|By PR Newswire||
|November 29, 2012 06:01 AM EST||
YAHUD, Israel, November 29, 2012 /PRNewswire/ --
Magal S3 Ltd. (NASDAQ GMS: MAGS) today announced its financial results for the three and nine month period ended September 30, 2012. Management will hold an investors' conference call later today, at 9:00 a.m. Eastern Time and 4:00 p.m. Israel time, to discuss the results.
THIRD QUARTER 2012 RESULTS SUMMARY
Revenues for the third quarter of 2012 were $23.5 million, a decrease of 15% compared with revenues of $27.7 million in the third quarter of 2011. The third quarter of 2011 was exceptional due to a particularly large project in Africa, that was delivered within a short period of time. On a sequential basis, revenues in the third quarter of 2012 increased by 43% compared with $16.4 million in the second quarter of 2012.
Gross profit in the third quarter was $9.7 million, or 41.3% of revenues, a decrease of 26% compared to gross profit of $13.1 million, or 47.2% of revenues, in the third quarter of 2011. The higher gross profit in the third quarter of 2011 was due to the large project in Africa. Gross profit in the third quarter of 2012 increased 34% compared to gross profit of $7.2 million, or 44.1% of revenues in the second quarter of 2012. The variance in the gross margin between quarters reflects changes between products and projects in the revenue mix.
Operating profit in the third quarter was $1.7 million, or 7.3% of revenues, compared to an operating profit of $5.6 million, or 20.4% of revenues, in the third quarter of 2011 and operating profit of $474 thousand, or 2.9% of revenues, in the second quarter of 2012.
Net income in the third quarter was $1.8 million, or $0.11 per share, compared with net income of $7.1 million, or $0.61 per share, in the third quarter of 2011 and net income of 938 thousand, or $0.06 per share in the second quarter of 2012.
Cash and short term deposits, net of current bank debt, as of September 30, 2012, increased to $39.2 million, or $2.44 per share, compared with cash and short term deposits, net of current bank debt, of $32.5 million, or $2.06 per share, on December 31, 2011.
Commenting on the results, Mr. Eitan Livneh, President and CEO of Magal said, "We have shown continued sequential improvements in revenue throughout 2012 and have continued to build our profitability throughout the year. While our results in the second half of last year were exceptionally good due to the short delivery timeframe of the Africa Cup of Nations project, we are now executing on a much improved business platform than in previous years. We are very proud of our achievements and in the solid turnaround of our business over the past two years."
Continued Mr. Livneh, "During the quarter, we continued to progress on a strategic basis which we believe assures our long-term future. We began offering cyber protection solutions by teaming with other technology companies to deliver turnkey cyber security solutions for critical sites in addition to the physical security we already provide. This enables us to offer a fully integrated suite of protection for customers in both the physical and online worlds. We have also continued to focus on cementing our presence in various key strategic regions globally. As always, we continue to look for other adjacent and synergistic markets that we can enter and bring significant value. With close to $40 million in net cash, our strong and growing cash levels provide us with greater flexibility and we are in a strong position to capitalize on opportunities as they may arise."
INVESTORS' CONFERENCE CALL INFORMATION:
The Company will host a conference call later today, November 29, 2012, at 9:00 a.m. Eastern Time and 4:00 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
Please begin placing your calls at least 10 minutes before the conference call commences. 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 from the day after the call for three months. The link to the replay will be accessible from Magal's website at: http://www.magal-s3.com.
About Magal S3
Magal S3 is a leading international provider of solutions and products for physical and cyber security, safety and site management. Over the past 42 years, Magal S3 has delivered tailor-made solutions and turnkey projects to hundreds of satisfied customers in over 80 countries in some of the world's most demanding locations.
Magal S3 offers holistic and integrated solutions for critical sites, managed by Fortis4G - our 4th generation cutting edge Physical Security Information Management system (PSIM). The solutions leverage our broadest portfolio of unique homegrown Perimeter Intrusion Detection Systems (PIDS), advanced outdoors CCTV / IVA technology and holistic Cyber Security solutions.
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.
