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Gilat Announces First Quarter 2010 Results
GlobeNewswire
2010-05-11
PETAH TIKVA, Israel, May 11, 2010 (GLOBE NEWSWIRE) -- Gilat Satellite
Networks Ltd. (Nasdaq:GILT), a worldwide leader in satellite networking
technology, solutions and services, today reported its results for the
quarter ending March 31, 2010.
Revenues for the first quarter of 2010 were $57.1 million compared to
$60.8 million for the same period of 2009. Net income for the first
quarter of 2010 was $0.6 million or $0.02 per diluted share compared to
a net income of $0.2 million, or $0.01 per diluted share in the first
quarter of 2009.
Gilat's Chief Executive Officer and Chairman of the Board Amiram
Levinberg said, "The quarter was highlighted by signing the definitive
agreement to acquire Raysat Antenna Systems. This acquisition is part
of our focus on the defense and military markets and we hope to be able
to close it by the beginning of the third quarter."
Recent Announcements:
-- Kazakhstan's ASTEL is deploying a Gilat SkyEdge II broadband satellite
network for corporate and government agency sites. The new network
includes two SkyEdge II satellite hub stations and several hundred
SkyEdge II Access VSATs, in addition to the recently announced Gilat
NetEdge Gateways.
-- Gilat is supplying a multinational broadband satellite network in Africa
that will be used to provide gaming and lottery services to an initial
2,500 sites in several countries in West Africa, including, the Ivory
Coast, DRC and Senegal.
-- Ethiopia's ETC has chosen Gilat's satellite network to provide broadband
services to hundreds of sites. The network will be used for enterprise
applications and includes Gilat's SkyAbis cellular backhaul solution to
extend the range of cellular services to remote regions.
-- Gilat was chosen by a major homeland security agency in Latin America to
provide a turnkey broadband communications solution. The new network
will be used for border control applications.
-- Gilat announced the appointment of Jaron Lotan to serve as Chief
Operating Officer. As COO Lotan will oversee all day-to-day business
operations, from sales to implementation, for all of the Company's
businesses other than Spacenet Inc.
-- Gilat entered into a definitive agreement to acquire Raysat Antenna
Systems, a leading SatCom On The Move antenna company. The acquisition
is part of Gilat's strategy to enter new military and defense markets.
-- Gilat and GVF announced a new VSAT installation training program for
Gilat SkyEdge II broadband satellite networks.
-- Gilat announced integrated SatCom On The Move solutions with Orbit
Technology Group. The integrated solutions have already been
successfully deployed, meeting the demanding requirements of
customers.
-- Gilat is providing a SkyEdge II network to telecom services provider,
Satcom Systems, which will be used for broadband Internet connectivity
in Africa. The network comprising a SkyEdge II hub located in Germany
and hundreds of VSATs, will enable Satcom Systems to expand its services
in West Africa.
-- Brazil's Amazonian Protection System (SIPAM) is deploying a Gilat
SkyEdge II broadband satellite communications network at more than 1,000
remote sites. The SkyEdge II VSAT network will enable SIPAM to more
effectively disseminate critical information to Amazonian states and
cities and the dozens of institutions and isolated sites.
-- Spacenet and EchoStar provided satellite service and communications
equipment to the American Red Cross for Haiti relief efforts following
the devastating earthquake.
Gilat will host a conference call today with an accompanying slide
presentation at 9:30 AM ET. In order to ensure audio access,
participants from the U.S. should dial in at (888) 281-1167 and
international participants should dial in at (972) 3-918-0610. The
presentation may be accessed through the Company's website at
www.gilat.com prior to the call. The call will also be available as a
Webcast on the Company's website at www.gilat.com and will be archived
for 30 days.
Notes:
(1) The attached summary financial statements were prepared in
accordance with U.S. Generally Accepted Accounting Principles (GAAP).
The attached summary financial statements for the first quarter of 2010
are unaudited. To supplement the consolidated financial statements
presented in accordance with GAAP, the Company presents Gilat's net
income, EBITDA and earnings per diluted share, before the impact of a
non-cash share-based payment charge, which is the non-cash stock option
expense as per SFAS 123 (R). Non-GAAP presentations of net income,
EBITDA and earnings per share are provided to enhance the understanding
of the Company's historical financial performance and comparability
between periods.
(2) Operating income before depreciation, amortization, non cash stock
option expenses as per SFAS 123(R) and exceptional items ('EBITDA') is
presented because it is a measure commonly used and is presented solely
in order to improve the understanding of the Company's operating
results and to provide further perspective on these results. EBITDA,
however, should not be considered as an alternative to operating income
or net income for the period as an indicator of the operating
performance of the Company.
Similarly, EBITDA should not be considered as an alternative to cash
flows from operating activities as a measure of liquidity. EBITDA is
not a measure of financial performance under generally accepted
accounting principles and may not be comparable to other similarly
titled measures for other companies. EBITDA may not be indicative of
the historic operating results of the Company; nor is it meant to be
predictive of potential future results. Reconciliation between the
Company's Operating income and EBIDTA is presented in the attached
summary financial statements.
