HAIFA, Israel, Aug. 15, 2019 /PRNewswire/ -- Elbit Systems
Ltd. (NASDAQ: ESLT) (TASE: ESLT), (the "Company")
the international high technology company, reported today its
consolidated results for the quarter ended June 30, 2019.
In this release, the Company is providing US-GAAP results as
well as additional non-GAAP financial data, which are intended to
provide investors a more comprehensive understanding of the
Company's business results and trends. Unless otherwise stated, all
financial data presented is GAAP financial data.
Management Comment:
Bezhalel (Butzi) Machlis, President and CEO of Elbit Systems,
commented: "We are pleased with the results of the second
quarter, with an ongoing increase in backlog as well as solid
revenue growth of over 19%, diversified across all our main regions
of business.
We are also encouraged that, with the IMI consolidation,
our ongoing focus on efficient operations enabled us to maintain a
similar level of operating margins to that of the second quarter
last year.
We continue to integrate and extract synergies from all our
recent acquisitions and are looking forward to further growth of
our business."
Second quarter 2019 results:
Revenues in the second quarter of 2019 were
$1,064.0 million, as compared to
$892.2 million in the second quarter
of 2018. The strong growth was driven mainly by the consolidation
of IMI.
Non-GAAP (*) gross profit amounted to
$294.3 million (27.7% of revenues) in
the second quarter of 2019, as compared to $254.8 million (28.6% of revenues) in the second
quarter of 2018. GAAP gross profit in the second quarter of
2019 was $288.4 million (27.1% of
revenues), as compared to $250.0
million (28.0% of revenues) in the second quarter of
2018.
Research and development expenses, net were
$77.3 million (7.3% of revenues) in
the second quarter of 2019, as compared to $76.6 million (8.6% of revenues) in the second
quarter of 2018.
Marketing and selling expenses, net were $73.6 million (6.9% of revenues) in the second
quarter of 2019, as compared to $69.9
million (7.8% of revenues) in the second quarter of
2018.
_____________
* see page 3
General and administrative expenses, net were
$57.2 million (5.4% of revenues) in
the second quarter of 2019, as compared to $37.0 million (4.2% of revenues) in the second
quarter of 2018.
Other operating income, net in the second quarter
of 2018 was $45.4 million. This was
the result of net gains related to valuation of shares in two of
our Israeli subsidiaries in the commercial cyber and medical
instrument areas, due to third party investments.
Non-GAAP(*) operating income was $89.6 million (8.4% of revenues) in the second
quarter of 2019, as compared to $73.1
million (8.2% of revenues) in the second quarter of
2018. GAAP operating income in the second quarter
of 2019 was $80.3 million (7.5%
of revenues), as compared to $111.8
million (12.5% of revenues) in the second quarter of
2018.
Financial expenses, net were $20.3 million in the second quarter of 2019, as
compared to $10.7 million in the
second quarter of 2018. Financial expenses, net in the second
quarter of 2019 include exchange rate differences of approximately
$5.2 million related to the
recognition of lease liabilities denominated in foreign currencies
(mainly in New Israeli Shekels) as a result of the adoption of ASC
842, Leases, effective January 1,
2019.
Other income, net was $1.6
million in the second quarter of 2019, as compared to
other expenses, net of $5.1 million
in the second quarter of 2018, mainly due to the non-service
cost components of pension plans, in accordance with ASU 2017-07
and adjustments to the fair value of our investments in Israeli
subsidiaries.
Taxes on income were $10.8
million (effective tax rate of 17.6%) in the second quarter
of 2019, as compared to $7.3 million
(effective tax rate of 7.6%) in the second quarter of 2018. The
effective tax rate is affected by the mix of the tax rates in the
various jurisdictions in which the Company's entities generate
taxable income and other income and expenses that are not a
part of the taxable income.
Equity in net earnings of affiliated companies
and partnerships was $3.5 million
(0.3% of revenues) in the second quarter of 2019, as compared to
$3.3 million (0.4% of revenues) in
the second quarter of 2018.
Net income attributable to non-controlling
interests was $0.4 million
in the second quarter of 2019, as compared to $0.1 million in the second quarter of 2018.
Non-GAAP(*) net income attributable to the
Company's shareholders in the second quarter of 2019 was
$64.3 million (6.0% of revenues), as
compared to $61.0 million (6.8% of
revenues) in the second quarter of 2018. GAAP net income
attributable to the Company's shareholders in the second
quarter of 2019 was $53.8 million
(5.1% of revenues), as compared to $91.9
million (10.3% of revenues) in the second quarter of
2018.
