|
|
|
Financial expenses,
net
|
|
(211)
|
(77)
|
|
(475)
|
|
(298)
|
|
|
Other income,
net
|
|
3
|
-
|
|
3
|
|
16
|
|
|
|
|
|
|
|
|
|
|
|
Loss before income
tax
|
|
(623)
|
(645)
|
|
(2,544)
|
|
(3,700)
|
|
|
|
|
|
|
|
|
|
|
|
Tax
expenses
|
|
(7)
|
(24)
|
|
(63)
|
|
(74)
|
|
|
|
|
|
|
|
|
|
|
|
Net
Loss
|
|
(631)
|
(669)
|
|
(2,607)
|
|
(3,775)
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net
loss per ordinary share
|
|
(0.31)
|
(0.33)
|
|
(1.28)
|
|
(1.86)
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of ordinary shares
|
|
|
|
|
|
|
|
|
|
used to compute basic
and diluted net loss per
|
|
|
|
|
|
|
|
|
|
ordinary share (in
thousands)
|
|
2,029
|
2,029
|
|
2,029
|
|
2,029
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eltek
Ltd.
|
|
|
|
|
|
|
Consolidated
Balance Sheets
|
|
|
|
|
|
|
(In thousands
US$)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of
December 31,
|
|
|
|
|
|
|
|
2018
|
2017
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
992
|
887
|
|
|
|
|
|
|
Receivables: Trade, net of provision for
doubtful accounts
|
|
5,682
|
6,963
|
|
|
|
|
|
|
Other
|
|
868
|
1,527
|
|
|
|
|
|
|
Inventories
|
|
3,611
|
3,871
|
|
|
|
|
|
|
Prepaid
expenses
|
|
292
|
254
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current
assets
|
|
11,445
|
13,502
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long term
assets
|
|
|
|
|
|
|
|
|
|
Severance pay
fund
|
|
53
|
57
|
|
|
|
|
|
|
Long term prepaid
expenses
|
|
39
|
-
|
|
|
|
|
|
|
Total long term
assets
|
|
92
|
57
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed assets, less
accumulated depreciation
|
|
6,623
|
8,586
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
18,160
|
22,145
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Shareholder's equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
|
|
|
Short-term credit and
current maturities of long-term debts
|
|
6,606
|
7,063
|
|
|
|
|
|
|
Short-term credit
from related party
|
|
2,668
|
1,442
|
|
|
|
|
|
|
Accounts payable:
Trade
|
|
4,108
|
5,451
|
|
|
|
|
|
|
Other
|
|
3,377
|
4,111
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current
liabilities
|
|
16,759
|
18,067
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term
liabilities
|
|
|
|
|
|
|
|
|
|
Long term debt,
excluding current maturities
|
|
308
|
388
|
|
|
|
|
|
|
Employee severance
benefits
|
|
211
|
231
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total long-term
liabilities
|
|
519
|
619
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
Ordinary shares, NIS
3.0 par value authorized 10,000,000
shares, issued and outstanding 2,028,552
|
|
1,985
|
1,985
|
|
|
|
|
|
|
Additional paid-in
capital
|
|
17,270
|
17,270
|
|
|
|
|
|
|
Cumulative foreign
currency translation adjustments
|
|
2,340
|
2,415
|
|
|
|
|
|
|
Capital
reserve
|
|
800
|
695
|
|
|
|
|
|
|
Accumulated
deficit
|
|
(21,513)
|
(18,906)
|
|
|
|
|
|
|
Shareholders'
equity
|
|
882
|
3,459
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
and shareholders' equity
|
|
18,160
|
22,145
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eltek
Ltd.
|
|
Unaudited Non-GAAP
EBITDA Reconciliations
|
|
(In thousands
US$)
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP EBITDA
Reconciliations
|
|
Three months
ended
|
|
Twelve months
ended
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
2018
|
2017
|
|
2018
|
|
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net Income
(loss)
|
|
(631)
|
(669)
|
|
(2,607)
|
|
(3,775)
|
|
|
Add back
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial expenses,
net
|
|
211
|
77
|
|
475
|
|
298
|
|
|
Income tax
expense
|
|
7
|
23
|
|
63
|
|
74
|
|
|
Depreciation and
amortization
|
|
370
|
438
|
|
1,649
|
|
2,058
|
|
|
Adjusted
EBITDA
|
|
(43)
|
(131)
|
|
(421)
|
|
(1,345)
|
|
|
Eltek
Ltd.
