YEHUD, Israel, Aug. 15, 2018 /PRNewswire/ -- Magal Security
Systems, Ltd. (NASDAQ: MAGS) today announced its financial
results for the three and six months periods ended June 30, 2018. Management will hold an investors'
conference call later today (at 9:30am
Eastern Time) to discuss the results.
SECOND QUARTER RESULTS SUMMARY
- Strong growth in second quarter revenue to $25.3 million, up 91% year-over-year and a 47%
increase sequentially.
- Operating income of $2.1
million compared with a loss of $1.7
million last year;
- Net income of $1.7 million
compared with a loss of $3.3 million
last year;
- EBITDA of $2.6 million, 10.2%
of revenue
SECOND QUARTER 2018 RESULTS
Revenues for the second quarter of 2018 were $25.3 million, a significant increase of 91%
compared with revenues of $13.3
million in the second quarter of 2017.
Gross profit for the second quarter of 2018 was
$11.1 million, or 43.6% of revenues,
an increase of 66% compared with gross profit of $6.7 million or 50.2% of revenues, in the second
quarter of 2017. The change in gross margin between the quarters
was a function of the products and projects mix executed during the
quarter.
Operating income for the second quarter of 2018 was
$2.1 million, a significant
improvement compared to an operating loss of $1.7 million in the second quarter of 2017.
Financial income, net for the second quarter was
$0.5 million compared with financial
expenses, net of $1.4 million in the
second quarter of 2017.
Net income in the second quarter of 2018 was $1.7 million, or $0.08 per share, compared with a net loss of
$3.3 million, or $0.14 loss per share in the second quarter of
2017.
EBITDA in the second quarter was $2.6 million, or 10.2% of revenue, an improvement
compared with negative EBITDA of $1.2
million in the second quarter of 2017.
Cash, short term deposits and restricted deposits, net of
bank debt, as of June 30, 2018,
were $45.4 million, or $1.97 per share, compared with cash and short
term deposits, net of bank debt, of $52.3
million, or $2.27 per share,
at December 31, 2017. The decrease in
cash is primarily due to the investment in working capital for
scaling up of various upcoming projects.
Commencing in the second quarter, Magal fully consolidated the
financial results of its recently acquired E.S.C. Baz subsidiary
into its financial results.
MANAGEMENT COMMENT
Commenting on the results, Mr. Dror
Sharon, CEO of Magal, commented, "Magal had a good
quarter from all standpoints, with organic growth in revenue and
corresponding improvements in profit across the board. Our revenues
increased on the back of the solid backlog we have built, which
continues to remain at healthy levels. Magal is in a good position
for 2018."
Continued Mr. Sharon, "Since joining Magal in June, I
have been very impressed by what I have seen. Magal is a company
with outstanding engineers and employees and market leading
technology. I see much potential for growth, as our technology and
product offerings continue to address the growing needs of the
security and HLS markets. I am excited and look forward to growing
the company over the quarters and years ahead."
INVESTORS' CONFERENCE CALL INFORMATION:
The Company will host a conference call later today,
August 15, 2018, at 9:30am Eastern Time and 4:30pm Israel
time.
To participate, please call one of the following
teleconferencing numbers:
US: 1 866 744 5399; Israel:
03 918 0692; UK: 0 800 404 8418; Intl.: +972 3 918 0692
If you are unable to connect using the toll-free numbers, please
try the international dial-in number.
A replay of the call will be available on the Company's website
for three months from the day after the call. The link to the
replay will be accessible at www.magalsecurity.com.
ABOUT MAGAL SECURITY SYSTEMS LTD.
Magal is a leading international provider of solutions and
products for physical and video security solutions, as well as site
management. Over the past 45 years, Magal has delivered its
products as well as tailor-made security solutions and turnkey
projects to hundreds of satisfied customers in over 80 countries –
under the most challenging conditions.
Magal offers comprehensive integrated solutions for critical
sites, managed by Fortis4G – our 4th generation, cutting-edge
physical security information management system (PSIM). The
solutions leverage our broad portfolio of home-grown PIDS
(Perimeter Intrusion Detection Systems), Symphony – our advanced
VMS (Video Management Software) with native IVA (Intelligent Video
Analytics) security solutions.
Forward Looking Statements
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.
