PETAH TIKVA, Israel, Aug. 10, 2010 (GLOBE NEWSWIRE) -- Gilat Satellite Networks Ltd. (Nasdaq:GILT), a worldwide leader in satellite networking technology, solutions and services, today reported its results for the quarter ending June 30, 2010.
Revenues for the second quarter of 2010 were $51.8 million compared to $56.0 million in the same period of 2009. Net loss for the second quarter of 2010 was $1.3 million or $0.03 per diluted share compared to a net loss of $1.2 million, or $0.03 per diluted share in the second quarter of 2009.
Revenues for the six month period ended June 30, 2010 were $108.9 million compared to $116.8 million in the same period of 2009. Net loss for the six month period ended June 30, 2010 was $0.7 million, or $0.02 per diluted share compared to net loss of $1 million or $0.02 per diluted share in the same period of 2009.
Gilat's Chief Executive Officer and Chairman of the Board Amiram Levinberg said, "Q2 was highlighted by the completion of our acquisition of RaySat Antenna Systems and the signing of a definitive agreement to acquire the antenna research and design center in Bulgaria. These acquisitions are part of our focus on the defense and military markets. In the second quarter we were able to increase our cash, and our bookings grew sequentially compared to Q1 2010 and to the comparable quarter of 2009, which leads us to be cautiously optimistic for the second half of the year."
Regarding the announcement on the settlement with the purchasers who were to close on a Merger Agreement in 2008 Mr. Levinberg commented, "With this legal dispute behind us, we can focus our full management attention on implementing our strategy and on our ongoing business."
LINK TO THE FINANCIAL STATEMENTS
Recent Announcements:
- Gilat announces settlement of litigation related to the termination of the 2008 Merger Agreement. The settlement agreements will result in the termination of all court proceedings filed by Gilat against each of the defendants, as well as general mutual waivers and releases provided by all parties, including the entities formed by the defendants to purchase Gilat.
- Gilat chosen to provide broadband satellite networks for homeland security in Asia. The networks are being used to deliver data, video and voice applications for homeland security and border patrol forces in addition to other defense requirements. The networks incorporate a video surveillance application and various quick-deploy transportable units.
- Vietnam Telecom International (VTI) selects Gilat for broadband satellite network deployment. The new SkyEdge II system will operate via VINASAT-1, the first Vietnamese communications satellite, and will combine both C-band and Ku-band capacity within the same network using the SkyEdge II multi-transponder capability.
- Gilat to provide satellite communications equipment for SchoolNet project expansion in Ethiopia. SchoolNet is a satellite-based network which provides Internet connectivity as well as TV- broadcast educational content to secondary schools across Ethiopia. The network has successfully enabled students in hundreds of rural schools to enjoy equal learning opportunities like those of their colleagues in urban schools throughout the country.
Gilat will host a conference call today with an accompanying slide presentation at 9:30 AM ET. In order to ensure audio access, participants from the U.S. should dial in at (888) 407-2553 and international participants should dial in at (972) 3-918-0610. The presentation may be accessed through the Company's website at http://www.gilat.com/ prior to the call. The call will also be available as a Webcast on the Company's website at http://www.gilat.com/ and will be archived for 30 days.
Notes:
(1) The attached summary financial statements were prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP). The attached summary financial statements for the second quarter of 2010 are unaudited. To supplement the consolidated financial statements presented in accordance with GAAP, the Company presents Gilat's net income, EBITDA and earnings per diluted share, before the impact of a non-cash share-based payment charge, which is the non-cash stock option expense as per SFAS 123 (R). Non-GAAP presentations of net income, EBITDA and earnings per share are provided to enhance the understanding of the Company's historical financial performance and comparability between periods.
(2) Operating income before depreciation, amortization, non cash stock option expenses as per SFAS 123(R) and exceptional items ('EBITDA') is presented because it is a measure commonly used and is presented solely in order to improve the understanding of the Company's operating results and to provide further perspective on these results. EBITDA, however, should not be considered as an alternative to operating income or net income for the period as an indicator of the operating performance of the Company.
Similarly, EBITDA should not be considered as an alternative to cash flows from operating activities as a measure of liquidity. EBITDA is not a measure of financial performance under generally accepted accounting principles and may not be comparable to other similarly titled measures for other companies. EBITDA may not be indicative of the historic operating results of the Company; nor is it meant to be predictive of potential future results. Reconciliation between the Company's Operating income and EBIDTA is presented in the attached summary financial statements.