MAGAL S3 LTD.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(All numbers except EPS expressed in thousands of US$)
Nine Months Three Months Ended September 30, Ended September 30, % % 2012 2011 change 2012 2011 change Revenue $55,470 $54,860 1.1 $23,490 $27,660 (15.1) Cost of revenue 32,085 30,805 4.2 13,797 14,608 (5.6) Gross profit 23,385 24,055 (2.8) 9,693 13,052 (25.7) Operating expenses: Research and development, net 3,113 2,918 6.7 1,043 1,000 4.3 Selling and marketing 12,575 12,382 1.6 4,581 5,645 (18.8) General and administrative 5,366 6,251 (14.2) 2,347 3,073 (23.6) Other income - (2,310) - (2,310) Total operating expenses 21,054 19,241 9.4 7,971 7,408 7.6 Operating income 2,331 4,814 1,722 5,644 Financial income, net 480 829 38 1,227 Income before income taxes 2,811 5,643 1,760 6,871 Income tax expense (benefit) 44 55 (23) (199) Net income 2,767 5,588 1,783 7,070 Basic net earnings per share $0.17 $0.52 $0.11 $0.61 Diluted net earnings per share $0.17 $0.52 $0.11 $0.61 Weighted average number of shares used in computing basic net earnings per share 15,974,044 10,794,696 16,053,490 11,579,325 Weighted average number of shares used in computing basic net earnings per share 16,012,647 10,794,696 16,066,440 11,579,325 Nine Months ended Three Months ended September 30, September 30, 2012 2011 2012 2011 % % % % Gross margin 42.2 43.8 41.3 47.2 Research and development, net as a % of revenues 5.6 5.3 4.4 3.6 Selling and marketing as a % of revenues 22.7 22.6 19.5 20.4 General and administrative as a % of revenues 9.7 11.4 10.0 11.1 Operating margin 4.2 8.8 7.3 20.4 Net margin 5.0 10.2 7.6 25.6
MAGAL S3 LTD.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(All numbers expressed in thousands of US$)
September 30, December 31, 2012 2011 CURRENT ASSETS: Cash and cash equivalents $38,154 $32,622 Short-term bank deposit 3,779 3,005 Restricted deposit 2,453 2,299 Trade receivables, net 12,089 13,230 Unbilled accounts receivable 2,819 4,855 Other accounts receivable and prepaid expenses 4,025 5,438 Deferred income taxes 546 508 Inventories 9,827 9,664 Total current assets 73,692 71,621 Long term investments and receivables: Long-term trade receivables 1,158 1,423 Long-term deposits and restricted bank deposits 6 2,202 Severance pay fund 2,071 2,121 Total long-term investments and receivables 3,235 5,746 PROPERTY AND EQUIPMENT, NET 6,668 6,460 OTHER INTANGIABLE ASSETS, NET 176 190 GOODWILL 2,000 1,970 Total assets $85,771 $85,987 CURRENT LIABILITIES: Short-term bank credit $5,115 $5,357 Current maturities of long-term bank debt 32 33 Trade payables 7,155 6,724 Customer advances 4,827 5,877 Other accounts payable and accrued expenses 10,157 13,137 Total current liabilities 27,286 31,128 LONG-TERM LIABILITIES: Long-term bank debt 40 38 Deferred income taxes 205 205 Accrued severance pay 3,083 3,605 Total long-term liabilities 3,328 3,848 SHAREHOLDERS' EQUITY Ordinary shares of NIS 1 par value - Authorized: 39,748,000 shares at September 30, 2012 and December 31, 2011; Issued and outstanding: 16,053,490 shares at September 30, 2012 and 15,819,822 shares at December 31, 2011 4,877 4,813 Additional paid-in capital 65,999 64,920 Accumulated other comprehensive income 5,383 4,486 Foreign currency translation adjustments (Company's stand alone financial statements) (58) 603 Accumulated deficit (21,044) (23,811) TOTAL SHAREHOLDERS' EQUITY 55,157 51,011 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $85,771 $85,987
For more information:
Magal S3 Ltd.
Eitan Livneh, CEO
Assistant: Ms. Elisheva Almog
E-mail: [email protected]
CCG Investor Relations
Ehud Helft/Kenny Green
Tel: (US) +1-646-201-9246
E-mail: [email protected]
SOURCE Magal Security Systems Ltd
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