YEHUD, Israel, Nov. 29, 2016 /PRNewswire/ -- Magal Security
Systems, Ltd. (NASDAQ: MAGS) today announced its financial
results for the three and nine months periods ended September 30, 2016. Management will hold an
investors' conference call later today, at 10:00 a.m. Eastern Time and 5:00 p.m. Israel
time, to discuss the results.
RESULTS SUMMARY
- The results include the operations of Aimetis, the Company's
recently acquired video surveillance subsidiary;
- Revenues increased to $21.3
million, up 57% compared to the prior quarter and by 25%
over the third quarter of 2015;
- Operating income of $1.6
million and net income of $0.6
million in the quarter;
- Net cash and equivalents of $21.2
million at quarter-end, subsequent to statement date Magal
completed a successful rights offering to shareholders, adding
$23.8 million to its cash position in
early October 2016.
- Magal completed a successful rights offering to
shareholders, adding $23.8 million to
its cash position in early October
2016.
THIRD QUARTER 2016 RESULTS
Revenues in the third quarter of 2016 were $21.3 million, an increase of 25.5% compared with
revenues of $17 million in the third
quarter of 2015 and an increase of 56.6% compared with revenues of
$13.6 million in the prior
quarter.
Gross profit in the third quarter of 2016 was
$10.9 million, or 51.1% of revenues,
compared with gross profit of $8.4
million or 49.6% of revenues in the third quarter of 2015
and gross profit of $6.1 million, or
44.5% of revenues, in the prior quarter. The variance in the gross
margin was due to the mix of projects and products sold in the
quarter.
Operating expenses in the third quarter increased to
$9.3 million compared to $7.2 million in the third quarter of 2015. The
majority of the increase was due to increased expenses following
the Aimetis acquisition.
Operating income in the third quarter of 2016 was
$1.6 million compared to operating
income of $1.3 million in the third
quarter of 2015 and an operating loss of $2.2 million in the prior quarter.
Net income in the third quarter of 2016 was $0.6 million, or $0.04 per share, compared to net income of
$0.9 million, or $0.05 per share, in the third quarter of 2015 and
a net loss of $2 million or
($0.12) per share in the prior
quarter of 2016.
Cash, short term deposits and restricted deposits, net of
bank debt, as of September 30, 2016,
was $21.2 million, or $1.29 per share, compared with cash and short
term deposits, net of current bank debt, of $31.1 million, or $1.90 per share, at December 31, 2015. On April 1, 2016, Senstar, Magal's wholly-owned
Canadian subsidiary acquired Aimetis for approximately $15.2 million in cash.
Cash and cash equivalents, do not reflect the proceeds from the
Company's rights offering which concluded on September 30, 2016. The Company sold 6,170,386
shares in the offering and received $23.8
million in proceeds in early October
2016.
MANAGEMENT COMMENT
Commenting on the results, Mr. Saar
Koursh, CEO of Magal, said, "We are pleased with these
results, growing our top line and demonstrating a fair
profitability level. These results support our expectations that
the second half of 2016 will be better than the first half.
In particular, we saw broad strength across our product
portfolio as well as within our focus region, in North America. We see further potential in
this region, with investments in critical sites and border
security."
"We are strongly encouraged by the support of our shareholders
who participated in our rights offering, which significantly
strengthened our balance sheet. This will enable us to take
advantage of many of the opportunities we are seeing in our end
markets," continued Mr. Koursh.
INVESTORS' CONFERENCE CALL INFORMATION:
The Company will host a conference call later today,
November 29, 2016, at 10:00 a.m. Eastern Time and 5:00 p.m. Israel
time.
To participate, please call one of the following
teleconferencing numbers:
US: 1 888 668 9141; Israel:
03 918 0609; UK: 0 800 917 5108; Intl.: +972 3 918 0609
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.magal-s3.com.
ABOUT MAGAL S3
Magal S3 is a leading international provider of
solutions and products for physical and cyber security, as well as
safety and site management. Over the past 45 years, Magal has
delivered tailor-made security solutions and turnkey projects to
hundreds of satisfied customers in over 80 countries – under some
of the most challenging conditions.