Non-GAAP(*) diluted net earnings per share
attributable to the Company's shareholders were
$1.46 for the second quarter of 2019,
as compared to $1.43 for the second
quarter of 2018. GAAP diluted earnings per share in the
second quarter of 2019 were $1.22, as
compared to $2.15 for the second
quarter of 2018.
The Company's backlog of orders as of June 30,
2019 totaled $9,796 million, as
compared to $8,065 million as of
June 30, 2018. Approximately 60% of the current backlog is
attributable to orders from outside Israel. Approximately 56% of the current
backlog is scheduled to be performed during the second half of 2019
and 2020.
_____________
* see page 3
Operating cash flows used in the six months ended
June 30, 2019 was $91.5
million, as compared to $1.1
million used in the six months ended June 30, 2018.
Investing cash flows include approximately
$344.9 million in proceeds from
factoring of the premises evacuation asset related to the IMI
acquisition.
Financing cash flows include approximately
$184.8 million in proceeds resulting
from the issuance of shares to institutional investors.
Adoption of New Accounting Standard:
The Company adopted Accounting Standards Update (ASU) 2016-02,
Leases (ASC 842), effective January 1,
2019, using a modified retrospective transition method.
Consequently, periods prior to January 1,
2019 are not restated for the adoption of ASU 2016-02.
Leases (ASC 842), as amended, requires lessees to
recognize a Right of Use (ROU) asset and lease liability on the
balance sheet for most lease arrangements and expands disclosures
about leasing arrangements for both lessees and lessors, among
other items. We adopted ASU 2016-02 using the optional transition
method whereby we applied the new lease requirements under ASU
2016-02 through a cumulative-effect adjustment.
On January 1, 2019, we recognized
approximately $377 million of
ROU operating lease assets and lease liabilities as a result of
adopting this standard. As part of our adoption, we elected all of
the available practical expedients with the exception of the
practical expedient permitting the use of hindsight when
determining the lease term and assessing impairment of ROU assets.
The adoption of the standard increased our financial expenses in
the first half of 2019 in the amount of $14.5 million as a result of exchange rate
differences on lease liabilities denominated in foreign currencies
(mainly NIS). The comparative periods have not been restated for
the adoption of ASU 2016-02.
* Non-GAAP financial data:
The following non-GAAP financial data is presented to enable
investors to have additional information on the Company's business
performance as well as a further basis for periodical comparisons
and trends relating to the Company's financial results. The Company
believes such data provides useful information to investors by
facilitating more meaningful comparisons of the Company's financial
results over time. Such non-GAAP information is used by the
Company's management to make strategic decisions, forecast future
results and evaluate the Company's current performance. However,
investors are cautioned that, unlike financial measures prepared in
accordance with GAAP, non-GAAP measures may not be comparable with
the calculation of similar measures for other companies.
The non-GAAP financial data includes reconciliation adjustments
regarding non-GAAP gross profit, operating income, net income and
diluted EPS. In arriving at non-GAAP presentations, the Company
factors out items such as those that have a non-recurring impact on
the income statements, various non-cash items, including
significant exchange rate differences, significant effects of
retroactive tax legislation and changes in accounting guidance and
other items, which in management's judgment, are items that are
considered to be outside of the review of core operating
results.
In the Company's non-GAAP presentation, the Company made certain
adjustments, as indicated in the table below.
These non-GAAP measures are not based on any comprehensive set
of accounting rules or principles. The Company believes that
non-GAAP measures have limitations in that they do not reflect all
of the amounts associated with the Company's results of operations,
as determined in accordance with GAAP, and that these measures
should only be used to evaluate the Company's results of operations
in conjunction with the corresponding GAAP measures.
Investors should consider non-GAAP financial measures in addition
to, and not as replacements for or superior to, measures of
financial performance prepared in accordance with GAAP.
