Backlog of orders at $16.6 billion; Revenues of $1.5 billion;
Non-GAAP net income of $73.5; GAAP net income of $60.7 million;
Non-GAAP net EPS of $1.65; GAAP net EPS of $1.36
HAIFA,
Israel, Nov. 28, 2023 /PRNewswire/
-- Elbit Systems Ltd. ("Elbit Systems" or the
"Company") (NASDAQ: ESLT) (TASE: ESLT), the
international high technology defense company, reported today its
consolidated results for the third quarter ended September 30, 2023.
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 view of the Company's
business results and trends. For a description of the Company's
non-GAAP definitions see page 4 below, "Non-GAAP financial data".
Unless otherwise stated, all financial data presented is US-GAAP
financial data.
Management Comment:
Bezhalel (Butzi) Machlis, President and CEO of Elbit
Systems, commented:
"Double digit revenue growth and an almost $2 billion increase in the backlog coupled with
the improvement in profitability in the third quarter provide us
with confidence in our ability to meet our long term plan and
overcome the current challenges.
Following the brutal attack on Israel, the outbreak of war on
the 7th of October and the increase in demand for our solutions by
the Israel MOD Elbit Systems has ramped up its production in
support of the Israel MOD and Israel's security forces. We remain
focused on maintaining our commitments to our customers around the
world.
We appreciate the multiple expressions of support from our
customers and business partners around the world.
Our hearts and prayers are with the hostages, the soldiers and
their families. I would like to express my appreciation to Elbit
Systems' employees around the world that are contributing to our
efforts to support Israel and our customers in challenging
times".
Third quarter 2023 results:
Revenues in the third quarter of 2023 were $1,501.6 million, as compared to $1,348.9 million in the third quarter of
2022.
Aerospace revenues increased by 24% in the third quarter of 2023
compared to the third quarter of 2022, mainly due to training &
simulation sales in Europe and UAS
in Asia Pacific. C4I and Cyber
revenues increased by 9% year over year mainly due to radio systems
sales in Europe. ISTAR and EW
revenues were similar to the revenues in the third quarter of 2022.
Land revenues increased by 7% mainly due to artillery and weapon
station sales in Europe. Elbit
Systems of America revenues decreased by 2% in the third quarter
due to lower precision guided munition sales.
For distribution of revenues by segments and geographic regions
see the tables on page 12.
Non-GAAP(*) gross profit amounted to
$373.8 million (24.9% of
revenues) in the third quarter of 2023, as compared to $337.9 million (25.0% of revenues) in the
third quarter of 2022. GAAP gross profit in the third
quarter of 2023 was $367.2 million
(24.5% of revenues), as compared to $326.0
million (24.2% of revenues) in the third quarter of 2022.
The GAAP and Non-GAAP gross profit in the third quarter of 2022
includes expenses of approximately $13
million related to the effect of the significant increase in
the Company's share price on employees' stock price linked
compensation plans.
Research and development expenses, net were $103.3 million (6.9% of revenues) in the
third quarter of 2023, as compared to $113.2 million (8.4% of revenues) in the
third quarter of 2022.
Marketing and selling expenses, net were $86.0 million (5.7% of revenues) in the third
quarter of 2023, as compared to $68.5
million (5.1% of revenues) in the third quarter of 2022.
General and administrative expenses, net were
$71.8 million (4.8% of revenues) in
the third quarter of 2023, as compared to $80.2 million (5.9% of revenues) in the third
quarter of 2022.
Other operating income, net in the third
quarter of 2022 were mainly capital gains of $9.4 million related to a sale of a building in
Israel.
Non-GAAP(*) operating income was $117.0 million (7.8% of revenues) in the
third quarter of 2023, as compared to $84.3 million (6.3% of revenues) in the
third quarter of 2022. GAAP operating income in the third
quarter of 2023 was $106.1 million (7.1% of revenues), as
compared to $73.4 million (5.4%
of revenues) in the third quarter of 2022. GAAP and
Non-GAAP(*) operating income in the third quarter
of 2022 was reduced by expenses of approximately $22 million related to the Company's stock price
linked compensation plans.
Financial expenses, net were $35.7 million in the third quarter of 2023,
as compared to $16.4 million in
the third quarter of 2022. The financial expenses in 2023 were
higher mainly as a result of the significant increase in interest
rates.
Taxes on income were $10.0
million in the third quarter of 2023, as compared to
$7.9 million in the third quarter of
2022.