About Gilat Satellite Networks Ltd.
Gilat Satellite Networks Ltd. is a leading provider of products and professional services for satellite-based broadband communications networks worldwide. Gilat was founded in 1987 and has shipped over 750,000 Very Small Aperture Terminals (VSATs) to more than 85 countries across six continents. Gilat's headquarters is located in Petah Tikva, Israel. The Company has 16 sales and service offices worldwide. Gilat markets a full line of high-performance VSATs under the SkyEdgeTM and SkyEdge II Product Family. Gilat's wholly-owned subsidiary, Spacenet Inc., is a leading provider of managed services in North America to the business and government segments. For more information, please visit http://www.gilat.com/.
The Gilat Satellite Networks Ltd. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5848
Certain statements made herein that are not historical are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. The words "estimate", "project", "intend", "expect", "believe" and similar expressions are intended to identify forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties. Many factors could cause the actual results, performance or achievements of Gilat to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, changes in general economic and business conditions, inability to maintain market acceptance to Gilat's products, inability to timely develop and introduce new technologies, products and applications, rapid changes in the market for Gilat's products, loss of market share and pressure on prices resulting from competition, introduction of competing products by other companies, inability to manage growth and expansion, loss of key OEM partners, inability to attract and retain qualified personnel, inability to protect the Company's proprietary technology and risks associated with Gilat's international operations and its location in Israel. For additional information regarding these and other risks and uncertainties associated with Gilat's business, reference is made to Gilat's reports filed from time to time with the Securities and Exchange Commission.
| GILAT SATELLITE NETWORKS LTD. | ||
| CONDENSED CONSOLIDATED BALANCE SHEET | ||
| US dollars in thousands | ||
| June 30, | December 31, | |
| 2010 | 2009 | |
| Unaudited | ||
| ASSETS | ||
| CURRENT ASSETS: | ||
| Cash and cash equivalents | 127,309 | 122,672 |
| Short-term bank deposits | 22,593 | 31,729 |
| Available-for-sale marketable securities | 4,674 | -- |
| Short-term restricted cash | 1,377 | 1,782 |
| Restricted cash held by trustees | 6,669 | 2,137 |
| Trade receivables, net | 43,925 | 45,597 |
| Inventories | 13,721 | 13,711 |
| Other current assets | 21,389 | 19,068 |
| Total current assets | 241,657 | 236,696 |
| LONG-TERM INVESTMENTS AND RECEIVABLES: | ||
| Long-term restricted cash | 4,392 | 4,896 |
| Severance pay fund | 9,435 | 9,912 |
|
Long-term trade receivables, receivables in respect of capital leases and other receivables |
1,101 | 2,204 |
| Total long-term investments and receivables | 14,928 | 17,012 |
| PROPERTY AND EQUIPMENT, NET | 99,201 | 100,532 |
| INTANGIBLE ASSETS AND DEFERRED CHARGES, NET | 2,651 | 2,988 |
| TOTAL ASSETS | 358,437 | 357,228 |
| GILAT SATELLITE NETWORKS LTD. | ||
| CONDENSED CONSOLIDATED BALANCE SHEET | ||
| US dollars in thousands | ||
| June 30, | December 31, | |
| 2010 | 2009 | |
| Unaudited | ||
| LIABILITIES AND EQUITY | ||
| CURRENT LIABILITIES: | ||
| Current maturities of long-term loans and convertible notes | 5,174 | 5,220 |
| Trade payables | 16,918 | 16,838 |
| Accrued expenses | 19,742 | 20,067 |
| Short-term advances from customer, held by trustees | 6,669 | 2,137 |
| Other current liabilities | 28,576 | 28,154 |
| Total current liabilities | 77,079 | 72,416 |
| LONG-TERM LIABILITIES: | ||
| Accrued severance pay | 9,775 | 10,011 |
