EX-99.1 2 exhibit_99-1.htm EXHIBIT 99.1
Exhibit 99.1



Press Release
 
Eltek Reports 2021 Third Quarter Financial Results


 •
Revenues of $8.0 million in the third quarter of 2021 compared to $9.3 million in the third quarter of 2020

•
Net loss of $26,000 in the third quarter of 2021 compared to net profit of $598,000 in the third quarter of 2020

•
EBITDA of $553,000 in the third quarter of 2021 compared to EBITDA of $1.0 million in the third quarter of 2020

•
Cash and cash equivalents as of September 30, 2021 were $8.9 million

PETACH-TIKVA, Israel, November 17, 2021 - Eltek Ltd. (NASDAQ: ELTK), a global manufacturer and supplier of technologically advanced solutions in the field of printed circuit boards, announced today its financial results for the quarter ended September 30, 2021.

Mr. Eli Yaffe, Chief Executive Officer, commented: "Our third quarter results reflect a reduction in working days during this quarter, compared to the number of working days in the third quarter of 2020. In addition, we incurred higher expenses due to the strength of the New Israeli Shekel ("NIS") compared to the US$ during the third quarter."
 
“We are conducting several R&D programs in order to keep our position as an innovative industry leader. In addition, we invested $1.4 million in new equipment during the first nine months of 2021. We continue to invest in new advanced manufacturing equipment that will strengthen our manufacturing capabilities and increase our competitiveness by implementing improved production processes and adoption of Industry 4.0 technologies," added Mr. Yaffe.
 
"Eltek has an improved balance sheet and cash flow, with a positive working capital of $12.5 million as of September 30, 2021 and operating cash flow of $3.4 million in the first nine months of 2021. We are making the necessary operational adjustments to expand our business, improve customer satisfaction, increase revenues and return to the trend of improved operational results,” concluded Mr. Yaffe.


 
Highlights of the Third Quarter of 2021 compared to the Third Quarter of 2020
 

 •
Revenues for the third quarter of 2021 were $8.0 million compared to revenues of $9.3 million in the third quarter of 2020;
 

 •
Gross profit was $1.4 million (17.5% of revenues) in the third quarter of 2021 compared to $1.8 million (19.7% of revenues) in the third quarter of 2020;
 

 •
Operating profit was $65,000 during the third quarter of 2021 as compared to operating profit of $638,000 in the third quarter of 2020;
 

 •
Net loss was $26,000, or ($0.00) per share in the third quarter of 2021 as compared to net profit of $598,000, or $0.14 per fully diluted share, in the third quarter of 2020;
 

 •
EBITDA was $553,000 in the third quarter of 2021 compared to EBITDA of $1.0 million in the third quarter of 2020;
 

 •
Net cash provided by operating activities amounted to $598,000 in the third quarter of 2021 compared to net cash provided by operating activities of $873,000 in the third quarter of 2020.
 

 •
Cash and cash equivalents as of September 30, 2021 totaled $8.9 million compared to $4.7 million as of December 31, 2020.
 
Highlights for the First Nine Months of 2021


 •
Revenues for the first nine months of 2021 were $24.3 million compared to $27.2 million in the first nine months of 2020;
 

 •
Gross profit was $4.9 million (20.2% of revenues) compared to gross profit of $5.5 million (20.3% of revenues) in the first nine months of 2020;
 

 •
Operating profit was $1.1 million compared to operating profit of $2.1 million in the first nine months of 2020;
 

 •
Net profit was $1.0 million, or $0.17 per fully diluted share compared to net profit of $1.8 million, or $0.42 per fully diluted share in the first nine months of 2020;
 

 •
EBITDA was $2.5 million in the first nine months of 2021, compared to EBITDA of $3.2 million in the first nine months of 2020;
 

 •
Net cash provided by operating activities amounted to $3.4 million in the first nine months of 2021 compared to net cash provided by operating activities of $3.7 million in the first nine months of 2020.
 

Conference Call
Today, Wednesday, November 17, 2021, at 8:30 a.m. Eastern Time, Eltek will conduct a conference call to discuss the results. The call will feature remarks by Eli Yaffe, Chief Executive Officer and Alon Mualem, Chief Financial Officer.
 
To participate, please call the following teleconference numbers. Please allow for additional time to connect prior to the call:
 
United States:         1-888-723-3164
Israel:                       03-9180691
International:          +972-3-9180691

                   At:
                   8:30 a.m. Eastern Time
5:30 a.m. Pacific Time
                   15:30 p.m. Israel Time

A replay of the call will be available through the Investor Info section on Eltek’s corporate website at http://www.nisteceltek.com approximately 24 hours after the conference call is completed and will be archived for 30 days.
 