Non-GAAP(*) net income attributable to the
Company's shareholders in the third quarter of 2023 was
$73.5 million (4.9% of
revenues), as compared to $62.6 million (4.6% of revenues) in the
third quarter of 2022. GAAP net income attributable to
the Company's shareholders in the third quarter of 2023 was
$60.7 million (4.0% of revenues), as
compared to $56.2 million (4.2% of
revenues) in the third quarter of 2022.
Non-GAAP(*) diluted net earnings per share
attributable to the Company's shareholders were
$1.65 for the third quarter of 2023,
as compared to $1.40 for the third
quarter of 2022. GAAP diluted earnings per share attributable to
the Company's shareholders in the third quarter of 2023 were
$1.36, as compared to $1.26 in the third quarter of 2022. Diluted net
earnings per share in the third quarter of 2022, were reduced by
$0.45 as a result of the expenses
related to the Company's stock price linked compensation plans.
The Company's backlog of orders as of September 30,
2023 totaled $16.6 billion.
Approximately 75% of the current backlog is attributable to orders
from outside Israel. Approximately 39% of the backlog is scheduled
to be performed during the remainder of 2023 and 2024.
Cash flows used in operating activities in the nine
months ended September 30, 2023 were $200.0 million, as compared to cash flows
provided by operating activities of $44.6 million in the nine months ended
September 30, 2022. The cash flows in the nine months ended
September 30, 2023 were affected
mainly by the increase in inventories.
__________
* see page 4
Impact of the "Swords of Iron" War on the Company
On October 7, 2023, Hamas
terrorists infiltrated Israel's southern border from the
Gaza Strip and conducted a series
of brutal attacks on civilian and military targets. Hamas also
launched extensive rocket attacks on the Israeli population and
industrial centers located along Israel's border with the
Gaza Strip and in many other parts
of Israel. Israel has also been attacked on other fronts, including
from Lebanon, which have prompted
military responses from Israel. Following the attacks, the
State of Israel declared a state
of war.
Since the commencement of hostilities, Elbit Systems has
experienced a considerable increased demand for our solutions from
the Israel Ministry Of Defense (IMOD) compared to the routine
levels of demands, and we have increased our support to the IMOD,
mainly through deliveries of our systems and dedicated efforts of
our employees. Subject to further developments, this demand may
continue and possibly generate material orders to the Company. At
the same time, the Company continues to support its international
customers.
While the vast majority of our facilities in Israel continue to operate uninterrupted, some
of our operations have experienced disruptions due to the
relocation of certain production lines, mobilization of personnel
for reserve duty (approximately 15% of our work force in
Israel has been called for duty),
operational constrains and supply chain disruptions.
Elbit Systems is taking a number of actions to protect the
safety of our employees and maintain business continuity, among
them relocation of production lines from facilities in areas that
have been evacuated to other facilities; recruitment of additional
employees to support an increase in production capacity and to
replace employees recruited into the reserves; increased monitoring
of our global supply chain to identify delays, shortages and
bottlenecks; rescheduling deliveries as necessary; and increasing
inventories to mitigate potential supply chain disruptions and to
support increased production. To date, the impact of the
disruptions on our financial results has not been
material.
The extent of the effects of the war on the Company's
performance will depend on future developments that are difficult
to predict at this time, including the duration and scope of the
war. We continue to monitor the situation closely.
* Non-GAAP financial data:
The following non-GAAP financial data, including Adjusted gross
profit, Adjusted operating income, Adjusted net income, and
Adjusted diluted earnings per share, is presented to enable
investors to have additional information on our business
performance as well as a further basis for periodical comparisons
and trends relating to our financial results. We believe such data
provides useful information to investors and analysts by
facilitating more meaningful comparisons of our financial results
over time. The non-GAAP adjustments exclude amortization expenses
of intangible assets related to acquisitions that occurred mainly
in prior periods, capital gains related primarily to the sale of
investments, revaluations of investments in affiliated companies,
non-operating foreign exchange gains or losses, one-time tax
expenses, and the effect of tax on each of these items. We present
these non-GAAP financial measures because management believes they
supplement and/or enhance management's, analysts' and investors'
overall understanding of the Company's underlying financial
performance and trends and facilitate comparisons among current,
past, and future periods.
Specifically, management uses Adjusted gross profit, Adjusted
operating income, and Adjusted net income attributable to the
Company's shareholders to measure the ongoing gross profit,
operating profit and net income performance of the Company because
the measure adjusts for more significant non-recurring items,
amortization expenses of intangible assets relating to prior
acquisitions, and non-cash expense which can fluctuate year to
year.
We believe Adjusted gross profit, Adjusted operating income, and
Adjusted net income attributable to the Company's shareholders are
useful to existing shareholders, potential shareholders and other
users of our financial information because they provide measures of
the Company's ongoing performance that enable these users to
perform trend analysis using comparable data.
