OREANDA-NEWS. Gilat Satellite Networks Ltd. (NASDAQ:GILT) (TASE:GILT), a worldwide leader in satellite networking technology, solutions and services, today reported its results for the first quarter ended March 31, 2016.

Key Financial Updates:

  • Revenue for Q1 2016 was $52.7 million compared to $45.2 million in comparable period of 2015, an increase of 17%.
  • EBITDA for Q1 2016 increased to $0.5 million compared to $0.2 million in comparable period of 2015.
  • Reiterated management objectives for 2016: continued growth with revenues between $290 and $310 million and EBITDA between $18 and $24 million.

On a GAAP basis, operating loss was $3.0 million in the first quarter of 2016 as compared to an operating loss of $4.0 million in the comparable quarter of 2015.

On a non-GAAP basis, operating loss was $1.4 million in the first quarter of 2016 as compared to an operating loss of $2.1 million in the comparable quarter of 2015.

On a GAAP basis, loss for the quarter was $4.0 million or $0.09 per diluted share compared to a loss of $5.6 million or $0.13 per diluted share in the same quarter of 2015.

On a non-GAAP basis, the loss for the quarter was $2.4 million or $0.05 per diluted share compared to a loss of $3.7 million or $0.09 per diluted share in the same quarter of 2015.

EBITDA for the first quarter of 2016 reached $0.5 million, compared to $0.2 million in the comparable period in 2015.

"I am pleased to report a good first quarter, which was in-line with our plans,” said Yona Ovadia, CEO of Gilat. “Our first quarter results are a strong testament to the validity of our strategy.  Our one-platform/multi-application X-Architecture continued to gain wide acceptance as the most advanced HTS ground equipment technology. In the first quarter, Eutelsat chose our X-Architecture platform to connect to RSCC's Express AMU1/EUTELSAT 36C satellite for the delivery of broadband services to users throughout western Russia. SES and Facebook also selected the platform for Facebook’s initiative to deliver broadband Internet access throughout Africa.

“In the Mobility market, our In-Flight Connectivity strategy gained momentum when Gogo, the global leader in providing broadband connectivity solutions and wireless entertainment to the aviation industry, selected our next-generation airborne IP network modem system.

“Our positive first quarter results were achieved despite the economic slowdown witnessed in the Latin American and CIS markets. We have more than compensated for these difficult market conditions with significant achievements in our strategic focus areas,” added Mr. Ovadia.

“Based on our solid first quarter business progress and results, our backlog and the prospects we continue to see, we reiterate our management objectives for FY2016 of a revenue target of $290 to $310 million and an EBITDA target of $18 to $24 million," concluded Mr. Ovadia.

Key Recent Announcements:

  • Telefonica del Peru Selects Gilat to Extend Cellular and Broadband Coverage to Rural Areas Nationwide
  • Eutelsat Selects Gilat Technology to Power Satellite Broadband Services in Western Russia
  • Gilat Partners with Austria’s Diamond Aircraft to Deliver Airborne Broadband Connectivity via Satellite
  • Gogo Selects Gilat to Provide its Next-Generation Airborne IP Network Modem System
  • SoftBank to Provide High-Speed LTE Services Using Gilat’s Satellite-Based Cellular Backhaul Technology

About Gilat
Gilat Satellite Networks Ltd (NASDAQ:GILT) (TASE:GILT) is a leading provider of products and services for satellite-based broadband communications. Gilat develops and markets a wide range of high-performance satellite ground segment equipment and VSATs, with an increasing focus on the consumer and Ka-band market. In addition, Gilat enables mobile SOTM (Satellite-on-the-Move) solutions providing low-profile antennas, next generation solid-state power amplifiers and modems. Gilat also provides managed network and satellite-based services for rural telephony and Internet access via its subsidiaries in Peru and Colombia.

With over 25 years of experience, and over a million products shipped to more than 90 countries, Gilat has provided enterprises, service providers and operators with efficient and reliable satellite-based connectivity solutions, including cellular backhaul, banking, retail, e-government and rural communication networks. Gilat also enables leading defense, public security and news organizations to implement advanced, on-the-move tactical communications on board their land, air and sea fleets using Gilat's high-performance SOTM solutions. Gilat controlling shareholders are the FIMI Private Equity Funds.