| Long-term loans, net | 8,795 | 9,830 |
| Accrued interest related to restructured debt | 871 | 1,176 |
| Convertible subordinated notes | 14,799 | 15,220 |
| Other long-term liabilities | 15,387 | 16,280 |
| Total long-term liabilities | 49,627 | 52,517 |
| COMMITMENTS AND CONTINGENCIES | ||
| EQUITY: | ||
| Share capital - ordinary shares of NIS 0.2 par value | 1,842 | 1,832 |
| Additional paid in capital | 864,072 | 863,337 |
| Accumulated other comprehensive income | 723 | 1,341 |
| Accumulated deficit | (634,906) | (634,215) |
| Total equity | 231,731 | 232,295 |
| TOTAL LIABILITIES AND EQUITY | 358,437 | 357,228 |
| GILAT SATELLITE NETWORKS LTD. | ||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
| U.S. dollars in thousands (except per share data) | ||||
|
Six months ended June 30, |
Three months ended June 30, |
|||
| 2010 | 2009 | 2010 | 2009 | |
| Unaudited | Unaudited | Unaudited | Unaudited | |
| Revenues | 108,903 | 116,829 | 51,791 | 56,003 |
| Cost of revenues | 72,413 | 81,851 | 34,938 | 38,979 |
| Gross profit | 36,490 | 34,978 | 16,853 | 17,024 |
| Research and development expenses: | ||||
| Expenses incurred | 9,472 | 8,095 | 4,749 | 4,086 |
| Less - grants | 1,485 | 1,185 | 1,270 | 950 |
| 7,987 | 6,910 | 3,479 | 3,136 | |
| Selling, marketing, general and administrative expenses | 29,856 | 28,510 | 14,783 | 14,380 |
| Operating loss | (1,353) | (442) | (1,409) | (492) |
| Financial income (expenses), net | 10 | (227) | (59) | (568) |
| Other income | -- | 199 | -- | -- |
| Loss before taxes on income | (1,343) | (470) | (1,468) | (1,060) |
| Taxes on income (tax benefit) | (652) | 495 | (135) | 143 |
| Net loss | (691) | (965) | (1,333) | (1,203) |
| Basic net loss per share | (0.02) | (0.02) | (0.03) | (0.03) |
| Diluted net loss per share | (0.02) | (0.02) | (0.03) | (0.03) |
| Weighted average number of shares used in computing net loss per share | ||||
| Basic | 40,356 | 40,102 | 40,403 | 40,133 |
| Diluted | 40,356 | 40,102 | 40,403 | 40,133 |
| GILAT SATELLITE NETWORKS LTD. | ||||
| RECONCILIATION BETWEEN GAAP AND NON-GAAP STATEMENTS OF OPERATIONS | ||||
| FOR COMPARATIVE PURPOSES | ||||
| U.S. dollars in thousands (except per share data) | ||||
|
Six months ended June 30, |
Three months ended June 30, |
|||
| 2010 | 2009 | 2010 | 2009 | |
| Unaudited | Unaudited | Unaudited | Unaudited | |
| GAAP operating loss | (1,353) | (442) | (1,409) | (492) |
| Non-cash stock-based compensation expenses (1) | 734 | 449 | 402 | 221 |
| Non-GAAP operating income (loss) | (619) | 7 | (1,007) | (271) |
| GAAP net loss | (691) | (965) | (1,333) | (1,203) |
| Non-cash stock-based compensation expenses (1) | 734 | 449 | 402 | 221 |
| Non-GAAP net income (loss) | 43 | (516) | (931) | (982) |
| GAAP Loss per share (diluted) | (0.02) | (0.02) | (0.03) | (0.03) |
| Non-cash stock-based compensation expenses (1) | 0.02 | 0.01 | 0.01 | 0.01 |
| Non-GAAP Loss per share (diluted) | -- | (0.01) | (0.02) | (0.02) |
| (1) Non-cash stock-based compensation expenses: | ||||
| Cost of Revenues | 134 | 77 | 67 | 37 |
| Research and development | 78 | 37 | 43 | 18 |
| Selling, general, marketing and administrative | 522 | 335 | 292 | 166 |
| 734 | 449 | 402 | 221 | |
| GILAT SATELLITE NETWORKS LTD. | ||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
| US dollars in thousands | ||||
|
Six months ended June 30, |
Three months ended June 30, |
|||
| 2010 | 2009 | 2010 | 2009 | |
| Unaudited | Unaudited | Unaudited | Unaudited | |
| Cash flows from operating activities: | ||||
| Net loss | (691) | (965) | (1,333) | (1,203) |
| Adjustments required to reconcile net loss to net cash provided by (used in) operating activities: | ||||
| Depreciation and amortization | 6,218 | 7,259 | 3,205 | 3,804 |
| Gain from redemption of convertible notes | -- | (22) | -- | (22) |
