Gilat Satellite Networks Ltd. (Nasdaq:GILT) (TASE:GILT), a
worldwide leader in satellite networking technology, solutions and
services, today reported its results for the first quarter ended
March 31, 2015.
Key Financial Updates:
- Revenues for the first quarter of 2015 were $45.2 million
compared to $50.9 million in the comparable period of 2014.
- EBITDA for the first quarter of 2015 was $0.2 million compared
to $2.8 million in the comparable period of 2014.
- Management objectives for 2015: continued growth to revenues
between $250 to $260 million and EBITDA between $26 to $28
million
Revenues for the first quarter of 2015 were $45.2 million,
compared to $50.9 million for the same period in 2014.
On a non-GAAP basis, operating loss was $2.1 million in the
first quarter of 2015 as compared to an operating income of $0.5
million in the comparable quarter of 2014.
On a GAAP basis, operating loss was $4.0 million in the first
quarter of 2015 as compared to an operating loss of $1.5 million in
the comparable quarter of 2014.
On a non-GAAP basis, net loss for the quarter was $3.7 million
or $0.09 per diluted share compared to net loss of $0.6 million or
$0.01 per diluted share in the same quarter of 2014.
On a GAAP basis, net loss for the quarter was $5.6 million or a
loss of $0.13 per diluted share compared to a net loss of $2.7
million or a loss of $0.06 per diluted share in the same quarter of
2014.
EBITDA for the first quarter of 2015 reached $0.2 million
compared with $2.8 million in the comparable period in 2014.
"We reiterate our management objectives for FY2015 of a revenue
target of $250 - $260 million and an EBITDA target of $26 - $28
million. As we expect, the second half of 2015 will be
significantly stronger than the first half," said Dov Baharav,
Interim CEO and Chairman of the Board of Gilat.
"We were pleased to see progress in our strategy of extending
broadband internet in rural areas in the first quarter, with the
significant award of Peru's Fitel project. We expect this project
to contribute to our growth in 2015 and even more so in 2016.
Moreover, we see positive momentum in HTS with a number of new
deals, such as JCP in Brazil and in Cellular Backhaul with RuralCom
in Canada and others."
"Looking forward, I am confident that we will see top- and
bottom-line growth in 2015, and, given our recent wins, we can
expect additional growth in 2016," Dov Baharav added.
Key Recent Announcements:
- Gilat Awarded $285 Million Regional Telecommunications
Infrastructure Project by Peru's Fitel
- Gilat's HTS VSAT Network Goes Live at JCP, BRASTRADING's
Telecommunications Subsidiary in Brazil
- Gilat Partners with Intelsat to Enable Rapid Deployment and
High Quality 2G/3G Cellular Connectivity to Underserved Regions of
the World
- Cellular Carrier RuralCom Selects Gilat as Prime Network
Contractor for its Alaska Highway and BC Coast Networks
Conference Call and Webcast Details:
Gilat management will host a conference call today at 13:30 GMT
/ 09:30 EDT / 16:30 IDT to discuss the results. International
participants are invited to access the call at (972)3-925-5943, and
US-based participants are invited to access the call by dialing
(1)866-500-4953. A replay of the conference call will be available
beginning at approximately 16:00 GMT/ 12:00 EDT/ 19:00 IDT today,
until 16:00 GMT/ 12:00 EDT/ 19:00 IDT May 22, 2015. A replay of the
call may also be accessed as a webcast via Gilat'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 are unaudited. To
supplement the consolidated financial statements presented in
accordance with GAAP, the Company presents Gilat's EBITDA before
the impact of non-cash share-based payment charges, depreciation
and amortization, other income and other costs related to
acquisition transactions. Non-GAAP presentations of net income,
operating 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 ASC 718 (formerly SFAS 123(R)) and
other costs related to acquisition transactions ('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 EBITDA is
presented in the attached summary financial statements.
About Gilat
Gilat Satellite Networks Ltd (Nasdaq:GILT) (TASE:GILT) is a
leading provider of products and services for satellite-based
broadband communications. Gilat develops and markets a wide range
of high-performance satellite ground segment equipment and VSATs,
with an increasing focus on the consumer and Ka-band market. In
addition, Gilat enables mobile SOTM (Satellite-on-the-Move)
solutions providing low-profile antennas, next generation
solid-state power amplifiers and modems. Gilat also provides
managed network and satellite-based services for rural telephony
and Internet access via its subsidiaries in Peru and Colombia.