       
GILAT SATELLITE NETWORKS LTD.      
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS      
U.S. dollars in thousands (except share and per share data)      
  Three months ended  
  March 31,  
    2016     2015    
  Unaudited Unaudited  
       
Revenues     52,665       45,190    
Cost of revenues     40,267       31,998    
Gross profit     12,398       13,192    
       
Research and development expenses     5,888       6,534    
Less - grants     86       190    
Research and development expenses, net     5,802       6,344    
Selling and marketing expenses     5,123       6,263    
General and administrative expenses     4,438       4,591    
Total operating expenses     15,363       17,198    
Operating loss     (2,965 )     (4,006 )  
Financial expenses, net      (743 )     (1,351 )  
Loss before taxes on income     (3,708 )     (5,357 )  
Taxes on income     318       249    
Loss     (4,026 )     (5,606 )  
       
Loss per share (basic and diluted)     (0.09 )     (0.13 )  
       
Weighted average number of shares used in computing loss per share (basic and diluted)   44,382,379     42,883,469    
       
GILAT SATELLITE NETWORKS LTD.  
RECONCILIATION BETWEEN GAAP AND NON-GAAP STATEMENTS OF OPERATIONS  
FOR COMPARATIVE PURPOSES  
U.S. dollars in thousands (except share and per share data)  
   Three months ended   Three months ended   
  March 31, 2016 March 31, 2015  
  GAAP Adjustments 1 Non-GAAP GAAP Adjustments 1 Non-GAAP  
  Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited  
               
Gross profit     12,398       1,184       13,582       13,192       1,251       14,443    
Operating expenses     15,363       (405 )     14,958       17,198       (688 )     16,510    
Operating loss     (2,965 )     1,589       (1,376 )     (4,006 )     1,939       (2,067 )  
Loss before taxes on income     (3,708 )     1,589       (2,119 )     (5,357 )     1,939       (3,418 )  
Loss     (4,026 )     1,589       (2,437 )     (5,606 )     1,939       (3,667 )  
               
Loss per share (basic and diluted)     (0.09 )     0.04       (0.05 )     (0.13 )     0.04       (0.09 )  
               
Weighted average number of shares used in              
computing loss per share (basic and diluted)   44,382,379       44,382,379     42,883,469       42,883,469    
               
1 Adjustments reflect the effect of non-cash stock based compensation as per ASC 718 and amortization of intangible assets related to      
Shares acquisition transactions.              
               
     Three months ended       Three months ended     
    March 31, 2016     March 31, 2015    
    Unaudited     Unaudited    
               
GAAP loss       (4,026 )         (5,606 )    
Gross profit:              
Non-cash stock-based compensation expenses (income)       (11 )         52      
Amortization of intangible assets related to acquisition transactions       1,195           1,199      
        1,184           1,251      
Operating expenses:              
Non-cash stock-based compensation expenses       212           476      
Amortization of intangible assets related to acquisition transactions       193           212      
        405           688      
               
Non GAAP loss       (2,437 )         (3,667 )    
               

 

GILAT SATELLITE NETWORKS LTD.      
CONDENSED EBITDA      
US dollars in thousands      
  Three months ended  
  March 31,  
    2016     2015    
  Unaudited Unaudited  
       
GAAP operating loss     (2,965 )     (4,006 )  
Add:      
Non-cash stock-based compensation expenses     201       528    
Depreciation and amortization     3,301       3,658    
EBITDA     537       180    
 
GILAT SATELLITE NETWORKS LTD.      
CONDENSED CONSOLIDATED BALANCE SHEET      
US dollars in thousands      
       
  March 31, December 31,  
    2016     2015    
  Unaudited Audited  
       
ASSETS      
       
CURRENT ASSETS:      
Cash and cash equivalents     33,160       18,435    
Restricted cash     87,707       100,779    
Restricted cash held by trustees     5,279       8,524    
Trade receivables, net     52,806       50,984    
Inventories     28,072       25,358    
Other current assets     18,432       16,223    
Total current assets     225,456       220,303    
       
LONG-TERM INVESTMENTS AND RECEIVABLES:      
Long-term restricted cash     188       179    
Severance pay funds     7,904       7,545    
Other long term receivables and deferred charges     223       221    
Total long-term investments and receivables     8,315       7,945    
       