Management uses Adjusted diluted earnings per share to evaluate
further adjusted net income attributable to the Company's
shareholders while considering changes in the number of diluted
shares over comparable periods.
We believe adjusted diluted earnings per share is useful to
existing shareholders, potential shareholders and other users of
our financial information because it also enables these users to
evaluate adjusted net income attributable to Company's shareholders
on a per-share basis.
The non-GAAP measures used by the Company are not based on any
comprehensive set of accounting rules or principles. We believe
that non-GAAP measures have limitations in that they do not reflect
all of the amounts associated with our results of operations, as
determined in accordance with GAAP, and that these measures should
only be used to evaluate our results of operations in conjunction
with the corresponding GAAP measures.
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. They
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 for per share amounts)
|
Nine months
ended
September
30, 2023
|
|
Nine months
ended
September
30, 2022
|
|
Three months
ended
September
30, 2023
|
|
Three months
ended
September
30, 2022
|
|
Year ended
December
31, 2022
|
GAAP gross
profit
|
$
1,100.8
|
|
$
992.7
|
|
$
367.2
|
|
$
326.0
|
|
$ 1,373.3
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
Amortization of
purchased intangible assets(*)
|
20.2
|
|
24.5
|
|
6.6
|
|
11.9
|
|
31.7
|
Non-GAAP gross
profit
|
$
1,121.0
|
|
$
1,017.2
|
|
$
373.8
|
|
$
337.9
|
|
$ 1,405.0
|
Percent of
revenues
|
25.8 %
|
|
25.4 %
|
|
24.9 %
|
|
25.0 %
|
|
25.5 %
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
income
|
$
301.5
|
|
$
247.2
|
|
$
106.1
|
|
$
73.4
|
|
$
367.5
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
Amortization of
purchased intangible assets(*)
|
32.7
|
|
37.8
|
|
10.9
|
|
11.5
|
|
49.2
|
Capital gain
|
—
|
|
(31.5)
|
|
—
|
|
(0.6)
|
|
(31.5)
|
Non-recurring gain
related to grants
|
—
|
|
—
|
|
—
|
|
—
|
|
(28.6)
|
Non-GAAP operating
income
|
$
334.2
|
|
$
253.5
|
|
$
117.0
|
|
$
84.3
|
|
$
356.6
|
Percent of
revenues
|
7.7 %
|
|
6.3 %
|
|
7.8 %
|
|
6.3 %
|
|
6.5 %
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
attributable to Elbit Systems' shareholders
|
$
185.1
|
|
$
190.2
|
|
$
60.7
|
|
$
56.2
|
|
$
275.4
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
Amortization of
purchased intangible assets(*)
|
32.7
|
|
37.8
|
|
10.9
|
|
11.5
|
|
49.2
|
Non-recurring gain
related to grants
|
—
|
|
—
|
|
—
|
|
—
|
|
(28.6)
|
Capital gain
|
—
|
|
(20.5)
|
|
—
|
|
(0.6)
|
|
(20.5)
|
Revaluation of
investment measured under fair value method
|
—
|
|
(4.6)
|
|
—
|
|
(4.6)
|
|
10.2
|
Non-operating foreign
exchange (gains) losses
|
5.7
|
|
(7.5)
|
|
3.3
|
|
0.9
|
|
(10.5)
|
Tax effect and other
tax items, net
|
(4.2)
|
|
(1.5)
|
|
(1.4)
|
|
(0.8)
|
|
(6.3)
|
Non-GAAP net income
attributable to Elbit Systems' shareholders
|
$
219.3
|
|
$
193.9
|
|
$
73.5
|
|
$
62.6
|
|
$
268.9
|
Percent of
revenues
|
5.0 %
|
|
4.8 %
|
|
4.9 %
|
|
4.6 %
|
|
4.9 %
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted net
EPS
|
$
4.15
|
|
$
4.27
|
|
$
1.36
|
|
$
1.26
|
|
$
6.18
|
Adjustments,
net
|
0.77
|
|
0.08
|
|
0.29
|
|
0.14
|
|
(0.15)
|
Non-GAAP diluted net
EPS
|
$
4.92
|
|
$
4.35
|
|
$
1.65
|
|
$
1.40
|
|
$
6.03
|
|
(*) While
amortization of acquired intangible assets is excluded from the
measures, the revenue of the acquired companies is reflected in
the
measures and the acquired assets contribute to revenue
generation.
|
Recent Events:
On August 16, 2023, the
Company announced that its partner in the Australian Land 400 Phase
3 project (the "Project"), Hanwha Defense Australia ("Hanwha"), has
reported that it was downselected by the Australian Government, as
the preferred tenderer for the Project, with final Government
approval to be sought at the conclusion of contract negotiations.