* Tables to follow *
MAGAL SECURITY
SYSTEMS LTD.
|
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
|
(All numbers
except EPS expressed in thousands of US$)
|
|
|
Three
Months
|
Six
Months
|
|
Ended June
30,
|
Ended June
30,
|
|
2017
|
|
2018
|
%
change
|
|
2017
|
|
2018
|
%
change
|
Revenue
|
13,254
|
|
25,348
|
91
|
|
27,589
|
|
42,603
|
54
|
Cost of
revenue
|
6,602
|
|
14,286
|
|
|
13,526
|
|
23,985
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
6,652
|
|
11,062
|
66
|
|
14,063
|
|
18,618
|
32
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Research
and development, net
|
1,682
|
|
1,822
|
8
|
|
3,287
|
|
3,427
|
4
|
Selling
and marketing
|
4,564
|
|
4,875
|
7
|
|
9,362
|
|
9,108
|
(3)
|
General
and administrative
|
2,073
|
|
2,288
|
10
|
|
3,933
|
|
3,973
|
1
|
Total operating
expenses
|
8,319
|
|
8,985
|
8
|
|
16,582
|
|
16,508
|
-
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
(1,667)
|
|
2,077
|
|
|
(2,519)
|
|
2,110
|
|
Financial income
(expenses), net
|
(1,374)
|
|
522
|
|
|
(4,010)
|
|
639
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss)
before income taxes
|
(3,041)
|
|
2,599
|
|
|
(6,529)
|
|
2,749
|
|
|
|
|
|
|
|
|
|
|
|
Taxes on
income
|
264
|
|
696
|
|
|
469
|
|
1,013
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
(3,305)
|
|
1,903
|
|
|
(6,998)
|
|
1,736
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss)
attributable to non-controlling interests
|
9
|
|
173
|
|
|
14
|
|
173
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Magal shareholders'
|
(3,314)
|
|
1,730
|
|
|
(7,012)
|
|
1,563
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income
(loss) per share
|
($0.14)
|
|
$0.08
|
|
|
$(0.31)
|
|
$0.07
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net income
(loss) per share
|
($0.14)
|
|
$0.07
|
|
|
$(0.31)
|
|
$0.07
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares used in computing
basic net income (loss) per share
|
23,032,448
|
|
23,042,346
|
|
|
22,958,689
|
|
23,037,456
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares used in computing
diluted net income (loss) per share
|
23,032,448
|
|
23,286,703
|
|
|
22,958,689
|
|
23,318,174
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months
|
|
|
Six
Months
|
|
|
Ended June
30,
|
|
|
Ended June
30,
|
|
|
2017
|
|
2018
|
|
|
2017
|
|
2018
|
|
|
%
|
|
%
|
|
|
%
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Gross margin
|
50.2
|
|
43.6
|
|
|
51
|
|
43.7
|
|
Research and
development, net as a % of revenues
|
12.7
|
|
7.2
|
|
|
11.9
|
|
8
|
|
Selling and marketing
as a % of revenues
|
34.4
|
|
19.2
|
|
|
33.9
|
|
21.4
|
|
General and
administrative as a % of revenues
|
15.6
|
|
9.0
|
|
|
14.3
|
|
9.3
|
|
Operating
margin
|
-
|
|
8.2
|
|
|
-
|
|
5
|
|
Net
margin
|
-
|
|
6.8
|
|
|
-
|
|
3.7
|
|
|
MAGAL SECURITY
SYSTEMS LTD.
|
RECONCILLATION OF
EBITDA TO NET LOSS
|
(All numbers
expressed in thousands of US$)
|
|
|
Three
Months
|
|
|
Six
Months
|
|
Ended June
30,
|
|
|
Ended June
30,
|
|
2017
|
|
2018
|
|
|
2017
|
|
2018
|
|
|
|
|
|
|
|
|
|
GAAP Net income
(loss)
|
(3,305)
|
|
1,903
|
|
|
(6,998)
|
|
1,736
|
Less:
|
|
|
|
|
|
|
|
|
Financial
income (expenses), net
|
(1,374)
|
|
522
|
|
|
(4,010)
|
|
639
|
Taxes on
income
|
264
|
|
696
|
|
|
469
|
|
1,013
|
Depreciation and amortization
|
(462)
|
|
(499)
|
|
|
(912)
|
|
(976)
|
EBITDA
|
(1,205)
|
|
2,576
|
|
|
(1,607)
|
|
3,086
|
MAGAL SECURITY
SYSTEMS LTD.