Reconciliation of
GAAP to Non-GAAP (Unaudited) Supplemental Financial
Data:
|
(US Dollars in
millions, except per share amount)
|
|
Six Months
Ended
June 30,
|
|
Three Months
Ended
June 30,
|
|
Year Ended
December 31,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
GAAP gross
profit
|
$
|
566.0
|
|
|
$
|
485.4
|
|
|
$
|
288.4
|
|
|
$
|
250.0
|
|
|
$
|
976.2
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
Amortization of
purchased intangible assets
|
11.7
|
|
|
9.2
|
|
|
5.9
|
|
|
4.8
|
|
|
19.1
|
|
Expenses related to
IMI acquisition
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66.6
|
|
Non-GAAP
gross profit
|
$
|
577.7
|
|
|
$
|
494.6
|
|
|
$
|
294.3
|
|
|
$
|
254.8
|
|
|
$
|
1,061.9
|
|
Percent of
revenues
|
27.7%
|
|
|
28.9%
|
|
|
27.7%
|
|
|
28.6%
|
|
|
28.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
income
|
$
|
156.3
|
|
|
$
|
175.1
|
|
|
$
|
80.3
|
|
|
$
|
111.8
|
|
|
$
|
292.8
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
Amortization of
purchased intangible assets
|
18.5
|
|
|
12.8
|
|
|
9.3
|
|
|
6.7
|
|
|
26.5
|
|
Expenses related to
IMI acquisition
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66.8
|
|
Gain from changes in
holdings
|
(1.2)
|
|
|
(45.4)
|
|
|
—
|
|
|
(45.4)
|
|
|
(45.4)
|
|
Non-GAAP operating
income
|
$
|
173.6
|
|
|
$
|
142.5
|
|
|
$
|
89.6
|
|
|
$
|
73.1
|
|
|
$
|
340.7
|
|
Percent of
revenues
|
8.3%
|
|
|
8.3%
|
|
|
8.4%
|
|
|
8.2%
|
|
|
9.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
attributable to Elbit
Systems' shareholders
|
$
|
104.3
|
|
|
$
|
141.6
|
|
|
$
|
53.8
|
|
|
$
|
91.9
|
|
|
$
|
206.7
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
Amortization of
purchased intangible assets
|
18.5
|
|
|
12.8
|
|
|
9.3
|
|
|
6.7
|
|
|
26.5
|
|
Expenses related to
IMI acquisition
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66.8
|
|
Impairment of
investment
|
—
|
|
|
5.1
|
|
|
—
|
|
|
5.1
|
|
|
17.6
|
|
Exchange rate
differences (*)
|
15.5
|
|
|
3.7
|
|
|
7.0
|
|
|
3.5
|
|
|
3.4
|
|
Gain from changes in
holdings
|
(5.8)
|
|
|
(45.4)
|
|
|
(4.6)
|
|
|
(45.4)
|
|
|
(45.4)
|
|
Related tax
benefits
|
(2.4)
|
|
|
(1.7)
|
|
|
(1.2)
|
|
|
(0.8)
|
|
|
(8.1)
|
|
Non-GAAP net
income attributable to
Elbit Systems' shareholders
|
$
|
130.1
|
|
|
$
|
116.1
|
|
|
$
|
64.3
|
|
|
$
|
61.0
|
|
|
$
|
267.5
|
|
Percent of
revenues
|
6.2%
|
|
|
6.8%
|
|
|
6.0%
|
|
|
6.8%
|
|
|
7.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted net
EPS
|
$
|
2.40
|
|
|
$
|
3.31
|
|
|
$
|
1.22
|
|
|
$
|
2.15
|
|
|
$
|
4.84
|
|
Adjustments,
net
|
0.60
|
|
|
(0.59)
|
|
|
0.24
|
|
|
(0.72)
|
|
|
1.42
|
|
Non-GAAP diluted
net EPS
|
$
|
3.00
|
|
|
$
|
2.72
|
|
|
$
|
1.46
|
|
|
$
|
1.43
|
|
|
$
|
6.26
|
|
(*) Exchange rate
differences in the first half of 2019 included exchange
rate differences of $ 14.5 million on lease contracts as a result
of the implementation of ASC 842, effective as of January 1, 2019,
as well as other assets and liabilities denominated in currencies
other than U.S. dollars.
|
Recent Events:
On June 16, 2019, the
Company announced that its wholly-owned subsidiary, Elbit Systems -
Cyclone Ltd., was awarded an approximately $50 million contract for the supply of structural
parts from composite materials for an aircraft of a customer in
North America. The contract will
be performed over six years.
On June 19, 2019, the
Company announced that it was awarded an approximately $73 million contract from Diehl Defence GmbH
& Co. KG to provide J-MUSIC™ Directed Infrared Counter Measure
systems for the German Air Forces' Airbus A400M aircraft. The
contract will be performed over a four-year period.
On June 25, 2019, the
Company announced that its subsidiary, BrightWay Vision Ltd. (BWV),
raised a $25 million investment from
Koito Manufacturing Co, Ltd. and Magenta Venture Partners,
following which they hold approximately 38.5% of BWV's shares, on a
fully diluted basis.
On June 26, 2019, the
Company announced, further to its announcement of August 17, 2017, that on June 25, 2019, the
United States Court of Appeals for the Federal Circuit in
Washington, DC ruled completely in
Elbit Systems' favor against Hughes Network Systems, LLC for
infringing an Elbit Systems patent relating to high-speed satellite
communications, U.S. Patent No. 6,240,073.
