ROBO ROBO Global Robotics and Automation Index

RoboGroup Announces Fourth-Quarter and Full-Year 2004 Financial Results Sharp Increase in 4th Quarter Revenues to NIS 20.1 Million; Sharp Decrease in Net Loss ROSH HA'AYIN, Israel, March 30 /PRNewswire-FirstCall/ -- RoboGroup T.E.K. Ltd. (NASDAQ:ROBO) today reported fourth-quarter and full-year 2004 financial results. Revenues for the fourth quarter totaled NIS 20.1 million (US$4.7 million) compared with NIS 11.2 million (US$2.6 million) for the comparable quarter in 2003. Gross profit for the fourth quarter increased to NIS 7.3 million (US$1.7 million) from NIS 3.2 million (US$0.7 million) in the fourth quarter of 2003. During the fourth quarter the company performed an inventory write off for slow moving and outdated inventory in the education field, in the amount of approximately NIS 2.6 million (US$0.6 million), stemming among other things from the launch of new products. RoboGroups' fourth-quarter net loss dropped to NIS 1.3 million (US$0.3 million) from a net loss of NIS 6.3 million (US$1.5 million) in the fourth quarter of 2003. Rafael Aravot, Chief Executive Officer of RoboGroup, commented: "Our full-year results reflect increased revenues, along with significant cost-cuts in G&A and R&D expenses, which resulted in a substantial decrease in our annual net loss. In mid 2004, we began to implement a cost-cutting plan to improve profitability in the educational sector. The plan included personnel cuts as well as integration of activities. However, despite the smaller workforce, I am happy to announce that we succeeded in meeting our high revenue goal of over NIS 20 million in the fourth quarter, our highest in the last two years. In addition, in the last quarter of the year, we would have achieved net income except for the inventory write-off.. Revenues for the twelve-month period reached NIS 61.7 million (US$14.3 million) compared to NIS 56.1 million (US$13 million) for the comparable period in 2003. The increased revenues stem mainly from an increase in revenues in the education segment and in the industrial motion control segment by YET. Gross profit for the twelve-month period reached NIS 25.9 million (US$6 million) compared with NIS 23.5 million (US$5.4 million) for the comparable period in 2003. The increase is mainly due to the increase in revenues. The net loss for the twelve month period decreased significantly to NIS 7.7 million (US$1.8 million) from NIS 18.0 million (US$4.2 million) in the comparable period in 2003. YET's revenues for the year 2004 totaled NIS 21 million (US$4.8) compared to NIS 14 million (US$3.2 million) for the year 2003. RoboGroup's part in YET's revenues is 50%. XtraDrive sales in the European and the Israeli markets began in 2004, following its launch in these markets in 2003. These sales were the main reason for YET's increased revenues in 2004. In 2004, XtraDrive was also launched in the US market. A complete Directors' Report for the fourth quarter of 2004 is available on the Company's Website at http://www.robo-group.com/ or as a PDF file upon request. Please contact Ayelet Shiloni at Integrated IR, toll-free +1-866-447-8633. RoboGroup and its subsidiaries are engaged in two major fields of activity. The first is the field of education devoted to RoboGroup's training products and e-learning systems. RoboGroup is a world leader in engineering and manufacturing technology training systems. The Company is market driven, deriving its growth from technological leadership, strong partnerships and management expertise. The other field of activity is the development, manufacturing and marketing of motion control products for the industrial market, which is performed through the Company's subsidiary, Yaskawa Eshed Technologies (YET). For more information, visit http://www.robo-group.com/. To the extent that this press release discusses expectations about market conditions or about market acceptance and future sales of the Company's products, or otherwise makes statements about the future, such statements are forward-looking and are subject to a number of risks and uncertainties that could cause results to differ materially from the statements made. These factors include the rapidly changing technology and evolving standards in the industries in which the Company and its subsidiaries operate, risks associated with the acceptance of new products by individual customers and by the market place and other factors discussed in the business description and management discussion and analysis sections of the Company's Annual Report on Form 20-F. Company Contact: Michal Afuta RoboGroup +972-3-900-4112 Agency Contact: Ayelet Shiloni Integrated IR +1-866-447-8633 RoboGroup T.E.K. Ltd. Balance Sheets (NIS in Thousands) Consolidated December, December, December, 31 31 31 2004 2004 2003 U.S.