Hanwha further reported that Elbit Systems is a key partner to
Hanwha to deliver the Redback Infantry Fighting Vehicle under the
Project.
On August 16, 2023, the
Company announced that S&P Global Ratings Maalot Ltd., an
Israeli rating agency had assigned an ilA-1+ (on local scaling)
short term issuer rating to the Company and an ilA-1+ (on local
scaling) short term rating to commercial paper that may be issued
by the Company in Israel.
On August 21, 2023, the
Company announced that it was awarded a contract worth
approximately $55 million to supply
multi-layered ReDrone Counter Unmanned Aerial Systems (C-UAS) to
the Netherlands. The contract will
be performed over a period of four years.
On September 1, 2023, the
Company announced, following its announcement of August 16, 2023, that it completed an issuance in
Israel of U.S. Dollar denominated
commercial paper in an amount of approximately $300 million par value, bearing an annual
interest of the SOFR 3M interest rate
and an additional 1%. S&P Global Ratings Maalot Ltd. had
assigned an ilA-1+ (on local scaling) short term rating to
commercial paper.
On September 5, 2023, the
Company announced that it was awarded two contracts by a European
country, worth an aggregate amount of approximately $200 million, to supply a C4I (Command, Control,
Communication, Computers, Intelligence) solution to artillery
battalions and a Hostile Fire Counter Attack solution. The
contracts will be executed until 2026, with options for further
extensions.
On September 11, 2023, the
Company announced that it was awarded a contract worth $109 million to supply BAE Systems Hägglunds the
Iron Fist Active Protection System for its CV90 platform, for a
European customer. The contract will be carried out over three
years.
On September 18, 2023, the
Company announced that it was awarded a $95
million contract to supply SkyStriker loitering munitions to
a European country. The contract will be carried out over a period
of two years.
On September 27, 2023, the
Company announced that it was awarded a contract worth
approximately $115 million to supply
tank ammunition to a NATO country. The contract will be performed
over a period of three years and includes options for further
extensions.
On September 27, 2023, the
Company announced that it has filed a shelf prospectus with the
Israel Securities Authority and the Tel Aviv Stock Exchange (the
"Shelf Prospectus").
The Shelf Prospectus will be effective for a period of two years
and will enable the Company to raise from time to time funds
through offerings and sales of various securities including debt
and equity, in Israel, at the
discretion of the Company. Any offering of these securities will be
made pursuant to a supplemental shelf offering report to be filed,
which will describe the terms of the securities being offered and
the specific details of each offering.
On October 25, 2023, the
Company announced that its subsidiary Elbit Systems Sweden AB
(Elbit Systems Sweden) was awarded a contract worth approximately
$170 million to become the
integration partner for the Swedish Army digitalization program LSS
Mark. The contract will be performed over a ten year period.
On October 29, 2023, the
Company announced that it was awarded a $135
million contract to establish an artillery ammunition
factory for an international customer. The contract will be
performed out over a period of two years.
Dividend:
The Board of Directors declared a dividend of $0.50 per share. The dividend's record date is
December 26, 2023. The dividend will
be paid on January 8, 2024, after
deduction of withholding tax, at the rate of 16.8%.
Conference Call:
The Company will be hosting a conference call today, Tuesday,
November 28, 2023, 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 Number:
1-866-744-5399
Canada Dial-in Number:
1-866-485-2399
Israel
Dial-in Number: 03-918-0610
International Dial-in
Number: 972-3-918-0610
at 9:00am Eastern
Time; 6:00am Pacific Time;
4:00pm Israel Time
The conference call will also be broadcast live on Elbit
Systems' website at https://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: 1-888-782-4291 (US and Canada) or +972-3-925-5900 (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 aerospace, 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, cyber-based systems and munitions. The Company also focuses
on the upgrading of existing platforms, developing new technologies
for defense, homeland security and commercial applications and
providing a range of support services, including training and
simulation systems.
For additional information, visit: https://elbitsystems.com/,
follow us on Twitter or visit our official Facebook, Youtube and
LinkedIn Channels.
