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RADA Electronic Industries Ltd.$4.77$.194.15%

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 RADA Electronic Industries Announces First Quarter 2019 Results
   Tuesday, May 21, 2019 7:44:00 AM ET

NETANYA, Israel, May 21, 2019 (GLOBE NEWSWIRE) -- RADA Electronic Industries Ltd. (NASDAQ: RADA) announced today its financial results for the quarter ended March 31, 2019.

Highlights of the first quarter of 2019

  • Past and ongoing investments promoting growth;
  • Revenues of $8.7 million, up 44% year-over-year;
  • Net loss of $0.5 million;
  • Q1-end net cash position of $21.5 million.

Management Comments

Dov Sella, RADA's Chief Executive Officer commented, “We are very pleased with our continued top line growth, based on revenues from our software-defined tactical radars. These are early fruits from the significant and ongoing investments we are making in R&D, and sales and marketing. Anticipating growth in the US, we are establishing an additional radar production line, to become active this year. As 2019 progresses, we anticipate that the radar market will transform from its current emerging phase to a programs-of-record phase, where we will start to see the generation of significant backlog, primarily from the US.”

Continued Mr. Sella, “Our strategy very much remains on track. Considering the strong growth this quarter and looking forward over the remainder of 2019, we continue to expect revenues in excess of $40 million for the year. This represents year-over-year growth of at least 43%, driven primarily by accelerating sales of tactical radars.”

2019 First Quarter Summary

Revenues totaled $8.7 million in the quarter, compared with revenues of $6.0 million in the first quarter of 2018, an increase of 44%.

Gross profit totaled $3.2 million in the quarter (or 36% of revenues), an increase of 45% compared to gross profit of $2.2 million in the first quarter of 2018 (or 36% of revenues).

Operating loss was $0.6 million in the quarter compared to operating income of $0.2 million in the first quarter of 2018.

Net loss attributable to RADA’s shareholders in the quarter was $0.5 million, or $0.01 per share, compared to a net profit of $0.2 million, or $0.01 per share, in the first quarter of 2018.

As of March 31, 2019, RADA had net cash and cash equivalents of $21.5 million compared to $20.8 million as of year-end 2018.

Investor Conference Call

The Company will host a conference call later today, starting at 9:00 am ET (4pm Israel time). Management will host the call and will be available to answer questions after presenting the results.

Dial in numbers are: US 1-888-668-9141; UK 0800-917-5108; Israel 03-918-0610 and International +972-3-918-0610.

For those unable to participate, the teleconference will be available for replay on RADA’s website at http://www.rada.com beginning 48 hours after the call.

About RADA Electronic Industries Ltd.

RADA Electronic Industries Ltd. is an Israel-based defense electronics contractor. The Company specializes in the development, production, and sales of tactical land radar for force and border protection, inertial navigation systems for air and land applications and avionics systems and upgrades.

Contact Information 
  
Company Contact:Investor Relations Contact:
  
Avi Israel (CFO)Ehud Helft/Gavriel Frohwein
Tel: +972-9-892-1111GK Investor & Public Relations
mrkt@rada.com  Tel: +1 646 688 3559
www.rada.com  rada@gkir.com  

Forward Looking Statements

Certain statements in this press release are "forward-looking statements" within the meaning of the Private Securities Litigation Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially. Such risk uncertainties and other factors include, but are not limited to, changes in general economic conditions, risks in product and technology developments, market acceptance of new products and continuing product demand, level of competition and other factors described in the Company's Annual Report on Form 20-F and other filings with the Securities and Exchange Commission.

 
CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands, except share and per share data
    
 March 31, December 31,
ASSETS2019 2018
 Unaudited Audited
CURRENT ASSETS:   
Cash and cash equivalents$ 21,499  $   20,814 
Restricted cash   422      422 
Trade receivables (net of allowance for doubtful accounts of $1.5 at March 31, 2019 and December 31, 2018) 11,439    13,382 
Contract assets   1,185     899 
Other receivables and prepaid expenses   2,156     506 
Inventories 15,459   11,244 
Current assets related to discontinued operations   -    1,524 
    
Total current assets 52,160   48,791 
    
LONG-TERM ASSETS:   
        