On June 26, 2019, the
Company announced that its subsidiary in the U.S., Elbit Systems of
America, LLC ("Elbit Systems of America"), was awarded an
approximately $26 million contract
from the United States Customs and Border Protection (CBP) to
install an Integrated Fixed Towers (IFT) system in the U.S. Border
Patrol Casa Grande Area of Responsibility (AoR) in Arizona. The project will be performed over a
one-year period. To date, Elbit Systems of America has been awarded
a number of contracts from CBP to install IFT systems in numerous
AoR's covering a total of approximately 200 miles of the
Arizona-Mexico border.
On August 7, 2019, the
Company announced that it was awarded a contract valued at
approximately $80 million to upgrade
tanks and supply radio systems for an Army of a country in
South East Asia. The contract will
be performed over a period of 32 months.
On August 12, 2019, the
Company announced that its subsidiary, Elbit Systems of America
LLC, ("Elbit Systems of America") was awarded a contract by the
U.S. Navy for the supply of components of the for Color Helmet
Mounted Display System of the CV-22 aircraft. The contract is in an
amount that is not material to Elbit Systems and is expected to be
completed by October 2020.
Dividend:
The Board of Directors declared a dividend of $0.44 per share for the second quarter of 2019.
The dividend's record date is September 9,
2019. The dividend will be paid from income generated as
Preferred Income (as defined under Israel tax laws), on September 23, 2019, net of taxes and levies, at
the rate of 20%.
Conference Call:
The Company will be hosting a conference call on Thursday, August 15, 2019 at 9:00 a.m. Eastern Time. On the call, management
will review and discuss the results and will be available to answer
questions.
To participate, please call one of the teleconferencing numbers
that follow. If you are unable to connect using the toll-free
numbers, please try the international dial-in number.
US Dial-in Numbers: 1-888-407-2553
Canada Dial-in Numbers: 1-888-604-5839
UK Dial-in Number: 0-800-917-9141
ISRAEL Dial-in Number:
03-918-0664
INTERNATIONAL Dial-in Number: +972-3-918-0664
at: 9:00 am Eastern
Time; 6:00 am Pacific Time;
2:00 pm UK Time; 4:00 pm Israel Time
This call will also be broadcast live on Elbit Systems' web-site
at http://www.elbitsystems.com . An online replay will
be available from 24 hours after the call ends.
Alternatively, for two days following the call, investors will
be able to dial a replay number to listen to the call. The dial-in
numbers are:
1-888-326-9310 (US and Canada) or +972-3-925-5925 (Israel and International).
About Elbit Systems
Elbit Systems Ltd. is an international high technology company
engaged in a wide range of defense, homeland security and
commercial programs throughout the world. The Company, which
includes Elbit Systems and its subsidiaries, operates in the areas
of airborne, land and naval systems, command, control,
communications, computers, intelligence surveillance and
reconnaissance ("C4ISR"), unmanned aircraft systems, advanced
electro-optics, electro-optic space systems, EW suites, signal
intelligence systems, data links and communications systems, radios
and munitions. The Company also focuses on the upgrading of
existing platforms, developing new technologies for defense,
homeland security and commercial aviation applications and
providing a range of support services, including training and
simulation systems.
For additional information, visit: www.elbitsystems.com or
follow us on Twitter
Attachments:
Consolidated balance sheets
Consolidated statements of income
Consolidated statements of cash flow
Consolidated revenue distribution by areas of operation and by
geographical regions
This press release contains forward-looking statements (within
the meaning of Section 27A of the Securities Act of 1933, as
amended and Section 21E of the Securities Exchange Act of 1943, as
amended) regarding Elbit Systems Ltd. and/or its subsidiaries
(collectively the Company), to the extent such statements do not
relate to historical or current fact. Forward-looking statements
are based on management's expectations, estimates, projections and
assumptions. Forward-looking statements are made pursuant to the
safe harbor provisions of the Private Securities Litigation Reform
Act of 1995, as amended. These statements are not guarantees of
future performance and involve certain risks and uncertainties,
which are difficult to predict. Therefore, actual future results,
performance and trends may differ materially from these
forward-looking statements due to a variety of factors, including,
without limitation: scope and length of customer contracts;
governmental regulations and approvals; changes in governmental
budgeting priorities; general market, political and economic
conditions in the countries in which the Company operates or sells,
including Israel and the United States among others; differences in
anticipated and actual program performance, including the ability
to perform under long-term fixed-price contracts; and the outcome
of legal and/or regulatory proceedings. The factors listed above
are not all-inclusive, and further information is contained in
Elbit Systems Ltd.'s latest annual report on Form 20-F, which is on
file with the U.S. Securities and Exchange Commission. All
forward-looking statements speak only as of the date of this
release. The Company does not undertake to update its
forward-looking statements.