With over 25 years of experience, and over a million products
shipped to more than 90 countries, Gilat has provided enterprises,
service providers and operators with efficient and reliable
satellite-based connectivity solutions, including cellular
backhaul, banking, retail, e-government and rural communication
networks. Gilat also enables leading defense, public security and
news organizations to implement advanced, on-the-move tactical
communications on board their land, air and sea fleets using
Gilat's high-performance SOTM solutions. Gilat's controlling
shareholders are the FIMI Private Equity Funds. For more
information, please visit us at www.gilat.com
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 |
|
|
March 31, |
December 31, |
|
2015 |
2014 |
|
Unaudited |
|
|
|
|
ASSETS |
|
|
|
|
|
CURRENT ASSETS: |
|
|
Cash and cash equivalents |
30,365 |
27,726 |
Restricted cash |
13,900 |
25,983 |
Restricted cash held by trustees |
3,680 |
15,441 |
Trade receivables, net |
55,900 |
57,728 |
Inventories |
29,003 |
25,112 |
Other current assets |
12,324 |
14,760 |
Total current
assets |
145,172 |
166,750 |
|
|
|
LONG-TERM INVESTMENTS AND
RECEIVABLES: |
|
|
Long-term restricted cash |
191 |
216 |
Severance pay funds |
7,900 |
8,085 |
Other long term receivables |
10,450 |
12,124 |
Total long-term investments and
receivables |
18,541 |
20,425 |
|
|
|
PROPERTY AND EQUIPMENT,
NET |
89,046 |
90,893 |
|
|
|
INTANGIBLE ASSETS, NET |
21,505 |
22,970 |
|
|
|
GOODWILL |
63,870 |
63,870 |
|
|
|
TOTAL ASSETS |
338,134 |
364,908 |
|
|
|
GILAT SATELLITE NETWORKS
LTD. |
CONDENSED CONSOLIDATED
BALANCE SHEET |
US dollars in
thousands |
|
March 31, |
December 31, |
|
2015 |
2014 |
|
Unaudited |
|
|
|
|
LIABILITIES AND
EQUITY |
|
|
|
|
|
CURRENT LIABILITIES: |
|
|
Short-term bank credit and loans |
4,720 |
15,857 |
Current maturities of long-term
loans |
4,528 |
4,595 |
Trade payables |
22,321 |
22,850 |
Accrued expenses |
19,816 |
22,475 |
Short-term advances from customers, held
by trustees |
6,989 |
12,858 |
Other current liabilities |
25,410 |
21,527 |
|
|
|
Total current
liabilities |
83,784 |
100,162 |
|
|
|
LONG-TERM LIABILITIES: |
|
|
Accrued severance pay |
7,872 |
8,157 |
Long-term loans, net of current
maturities |
21,875 |
26,271 |
Other long-term liabilities |
4,937 |
5,179 |
|
|
|
Total long-term
liabilities |
34,684 |
39,607 |
|
|
|
COMMITMENTS AND
CONTINGENCIES |
|
|
|
|
|
EQUITY: |
|
|
Share capital - ordinary shares of NIS
0.2 par value |
1,982 |
1,966 |
Additional paid-in capital |
877,932 |
876,624 |
Accumulated other comprehensive loss |
(2,611) |
(1,420) |
Accumulated deficit |
(657,637) |
(652,031) |
|
|
|
Total equity |
219,666 |
225,139 |
|
|
|
TOTAL LIABILITIES AND
EQUITY |
338,134 |
364,908 |
|
|
|
GILAT SATELLITE NETWORKS
LTD. |
RECONCILIATION BETWEEN
GAAP AND NON-GAAP STATEMENTS OF OPERATIONS |
FOR COMPARATIVE
PURPOSES |
U.S. dollars in thousands
(except share and per share data) |
|
|
Three months ended |
|
|
Three months ended |
|
|
|
31 March 2015 |
|
|
31 March 2014 |
|
|
GAAP |
Adjustments (1) |
Non-GAAP |
GAAP |
Adjustments (1) |
Non-GAAP |
|
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
|
|
|
|
|
|
|
Revenues |
45,190 |
-- |
45,190 |
50,851 |
-- |
50,851 |
Cost of revenues |
31,998 |
(1,251) |
30,747 |
30,876 |
(1,267) |
29,609 |
Gross profit |
13,192 |
1,251 |
14,443 |
19,975 |
1,267 |
21,242 |
|
29% |
|
32% |
39% |
|
42% |
Research and development
expenses: |
|
|
|
|
|
|
Expenses incurred |
6,534 |
(110) |
6,424 |
7,239 |
(122) |
7,117 |