|
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(All numbers
expressed in thousands of US$)
|
|
|
|
|
|
December
31,
|
|
June
30,
|
|
2017
|
|
2018
|
CURRENT
ASSETS:
|
|
|
|
Cash and cash
equivalents
|
$22,463
|
|
$34,812
|
Short-term bank
deposits
|
27,025
|
|
6,605
|
Restricted
deposits
|
2,842
|
|
3,964
|
Trade receivables,
net
|
14,489
|
|
15,779
|
Unbilled accounts
receivable
|
6,309
|
|
6,075
|
Other accounts
receivable and prepaid expenses
|
2,850
|
|
2,910
|
Inventories
|
9,596
|
|
10,940
|
|
|
|
|
Total current
assets
|
85,574
|
|
81,085
|
|
|
|
|
LONG TERM
INVESTMENTS AND RECEIVABLES:
|
|
|
|
|
|
|
|
Long-term deposits
and restricted bank deposits
|
155
|
|
153
|
Severance pay
fund
|
1,524
|
|
1,412
|
Deferred income
taxes
|
2,579
|
|
2,529
|
|
|
|
|
Total long-term
investments and receivables
|
4,258
|
|
4,094
|
|
|
|
|
PROPERTY AND
EQUIPMENT, NET
|
5,718
|
|
6,188
|
|
|
|
|
GOODWILL AND
INTANGIBLE ASSETS, NET
|
16,995
|
|
16,272
|
|
|
|
|
Total
assets
|
$112,545
|
|
$107,639
|
MAGAL SECURITY
SYSTEMS LTD.
|
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(All numbers
expressed in thousands of US$)
|
|
|
|
|
|
December
31,
|
|
June
30,
|
|
2017
|
|
2018
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
|
|
|
Trade
payables
|
$5,198
|
|
$5,114
|
Customer
advances
|
7,191
|
|
3,278
|
Other accounts
payable and accrued expenses
|
13,784
|
|
12,463
|
|
|
|
|
Total current
liabilities
|
26,173
|
|
20,855
|
|
|
|
|
LONG-TERM
LIABILITIES:
|
|
|
|
Deferred
revenues
|
891
|
|
731
|
Deferred income
taxes
|
190
|
|
185
|
Accrued severance
pay
|
2,328
|
|
2,297
|
Other long-term
liabilities
|
14
|
|
324
|
|
|
|
|
Total long-term
liabilities
|
3,423
|
|
3,537
|
|
|
|
|
|
|
|
|
Non-controlling
interest
|
-
|
|
1,586
|
|
|
|
|
SHAREHOLDERS'
EQUITY
|
|
|
|
Share Capital:
Ordinary shares of NIS 1 par value -
|
|
|
|
|
Authorized:
39,748,000 shares at December 31, 2017 and June 30, 2018;
Issued and outstanding: 23,032,448 shares at December 31, 2017
and
23,042,852 shares at June 30, 2018
|
6,716
|
|
6,719
|
Additional paid-in
capital
|
93,975
|
|
94,017
|
Accumulated other
comprehensive loss
|
(87)
|
|
(1,170)
|
Foreign currency
translation adjustments (stand alone financial
statements)
|
5,859
|
|
3,879
|
Accumulated
deficit
|
(23,514)
|
|
(21,784)
|
|
|
|
|
TOTAL
SHAREHOLDERS' EQUITY
|
82,949
|
|
81,661
|
|
|
|
|
TOTAL LIABILITIES
AND SHAREHOLDERS' EQUITY
|
$112,545
|
|
$107,639
|
|
|
|
|
|
For more information:
Magal Security
Systems Ltd.
Diane Hill,
Assistant to the CEO
Tel:
+972-3-539-1421
E-mail:
dianeh@magal-s3.com
Web:
www.magalsecurity.com
|
GK Investor
Relations
Ehud Helft / Gavriel Frohwein
Tel: (US) +1 646 688 3559
E-mail: magal@gkir.com
|
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SOURCE Magal Security Systems, Ltd