Elbit Systems Ltd., its logo, brand, product, service and
process names appearing in this Press Release are the trademarks or
service marks of Elbit Systems Ltd. or its affiliated
companies. All other brand, product, service and process
names appearing are the trademarks of their respective holders.
Reference to or use of a product, service or process other than
those of Elbit Systems Ltd. does not imply recommendation,
approval, affiliation or sponsorship of that product, service or
process by Elbit Systems Ltd. Nothing contained herein shall be
construed as conferring by implication, estoppel or otherwise any
license or right under any patent, copyright, trademark or other
intellectual property right of Elbit Systems Ltd. or any third
party, except as expressly granted herein.
(FINANCIAL TABLES TO FOLLOW)
ELBIT SYSTEMS
LTD.
|
CONSOLIDATED
BALANCE SHEETS
|
(In thousands of US
Dollars)
|
|
June 30,
2019
|
|
December 31,
2018
|
|
Unaudited
|
|
Audited
|
Assets
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
|
191,810
|
|
$
|
208,479
|
Short-term bank
deposits and restricted deposits
|
10,825
|
|
16,447
|
Trade and unbilled
receivables and contract assets, net
|
1,839,624
|
|
1,712,915
|
Other receivables and
prepaid expenses
|
197,671
|
|
199,148
|
Inventories,
net
|
1,276,806
|
|
1,141,996
|
Total current
assets
|
3,516,736
|
|
3,278,985
|
|
|
|
|
Investments in
affiliated companies and partnerships and other
companies
|
198,362
|
|
196,180
|
Long-term trade and
unbilled receivables and contract assets
|
254,779
|
|
297,145
|
Premises
evacuation
|
—
|
|
365,436
|
Long-term bank deposits and other
receivables
|
77,531
|
|
42,962
|
Deferred income
taxes, net
|
43,316
|
|
42,804
|
Severance pay
fund
|
285,646
|
|
278,732
|
|
859,634
|
|
1,223,259
|
|
|
|
|
Operating lease right
of use assets
|
368,676
|
|
—
|
Property, plant and
equipment, net
|
711,516
|
|
686,620
|
Goodwill and other
intangible assets, net
|
1,293,647
|
|
1,261,921
|
Total
assets
|
$
|
6,750,209
|
|
$
|
6,450,785
|
|
|
|
|
|
|
|
|
Liabilities and
Equity
|
|
|
|
Short-term bank
credit and loans
|
$
|
154,536
|
|
$
|
208,821
|
Current maturities of
long-term loans and Series A Notes
|
164,006
|
|
62,546
|
Operating lease
liabilities
|
63,707
|
|
—
|
Trade
payables
|
758,139
|
|
776,100
|
Other payables and
accrued expenses
|
1,095,463
|
|
1,081,992
|
Contract
liabilities
|
812,704
|
|
780,994
|
|
3,048,555
|
|
2,910,453
|
|
|
|
|
Long-term loans, net
of current maturities
|
126,528
|
|
467,649
|
Series A Notes, net
of current maturities
|
—
|
|
56,303
|
Employee benefit
liabilities
|
748,830
|
|
736,798
|
Deferred income taxes
and tax liabilities, net
|
88,310
|
|
78,677
|
Operating lease
liabilities
|
319,751
|
|
—
|
Contract
liabilities
|
89,769
|
|
175,890
|
Other long-term
liabilities
|
202,558
|
|
170,607
|
|
1,575,746
|
|
1,685,924
|
|
|
|
|
Elbit Systems Ltd.'s
equity
|
2,103,016
|
|
1,832,453
|
Non-controlling
interests
|
22,892
|
|
21,955
|
Total
equity
|
2,125,908
|
|
1,854,408
|
Total liabilities
and equity
|
$
|
6,750,209
|
|
$
|
6,450,785
|
ELBIT SYSTEMS
LTD.