Long-term receivables and other deposits   85   79 
Property, plant and equipment, net   4,588   4,632 
Operating lease right-of-use asset   1,894   - 
Total long-term assets   6,567   4,711 
    
Total assets$58,727  $53,502 
    
LIABILITIES AND SHAREHOLDERS' EQUITY   
    
CURRENT LIABILITIES:   
Trade payables$ 7,665   $  5,650 
Other accounts payable and accrued expenses   4,166   3,842 
Advances from customers, net 866   727 
Contract liabilities 515   366 
Operating lease short-term liabilities   837   - 
Current liabilities related to discontinued operations   -   366 
    
Total current liabilities   14,049   10,951 
    
LONG-TERM LIABILITIES:   
Accrued severance pay and other long-term liabilities   722   690 
Operating lease long-term liabilities 1,057   - 
 Total long-term liabilities   1,779   690 
    
RADA SHAREHOLDERS' EQUITY   
Share capital -   
Ordinary shares of NIS 0.03 par value - Authorized: 100,000,000 shares at March 31, 2019 and December 31, 2018; Issued and outstanding: 38,067,024 at March 31, 2019 and 37,516,891 at December 31, 2018.   390   386 
        
Additional paid-in capital 120,338   118,568 
Accumulated other comprehensive income   -   220 
Accumulated deficit (77,446)  (76,961)
    
Total RADA shareholders’ equity 43,282   42,213 
Non-controlling interest   (383)  (352)
        
Total equity  42,899   41,861 
        
Total liabilities and equity$58,727  $53,502 
        


CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands, except share and per share data
 Three months ended Year ended
 March 31,  December 31,
 2019 2018 2018
 Unaudited Audited
      
      
Revenues$   8,687  $    6,020   $    28,032  
      
Cost of revenues  5,534   3,841     17,914 
      
Gross profit   3,153   2,179     10,118 
      
Operating expenses:     
      
Research and development   1,366   592   3,092 
Marketing and selling    882   634   2,860 
General and administrative 1,463   748   4,001 
Net loss from sale of fixed assets -   -   103 
      
Total operating expenses 3,711   1,974   10,056 
      
Operating income (loss) (558)  205   62 
            
Financial income, net 42   8   119 
      
Net income (loss) from continuing operations (516)  213   181 
Net income (loss) from discontinued operations -   (9)  (404)
      
Net income (Loss)$(516) $ 204  $(223)
Net income (loss) attributable to non-controlling interest (31)  (16)  (386)
            
Net income (loss) attributable to RADA Electronic Industries' shareholders$(485) $220  $163 
Basic net income (loss) from continuing operations per Ordinary share$(0.01) $0.01  $0.02 
Diluted net income (loss) from continuing operations per Ordinary share$(0.01) $0.01  $0.02 
Basic and diluted net income (loss) from discontinued operations per Ordinary share$-  $0.00  $(0.01)
Basic and diluted net income (loss) per Ordinary share$(0.01) $0.01  $0.01 
Weighted average number of Ordinary shares used for computing basic net income (loss) per share 37,966,987   32,604,550   33,184,570 
Weighted average number of Ordinary shares used for computing diluted net income (loss) per share 38,454,861   33,202,955   33,716,931 
            

In February 2016, the FASB established Topic 842, Leases, by issuing ASU 2016-02, which requires lessees to recognize leases on-balance sheet and disclose key information about leasing arrangements. Topic 842 was subsequently amended by ASU 2018-01, Land Easement Practical Expedient for Transition to Topic 842; ASU 2018-10, Codification Improvements to Topic 842, Leases; and ASU 2018-11, Targeted Improvements. The new standard establishes a right-of-use model (ROU) that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases are classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. The Company adopted the new standard on the first day of fiscal 2019. The Company used the modified retrospective transition approach with the effective date as the date of initial application. Consequently, financial information will not be updated, and the disclosures required under the new standard will not be provided for dates and periods before January 2019. The new standard provides several optional practical expedients in transition. The Company elected the ‘package of practical expedients’, which permits us not to reassess under the new standard the prior conclusions about lease identification, lease classification and initial direct costs. The adoption of the standard resulted in a material effect on the Company’s financial statements with a balance sheet recognition of additional lease assets and lease liabilities of approximately $1.9 million as of March 31, 2019.

RADA logo.jpg

Source: RADA Electronic Industries Ltd.


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