About Gilat Satellite Networks Ltd.
Gilat Satellite Networks Ltd. is a leading provider of products and
professional services for satellite-based broadband communications
networks worldwide. Gilat was founded in 1987 and has shipped over
750,000 Very Small Aperture Terminals (VSATs) to more than 85 countries
across six continents. Gilat's headquarters is located in Petah Tikva,
Israel. The Company has 16 sales and service offices worldwide. Gilat
markets a full line of high-performance VSATs under the SkyEdge(TM) and
SkyEdge II Product Family. Gilat's wholly-owned subsidiary, Spacenet
Inc., is a leading provider of managed services in North America to the
business and government segments. For more information, please visit
www.gilat.com.
The Gilat Satellite Networks Ltd. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=5848
Certain statements made herein that are not historical are
forward-looking within the meaning of the Private Securities Litigation
Reform Act of 1995. The words "estimate", "project", "intend",
"expect", "believe" and similar expressions are intended to identify
forward-looking statements. These forward-looking statements involve
known and unknown risks and uncertainties. Many factors could cause the
actual results, performance or achievements of Gilat to be materially
different from any future results, performance or achievements that may
be expressed or implied by such forward-looking statements, including,
among others, changes in general economic and business conditions,
inability to maintain market acceptance to Gilat's products, inability
to timely develop and introduce new technologies, products and
applications, rapid changes in the market for Gilat's products, loss of
market share and pressure on prices resulting from competition,
introduction of competing products by other companies, inability to
manage growth and expansion, loss of key OEM partners, inability to
attract and retain qualified personnel, inability to protect the
Company's proprietary technology and risks associated with Gilat's
international operations and its location in Israel. For additional
information regarding these and other risks and uncertainties
associated with Gilat's business, reference is made to Gilat's reports
filed from time to time with the Securities and Exchange Commission.
GILAT SATELLITE NETWORKS LTD.
CONDENSED CONSOLIDATED BALANCE SHEET
US dollars in thousands
December
March 31, 31,
---------- ----------
2010 2009
---------- ----------
Unaudited
----------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents 85,401 122,672
Short-term bank deposits 54,530 31,729
Available-for-sale
marketable securities 4,852 --
Short-term restricted cash 1,855 1,782
Restricted cash held by
trustees 857 2,137
Trade receivables, net 54,326 45,597
Inventories 15,307 13,711
Other current assets 18,063 19,068
---------- ----------
Total current assets 235,191 236,696
---------- ----------
LONG-TERM INVESTMENTS AND
RECEIVABLES:
Long-term restricted cash 5,140 4,896
Severance pay fund 10,061 9,912
Long-term trade receivables,
receivables in respect of
capital leases and other
receivables 2,683 2,204
---------- ----------
Total long-term investments
and receivables 17,884 17,012
---------- ----------
PROPERTY AND EQUIPMENT, NET 99,018 100,532
---------- ----------
INTANGIBLE ASSETS AND DEFERRED
CHARGES, NET 2,860 2,988
---------- ----------
TOTAL ASSETS 354,953 357,228
------------------------------ ========== ==========
GILAT SATELLITE NETWORKS LTD.
CONDENSED CONSOLIDATED BALANCE SHEET
US dollars in thousands
December
March 31, 31,
---------- ----------
2010 2009
---------- ----------
Unaudited
----------
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Current maturities of
long-term loans and
convertible notes 5,200 5,220
Trade payables 15,816 16,838
Accrued expenses 21,266 20,067
Short-term advances from
customer, held by trustees 857 2,137
Other current liabilities 26,822 28,154
---------- ----------
Total current liabilities 69,961 72,416
---------- ----------
LONG-TERM LIABILITIES:
Accrued severance pay 10,274 10,011
Long-term loans, net 9,343 9,830
Accrued interest related to
restructured debt 1,176 1,176
Convertible subordinated
notes 15,219 15,220
Other long-term liabilities 15,824 16,280
---------- ----------
Total long-term liabilities 51,836 52,517
---------- ----------
COMMITMENTS AND CONTINGENCIES
EQUITY:
Share capital - ordinary
shares of NIS 0.2 par value 1,837 1,832
Additional paid in capital 863,670 863,337
Accumulated other
comprehensive income 1,222 1,341
Accumulated deficit (633,573) (634,215)
---------- ----------
Total equity 233,156 232,295
---------- ----------
TOTAL LIABILITIES AND EQUITY 354,953 357,228
------------------------------ ========== ==========
GILAT SATELLITE NETWORKS LTD.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except per share data)
Three months ended
March 31,
--------------------
2010 2009
--------- ---------
Unaudited Unaudited
--------- ---------
Revenues 57,112 60,826
Cost of revenues 37,475 42,872
--------- ---------
Gross profit 19,637 17,954
--------- ---------
Research and development
expenses:
Expenses incurred 4,723 4,009
Less - grants 215 235
--------- ---------
4,508 3,774
--------- ---------
Selling, marketing, general and
administrative expenses 15,073 14,130
--------- ---------
Operating income 56 50
--------- ---------
Financial income, net 69 341
Other income -- 199
--------- ---------
Income before taxes on income 125 590
--------- ---------
Taxes on income (tax benefit) (517) 352
--------- ---------
Net income 642 238
========= =========
Basic net earnings per share 0.02 0.01
========= =========
Diluted net earnings per share 0.02 0.01
========= =========
Weighted average number of shares
used in computing net earnings
per share
Basic 40,309 40,071
========= =========
Diluted 41,969 41,206
========= =========
GILAT SATELLITE NETWORKS LTD.