$ (K) (1) NIS (K) NIS (K) Reported Reported Adjusted amounts amounts amount (*) (*) (*) ASSETS Current assets Cash and cash equivalents 1,615 6,957 14,878 Short-term investments 23 99 - Trade receivables 3,547 15,282 13,217 Other receivables and debit balances 486 2,093 2,292 Inventories 2,175 9,372 13,603 7,846 33,803 43,990 Long-term investments Investments in investee and other companies - - 15 Funds in respect of employee rights upon retirement, net 131 563 81 131 563 96 Fixed assets, net 8,484 36,548 38,233 Other assets and deferred expenses 240 1,036 1,525 16,701 71,950 83,844 (1) Convenience translation into U.S. Dollars. (*) Discontinuance of the adjustment for the effects of inflation according to the Israeli CPI as of December 2003 (*) Adjusted amounts for the Israeli CPI as of December 2003. RoboGroup T.E.K. Ltd. Balance Sheets (NIS in Thousands) Consolidated December, December, December, 31 31 31 2004 2004 2003 U.S.$ (K) (1) NIS (K) NIS (K) Reported Reported Adjusted amounts amounts amount (*) (*) (*) LIABILITIES Current liabilities Credit from banks 3,535 15,228 15,941 Trade payables 1,359 5,853 5,394 Other payables and credit balances 2,398 10,333 14,345 7,292 31,414 35,680 Long-term liabilities Loans from banks 3,969 17,100 17,516 Provision for deferred taxes 38 163 - Liability for termination of employee/employer relationship, net 32 139 200 4,039 17,402 17,716 Commitments, contingent liabilities and pledges Shareholders' equity Share capital 2,646 11,400 11,399 Authorized capital as at December 31, 2004 and 2003 was 25,000,000 shares of NIS 0.5 par value of which 11,239,952 and 11,238,352 shares were issued and outstanding on December 31, 2004 and 2003 respectively Premium on shares 9,854 42,452 42,214 Capital reserves 401 1,727 1,807 Accumulated deficit (7,348) (31,656) (23,969) Treasury stock (183) (789) (1,003) 5,370 23,134 30,448 16,701 71,950 83,844 (1) Convenience translation into U.S. Dollars. (*) Discontinuance of the adjustment for the effects of inflation according to the Israeli CPI as of December 2003 (*) Adjusted amounts for the Israeli CPI as of December 2003. RoboGroup T.E.K. Ltd. Statement of Operations (NIS in Thousands) Consolidated Year Year Year Year ended ended ended ended December, December, December, December, 31 31 31 31 2004 2004 2003 2002 U.S.$ (K) NIS (K) (1) NIS (K) NIS (K) Reported Reported Adjusted Adjusted amounts amounts amount amount (*) (*) (**) (**) Revenues 14,330 61,734 56,116 86,159 Cost of revenues 8,320 35,843 32,598 41,412 Gross profit 6,010 25,891 23,518 44,747 Operating expenses Research and development expenses, net 1,769 7,619 12,651 12,755 Marketing and selling expenses 3,065 13,204 12,622 14,240 Administrative and general expenses 2,331 10,042 14,569 13,630 7,165 30,865 39,842 40,625 Operating income (loss) (1,155) (4,974) (16,324) 4,122 Financial expenses, net (490) (2,111) (3,783) (1,402) Other income, net 188 809 2,032 1,640 Income (loss) before taxes on income (1,457) (6,276) (18,075) 4,360 Income tax expenses (income) 327 1,411 (82) 1,051 Income (loss) before Company's share in results of Investee companies (1,784) (7,687) (17,993) 3,309 Company's share in losses of Investee companies - - - - Net income (loss) (1,784) (7,687) (17,993) 3,309 Earnings (loss) per share ("EPS") (0.17) (0.71) (1.67) 0.31 Number of shares used in computation of EPS (in thousands) 10,757 10,757 10,744 10,731 (1) Convenience translation into U.S. Dollars. (*) Discontinuance of the adjustment for the effects of inflation according to the Israeli CPI as of December 2003 (**) Adjusted amounts for the Israeli CPI as of December 2003. DATASOURCE: RoboGroup t.e.k. Ltd CONTACT: Company Contact: Michal Afuta, RoboGroup, , Tel: +972-3-900-4112, Agency Contact: Ayelet Shiloni, Integrated IR, , Tel: +1-866-447-8633

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