Magal S3 offers comprehensive integrated solutions
for critical sites, managed by Fortis4G – our
4th generation, cutting-edge PSIM (Physical
Security Information Management system). The solutions leverage our
broad portfolio of homegrown PIDS (Perimeter Intrusion
Detection Systems), advanced VMS with native IVA and
Cyber 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.
For more information:
* Tables to follow *
MAGAL S3
LTD. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS
OF OPERATIONS (All numbers except EPS expressed in
thousands of US$)
|
|
|
Three Months
Ended September
30,
|
|
Nine Months
Ended September 30,
|
|
|
2015
|
|
2016
|
%change
|
|
2015
|
|
2016
|
%change
|
Revenue
|
$17,011
|
|
$21,341
|
25.5
|
|
$44,466
|
|
$47,573
|
7
|
Cost of
revenue
|
8,573
|
|
10,435
|
|
|
24,315
|
|
24,354
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
8,438
|
|
10,906
|
29.2
|
|
20,151
|
|
23,219
|
15.2
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Research
and development, net
|
1,031
|
|
1,788
|
73.4
|
|
3,065
|
|
5,044
|
64.4
|
Selling
and marketing
|
4,467
|
|
5,445
|
21.9
|
|
10,678
|
|
12,486
|
16.9
|
General
and administrative
|
1,652
|
|
2,097
|
26.9
|
|
4,941
|
|
5,717
|
15.7
|
Total operating
expenses
|
7,150
|
|
9,330
|
30.5
|
|
18,684
|
|
23,247
|
24.4
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
1,288
|
|
1,576
|
|
|
1,467
|
|
(28)
|
|
Financial income
(expenses), net
|
758
|
|
(491)
|
|
|
504
|
|
(1,047)
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss)
before income taxes
|
2,046
|
|
1,085
|
|
|
1,971
|
|
(1,075)
|
|
|
|
|
|
|
|
|
|
|
|
Taxes on
income
|
1,172
|
|
403
|
|
|
1,379
|
|
752
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
874
|
|
682
|
|
|
592
|
|
(1,827)
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss)
attributable to non-controlling interests
|
10
|
|
35
|
|
|
(12)
|
|
14
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Magal shareholders'
|
864
|
|
647
|
|
|
604
|
|
(1,841)
|
|
|
|
|
|
|
|
|
|
|
|
Basic net earnings
(loss) per share
|
$0.05
|
|
$0.04
|
|
|
$0.04
|
|
$(0.11)
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net
earnings (loss) per share
|
$0.05
|
|
$0.04
|
|
|
$0.04
|
|
$(0.11)
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares used in computing basic net earnings (loss) per
share
|
16,377,589
|
|
16,442,914
|
|
|
16,334,337
|
|
16,413,660
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares used in computing diluted net earnings (loss) per
share
|
16,467,839
|
|
16,536,949
|
|
|
16,432,110
|
|
16,413,660
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months
Ended September
30,
|
|
|
Nine
Months
Ended September
30,
|
|
|
2015
%
|
|
2016
%
|
|
|
2015
%
|
|
2016
%
|
|
|
|
|
|
|
|
|
|
|
|
Gross margin
|
49.6
|
|
51.1
|
|
|
45.3
|
|
48.8
|
|
Research and
development, net as a % of revenues
|
6.1
|
|
8.4
|
|
|
6.9
|
|
10.6
|
|
Selling and marketing
as a % of revenues
|
26.3
|
|
25.5
|
|
|
24.0
|
|
26.2
|
|
General and
administrative as a % of revenues