| Gain from the sale of an investment accounted for at cost | -- | (199) | -- | -- |
| Stock-based compensation related to employees | 734 | 449 | 402 | 221 |
| Accrued severance pay, net | 241 | (494) | 127 | (201) |
| Accrued interest and exchange rate differences on short and long-term restricted cash, net | 19 | 155 | 168 | (108) |
| Accrued interest and exchange rate differences on marketable securities and short term bank deposits, net | 110 | (277) | 171 | (357) |
| Exchange rate differences on long-term loans | (915) | 81 | (495) | 366 |
| Exchange rate differences on loans to employees | 1 | -- | 1 | (5) |
| Capital loss from disposal of property and equipment | 245 | 64 | 238 | 59 |
| Deferred income taxes | 6 | 215 | (5) | 181 |
| Decrease in trade receivables, net | 1,602 | 8,835 | 10,384 | 7,317 |
| Decrease in other assets (including short-term, long-term and deferred charges) | (2,143) | 7,082 | (2,356) | (1,027) |
| Decrease (increase) in inventories | (871) | 6,152 | 1,036 | 4,876 |
| Increase (decrease) in trade payables | 92 | (13,663) | 1,106 | (6,977) |
| Decrease in accrued expenses | (626) | (3,359) | (1,827) | (1,652) |
| Increase (decrease) in advances from customer, held by trustees, net | 4,532 | (10,963) | 5,813 | (8,065) |
| Increase (decrease) in other accounts payable and other long term liabilities | (274) | (6,915) | 1,303 | 1,802 |
| Net cash provided by (used in) operating activities | 8,280 | (6,565) | 17,938 | (991) |
| GILAT SATELLITE NETWORKS LTD. | ||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
| US dollars in thousands | ||||
|
Six months ended June 30, |
Three months ended June 30, |
|||
| 2010 | 2009 | 2010 | 2009 | |
| Unaudited | Unaudited | Unaudited | Unaudited | |
| Cash flows from investing activities: | ||||
| Purchase of property and equipment | (3,725) | (1,873) | (2,732) | (1,081) |
| Proceeds from sale of an investment accounted for at cost | -- | 199 | -- | -- |
| Purchase of held-to-maturity marketable securities and deposits | (30,693) | (74,077) | -- | (13,265) |
| Proceeds from held-to-maturity marketable securities and deposits | 39,877 | 73,212 | 31,924 | 13,929 |
| Purchase of available-for-sale marketable securities | (4,804) | -- | -- | -- |
| Loans to employees, net | 1 | 12 | 2 | 15 |
| Investment in restricted cash held by trustees | (11,110) | -- | (9,706) | -- |
| Proceeds from restricted cash held by trustees | 6,555 | 10,848 | 3,768 | 8,211 |
| Investment in restricted cash (including long-term) | (421) | (87) | (34) | (37) |
| Proceeds from restricted cash (including long-term) | 1,332 | 998 | 1,262 | 801 |
| Net cash provided by (used in) investing activities | (2,988) | 9,232 | 24,484 | 8,573 |
| Cash flows from financing activities: | ||||
| Early redemption and repayment of convertible notes | (420) | (45) | (420) | (45) |
| Issuance of restricted stock units | 10 | 6 | 5 | 3 |
| Repayment of long-term loans | (166) | (167) | (79) | (86) |
| Net cash used in financing activities | (576) | (206) | (494) | (128) |
| Effect of exchange rate changes on cash and cash equivalents | (79) | 503 | (20) | 488 |
| Increase in cash and cash equivalents | 4,637 | 2,964 | 41,908 | 7,942 |
| Cash and cash equivalents at the beginning of the period | 122,672 | 73,916 | 85,401 | 68,938 |
| Cash and cash equivalents at the end of the period | 127,309 | 76,880 | 127,309 | 76,880 |
| GILAT SATELLITE NETWORKS LTD. | ||||
| CONDENSED EBITDA | ||||
| US dollars in thousands | ||||
|
Six months ended June 30, |
Three months ended June 30, |
|||
| 2010 | 2009 | 2010 | 2009 | |
| Unaudited | Unaudited | Unaudited | Unaudited | |
| Operating loss | (1,353) | (442) | (1,409) | (492) |
| Add: | ||||
| Non-cash stock-based compensation expenses | 734 | 449 | 402 | 221 |
| Deprecation and amortization | 6,218 | 7,259 | 3,205 | 3,804 |
| EBITDA | 5,599 | 7,266 | 2,198 | 3,533 |