Attachments:
Consolidated balance sheets
Consolidated statements of income
Consolidated statements of cash flows
Consolidated revenue distribution by geographical regions and by
segments
Company Contact:
Dr. Yaacov (Kobi)
Kagan, EVP & Chief Financial Officer
Tel: +972-77-2946663
kobi.kagan@elbitsystems.com
Rami Myerson, VP, Investor
Relations
Tel: +972-77-2948984
rami.myerson@elbitsystems.com
Dalia Bodinger, VP,
Communications & Brand
Tel: +972-77-2947602
dalia.bodinger@elbitsystems.com
This press release may contain forward–looking statements
(within the meaning of Section 27A of the Securities Act of 1933,
as amended, Section 21E of the Securities Exchange Act of 1934, as
amended and the Israeli Securities Law, 1968) regarding Elbit
Systems Ltd. and/or its subsidiaries (collectively the Company), to
the extent such statements do not relate to historical or current
facts. Forward-looking statements are based on management's current
expectations, estimates, projections and assumptions about future
events. 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, uncertainties and
assumptions about the Company, which are difficult to predict,
including projections of the Company's future financial results,
its anticipated growth strategies and anticipated trends in its
business. 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; including the
duration and scope of the current war in Israel, and the potential impact on our
operations; changes in global health and macro-economic conditions;
differences in anticipated and actual program performance,
including the ability to perform under long-term fixed-price
contracts; changes in the competitive environment; 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.
Although the Company believes the expectations reflected in the
forward-looking statements contained herein are reasonable, it
cannot guarantee future results, level of activity, performance or
achievements. Moreover, neither the Company nor any other person
assumes responsibility for the accuracy and completeness of any of
these forward-looking statements. 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)
|
|
|
As of
September 30,
2023
(Unaudited)
|
|
As of
December 31,
2022
(Audited)
|
Assets
|
|
|
|
Cash and cash
equivalents
|
$
120,288
|
|
$
211,108
|
Short-term bank
deposits
|
26,582
|
|
1,040
|
Trade and unbilled
receivables and contract assets, net
|
2,694,533
|
|
2,574,605
|
Other receivables and
prepaid expenses
|
282,972
|
|
298,698
|
Inventories,
net
|
2,291,626
|
|
1,946,326
|
Total current
assets
|
5,416,001
|
|
5,031,777
|
|
|
|
|
Investments in
affiliated companies, partnerships and other companies
|
154,335
|
|
159,604
|
Long-term trade and
unbilled receivables and contract assets
|
355,398
|
|
374,054
|
Long-term bank deposits
and other receivables
|
90,072
|
|
112,525
|
Deferred income taxes,
net
|
22,769
|
|
20,025
|
Severance pay
fund
|
203,160
|
|
227,786
|
Total
|
825,734
|
|
893,994
|
|
|
|
|
Operating lease right
of use assets
|
422,552
|
|
405,446
|
Property, plant and
equipment, net
|
1,058,071
|
|
949,207
|
Goodwill and other
intangible assets, net
|
1,892,893
|
|
1,935,227
|
Total assets
|
$
9,615,251
|
|
$
9,215,651
|
|
|
|
|
Liabilities and
Equity
|
|
|
|
Short-term bank credit
and loans
|
$
776,335
|
|
$
115,076
|
Current maturities of
long-term loans and Series B, C and D Notes
|
72,141
|
|
76,555
|
Operating lease
liabilities
|
62,846
|
|
69,322
|
Trade
payables
|
1,100,489
|
|
1,067,818
|
Other payables and
accrued expenses
|
1,265,494
|
|
1,171,357
|
Contract
liabilities
|
1,568,218
|
|
1,777,161
|
Total current
liabilities
|
4,845,523
|
|
4,277,289
|
|
|
|
|
Long-term loans, net of
current maturities
|
39,622
|
|
264,541
|
Series B, C and D
Notes, net of current maturities
|
329,398
|
|
415,537
|
Employee benefit
liabilities
|
566,562
|
|
618,088
|
Deferred income taxes
and tax liabilities, net
|
62,264
|
|
72,965
|
Contract
liabilities
|
298,566
|
|
217,075
|
Operating lease
liabilities
|
346,898
|
|
344,585
|
Other long-term
liabilities
|
281,289
|
|
247,896
|
Total long-term
liabilities
|
1,924,599
|
|
2,180,687
|
|
|
|
|
Elbit Systems Ltd.'s
equity
|
2,842,835
|
|
2,755,221
|
Non-controlling
interests
|
2,294
|
|
2,454
|
Total equity
|
2,845,129
|
|
2,757,675
|
Total liabilities and
equity
|
$
9,615,251
|
|
$
9,215,651
|
ELBIT SYSTEMS
LTD.