|
9.7
|
|
9.8
|
|
|
11.1
|
|
12.0
|
|
Operating
margin
|
7.6
|
|
7.4
|
|
|
3.3
|
|
N/A
|
|
Net
margin
|
5.1
|
|
3
|
|
|
1.4
|
|
N/A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MAGAL S3
LTD. UNAUDITED CONDENSED CONSOLIDATED BALANCE
SHEETS (All numbers expressed in thousands of
US$)
|
|
|
|
|
|
December 31,
2015
|
|
September 30,
2016
|
CURRENT
ASSETS:
|
|
|
|
Cash and cash
equivalents
|
$27,319
|
|
$10,191
|
Short-term bank
deposits
|
3,055
|
|
7,031
|
Restricted
deposits
|
786
|
|
3,935
|
Trade receivables,
net
|
13,706
|
|
16,178
|
Unbilled accounts
receivable
|
5,597
|
|
4,287
|
Other accounts
receivable and prepaid expenses
|
2,107
|
|
3,141
|
Inventories
|
7,879
|
|
6,930
|
|
|
|
|
Total current
assets
|
60,449
|
|
51,693
|
|
|
|
|
Long term investments
and receivables:
|
|
|
|
|
|
|
|
Long-term trade
receivables
|
617
|
|
410
|
Long-term deposits
and restricted bank deposits
|
136
|
|
121
|
Severance pay
fund
|
1,761
|
|
1,745
|
Deferred income
taxes
|
1,055
|
|
626
|
|
|
|
|
Total long-term
investments and receivables
|
3,569
|
|
2,902
|
|
|
|
|
PROPERTY AND
EQUIPMENT, NET
|
5,415
|
|
5,579
|
|
|
|
|
GOODWILL AND OTHER
INTANGIBLE ASSETS, NET
|
5,563
|
|
17,506
|
|
|
|
|
Total
assets
|
$74,996
|
|
$77,680
|
|
December
31,
|
|
September
30,
|
|
2015
|
|
2016
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
|
|
|
Trade
payables
|
$3,185
|
|
$3,908
|
Customer
advances
|
2,520
|
|
2,530
|
Other accounts
payable and accrued expenses
|
10,748
|
|
12,424
|
|
|
|
|
Total current
liabilities
|
16,453
|
|
18,862
|
|
|
|
|
LONG-TERM
LIABILITIES:
|
|
|
|
Long-term bank debt
and other long-term payables
|
15
|
|
285
|
Deferred income
taxes
|
173
|
|
178
|
Accrued severance
pay
|
2,660
|
|
2,667
|
|
|
|
|
Total long-term
liabilities
|
2,848
|
|
3,130
|
|
|
|
|
SHAREHOLDERS'
EQUITY
|
|
|
|
Share Capital:
Ordinary shares of NIS 1 par value -
|
|
|
|
|
Authorized:
39,748,000 shares at December 31, 2015 and September 30,
2016; Issued and outstanding: 16,398,872 shares at
December 31, 2015 and
16,454,362 shares at September 30, 2016
|
4,968
|
|
4,983
|
Additional paid-in
capital
|
69,888
|
|
93,937
|
Receivables on
account of shares
|
-
|
|
(23,818)
|
Accumulated other
comprehensive loss
|
(1,850)
|
|
(1,174)
|
Foreign currency
translation adjustments (stand alone financial
statements)
|
406
|
|
1,304
|
Accumulated
deficit
|
(17,629)
|
|
(19,470)
|
|
|
|
|
Total shareholders'
equity
|
55,783
|
|
55,762
|
Non-controlling
interest
|
(88)
|
|
(74)
|
|
|
|
|
TOTAL
SHAREHOLDERS' EQUITY
|
55,695
|
|
55,688
|
|
|
|
|
TOTAL LIABILITIES
AND SHAREHOLDERS' EQUITY
|
$74,996
|
|
$77,680
|
|
|
|
|
|
Magal S3 Ltd.
Saar Koursh, CEO
Tel: +972 3
539 1421
E-mail:
elishevaa@magal-s3.com
Web:
www.magal-s3.com
GK Investor Relations
Ehud Helft / Gavriel Frohwein
Tel: (US) +1 646 688 3559
E-mail: magal@gkir.com
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/magal-security-systems-reports-third-quarter-2016-financial-results-300369687.html
SOURCE Magal Security Systems Ltd