PROPERTY AND EQUIPMENT, NET     81,220       81,963    
       
INTANGIBLE ASSETS, NET     15,711       17,154    
       
GOODWILL     43,468       43,468    
       
TOTAL ASSETS     374,170       370,833    
       
GILAT SATELLITE NETWORKS LTD.      
CONDENSED CONSOLIDATED BALANCE SHEET      
US dollars in thousands      
       
  March 31, December 31,  
    2016     2015    
  Unaudited Audited  
       
LIABILITIES AND EQUITY      
       
CURRENT LIABILITIES:      
Short-term bank credit and loans     4,250       7,000    
Current maturities of long-term loans     4,568       4,542    
Trade payables     21,176       17,210    
Accrued expenses     31,022       23,481    
Advances from customers     71,008       82,813    
Advances from customers, held by trustees     4,578       8,515    
Other current liabilities     17,631       16,213    
       
Total current liabilities     154,233       159,774    
       
LONG-TERM LIABILITIES:      
Accrued severance pay     7,742       7,506    
Long-term loans, net of current maturities     17,418       21,493    
Other long-term liabilities     3,744       3,978    
       
Total long-term liabilities     28,904       32,977    
       
EQUITY:      
Share capital - ordinary shares of NIS 0.2 par value     2,578       2,048    
Additional paid-in capital     899,376       884,126    
Accumulated other comprehensive loss     (2,530 )     (3,727 )  
Accumulated deficit     (708,391 )     (704,365 )  
       
Total equity     191,033       178,082    
       
TOTAL LIABILITIES AND EQUITY     374,170       370,833    
           
       
GILAT SATELLITE NETWORKS LTD.      
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS      
US dollars in thousands      
       
  Three months ended  
  March 31,  
    2016     2015    
  Unaudited Unaudited  
Cash flows from operating activities:      
Loss from continuing operations     (4,026 )     (5,606 )  
Adjustments required to reconcile loss      
to net cash provided by (used in) operating activities:      
Depreciation and amortization     3,301       3,658    
Stock-based compensation     201       528    
Accrued severance pay, net     (123 )     (101 )  
Accrued interest and exchange rate differences on      
short and long-term restricted cash, net     (409 )     43    
Exchange rate differences on long-term loans     90       (329 )  
Deferred income taxes, net     -        (41 )  
Decrease (increase) in trade receivables, net     (1,394 )     721    
Decrease (increase) in other assets (including short-term, long-term      
and deferred charges)     (2,154 )     2,934    
Increase in inventories     (2,685 )     (4,182 )  
Decrease in restricted cash directly related to operating activities, net     6,304       -     
Increase (decrease) in trade payables     4,089       (195 )  
Increase (decrease) in accrued expenses     7,408       (2,173 )  
Decrease in advance from customers     (11,823 )     (767 )  
Decrease in advances from customers, held      
by trustees     (4,063 )     (5,178 )  
Increase in other current liabilities and other long term liabilities     1,221       5,017    
Net cash used in operating activities     (4,063 )     (5,671 )  
       
GILAT SATELLITE NETWORKS LTD.      
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS      
US dollars in thousands      
       
  Three months ended  
  March 31,  
    2016     2015    
  Unaudited Unaudited  
Cash flows from investing activities:      
Purchase of property and equipment     (1,104 )     (741 )  
Proceeds from restricted cash held by trustees     3,675       10,922    
Investment in restricted cash (including long-term)     (179 )     (10,052 )  
Proceeds from restricted cash (including long-term)     7,347       22,117    
Net cash provided by investing activities     9,739       22,246    
       
Cash flows from financing activities:      
Capital lease payments     (51 )     (102 )  
Issuance of shares in a rights offering     15,243       -     
Issuance of restricted stock units and exercise of stock options     336       793    
Short term bank credit, net     (2,750 )     (10,007 )  
Repayment of long-term loans     (4,139 )     (4,135 )  
Net cash provided by (used in) financing activities     8,639       (13,451 )  
       
Effect of exchange rate changes on cash and cash equivalents     410       (485 )  
       
Increase in cash and cash equivalents     14,725       2,639    
       
Cash and cash equivalents at the beginning of the period     18,435       27,726    
       
Cash and cash equivalents at the end of the period     33,160       30,365