Less - grants |
190 |
-- |
190 |
354 |
-- |
354 |
|
6,344 |
(110) |
6,234 |
6,885 |
(122) |
6,763 |
Selling and marketing expenses |
6,263 |
(337) |
5,926 |
9,690 |
(342) |
9,348 |
General and administrative expenses |
4,591 |
(241) |
4,350 |
4,912 |
(303) |
4,609 |
Operating income (loss) |
(4,006) |
1,939 |
(2,067) |
(1,512) |
2,034 |
522 |
Financial expenses, net |
(1,351) |
-- |
(1,351) |
(1,034) |
-- |
(1,034) |
Loss before taxes on
income |
(5,357) |
1,939 |
(3,418) |
(2,546) |
2,034 |
(512) |
Taxes on income |
249 |
-- |
249 |
90 |
-- |
90 |
Net loss from continuing
operations |
(5,606) |
1,939 |
(3,667) |
(2,636) |
2,034 |
(602) |
Net loss from discontinued
operations |
-- |
-- |
-- |
(51) |
51 |
-- |
Net loss |
(5,606) |
1,939 |
(3,667) |
(2,687) |
2,085 |
(602) |
|
|
|
|
|
|
|
Basic net loss per share from
continuing operations |
(0.13) |
|
|
(0.06) |
|
|
Basic net loss per share from
discontinued operations |
-- |
|
|
(0.00) |
|
|
Basic net loss per
share |
(0.13) |
|
(0.09) |
(0.06) |
|
(0.01) |
|
|
|
|
|
|
|
Diluted net loss per share from
continuing operations |
(0.13) |
|
|
(0.06) |
|
|
Diluted net loss per share from
discontinued operations |
-- |
|
|
(0.00) |
|
|
Diluted net loss per
share |
(0.13) |
|
(0.09) |
(0.06) |
|
(0.01) |
|
|
|
|
|
|
|
Weighted average number of shares
used in computing net loss per share |
|
|
|
|
|
|
Basic |
42,883,469 |
|
42,883,469 |
42,175,937 |
|
42,175,937 |
Diluted |
42,883,469 |
|
42,883,469 |
42,175,937 |
|
42,175,937 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Adjustments reflect the
effect of non-cash stock based compensation as per ASC 718,
amortization of intangible assets related to Shares acquisition
transactions, and net income (loss) from discontinued
operations. |
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
Three months ended |
|
|
|
31 March 2015 |
|
|
31 March 2014 |
|
|
|
Unaudited |
|
|
Unaudited |
|
Non-cash stock-based compensation
expenses: |
|
|
|
|
|
|
Cost of revenues |
|
52 |
|
|
58 |
|
Research and development |
|
110 |
|
|
122 |
|
Selling and marketing |
|
125 |
|
|
130 |
|
General and administrative |
|
241 |
|
|
303 |
|
|
|
528 |
|
|
613 |
|
|
|
|
|
|
|
|
Amortization of intangible assets
related to acquisition transactions: |
|
|
|
|
|
|
Cost of revenues |
|
1,199 |
|
|
1,209 |
|
Selling and marketing |
|
212 |
|
|
212 |
|
|
|
1,411 |
|
|
1,421 |
|
|
|
|
|
|
|
|
GILAT SATELLITE NETWORKS
LTD. |
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS |
U.S. dollars in thousands
(except share and per share data) |
|
Three months
ended |
|
March
31, |
|
2015 |
2014 |
|
Unaudited |
Unaudited |
|
|
|
Revenues |
45,190 |
50,851 |
Cost of revenues |
31,998 |
30,876 |
Gross profit |
13,192 |
19,975 |
|
|
|
Research and development
expenses: |
|
|
Expenses incurred |
6,534 |
7,239 |
Less - grants |
190 |
354 |
|
6,344 |
6,885 |
Selling and marketing expenses |
6,263 |
9,690 |
General and administrative expenses |
4,591 |
4,912 |
Operating loss |
(4,006) |
(1,512) |
Financial expenses, net |
(1,351) |
(1,034) |
Loss before taxes on
income |
(5,357) |
(2,546) |
Taxes on income |
249 |
90 |
Net loss from continuing
operations |
(5,606) |
(2,636) |
Net loss from discontinued
operations |
-- |
(51) |
Net loss |
(5,606) |
(2,687) |
|
|
|
Net loss per share from continuing
operations (basic and diluted) |
(0.13) |
(0.06) |
Net loss per share from discontinued
operations (basic and diluted) |
-- |
(0.00) |
Net loss per share (basic and
diluted) |
(0.13) |
(0.06) |
|
|
|