RECONCILIATION BETWEEN GAAP AND NON-GAAP STATEMENTS OF
OPERATIONS
FOR COMPARATIVE PURPOSES
U.S. dollars in thousands (except per share data)
Three months ended
March 31,
--------------------
2010 2009
--------- ---------
Unaudited Unaudited
--------- ---------
GAAP operating income 56 50
Non-cash stock-based compensation expenses
(1) 332 228
--------- ---------
Non-GAAP operating income 388 278
--------- ---------
GAAP net income 642 238
Non-cash stock-based compensation expenses
(1) 332 228
--------- ---------
Non-GAAP net income 974 466
--------- ---------
GAAP Earnings per share (diluted) 0.02 0.01
Non-cash stock-based compensation expenses
(1) -- --
--------- ---------
Non-GAAP Earnings per share (diluted) 0.02 0.01
--------- ---------
(1) Non-cash stock-based compensation
expenses:
Cost of Revenues 67 40
Research and development 35 19
Selling, general, marketing and
administrative 230 169
--------- ---------
332 228
========= =========
GILAT SATELLITE NETWORKS LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
US dollars in thousands
Three months ended
March 31,
--------------------
2010 2009
--------- ---------
Unaudited Unaudited
--------- ---------
Cash flows from operating activities:
---------------------------------------------------
Net income 642 238
Adjustments required to reconcile net income to net cash used in
operating activities:
Depreciation and amortization 3,013 3,455
Gain from the sale of an investment accounted for
at cost -- (199)
Stock-based compensation related to employees 332 228
Accrued severance pay, net 114 (293)
Accrued interest and exchange rate differences on
short and long-term restricted cash, net (149) 263
Accrued interest and exchange rate differences on
held-to-maturity marketable securities and short
term bank deposits, net (61) 80
Exchange rate differences on long-term loans (420) (285)
Exchange rate differences on loans to employees -- 5
Capital loss from disposal of property and
equipment 7 5
Deferred income taxes 11 34
Decrease (increase) in trade receivables, net (8,782) 1,518
Decrease in other assets (including short-term,
long-term and deferred charges) 213 8,109
Decrease (increase) in inventories (1,907) 1,276
Decrease in trade payables (1,014) (6,686)
Increase (decrease) in accrued expenses 1,201 (1,707)
Decrease in advances from customer, held by
trustees, net (1,281) (2,898)
Decrease in other accounts payable and other long
term liabilities (1,577) (8,717)
--------- ---------
Net cash used in operating activities (9,658) (5,574)
--------- ---------
GILAT SATELLITE NETWORKS LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
US dollars in thousands
Three months ended
March 31,
--------------------
2010 2009
--------- ---------
Unaudited Unaudited
--------- ---------
Cash flows from investing activities:
---------------------------------------------------
Purchase of property and equipment (993) (792)
Proceeds from sale of an investment accounted for
at cost -- 199
Purchase of held-to-maturity marketable securities
and deposits (30,693) (60,812)
Proceeds from held-to-maturity marketable
securities and deposits 7,953 59,283
Loans to employees, net (1) (3)
Investment in restricted cash held by trustees (1,404) --
Proceeds from restricted cash held by trustees 2,787 2,637
Investment in restricted cash (including long-term) (387) (50)
Proceeds from restricted cash (including long-term) 70 197
Purchase of available-for-sale marketable
securities (4,804) --
--------- ---------
Net cash provided by (used in) investing activities (27,472) 659
--------- ---------
Cash flows from financing activities:
---------------------------------------------------
Issuance of restricted stock units 5 3
Repayment of long-term loans (87) (81)
--------- ---------
Net cash used in financing activities (82) (78)
--------- ---------
Effect of exchange rate changes on cash and cash
equivalents (59) 15
--------- ---------
Decrease in cash and cash equivalents (37,271) (4,978)
Cash and cash equivalents at the beginning of the
period 122,672 73,916
--------- ---------
Cash and cash equivalents at the end of the period 85,401 68,938
========= =========
GILAT SATELLITE NETWORKS LTD.
CONDENSED EBITDA
US dollars in thousands
Three months ended
March 31,
--------------------
2010 2009
--------- ---------
Unaudited Unaudited
--------- ---------
Operating income 56 50
Add:
Non-cash stock-based
compensation expenses 332 228
Deprecation and amortization 3,013 3,455
--------- ---------
EBITDA 3,401 3,733
========= =========
CONTACT: Watts Capital Partners, LLC
Investor Relations Contact:
Tom Watts
+1 (212) 735-8920
twatts@wattscapital.com
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