|
CONSOLIDATED
STATEMENTS OF INCOME
|
(In thousands of US
Dollars, except for share and per share amount)
|
|
|
Six Months
Ended
June
30,
|
|
Three Months
Ended
June 30,
|
|
Year Ended
December 31,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2018
|
|
Unaudited
|
|
Unaudited
|
|
Audited
|
Revenues
|
$
|
2,085,704
|
|
|
$
|
1,710,694
|
|
|
$
|
1,063,981
|
|
|
$
|
892,166
|
|
|
$
|
3,683,684
|
|
Cost of
revenues
|
1,519,689
|
|
|
1,225,283
|
|
|
775,588
|
|
|
642,180
|
|
|
2,707,505
|
|
Gross
profit
|
566,015
|
|
|
485,411
|
|
|
288,393
|
|
|
249,986
|
|
|
976,179
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Research and
development, net
|
154,658
|
|
|
144,740
|
|
|
77,303
|
|
|
76,555
|
|
|
287,352
|
|
Marketing and
selling, net
|
145,405
|
|
|
138,119
|
|
|
73,573
|
|
|
69,949
|
|
|
281,014
|
|
General and
administrative, net
|
110,866
|
|
|
72,784
|
|
|
57,226
|
|
|
37,045
|
|
|
160,348
|
|
Other operating
income, net
|
(1,234)
|
|
|
(45,367)
|
|
|
—
|
|
|
(45,367)
|
|
|
(45,367)
|
|
Total operating
expenses
|
409,695
|
|
|
310,276
|
|
|
208,102
|
|
|
138,182
|
|
|
683,347
|
|
Operating
income
|
156,320
|
|
|
175,135
|
|
|
80,291
|
|
|
111,804
|
|
|
292,832
|
|
|
|
|
|
|
|
|
|
|
|
Financial expenses,
net(*)
|
(34,254)
|
|
|
(20,994)
|
|
|
(20,329)
|
|
|
(10,745)
|
|
|
(44,061)
|
|
Other (expenses)
income, net
|
(1,807)
|
|
|
(5,088)
|
|
|
1,623
|
|
|
(5,110)
|
|
|
(11,449)
|
|
Income before income
taxes
|
120,259
|
|
|
149,053
|
|
|
61,585
|
|
|
95,949
|
|
|
237,322
|
|
|
|
|
|
|
|
|
|
|
Taxes on
income
|
(20,924)
|
|
|
(13,639)
|
|
|
(10,825)
|
|
|
(7,277)
|
|
|
(26,445)
|
|
|
99,335
|
|
|
135,414
|
|
|
50,760
|
|
|
88,672
|
|
|
210,877
|
|
|
|
|
|
|
|
|
|
|
Equity in net
earnings (losses) of
affiliated companies and partnerships
|
5,741
|
|
|
6,445
|
|
|
3,494
|
|
|
3,311
|
|
|
(2,222)
|
|
Net income
|
$
|
105,076
|
|
|
$
|
141,859
|
|
|
$
|
54,254
|
|
|
$
|
91,983
|
|
|
$
|
208,655
|
|
Less: net income
attributable to non-
controlling interests
|
(800)
|
|
|
(299)
|
|
|
(434)
|
|
|
(53)
|
|
|
(1,917)
|
|
Net income
attributable to Elbit
Systems Ltd.'s shareholders
|
$
|
104,276
|
|
|
$
|
141,560
|
|
|
$
|
53,820
|
|
|
$
|
91,930
|
|
|
$
|
206,738
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share
attributable to Elbit Systems Ltd.'s shareholders:
|
|
|
|
|
Basic net earnings
per share
|
$
|
2.41
|
|
|
$
|
3.31
|
|
|
$
|
1.23
|
|
|
$
|
2.15
|
|
|
$
|
4.84
|
|
Diluted net earnings
per share
|
$
|
2.40
|
|
|
$
|
3.31
|
|
|
$
|
1.22
|
|
|
$
|
2.15
|
|
|
$
|
4.84
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares (in thousands)(**)
|
|
|
|
|
|
|
|
|
Shares used in
computation of basic
earnings per share
|
43,340
|
|
|
42,752
|
|
|
43,927
|
|
|
42,753
|
|
|
42,753
|
|
Shares used in
computation of diluted
earnings per share
|
43,391
|
|
|
42,754
|
|
|
44,026
|
|
|
42,755
|
|
|
42,753
|
|
|
(*) Financial
expenses in the first half of 2019 included exchange rate
differences of $14.5 million on lease contracts as a result of the
implementation of ASC 842.
