Carmel Container Systems Ltd. Reports Results for The Quarter Ended March 31, 2004
May 10 2004 - 10:01AM
PR Newswire (US)
Carmel Container Systems Ltd. Reports Results for The Quarter Ended
March 31, 2004 TEL-AVIV, Israel, May 10 /PRNewswire-FirstCall/ --
Carmel Container Systems Ltd. ("Carmel" or the "Company"), a
leading Israeli designer, manufacturer and marketer of containers,
packaging materials and related products, reported today its
consolidated financial results for the first quarter of 2004.
Carmel's Ordinary Shares are traded on the American Stock Exchange
. The financial results for the first three months of 2004 were
primarily influenced by the following factors: -- The recession
tendency that characterized the Israeli economy, since September
2000, caused a significant decrease in many economy activities, has
changed slightly by the end of the year, which in turn positively
affected the Company's business, financial condition and results of
operations. Such economic activities include: -- Moderate
improvement in the volumes of the local demands for customer's
goods and private consumption in the first quarter. -- Slight
increase in the volumes of the industrial export to the U.S.A. and
Europe. -- Some good indexes were published by the end of the last
quarter. -- Still due to the continued economic slowdown, the price
of packaging products during the first three months of 2004
remained at about the same low level as at the end of 2003. -- In
the first quarter of 2004 there has been a slight growth in the
volume of the Hi-Tech export, which contributed to stop the
withdrawal of the industry's productivity. Carmel's results for the
first quarter of 2004 were improved as compared to the results of
the first quarter of 2003, that improvement was achieved mainly by
increased sales, which caused an improvement in other parameters,
including gross profit and net profit. All this happened in spite
of low sale prices, which remained at about the same level as at
the end of 2003. The economic improvement has not yet affected the
selling prices level, that remains relatively low as a result of
the continued recession in the local Israeli market in previous
years. During the second six months of 2002 the price of raw
materials increased slightly and remained at the same level during
the first half of 2003. During the second half of 2003 and the
first three months of 2004, the price of raw materials decreased
slightly and as a result operating income increased slightly. The
New Israeli Shekel ("NIS") devaluated by 3.4% against the Dollar
during the first quarter of 2004, as compared to revaluation of
1.1% during the same period of 2003. As a result, the Company's
recorded financial expenses increase during the first quarter of
2004. The translation of the amounts from NIS into U.S. dollars is
at a rate of exchange of NIS 4.528 to $1 (which was the rate of
exchange at March 31, 2004). As a result, the amounts presented in
U.S. dollars for the year 2003 are different from the U.S. dollar
amounts previously published by the Company with respect to such
period. Revenues in the first quarter of 2004 were NIS 101.6
million ($ 22.4 million), as compared to NIS 91.4 million ($ 20.2
million), for the first quarter of 2003. The increase in sales in
2004, as compared to 2003, resulted primarily from an increase in
the volume of sales and a very slight increase of the average
selling prices. Gross profit for the first quarter of 2004 was NIS
15.7 million ($3.5million), representing 15.5% of sales, as
compared to NIS 8.8 million ($ 1.9 million), representing 9.7% of
sales, for the first quarter of 2003. Operating income before
financial expenses were NIS 6.4 million ($1.4 million) representing
6.3% of sales for the first quarter 2004, as compared to operating
income of NIS 37.0 thousand ($8.2 thousand), representing 0.0% of
sales for the same period of 2003. Financial expenses net for the
first quarter of 2004 were NIS 2.4 million ($0.5 million),
representing 2.3% of sales, as compared to NIS 1.3 million ($0.3
million), representing 1.5% of sales, for the same period of 2003.
The increase in actual financial expenses in the first quarter of
2004, as compared to the first quarter of 2003, reflects a
devaluation of the NIS against the Dollar of 3.4%, as compared to a
rate of revaluation of 1.1% in the same period of 2003. Other
income, net for the first quarter of 2004 was NIS 4.0 thousand
($0.9 thousand), as compared to net expenses of NIS 39.0 thousand
($8.6 thousand) during the same period of 2003. Income before taxes
for the first quarter of 2004 was NIS 4.0 million ($0.9 million),
representing 3.9% of sales, as compared to a loss before taxes of
NIS 1.3 million ($0.3 million) for the first quarter of 2003,
representing 1.4% of sales during that period. Tax on income for
the first quarter of 2004 was NIS -1.2 million (-$0.3 million), as
compared with a tax on income of NIS 0.5 million ($0.1 million) for
the same period of 2003. Net income for the first quarter of 2004
was NIS 2.8 millions ($0.6 millions), representing 2.7% of sales,
as compared to a net loss of NIS 0.5 millions ($0.1 millions),
representing 0.6% of sales for the first quarter of 2003. Income
per share for the first quarter of 2004 was NIS 1.16 ($0.26), as
compared to net loss per share of NIS 0.22 ($0.04) for the same
period of 2003. The Company's positive cash flow for the first
quarter of 2004 from operating activities was NIS 7.8 million ($1.7
million), as compared to a negative cash flow from operating
activities of NIS 9.3 million ($2.0 million) for the same period of
2003. Depreciation and amortization in the first quarter of 2004
was NIS 4.8 million ($1.1 million), as compared to NIS 6.1 million
($1.3 million) in 2003. During the first quarter of 2004, the
company reduced its net debt to banks in an amount of NIS 6.8
millions ($1.5 million). The positive net cash flow in 2004,
financed the Company's acquisition of NIS 1.1 million ($0.2
million) of fixed assets and the Company's various activities and
the decrease in long and short financial debt. Forward-looking
statements with respect to the Company's business, financial
condition and results of operations contained in this release are
subject to risks and uncertainties that could cause actual results
to differ materially from those contemplated in such
forward-looking statements, including, but not limited to,
fluctuations in product demand, the impact of competitive pricing
as well as certain other risks detailed from time to time in the
Company's filings with the Securities and Exchange Commission. The
Company undertakes no obligation to publicly release any revisions
to these forward-looking statements to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events. Carmel Containers Systems Ltd. Consolidated
Unaudited Statement of Income Three Months Ended March 31, 2004 NIS
U.S. Dollars In millions, except per In millions share data March
31, March 31, March 31, 2004 2003 2004 Net sales NIS 91.4 NIS 101.6
$22.4 Gross profit 8.8 15.7 3.5 Operating income (loss) 0.0 6.4 1.4
Net income (loss) (0.5) 2.8 0.6 Weighted average shares 2,400,000
2,400,000 2,400,000 Net income (loss) per 1,000 shares NIS (0.22)
NIS 1.16 $0.26 Translation of NIS to US Dollars is at the exchange
rate of NIS 4.528 to U.S.$ 1.00, reflecting such exchange rate at
March 31, 2004. DATASOURCE: Carmel Container Systems Ltd. CONTACT:
Doron Kempler of Carmel Container Systems Ltd., +972-6-623-9360; or
David P. Stone at Weil, Gotshal & Manges, +1-212-310-8403, for
Carmel Container Systems Web site: http://www.carmelccs.com/
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