Magal Security Systems Ltd. Announces 2004 First Quarter Results -
Net Income increases 29% compared with the first quarter of 2003
and 30% compared with the fourth quarter of 2003 - YAHUD, Israel,
April 28 /PRNewswire-FirstCall/ -- Security Systems Ltd. today
announced its consolidated financial results for the three-month
period ended March 31, 2004. Revenues for the first quarter of 2004
reached US$14.2 million, an increase of 11 percent compared with
the first quarter of 2003. Operating income reached US$1.2 million
and net income reached US$687,000, an increase of 14 percent and 29
percent respectively compared with the first quarter of 2003.
Compared with the fourth quarter of 2003, revenues decreased by 20
percent, operating income increased by 12 percent and net income
increased by 30 percent. Operating expenses for the first quarter
of 2004 reached US$5.1 million, an increase of 17 percent compared
with the same period of last year and a decrease of 26 percent
compared with the fourth quarter of 2003. Diluted earnings per
share for the first quarter reached US$0.08, an increase of 14
percent compared with the same period of last year. Commenting on
the results, Mr. Jacob Even-Ezra, Chairman of Magal, said:
"Usually, our first quarter of the year is the weakest quarter, as
outdoor installations are harder during the winter months. We
remain pleased with the organic growth in our business and the
growth in the operating income, income before tax and net income
compared to the first and fourth quarters of 2003." Mr. Even-Ezra
added: " During this quarter, we launched three new products. These
were the Fortis Integrated Command and Control System, the
PipeGuard Pipeline Security System and the DreamBox, the All-in-One
CCTV solution. Management believes that the sales of Fortis and
DreamBox will start during the year 2004. Sales of the PipeGuard,
we expect will start in the year 2005 due to the long trial periods
associated with this product." Mr. Even-Ezra concluded: " Based on
the first quarter results, the current backlog and increased
interest in our security products, we have every reason to believe
that our results in the year 2004 will be better than those of
2003". The Company will be hosting its quarterly conference call at
11:00am EDT. On the call, Mr. Jacob Even-Ezra, Chairman of the
Board & CEO, and Ms. Raya Asher, V.P. Finance & CFO, will
review and discuss the first quarter 2004 results. They will then
be available to answer questions. To participate, you may listen to
the webcast by accessing the link from Magal's web-site at:
http://www.magal-ssl.com/. Alternatively, you may call one of the
teleconferencing numbers that follows. Please place your calls 5-10
minutes before the conference call commences. If you are unable to
connect using one of the toll-free numbers, please try the
international dial-in number or the webcast. US Dial-in Number:
1-866-860-9642 Canada Dial-in Number: 1-866-485-2399 ISRAEL Dial-in
Number: 03-9180610 INTERNATIONAL Dial-in Number: +972 3 9180610 At:
11:00am Eastern Time, 8:00am Pacific Time, 6:00pm Israel Time About
Magal Security Systems, Ltd.: Magal Security Systems Ltd. (Magal)
is engaged in the development, manufacturing and marketing of
computerized security systems, which automatically detect, locate
and identify the nature of unauthorized intrusions. Magal also
supplies video monitoring services through Smart Interactive
Systems, Inc., a subsidiary established in the U.S. in June 2001.