About Eltek

Eltek – "Innovation Across the Board", is a global manufacturer and supplier of technologically advanced solutions in the field of printed circuit boards (PCBs), and is the Israeli leader in this industry. PCBs are the core circuitry of most electronic devices. Eltek specializes in the manufacture and supply of complex and high quality PCBs, HDI, multilayered and flex-rigid boards for the high-end market. Eltek is ITAR compliant and has AS-9100 and NADCAP Electronics certifications. Its customers include leading companies in the defense, aerospace and medical industries in Israel, the United States, Europe and Asia.

Eltek was founded in 1970. The Company’s headquarters, R&D, production and marketing center are located in Israel. Eltek also operates through its subsidiary in North America and by agents and distributors in Europe, India, South Africa and South America.

For more information, visit Eltek's web site at www.nisteceltek.com.


Use of Non-GAAP Financial Information
 
The Company reports financial results in accordance with U.S. GAAP. To supplement the consolidated financial statements presented in accordance with GAAP, the Company presents the Non-GAAP presentation of EBITDA. This non-GAAP measure is not in accordance with, nor is it a substitute for, a GAAP measure. The Company uses EBITDA to evaluate and manage the Company’s operations internally. The Company is also providing this information to assist investors in performing additional financial analysis. Reconciliation between the company's results on a GAAP and non-GAAP basis is provided in a table below.
 
Forward Looking Statement:
Certain matters discussed in this news release are forward-looking statements that involve a number of risks and uncertainties including, but not limited to statements regarding expected results in future quarters, the impact of the Coronavirus on the economy and our operations, risks in product and technology development and rapid technological change, product demand, the impact of competitive products and pricing, market acceptance, the sales cycle, changing economic conditions and other risk factors detailed in the Company's Annual Report on Form 20-F and other filings with the United States Securities and Exchange Commission.

Investor Contact:
Alon Mualem
Chief Financial Officer
alonm@nisteceltek.com
+972-3-9395023

(Tables follow)


Eltek Ltd.
Consolidated Statements of Operations
(In thousands US$, except per share data)

   
Three months ended
    
Nine months ended
  
   
September 30,
    
September 30,
  
   
2021
    
2020
    
2021
    
2020
  
                         
Revenues
    
7,965
      
9,256
      
24,302
      
27,206
  
Costs of revenues
    
(6,570
)
    
(7,433
)
    
(19,397
)
    
(21,679
)
                                 
Gross profit
    
1,395
      
1,823
      
4,905
      
5,527
  
                                 
Selling, general and administrative expenses
    
(1,285
)
    
(1,183
)
    
(3,706
)
    
(3,467
)
                                 
R&D expenses, net
    
(45
)
    
(2
)
    
(55
)
    
-
  
Operating profit
    
65
      
638
      
1,144
      
2,060
  
                                 
Financial expenses, net
    
(121
)
    
(19
)
    
(101
)
    
(158
)
Other income (expenses), net
    
44
      
(10
)
    
41
      
(10
)
                                 
Profit before income tax
    
(12
)
    
609
      
1,084
      
1,892
  
                                 
Tax expenses
    
(14
)
    
(11
)
    
(64
)
    
(50
)
                                 
Net Profit (loss)
    
(26
)
    
598
      
1,020
      
1,842
  
                                 
Earnings per share
                                
                                 
Basic and diluted net profit per ordinary share
    
(0.00
)
    
0.14
      
0.17
      
0.42
  
                                 
Weighted average number of ordinary shares used to compute
          
basic net profit per ordinary share (in thousands)
    
5,840
      
4,380
      
5,840
      
4,380
  
                                 
Weighted average number of ordinary shares used to compute
          
diluted net profit per ordinary share (in thousands)
    
5,840
      
4,380
      
5,871
      
4,380
  


Eltek Ltd.
Consolidated Balance Sheets
(In thousands US$)

   
September 30,
    
December 31,
  
   
2021
    
2020
  
Assets
            
             
Current assets
            
Cash and cash equivalents
    
8,885
      
4,735
  
Receivables: Trade, net of provision for doubtful accounts
    
6,441
      
9,062
  
                       Other
    
901
      
700
  
Inventories
    
4,216
      
3,704
  
Prepaid expenses
    
269
      
619
  
                 
Total current assets
    
20,712
      
18,820
  
                 
Long term assets
                
Restricted deposits
    
218
      
62
  
Severance pay fund
    
64
      
64
  
Operating lease right of use assets
    
8,802
      
8,948
  
Total long term assets
    
9,084
      
9,074
  
                 
Fixed assets, less accumulated depreciation
    
7,414
      
7,263
  
                 
Total Assets
    
37,210
      
35,157
  
                 
Liabilities and Shareholder's equity
                
                 
Current liabilities
                
Short-term credit and current maturities of long-term debts
    
595
      
676
  
Accounts payable: Trade
    
3,523
      
4,452
  
                            Other
    
3,230
      
3,831
  
Short-term operating lease liabilities
    
852
      
742
  
                 
Total current liabilities
    
8,200
      
9,701
  
                 
Long-term liabilities
                
Long term debt, excluding current maturities
    
3,965
      
1,495
  
Employee severance benefits
    
332
      
338
  
Deferred tax liabilities
    
107
      
84
  
Long-term operating lease liabilities
    
8,057
      
8,272
  
                 
Total long-term liabilities
    
12,461
      
10,189
  
                 
Equity
                
Ordinary shares, NIS 3.0 par value authorized 10,000,000 shares, issued and outstanding 5,840,357
    
