Eltek Reports Fourth Quarter and Full Year 2016 Financial Results

PETACH-TIKVA, Israel, March 27, 2017  /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, 2016.

Mr. Yitzhak Nissan, Chairman of the Board and Chief Executive Officer, commented: "Our fourth quarter revenues of $8.1 million were lower than the $10.4 million of  revenues we had in the fourth quarter of 2015. The decrease was primarily attributable to the lower number of working days in the fourth quarter as compared to last year's fourth quarter, due to the local holiday season and the continued competition in the local military market. Our bottom line was also affected by two one-time expenses. The first was a $1.1 million write-off of a deferred tax asset, due to uncertainty about our ability to utilize it in the foreseeable future. The second was a $271,000 expense associated with the sale of all of our shares in Kubatronik-Leiterplatten GmbH, our German subsidiary, which had drawn significant resources from us for several years. We believe that the sale of Kubatronik will assist us to focus on improving our future results.

Although competitive pressures remain strong, we have made positive progress in improving our on-time delivery and manufacturing yields. In addition, we continue to enhance our working relations with our defense customers by providing advanced technological solutions that meet their needs. Eltek is also restructuring its sales organization in order to increase the top line. We believe that these steps will prove fruitful for us and will contribute to achieving our goal of becoming a leading company in our field in terms of technology, on-time delivery and product quality," Mr. Nissan concluded.

Highlights of the Full Year of 2016 compared to the Full Year of 2015

• Revenues for the full year of 2016 amounted to $37.1 million; compared to revenues of $41.4 million in 2015, a decrease of approximately 10.4%.
• Gross profit was $2.8 million (7.6% of revenues), compared to gross profit of $6.6 million (15.8% of revenues) in 2015;
• Operating loss was $2 million compared to an operating profit of $1.5 million in 2015;
• Net loss was $3.6 million or $0.36 per fully diluted share, compared to net profit of 1.0 million or $0.10 per fully diluted share in 2015. Before the $1.1 million write-off of a deferred tax asset and the $271,000 one-time expenses recorded in connection with our sale of Kubatronik, the net loss for the full year of 2016 (on a non-GAAP basis) was $2.3 million, $0.23 per fully diluted share.
• EBITDA amounted to $(313,000) ((0.8%) of revenues) compared to $3.3 million (8.1% revenues) in 2015;
• Net cash provided by operating activities amounted to $165,000 compared to $1.7 million in 2015;
• Cash and cash equivalents as of December 31, 2016 were $1.2 million, compared to $1.0 million as of December 31, 2015. In addition, the Company had un-utilized lines of credit of $1.3 million as of December 31, 2016.

Highlights of the Fourth Quarter of 2016 compared to the Fourth Quarter of 2015

• Revenues for the fourth quarter of 2016 were $8.1 million compared with revenues of $10.4 million in the fourth quarter of 2015;
• Gross loss was $463,000 ((5.7%) of revenues) compared with a gross profit of $1.7 million (16.3% of revenues) in the fourth quarter of 2015;
• Operating loss was $1.6 million compared to an operating profit of $455,000 in the fourth quarter of 2015;
• Net loss was $3 million or $0.30 per fully diluted share compared to net profit of $228,000 or $0.02 per fully diluted share in the fourth quarter of 2015. The net loss for Q4-2016 (on a non-GAAP basis) was $1.7 million, $0.16 per fully diluted share before the one-time expenses recorded in the fourth quarter of 2016;
• EBITDA amounted to $(1.4) million ((17.2%) of revenues) compared to EBITDA of $940,000 (9% of revenues) in the fourth quarter of 2015;
• Net cash used in operating activities amounted to $1.3 million, compared to $1.4 million of cash provided by operating activities in the fourth quarter of 2015.

Conference Call

Today, Monday, March 27, 2017 at 9:30 a.m. Eastern Time, Eltek will conduct a conference call to discuss the results. The call will feature remarks by Mr. Yitzhak Nissan, Chairman of the Board of Directors and Chief Executive Officer, Mr. Roberto Tulman, Deputy CEO and Chief Technology Officer, and Mr. Amnon Shemer, Chief Financial Officer.

To participate, please call the following teleconference numbers. Please allow for additional time to connect prior to the call:

United States: +1-888-407-2553 Israel: +972-03-9180685International: +972-3-9180685

At:

9:30 a.m. Eastern Time6:30 a.m. Pacific Time16:30 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.

(Tables follow)

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.

Investor Contact:

Nir ZalikKM Investor relationsTel: +972- 3-5167620[email protected] www.km-ir.co.il

Amnon ShemerChief Financial Officer[email protected] +972-3-9395023

 

 

 

 

 

 

 

 

 

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SOURCE Eltek Ltd.