YEHUD, Israel, May 16, 2018 /PRNewswire/ --Magal Security
Systems, Ltd. (NASDAQ: MAGS) today announced its financial
results for the three month period ended March 31, 2018. Management will hold an
investors' conference call later today (at 10am Eastern Time) to discuss the results.
First Quarter Results Summary
- Strong growth in first quarter revenue to $17.3 million, up 20% year-over-year.
- Significant improvement in operating expenses: a 9%
reduction year-over-year.
- Net loss of $0.2 million, or
$0.01 per share, an improvement
compared with a net loss of $3.7
million, or $0.16 per share
last year.
- EBITDA of $0.5 million
compared with negative EBITDA of $0.4
million in the first quarter of last year.
- Backlog at highest ever level as of end of the first
quarter.
First Quarter 2018 Results
Revenues for the first quarter of 2018 were $17.3 million, an increase of 20% compared with
revenues of $14.3 million in the
first quarter of 2017.
Gross profit for the first quarter of 2018 was
$7.6 million, or 43.8% of revenues,
an increase of 2% compared with gross profit of $7.4 million or 51.7% of revenues, in the first
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 first quarter of 2018 was
$33 thousand, an improvement compared
to an operating loss of $0.9 million
in the first quarter of 2017.
Net loss in the first quarter of 2018 was $0.2 million, or $0.01 per share, compared with a net loss of
$3.7 million, or $0.16 per share in the first quarter of 2017.
EBITDA in the first quarter was $0.5 million, an improvement compared with
negative EBITDA of $0.4 million in
the first quarter of 2017.
Cash, short term deposits and restricted deposits, net of
bank debt, as of March 31, 2018,
were $49.4 million, or $2.15 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 projects which are commencing.
Management Comment
Commenting on the results, Mr. Yaniv
Shachar, interim CEO of Magal, said, "We are pleased
with our return to growth and operating profitability, recovering
from a weak 2017. The solid improvement in results, especially the
lower level of expenses, follows important steps that we took last
year to rationalize expenses and increase efficiencies. Looking
ahead, the high level of new orders that Magal has won over the
past few months has built a strong backlog, and as at the end of
the first quarter, our backlog is the highest it has ever been in
our history. This bodes very well for Magal in the coming
year."
Continued Mr. Shachar, "In the coming weeks, Dror Sharon, a highly experienced homeland
security industry veteran will be joining Magal as the new CEO. We
thank Saar Koursh, our former CEO,
for his key contributions to Magal throughout his tenure which
culminated in the successful first quarter that we announced today.
We wish him well in future."
Investors' Conference Call Information:
The Company will host a conference call later today,
May 16, 2018, at 10am Eastern Time and 5pm Israel
time.
To participate, please call one of the following
teleconferencing numbers:
US: 1-888-281-1167; Israel:
03-918-0644; UK: 0-800-917-9141; Intl.: +972-3-918-0644
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 some of the most challenging conditions.
Magal offers comprehensive integrated solutions for critical
sites, managed by Fortis4G - its 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.
Web: www.magalsecurity.com
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
|
|
|
Ended March
31,
|
|
|
2017
|
|
2018
|
%
change
|
|
Revenue
|
14,335
|
|
17,255
|
20
|
|
Cost of
revenue
|
6,924
|
|
9,699
|
|
|
|
|
|
|
|
|
Gross
profit
|
7,411
|
|
7,556
|
2
|
|
Operating
expenses:
|
|
|
|
|
|
Research
and development, net
|
1,605
|
|
1,605
|
-
|
|
Selling
and marketing
|
4,798
|
|
4,233
|
(12)
|
|
General
and administrative
|
1,860
|
|
1,685
|
(9)
|
|
Total operating
expenses
|
8,263
|
|
7,523
|
(9)
|
|
|
|
|
|
|
|
Operating income
(loss)
|
(852)
|
|
33
|
|
|
Financial income
(expenses), net
|
(2,636)
|
|
117
|
|
|
|
|
|
|
|
|
Income (loss)
before income taxes
|
(3,488)
|
|
150
|
|
|
|
|
|
|
|
|
Taxes on
income
|
205
|
|
317
|
|
|
|
|
|
|
|
|
Net
loss
|
(3,693)
|
|
(167)
|
|
|
|
|
|
|
|
|
Income (loss)
attributable to non-controlling interests
|
(5)
|
|
-
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Magal shareholders'
|
(3,698)
|
|
(167)
|
|
|
|
|
|
|
|
|
Basic and diluted
net loss per share
|
($0.16)
|
|
($0.01)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares used in computing basic and diluted net loss per
share
|
22,916,333
|
|
23,032,511
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months
Ended March
31
|
|
|
|
2017
%
|
|
2018
%
|
|
|
|
|
|
|
|
|
Gross margin
|
51.7
|
|
43.8
|
|
|
Research and
development, net as a % of revenues
|
11.2
|
|
9.3
|
|
|
Selling and marketing
as a % of revenues
|
33.5
|
|
24.5
|
|
|
General and
administrative as a % of revenues
|
13.0
|
|
9.8
|
|
|
Operating
margin
|
-
|
|
0.2
|
|
|
Net
margin
|
-
|
|
-
|
|
|
MAGAL SECURITY
SYSTEMS LTD.