5,296
      
5,296
  
Additional paid-in capital
    
22,846
      
22,846
  
Cumulative foreign currency translation adjustments
    
3,103
      
3,153
  
Capital reserve
    
1,394
      
1,084
  
Accumulated deficit
    
(16,090
)
    
(17,112
)
Shareholders' equity
    
16,549
      
15,267
  
Total liabilities and shareholders' equity
    
37,210
      
35,157
  


Eltek Ltd.
  
Unaudited Non-GAAP EBITDA Reconciliations
  
(In thousands US$)
  

Non-GAAP EBITDA Reconciliations
  
Three months ended
    
Nine months ended
  
   
September 30,
    
September 30,
  
   
2021
    
2020
    
2021
    
2020
  
                         
                         
GAAP net Income (loss)
    
(26
)
    
598
      
1,020
      
1,842
  
Add back items:
                                
                                 
Financial expenses, net
    
121
      
19
      
101
      
158
  
Income tax expense
    
14
      
11
      
64
      
50
  
Depreciation and amortization
    
444
      
390
      
1,330
      
1,176
  
Non-GAAP EBITDA
    
553
      
1,018
      
2,515
      
3,226
  


 
Eltek Ltd.
Consolidated Statement of  Cash flow
(In thousands US$)

   
Three months ended
    
Nine months ended
  
   
September 30,
    
September 30,
  
   
2021
    
2020
    
2021
    
2020
  
                         
Cash flows from operating activities:
                    
                         
Net Income
    
(26
)
    
598
      
1,020
      
1,842
  
                                 
Adjustments to reconcile net profit to net
                          
cash flows provided by operating activities:
                          
Depreciation and amortization
    
445
      
391
      
1,331
      
1,177
  
Capital gain on disposal of fixed assets, net
    
-
      
(16
)
    
-
      
(16
)
Stock-based compensation
    
127
      
48
      
310
      
91
  
Revaluation of long term loans
    
-
      
(2
)
    
-
      
2
  
Increase in deferred tax liabilities
    
6
      
6
      
22
      
18
  
     
578
      
427
      
1,663
      
1,272
  
                                 
Decrease (Increase) in operating lease right-of-use assets
    
17
      
(1
)
    
41
      
(5
)
Decrease in trade receivables
    
1,015
      
949
      
2,560
      
1,098
  
Decrease (increase) in other receivables and prepaid expenses
    
48
      
(1,077
)
    
143
      
(890
)
Decrease (increase) in inventories
    
(275
)
    
(50
)
    
(525
)
    
198
  
Increase (decrease) in trade payables
    
(464
)
    
397
      
(875
)
    
27
  
Increase (decrease) in other liabilities and accrued expenses
    
(300
)
    
(357
)
    
(579
)
    
181
  
Increase (decrease) in employee severance benefits, net
    
5
      
(13
)
    
(5
)
    
27
  
     
46
      
(152
)
    
760
      
636
  
                                 
Net cash provided by operating activities
    
598
      
873
      
3,443
      
3,750
  
                                 
Cash flows from investing activities:
                                
Purchase of fixed assets
    
(824
)
    
(348
)
    
(1,362
)
    
(802
)
Restricted deposits
    
(2
)
    
(1
)
    
(156
)
    
(58
)
Net cash used in investing activities
    
(826
)
    
(349
)
    
(1,518
)
    
(860
)
                                 
Cash flows from financing activities:
                                
Short- term bank credit, net
    
-
      
(1,163
)
    
(377
)
    
(1,928
)
Repayment of short- term shareholder loan
    
-
      
-
      
-
      
(571
)
Repayment of long-term loans from bank
    
(111
)
    
(37
)
    
(188
)
    
(145
)
Proceeds from long-term loans
    
-
      
-
      
3,062
      
1,141
  
Repayment of credit from fixed asset payables
    
-
      
(87
)
    
(285
)
    
(391
)
Net cash used in financing activities
    
(111
)
    
(1,287
)
    
2,212
      
(1,894
)
                                 
Effect of translation adjustments
    
55
      
7
      
13
      
27
  
                                 
Net increase (decrease) in cash and cash equivalents
    
(284
)
    
(756
)
    
4,150
      
1,023
  
                                 
Cash and cash equivalents at beginning of the period
    
9,169
      
3,407
      
4,735
      
1,628
  
                                 
Cash and cash equivalents at period end
    
8,885
      
2,651
      
8,885
      
2,651