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RADA Electronic Industries Announces Third Quarter and First Nine Months 2013 Results

NETANYA, Israel, Nov. 25, 2013 (GLOBE NEWSWIRE) -- RADA Electronic Industries Ltd. (Nasdaq:RADA) today announced its financial results for the third quarter and the nine months ended September 30, 2013.

2013 Third quarter Results

Revenues totaled $4.5 million, a 29% decrease when compared with $6.3 million in the third quarter of 2012.

Gross Profit totaled $0.9 million, a 30% decrease when compared with $1.27 million in the third quarter of 2012.

Operating expenses totaled $1 million, a 40% decrease when compared with $1.6 million in the third quarter of 2012.

Financial Expenses totaled $471,000 a 69% increase when compared with financial expenses of $279,000 in the third quarter of 2012.

As a result, the Company reported a net loss of $576,000, or $0.06 per share, for the third quarter of 2013 compared to a net loss of $648,000 or $0.07 per share, for the third quarter of 2012.

First nine months 2013 Results

Revenues totaled approximately $15 million in both periods.

Gross profit totaled $2.5 million, a 33% decrease when compared with $3.8 million for the same period in 2012.

Operating expenses totaled $3.8 million, a 21% decrease when compared with $4.8 million for the same period in 2012.

Financial expenses totaled $1,404,000, a 69% increase when compared with financial expenses of $829,000 for the same period in 2012.

As a result, the Company reported a net loss of $ 2,675,000 or $0.3 per share for the nine months ended September 30, 2013, compared with a net loss of $1,810,000 or $0.2 per share, for the comparable period in 2012.

Management Comment

Commenting on the results, Zvika Alon, RADA's Chief Executive Officer said, "While our revenues for the nine months ended September 30, 2013 is similar to that of 2012, there was a decrease in revenues during the third quarter of 2013 compared to the third quarter of 2012. This decrease is due to delays in deliveries, planned for the third quarter of 2013 in some of our profitable avionics programs, especially for customers in Asia. It caused a shift in the revenues to the fourth quarter and we expect an increase in revenues in the last quarter of 2013. This is the major reason for the reduction in gross margin during the third quarter of 2013. In addition, the reduction in USD/ILS exchange rate is increasing our cost of goods sold when compared to last year. On the other hand, the reduction in R&D spending due to the maturity of our newly introduced products has improved our operational margins. Our financial expenses have significantly increased when compared to the third quarter of 2012 because of the debt we incurred to finance our R&D efforts during the past years. During the third quarter, we delivered inertial navigation and radar systems to various customers and will continue deliveries in the following months."

About RADA

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.

Note: 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 SHEET
U.S. dollars in thousands, except per share data
ASSETS September 30, 2013 December
31, 2012
Unaudited Audited
CURRENT ASSETS:
Cash and cash equivalents $1,483 $1,164
Restricted cash 1,258 1,311
Trade receivables (net of allowance for doubtful accounts of $ 29 and $ 15 at September 30, 2013 and at December 31, 2012 respectively) 2,995 5,381
Costs and estimated earnings in excess of billings on uncompleted contracts 2,209 1,748
Other accounts receivables and prepaid expenses 1,077 939
Inventories 6,626 7,272
Total current assets 15,648 17,815
LONG-TERM RECEIVABLES AND OTHER DEPOSITS 1,165 1,160
PROPERTY, PLANT AND EQUIPMENT, NET 2,986 3,324
OTHER ASSET - GOODWILL 587 587
Total assets 20,386 $22,886
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Bank credit $1,383 $3,172
Trade payables 2,392 1,948
Convertible note from a shareholder 3,000 3,000
Loans from shareholders, net 5,173 3,968
Other accounts payable and accrued expenses 3,968 3,750
Total current liabilities 15,916 15,838
LONG-TERM LIABILITIES:
Accrued severance pay and other long term liability 551 519
Total long-term liabilities 551 519
RADA SHAREHOLDERS' EQUITY
Share capital --
Ordinary shares of NIS 0.015 par value - Authorized: 16,333,333 shares at September 30, 2013 and December 31, 2012; Issued and outstanding: 8,918,647 at September 30, 2013 and at December 31, 2012 respectively. 119 119
Additional paid-in capital 70,884 70,884
Accumulated other comprehensive income 536 468
Accumulated deficit (68,240) (65,565)
Total RADA shareholders' equity 3,299 5,906
Noncontrolling interest 620 623
Total equity 3,919 6,529
Total liabilities and equity 20,386 $22,886
CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands, except per share data
Nine months
ended
Sep 30,
Three months
ended
Sep 30,
Year ended
December 31,
2013 2012 2013 2012 2012
(Unaudited) Audited
Revenues $15,045 $15,018 $4,453 $6,280 $21,551
Cost of revenues 12,523 11,263 3,560 5,006 16,233
Gross profit 2,522 3,755 893 1,274 5,318
Operating expenses:
Research and development 1,082 1,822 266 499 2,423
Marketing and selling 1,290 1,186 305 485 1,664
General and administrative 1,441 1,735 435 664 2,137
Total operating expenses: 3,813 4,743 1,006 1,648 6,224
Operating loss (1,291) (988) (113) (374) (1,906)
Financial expense, net 1,404 829 471 279 1,149
Consolidated loss
(2,695) (1,817) (584) (653) (2,055)
Less: Net loss attributable to 20 7 7 5 4
Non-controlling interest
Loss attributable to $ (2,675) $ (1,810) $ (576) $ (648) $ (2,051)
RADA shareholders
Loss per share:
Basic and diluted loss per share $ (0.3) $ (0.2) $ (0.06) $ (0.07) $ (0.23)
Weighted average number of Ordinary shares used for computing basic and diluted loss per share 8,918,647 8,918,647 8,918,647 8,918,647 8,918,647

CONTACT: Shiri Lazarovich- C.F.O RADA Electronic Industries Ltd. Tel: +972-9-8921111 Shiri.Lazarovich@rada.comSource:RADA Electronic Industries Ltd.