Weighted average number of shares
used in computing net loss per share |
|
|
Basic |
42,883,469 |
42,175,937 |
Diluted |
42,883,469 |
42,175,937 |
|
|
|
GILAT SATELLITE NETWORKS
LTD. |
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS |
US dollars in
thousands |
|
|
Three months
ended |
|
March
31, |
|
2015 |
2014 |
|
Unaudited |
Unaudited |
Cash flows from continuing
operations |
|
|
Cash flows from operating
activities: |
|
|
Net loss |
(5,606) |
(2,687) |
Net loss from discontinued
operations |
-- |
(51) |
Net loss from continuing
operations |
(5,606) |
(2,636) |
Adjustments required to reconcile net
loss to net cash generated provided by (used in) operating
activities: |
|
|
Depreciation and amortization |
3,658 |
3,684 |
Stock-based compensation |
528 |
613 |
Accrued severance pay, net |
(101) |
(122) |
Accrued interest and exchange rate
differences on short and long-term restricted cash, net |
43 |
86 |
Exchange rate differences on long-term
loans |
(329) |
6 |
Capital loss from disposal of property and
equipment |
-- |
17 |
Deferred income taxes |
(41) |
(36) |
Decrease (increase) in trade receivables,
net |
721 |
(2,040) |
Decrease (increase) in other assets
(including short-term, long-term and deferred charges) |
2,934 |
(7,783) |
Decrease (increase) in inventories |
(4,182) |
670 |
Decrease in trade payables |
(195) |
(2,050) |
Increase (decrease) in accrued expenses |
(2,173) |
1,675 |
Increase (decrease) in advances from
customers, held by trustees |
(5,178) |
4,228 |
Increase (decrease) in other current
liabilities and other long term liabilities |
4,250 |
(2,243) |
Net cash used in operating
activities |
(5,671) |
(5,931) |
|
|
|
GILAT SATELLITE NETWORKS
LTD. |
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS |
US dollars in
thousands |
|
|
Three months
ended |
|
March
31, |
|
2015 |
2014 |
|
Unaudited |
Unaudited |
Cash flows from investing
activities: |
|
|
Purchase of property and equipment |
(741) |
(525) |
Investment in restricted cash held by
trustees |
-- |
(4,228) |
Proceeds from restricted cash held by
trustees |
10,922 |
2,950 |
Investment in restricted cash (including
long-term) |
(10,052) |
-- |
Proceeds from restricted cash (including
long-term) |
22,117 |
76 |
|
|
|
Net cash Provided by (used in)
investing activities |
22,246 |
(1,727) |
|
|
|
|
|
|
Cash flows from financing
activities: |
|
|
Capital lease payments |
(102) |
-- |
Issuance of restricted stock units and
exercise of stock options |
793 |
293 |
Short term bank credit, net |
(10,007) |
1,652 |
Repayment of long-term loans |
(4,135) |
(4,165) |
|
|
|
Net cash used in financing
activities |
(13,451) |
(2,220) |
|
|
|
|
|
|
Effect of exchange rate changes on
cash and cash equivalents |
(485) |
33 |
|
|
|
Increase (decrease) in cash and cash
equivalents |
2,639 |
(9,845) |
|
|
|
Cash and cash equivalents at the
beginning of the period |
27,726 |
58,424 |
|
|
|
Cash and cash equivalents at the end
of the period |
30,365 |
48,579 |
|
|
|
GILAT SATELLITE NETWORKS
LTD. |
CONDENSED
EBITDA |
US dollars in
thousands |
|
Three months
ended |
|
March
31, |
|
2015 |
2014 |
|
Unaudited |
Unaudited |
|
|
|
Operating loss |
(4,006) |
(1,512) |
Add: |
|
|
Non-cash stock-based compensation
expenses |
528 |
613 |
Depreciation and amortization |
3,658 |
3,684 |
EBITDA |
180 |
2,785 |
CONTACT: Gilat Satellite Networks
Joelle Inowlocki
JoelleI@gilat.com
KCSA Strategic Communications
Phil Carlson, Vice President
(212) 896-1233
pcarlson@kcsa.com
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