|
CONSOLIDATED
STATEMENTS OF INCOME
|
(In thousands of US
Dollars, except for share and per share amounts)
|
|
|
Nine months
ended
September
30, 2023
(Unaudited)
|
|
Nine months
ended
September
30, 2022
(Unaudited)
|
|
Three months
ended
September
30, 2023
(Unaudited)
|
|
Three months
ended
September
30, 2022
(Unaudited)
|
|
Year ended
December
31, 2022
(Audited)
|
Revenues
|
$ 4,348,950
|
|
$ 4,005,119
|
|
$
1,501,567
|
|
$
1,348,940
|
|
$ 5,511,549
|
Cost of
revenues
|
3,248,104
|
|
3,012,466
|
|
1,134,393
|
|
1,022,959
|
|
4,138,266
|
Gross profit
|
1,100,846
|
|
992,653
|
|
367,174
|
|
325,981
|
|
1,373,283
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Research and
development, net
|
307,065
|
|
310,225
|
|
103,315
|
|
113,193
|
|
435,650
|
Marketing and selling,
net
|
267,845
|
|
238,275
|
|
85,967
|
|
68,521
|
|
326,020
|
General and
administrative, net
|
224,406
|
|
237,274
|
|
71,842
|
|
80,220
|
|
313,047
|
Other operating income,
net
|
—
|
|
(40,274)
|
|
—
|
|
(9,374)
|
|
(68,918)
|
Total operating
expenses
|
799,316
|
|
745,500
|
|
261,124
|
|
252,560
|
|
1,005,799
|
Operating
income
|
301,530
|
|
247,153
|
|
106,050
|
|
73,421
|
|
367,484
|
|
|
|
|
|
|
|
|
|
|
Financial expenses,
net
|
(91,991)
|
|
(24,605)
|
|
(35,722)
|
|
(16,396)
|
|
(51,364)
|
Other income
(expenses), net
|
(5,375)
|
|
(9,096)
|
|
(1,851)
|
|
4,822
|
|
(23,562)
|
Income before income
taxes
|
204,164
|
|
213,452
|
|
68,477
|
|
61,847
|
|
292,558
|
Taxes on
income
|
(27,957)
|
|
(28,678)
|
|
(10,014)
|
|
(7,932)
|
|
(24,131)
|
Income after taxes on
income
|
176,207
|
|
184,774
|
|
58,463
|
|
53,915
|
|
268,427
|
|
|
|
|
|
|
|
|
|
|
Equity in net earnings
of affiliated companies and partnerships
|
9,247
|
|
5,224
|
|
2,395
|
|
2,313
|
|
7,042
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$
185,454
|
|
$
189,998
|
|
$
60,858
|
|
$
56,228
|
|
$
275,469
|
|
|
|
|
|
|
|
|
|
|
Less: net (income)
losses attributable to non-controlling interests
|
(331)
|
|
154
|
|
(155)
|
|
(7)
|
|
(21)
|
Net income
attributable to Elbit Systems Ltd.'s shareholders
|
$
185,123
|
|
$
190,152
|
|
$
60,703
|
|
$
56,221
|
|
$
275,448
|
|
|
|
|
|
|
|
|
|
|
Earnings per share
attributable to
Elbit Systems Ltd.'s
shareholders:
|
|
|
|
|
|
|
|
|
|
Basic net earnings per
share
|
$
4.17
|
|
$
4.29
|
|
$
1.37
|
|
$
1.27
|
|
$
6.21
|
Diluted net earnings
per share
|
$
4.15
|
|
$
4.27
|
|
$
1.36
|
|
$
1.26
|
|
$
6.18
|
|
|
|
|
|
|
|
|
|
|
Weighted average number
of shares used
in computation
of:
|
|
|
|
|
|
|
|
|
|
Basic earnings per
share (in thousands)
|
44,351
|
|
44,314
|
|
44,360
|
|
44,336
|
|
44,322
|
Diluted earnings per
share (in thousands)
|
44,579
|
|
44,581
|
|
44,642
|
|
44,638
|
|
44,581
|
ELBIT SYSTEMS
LTD.