(**) During the
second quarter of 2019 the Company issued 1,408,921 shares to
institutional investors.
|
ELBIT SYSTEMS
LTD.
|
CONSOLIDATED
STATEMENTS OF CASH FLOW
|
(In thousands of US
dollars)
|
|
Six Months
Ended
June 30,
|
|
Year Ended
December 31,
|
|
2019
|
|
2018
|
|
2018
|
|
Unaudited
|
|
Audited
|
CASH FLOWS FROM
OPERATING ACTIVITIES
|
|
|
|
|
|
Net
income
|
$
|
105,076
|
|
|
$
|
141,859
|
|
|
$
|
208,655
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
Depreciation and
amortization
|
66,854
|
|
|
56,413
|
|
|
118,205
|
|
Adjustment to fair
value investment
|
—
|
|
|
5,114
|
|
|
13,334
|
|
Stock-based
compensation
|
1,951
|
|
|
—
|
|
|
1,387
|
|
Amortization of Series
A Notes premium and related issuance costs, net
|
(46)
|
|
|
(46)
|
|
|
(92)
|
|
Deferred income taxes
and reserve, net
|
9,267
|
|
|
1,305
|
|
|
13,724
|
|
Loss (gain) on sale of
property, plant and equipment
|
(432)
|
|
|
(89)
|
|
|
2,080
|
|
Loss (gain) on sale and
revaluation of investments
|
(4,479)
|
|
|
(43,201)
|
|
|
(41,822)
|
|
Equity in net earnings
of affiliated companies and partnerships, net of dividend
received (*)
|
411
|
|
|
(4,093)
|
|
|
17,929
|
|
Changes in operating
assets and liabilities, net of amounts acquired:
|
|
|
|
|
|
Decrease (increase) in
short and long-term trade and unbilled receivables and
contract assets and prepaid expenses
|
(78,562)
|
|
|
18,077
|
|
|
(89,099)
|
|
Increase in
inventories, net
|
(134,370)
|
|
|
(136,949)
|
|
|
(117,221)
|
|
Decrease in trade
payables, other payables and accrued expenses
|
(5,638)
|
|
|
(91,660)
|
|
|
(89,956)
|
|
Severance, pension and
termination indemnities, net
|
3,012
|
|
|
439
|
|
|
(31,363)
|
|
Increase (decrease) in
contract liabilities
|
(54,515)
|
|
|
51,689
|
|
|
185,898
|
|
Net cash provided by
(used in) operating activities
|
(91,471)
|
|
|
(1,142)
|
|
|
191,659
|
|
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES
|
|
|
|
|
|
Purchase of property,
plant and equipment and other assets
|
(64,904)
|
|
|
(48,374)
|
|
|
(102,301)
|
|
Acquisition of
subsidiaries and business operations
|
(5,634)
|
|
|
(127,569)
|
|
|
(504,447)
|
|
Proceeds from premises
evacuation
|
344,913
|
|
|
—
|
|
|
—
|
|
Investments in
affiliated companies and other companies
|
(1,350)
|
|
|
(3,748)
|
|
|
(7,538)
|
|
Deconsolidation of
subsidiary
|
—
|
|
|
(2,873)
|
|
|
(2,873)
|
|
Proceeds from sale of
property, plant and equipment
|
1,039
|
|
|
1,106
|
|
|
4,388
|
|
Investment in long-term
deposits
|
(289)
|
|
|
(180)
|
|
|
(183)
|
|
Proceeds from sale of
long-term deposits
|
350
|
|
|
67
|
|
|
82
|
|
Investment in
short-term deposits and marketable securities
|
(15,649)
|
|
|
(5,072)
|
|
|
(10,361)
|
|
Proceeds from sale of
short-term deposits and marketable securities
|
21,856
|
|
|
18,104
|
|
|
30,363
|
|
Net cash provided by
(used in) investing activities
|
280,332
|
|
|
(168,539)
|
|
|
(592,870)
|
|
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES
|
|
|
|
|
|
Proceeds from exercise
of options
|
—
|
|
|
48
|
|
|
48
|
|
Issuance of
shares
|
184,840
|
|
|
—
|
|
|
—
|
|
Repayment of long-term
loans
|
(241,984)
|
|
|
(28)
|
|
|
(775)
|
|
Proceeds from long-term
loans
|
—
|
|
|
340,386
|
|
|
342,528
|
|
Repayment of Series A
Notes
|
(55,532)
|
|
|
—
|
|
|
(55,532)
|
|
Dividends
paid
|
(38,273)
|
|
|
(18,827)
|
|
|
(75,305)
|
|
Change in short-term
bank credit and loans, net
|
(54,581)
|
|
|
(120,995)
|
|
|
242,652
|
|
Net cash (used in)
provided by financing activities
|
(205,530)
|
|
|
200,584
|
|
|
453,616
|
|
|
|
|
|
|
|
Net increase
(decrease) in cash and cash equivalents
|
(16,669)
|
|
|
30,903
|
|
|
52,405
|
|
Cash and cash
equivalents at the beginning of the year
|
208,479
|
|
|
156,074
|
|
|
156,074
|
|
Cash and cash
equivalents at the end of the period
|
$
|
191,810
|
|
|
$
|
186,977
|
|
|
$
|
208,479
|
|
* Dividend
received from affiliated companies and partnerships
|
$
|
6,152
|
|
|
$
|
2,352
|
|
|
$
|
15,707
|
|
ELBIT SYSTEMS
LTD.