|
|
Consolidated
Statement of Cash flow
|
|
(In thousands
US$)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Twelve months
ended
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
2018
|
2017
|
|
2018
|
|
2017
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
(631)
|
(669)
|
|
(2,607)
|
|
(3,775)
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to
reconcile net loss to net
|
|
|
|
|
|
|
|
|
|
cash flows
provided by operating activities:
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
367
|
438
|
|
1,649
|
|
1,722
|
|
|
Capital lose on
disposal of fixed assets, net
|
|
101
|
-
|
|
101
|
|
(13)
|
|
|
Amortization of
Intabgible assets
|
|
-
|
-
|
|
-
|
|
348
|
|
|
Stock-based
compensation
|
|
56
|
-
|
|
56
|
|
-
|
|
|
Transaction with
controlling shareholder
|
|
49
|
-
|
|
49
|
|
-
|
|
|
Revaluation of long
term loans
|
|
6
|
13
|
|
29
|
|
17
|
|
|
|
579
|
451
|
|
1,884
|
|
2,075
|
|
|
|
|
|
|
|
|
|
|
|
Decrease (increase)
in trade receivables
|
|
1,264
|
(975)
|
|
790
|
|
(597)
|
|
|
Decrease (increase)
in other receivables and prepaid expenses
|
|
155
|
(447)
|
|
467
|
|
(1,249)
|
|
|
Decrease (increase)
in inventories
|
|
631
|
541
|
|
(30)
|
|
471
|
|
|
Increase (decrease)
in trade payables
|
|
(1,518)
|
69
|
|
(871)
|
|
(330)
|
|
|
Increase (decrease)
in other liabilities and accrued expenses
|
|
(309)
|
187
|
|
(443)
|
|
(107)
|
|
|
Increase (decrease)
in employee severance benefits, net
|
|
(35)
|
67
|
|
(3)
|
|
69
|
|
|
|
188
|
(558)
|
|
(90)
|
|
(1,743)
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided
by (used in) operating activities
|
|
136
|
(775)
|
|
(813)
|
|
(3,444)
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
|
Purchase of fixed
assets
|
|
(425)
|
(43)
|
|
(619)
|
|
(275)
|
|
|
Net cash used in
investing activities
|
|
(425)
|
(43)
|
|
(619)
|
|
(275)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
|
Short- term bank
credit, net
|
|
29
|
984
|
|
986
|
|
2,756
|
|
|
Short- term
shareholder loan
|
|
(40)
|
-
|
|
1,390
|
|
1,430
|
|
|
Repayment of
long-term loans from bank
|
|
(220)
|
(233)
|
|
(910)
|
|
(870)
|
|
|
Proceeds from
long-term loans
|
|
377
|
(36)
|
|
378
|
|
167
|
|
|
Repayment of credit
from fixed asset payables
|
|
(83)
|
(32)
|
|
(317)
|
|
(239)
|
|
|
Net cash provided
by (used in) financing activities
|
|
64
|
683
|
|
1,527
|
|
3,244
|
|
|
|
|
|
|
|
|
|
|
|
Effect of
translation adjustments
|
|
15
|
20
|
|
10
|
|
128
|
|
|
|
|
|
|
|
|
|
|
|
Net increase
(decrease) in cash and cash equivalents
|
|
(210)
|
(116)
|
|
105
|
|
(347)
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents at beginning of the period
|
|
1,202
|
1,003
|
|
887
|
|
1,234
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents at period end
|
|
992
|
887
|
|
992
|
|
887
|
|
|
|
|
|
|
|
|
|
|
Investor Contact:
Alon Mualem
Chief
Financial Officer
alonm@nisteceltek.com
+972-3-9395023
View original
content:http://www.prnewswire.com/news-releases/eltek-reports-fourth-quarter-and-full-year-2018-financial-results-300833720.html
SOURCE Eltek Ltd.