|
CONSOLIDATED
STATEMENTS OF CASH FLOW
|
(In thousands of US
Dollars)
|
|
|
Nine months
ended
September
30, 2023
(Unaudited)
|
|
Nine months
ended
September
30, 2022
(Unaudited)
|
|
Year ended
December
31, 2022
(Audited)
|
CASH FLOWS FROM
OPERATING ACTIVITIES
|
|
|
|
|
|
Net income
|
$
185,454
|
|
$
189,998
|
|
$ 275,469
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
Depreciation and
amortization
|
123,477
|
|
121,128
|
|
161,290
|
Stock-based
compensation
|
9,732
|
|
9,392
|
|
10,463
|
Amortization of series
B, C and D related issuance costs, net
|
445
|
|
592
|
|
773
|
Deferred income taxes
and reserve, net
|
4,025
|
|
(622)
|
|
(2,219)
|
Gain on sale of
property, plant and equipment
|
(241)
|
|
(17,998)
|
|
(18,995)
|
Loss (gain) on sale of
investment, remeasurement of investment held under fair value
method
|
6
|
|
(22,453)
|
|
(7,360)
|
Equity in net earnings
of affiliated companies and partnerships, net of dividend received
(*)
|
5,060
|
|
11,811
|
|
11,368
|
Changes in operating
assets and liabilities, net of amounts acquired:
|
|
|
|
|
|
Decrease (increase) in
trade and unbilled receivables and prepaid expenses
|
(65,444)
|
|
(120,229)
|
|
97,151
|
Increase in
inventories, net
|
(345,201)
|
|
(274,207)
|
|
(305,058)
|
Increase (decrease) in
trade payables and other payables and accrued expenses
|
30,999
|
|
5,841
|
|
(123,289)
|
Severance, pension and
termination indemnities, net
|
(20,892)
|
|
(60,653)
|
|
(51,689)
|
Increase (decrease) in
contract liabilities
|
(127,451)
|
|
202,044
|
|
192,164
|
Net cash (used in)
provided by operating activities
|
(200,031)
|
|
44,644
|
|
240,068
|
CASH FLOWS FROM
INVESTING ACTIVITIES
|
|
|
|
|
|
Purchase of property,
plant and equipment and other assets
|
(157,787)
|
|
(188,355)
|
|
(205,110)
|
Acquisition of
subsidiaries, net of cash assumed
|
(10,380)
|
|
(6,704)
|
|
(12,430)
|
Deferred payment on
acquisition
|
—
|
|
—
|
|
(50,749)
|
Investments in
affiliated companies and other companies, net
|
(2,939)
|
|
(2,782)
|
|
(4,466)
|
Proceeds from sale of
property, plant and equipment
|
600
|
|
23,091
|
|
24,882
|
Proceeds from sale of a
subsidiary and business operation
|
—
|
|
93,138
|
|
93,138
|
Proceeds from
(investment in) short-term deposits, net
|
(25,576)
|
|
1,967
|
|
2,567
|
Proceeds from sale of
long-term deposits, net
|
83
|
|
132
|
|
186
|
Net cash used in
investing activities
|
(195,999)
|
|
(79,513)
|
|
(151,982)
|
CASH FLOWS FROM
FINANCING ACTIVITIES
|
|
|
|
|
|
Issuance of
shares
|
15
|
|
22
|
|
24
|
Issuance of commercial
paper
|
313,620
|
|
—
|
|
—
|
Repayment of long-term
loans
|
(246,173)
|
|
(29,929)
|
|
(122,353)
|
Proceeds from long-term
bank loans
|
20,000
|
|
67,891
|
|
39,547
|
Repayment of Series B,
C and D Notes
|
(62,434)
|
|
(65,374)
|
|
(65,379)
|
Dividends paid
(**)
|
(67,033)
|
|
(64,644)
|
|
(86,813)
|
Change in short-term
bank credit and loans, net
|
347,215
|
|
116,091
|
|
99,003
|
Net cash (used in)
provided by financing activities
|
305,210
|
|
24,057
|
|
(135,971)
|
Net decrease in cash
and cash equivalents
|
(90,820)
|
|
(10,812)
|
|
(47,885)
|
CASH AND CASH
EQUIVALENTS AT THE BEGINNING OF THE PERIOD
|
$
211,108
|
|
$
258,993
|
|
$ 258,993
|
CASH AND CASH
EQUIVALENTS AT THE END OF THE PERIOD
|
$
120,288
|
|
$
248,181
|
|
$ 211,108
|
(*)
Dividend received from affiliated companies and
partnerships
|
$
14,307
|
|
$
17,035
|
|
$
18,409
|
|
(**)
Dividends paid during 2023 included approximately $500 dividends
paid by subsidiaries to non-controlling interests.
|
ELBIT SYSTEMS
LTD.