DISTRIBUTION OF
REVENUES
Consolidated
Revenues by Areas of Operation:
|
|
Six months ended
June 30,
|
|
Three months ended
June 30,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
$
millions
|
|
%
|
|
$
millions
|
|
%
|
|
$
millions
|
|
%
|
|
$
millions
|
|
%
|
Airborne
systems
|
781.3
|
|
|
37.5
|
|
|
678.3
|
|
|
39.7
|
|
|
412.9
|
|
|
38.8
|
|
|
367.3
|
|
|
41.2
|
|
Land
systems
|
565.5
|
|
|
27.1
|
|
|
256.5
|
|
|
15.0
|
|
|
262.0
|
|
|
24.6
|
|
|
142.1
|
|
|
15.9
|
|
C4ISR
systems
|
505.4
|
|
|
24.2
|
|
|
563.1
|
|
|
32.9
|
|
|
261.9
|
|
|
24.6
|
|
|
287.9
|
|
|
32.3
|
|
Electro-optic
systems
|
171.3
|
|
|
8.2
|
|
|
154.8
|
|
|
9.0
|
|
|
93.4
|
|
|
8.8
|
|
|
66.8
|
|
|
7.5
|
|
Other (mainly
non-defense
engineering and production services)
|
62.2
|
|
|
3.0
|
|
|
58.0
|
|
|
3.4
|
|
|
33.8
|
|
|
3.2
|
|
|
28.1
|
|
|
3.1
|
|
Total
|
2,085.7
|
|
|
100.0
|
|
|
1,710.7
|
|
|
100.0
|
|
|
1,064.0
|
|
|
100.0
|
|
|
892.2
|
|
|
100.0
|
|
Consolidated
Revenues by Geographical Regions:
|
|
Six months ended
June 30,
|
|
Three months ended
June 30,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
$
millions
|
|
%
|
|
$
millions
|
|
%
|
|
$
millions
|
|
%
|
|
$
millions
|
|
%
|
Israel
|
494.3
|
|
|
23.7
|
|
|
351.9
|
|
|
20.6
|
|
|
232.4
|
|
|
21.8
|
|
|
166.3
|
|
|
18.6
|
|
North
America
|
575.3
|
|
|
27.6
|
|
|
461.2
|
|
|
27.0
|
|
|
299.6
|
|
|
28.2
|
|
|
252.5
|
|
|
28.3
|
|
Europe
|
388.0
|
|
|
18.6
|
|
|
315.7
|
|
|
18.5
|
|
|
191.5
|
|
|
18.0
|
|
|
162.9
|
|
|
18.3
|
|
Asia-Pacific
|
483.9
|
|
|
23.2
|
|
|
364.0
|
|
|
21.3
|
|
|
267.3
|
|
|
25.1
|
|
|
190.4
|
|
|
21.3
|
|
Latin
America
|
72.6
|
|
|
3.5
|
|
|
91.0
|
|
|
5.3
|
|
|
40.8
|
|
|
3.8
|
|
|
50.9
|
|
|
5.7
|
|
Other
countries
|
71.6
|
|
|
3.4
|
|
|
126.9
|
|
|
7.3
|
|
|
32.4
|
|
|
3.1
|
|
|
69.2
|
|
|
7.8
|
|
Total
|
2,085.7
|
|
|
100.0
|
|
|
1,710.7
|
|
|
100.0
|
|
|
1,064.0
|
|
|
100.0
|
|
|
892.2
|
|
|
100.0
|
|
Company Contact:
Joseph Gaspar, Executive
VP & CFO
Tel: +972-772946663
j.gaspar@elbitsystems.com
David Vaaknin, VP, Head of Corporate Communications
Tel: +972-772946691
david.vaaknin@elbitsystems.com
Elbit Systems Ltd.
IR Contact:
Ehud Helft
Kenny Green
GK Investor Relations
Tel: 1-646-201-9246
elbitsystems@gkir.com
View original
content:http://www.prnewswire.com/news-releases/elbit-systems-reports-second-quarter-2019-results-300902335.html
SOURCE Elbit Systems Ltd.