|
RECONCILLATION OF
EBITDA TO NET LOSS
|
(All numbers
expressed in thousands of US$)
|
|
|
Three
Months
Ended March
31,
|
|
2017
|
|
2018
|
|
|
|
|
GAAP Net
loss
|
(3,693)
|
|
(167)
|
Less:
|
|
|
|
Financial
income (expenses), net
|
(2,636)
|
|
117
|
Taxes on
income
|
205
|
|
317
|
Depreciation and amortization
|
(450)
|
|
(477)
|
EBITDA
|
(402)
|
|
510
|
MAGAL SECURITY
SYSTEMS LTD.
|
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(All numbers
expressed in thousands of US$)
|
|
|
December
31,
|
|
March
31,
|
|
2017
|
|
2018
|
CURRENT
ASSETS:
|
|
|
|
Cash and cash
equivalents
|
$22,463
|
|
$42,221
|
Short-term bank
deposits
|
27,025
|
|
1,014
|
Restricted
deposits
|
2,842
|
|
6,183
|
Trade receivables,
net
|
14,489
|
|
13,493
|
Unbilled accounts
receivable
|
6,309
|
|
5,057
|
Other accounts
receivable and prepaid expenses
|
2,850
|
|
5,381
|
Inventories
|
9,596
|
|
9,701
|
|
|
|
|
Total current
assets
|
85,574
|
|
83,050
|
|
|
|
|
Long term investments
and receivables:
|
|
|
|
|
|
|
|
Long-term deposits
and restricted bank deposits
|
155
|
|
166
|
Severance pay
fund
|
1,524
|
|
1,446
|
Deferred income
taxes
|
2,579
|
|
2,688
|
|
|
|
|
Total long-term
investments and receivables
|
4,258
|
|
4,300
|
|
|
|
|
PROPERTY AND
EQUIPMENT, NET
|
5,718
|
|
6,093
|
|
|
|
|
INTANGIBLE ASSETS,
NET
|
4,303
|
|
3,981
|
|
|
|
|
GOODWILL
|
12,692
|
|
12,450
|
|
|
|
|
Total
assets
|
$112,545
|
|
$109,874
|
MAGAL SECURITY
SYSTEMS LTD.
|
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(All numbers
expressed in thousands of US$)
|
|
|
December
31,
|
|
March
31,
|
|
2017
|
|
2018
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
|
|
|
Trade
payables
|
$5,198
|
|
$3,821
|
Customer
advances
|
7,191
|
|
6,857
|
Other accounts
payable and accrued expenses
|
13,784
|
|
13,192
|
|
|
|
|
Total current
liabilities
|
26,173
|
|
23,870
|
|
|
|
|
LONG-TERM
LIABILITIES:
|
|
|
|
Deferred
revenues
|
891
|
|
867
|
Deferred income
taxes
|
190
|
|
196
|
Accrued severance
pay
|
2,328
|
|
2,253
|
Other long-term
liabilities
|
14
|
|
360
|
|
|
|
|
Total long-term
liabilities
|
3,423
|
|
3,676
|
|
|
|
|
SHAREHOLDERS'
EQUITY
|
|
|
|
Share Capital:
Ordinary shares of NIS 1 par value -
|
|
|
|
|
Authorized:
39,748,000 shares at December 31, 2017 and March 31, 2018; Issued
and outstanding: 23,032,448 shares at December 31, 2017 and
23,035,282 shares at March 31, 2018
|
6,716
|
|
6,717
|
Additional paid-in
capital
|
93,975
|
|
94,026
|
Accumulated other
comprehensive loss
|
(87)
|
|
(276)
|
Foreign currency
translation adjustments (stand alone financial
statements)
|
5,859
|
|
5,425
|
Accumulated
deficit
|
(23,514)
|
|
(23,564)
|
|
|
|
|
TOTAL
SHAREHOLDERS' EQUITY
|
82,949
|
|
82,328
|
|
|
|
|
TOTAL LIABILITIES
AND SHAREHOLDERS' EQUITY
|
$112,545
|
|
$109,874
|
|
|
|
|
|
For more information:
Magal Security Systems Ltd.
Diane Hill, Assistant to the
CEO
Tel: +972-3-539-1421
E-mail: dianeh@magal-s3.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.