|
DISTRIBUTION OF
REVENUES
|
(In millions of US
Dollars)
|
|
|
Consolidated
revenues by geographical regions:
|
|
|
Nine months
ended
September
30, 2023
|
|
%
|
|
Nine months
ended
September
30, 2022
|
|
%
|
|
Three months
ended
September
30, 2023
|
|
%
|
|
Three months
ended
September
30, 2022
|
|
%
|
|
Year ended
December
31, 2022
|
|
%
|
Israel
|
$
730.0
|
|
16.8
|
|
$
800.5
|
|
20.0
|
|
$
230.2
|
|
15.3
|
|
$
253.3
|
|
18.8
|
|
$
1,071.9
|
|
19.4
|
North
America
|
1,049.6
|
|
24.1
|
|
1,090.1
|
|
27.2
|
|
359.7
|
|
24.0
|
|
386.3
|
|
28.6
|
|
1,489.7
|
|
27.0
|
Europe
|
1,329.7
|
|
30.6
|
|
859.1
|
|
21.4
|
|
496.9
|
|
33.1
|
|
347.1
|
|
25.7
|
|
1,243.6
|
|
22.6
|
Asia-Pacific
|
968.1
|
|
22.3
|
|
1,038.1
|
|
25.9
|
|
314.2
|
|
20.9
|
|
260.0
|
|
19.3
|
|
1,405.5
|
|
25.5
|
Latin
America
|
85.1
|
|
2.0
|
|
76.7
|
|
1.9
|
|
26.9
|
|
1.8
|
|
42.8
|
|
3.2
|
|
119.9
|
|
2.2
|
Other
countries
|
186.5
|
|
4.2
|
|
140.6
|
|
3.6
|
|
73.7
|
|
4.9
|
|
59.4
|
|
4.4
|
|
180.9
|
|
3.3
|
Total
revenue
|
$
4,349.0
|
|
100.0
|
|
$
4,005.1
|
|
100.0
|
|
$
1,501.6
|
|
100.0
|
|
$
1,348.9
|
|
100.0
|
|
$
5,511.5
|
|
100.0
|
|
Consolidated
revenues by segments:
|
|
|
Nine months
ended
September
30, 2023
|
|
Nine months
ended
September
30, 2022
|
|
Three months
ended
September
30, 2023
|
|
Three months
ended
September
30, 2022
|
|
Year ended
December
31, 2022
|
Aerospace
|
|
|
|
|
|
|
|
|
|
External
customers
|
$
1,188.1
|
|
$
1,052.6
|
|
$
404.1
|
|
$
296.6
|
|
$
1,471.1
|
Intersegment
revenue
|
181.8
|
|
193.1
|
|
58.0
|
|
75.2
|
|
262.1
|
Total
|
1,369.9
|
|
1,245.7
|
|
462.1
|
|
371.8
|
|
1,733.2
|
C4I and
Cyber
|
|
|
|
|
|
|
|
|
|
External
customers
|
490.7
|
|
$
452.1
|
|
$
171.7
|
|
160.7
|
|
631.3
|
Intersegment
revenue
|
41.8
|
|
36.0
|
|
16.4
|
|
12.0
|
|
47.1
|
Total
|
532.5
|
|
488.1
|
|
188.1
|
|
172.7
|
|
678.4
|
ISTAR and EW
|
|
|
|
|
|
|
|
|
|
External
customers
|
735.6
|
|
660.0
|
|
242.9
|
|
233.5
|
|
882.2
|
Intersegment
revenue
|
138.9
|
|
120.0
|
|
44.2
|
|
53.5
|
|
163.4
|
Total
|
874.5
|
|
780.0
|
|
287.1
|
|
287.0
|
|
1,045.6
|
Land
|
|
|
|
|
|
|
|
|
|
External
customers
|
884.7
|
|
806.0
|
|
330.0
|
|
296.9
|
|
1,075.8
|
Intersegment
revenue
|
52.1
|
|
78.6
|
|
11.3
|
|
23.4
|
|
92.7
|
Total
|
936.8
|
|
884.6
|
|
341.3
|
|
320.3
|
|
1,168.5
|
ESA
|
|
|
|
|
|
|
|
|
|
External
customers
|
1,049.9
|
|
1,034.4
|
|
352.9
|
|
361.2
|
|
1,451.1
|
Intersegment
revenue
|
5.6
|
|
3.0
|
|
1.9
|
|
1.8
|
|
5.6
|
Total
|
1,055.5
|
|
1,037.4
|
|
354.8
|
|
363.0
|
|
1,456.7
|
Revenues
|
|
|
|
|
|
|
|
|
|
Total revenues
(external customers and intersegment)
for reportable segments
|
4,769.2
|
|
4,435.8
|
|
1,633.4
|
|
1,514.8
|
|
6,082.4
|
Less - intersegment
revenue
|
(420.2)
|
|
(430.7)
|
|
(131.8)
|
|
(165.9)
|
|
(570.9)
|
Total
revenues
|
$
4,349.0
|
|
$
4,005.1
|
|
$
1,501.6
|
|
$
1,348.9
|
|
$
5,511.5
|
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SOURCE Elbit Systems Ltd.