The Company's products are currently used in more than 70 countries
worldwide to protect national borders, airports, correctional
facilities, nuclear power stations and other sensitive facilities
from terrorism, theft and other threats. Israeli-based Magal has
subsidiaries in the U.S., Canada, the U.K., Germany, Romania,
Mexico and an office in China. Revenues for fiscal year 2003 were
US$59 million, with net income of US$2.4 million. Magal trades
under the symbol MAGS in the U.S. on the Nasdaq National Market
since 1993 and in Israel on the Tel-Aviv Stock Exchange (TASE)
since July 2001. This press release contains forward-looking
statements, which are subject to risks and uncertainties. Such
statements are based on assumptions and expectations which may not
be realized and are inherently subject to risks and uncertainties,
many of which cannot be predicted with accuracy and some of which
might not even be anticipated. Future events and actual results,
financial and otherwise, may differ from the results discussed in
the forward- looking statements. A number of these risks and other
factors that might cause differences, some of which could be
material, along with additional discussion of forward-looking
statements, are set forth in the Company's Annual Report on Form
20-F filed with the Securities and Exchange Commission. Contacts:
Magal Security Systems, Ltd Gal Investor Relations Raya Asher, CFO
Ehud Helft, Investor Relations Tel: +972-3-5391444 Tel: +1-866- 704
6710 Fax: +972-3-5366245 Tel (Intl): +972-3-6074717 E-mail: E-mail:
, MAGAL SECURITY SYSTEMS LTD. UNAUDITED CONDENSED CONSOLIDATED
STATEMENTS OF INCOME (All numbers except EPS expressed in thousands
of US$) Quarter ended March 31 2004 2003 % change Revenues 14,215
12,801 11% Cost of revenues 7,945 7,400 7% Gross Profit 6,270 5,401
16% Operating expenses: Research & development, net 1,131 1,084
4% Selling & marketing, net 2,621 1,930 36% General &
administrative 1,301 1,320 -1% 5,053 4,334 17% Operating income
1,217 1,067 14% Financial expenses, net 93 331 Income before taxes
on income 1,124 736 53% Taxes on income 437 204 Net income 687 532
29% Basic net earnings per share 0.09 0.07 29% Diluted net earnings
per share 0.08 0.07 14% Weighted average ordinary shares
outstanding (in thousands) 8,065 7,897 Weighted average ordianry
shares outstanding, assuming dilution (in thousands) 8,186 7,985
Quarter Ended March 31, 2004 2003 Gross Margin (%) 44.1 42.2
Research & development net as a % of Revenues 8.0 8.5 Selling
& Marketing as a % of Revenues 18.4 15.1 General &
Administrative as a % of Revenues 9.2 10.3 Operating margin (%) 8.6
8.3 Net income margin (%) 4.8 4.2 Total Bank Debt to Total
Capitalization 0.46 *0.47 Current Ratio 2.06 *1.76 * As of December
31, 2003 MAGAL SECURITY SYSTEMS LTD. CONDENSED CONSOLIDATED BALANCE
SHEETS (All numbers expressed in thousands of US$) March 31,
December 31, 2004 2003 Unaudited Audited CURRENT ASSETS: Cash and
cash equivalents 5,425 4,389 Short-term bank deposits 9,084 9,000
Trade receivables: 13,290 14,885 Unbilled accounts receivable 4,808
5,072 Other accounts receivable 3,145 3,332 Inventories 11,416
11,777 Deferred income taxes 931 979 Total current assets 48,099
49,434 Long term investments and trade receivables: Long-term trade
receivables 105 300 Long-term bank deposits 3,075 3,051 Severance
pay fund 1,895 1,960 Total long term investments and trade
receivables 5,075 5,311 PROPERTY AND EQUIPMENT, NET 12,137 11,505
OTHER ASSETS, NET 5,159 5,193 Total assets 70,470 71,443 CURRENT
LIABILITIES: Short-term bank credit 12,861 12,597 Current
maturities of long-term bank loans 1,348 3,841 Trade payables 3,005
5,077 Other accounts payable and accrued expenses 6,116 6,518 Total
current liabilities 23,330 28,033 LONG-TERM LOANS 4,342 1,873
ACCRUED SEVERANCE PAY 1,926 1,992 UNREALIZED LOSSES ON FORWARD
CONTRATCS 365 561 SHAREHOLDERS' EQUITY: Share capital 2,717 2,683
Additional paid-in capital 24,820 24,098 Unrealized losses on
forward contracts, net (556) (807) Accumulated other comprehensive
income 1,115 1,286 Retained earnings 12,411 11,724 Total
shareholders' equity 40,507 38,984 TOTAL LIABILITIES &
SHAREHOLDERS' EQUITY 70,470 71,443 DATASOURCE: Magal Security
Systems Ltd. CONTACT: Raya Asher, CFO of Magal Security Systems,
Ltd, +972-3-5391444, fax, +972-3-5366245, ; Ehud Helft, Investor
Relations of Gal Investor Relations, +1-866-704-6710, (Intl):
+972-3-6074717, or , for Magal Security Systems, Ltd Web site:
http://www.magal-ssl.com/ x
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