– Profitability and revenue improve compared to first quarter 2014 –
Petah Tikva, Israel, August 13, 2014 – Gilat Satellite Networks Ltd. (NASDAQ, TASE: GILT), a worldwide leader in satellite networking technology, solutions and services, today reported its results for the second quarter ended June 30, 2014.
Key Financial Highlights:
Revenues for the second quarter increased to $54.1 million compared to $50.9 million in the first quarter of 2014.
Non-GAAP operating income was $1.5 million, compared to operating income of $0.5 million in the first quarter of 2014. GAAP operating loss was $0.5 million compared to a loss of $1.5 million in the first quarter of 2014
Management reaffirms 2014 objectives for annual revenues of $240-$245 million and EBITDA margin levels of approximately 9%
Revenues for the second quarter were $54.1 million, compared to $50.9 million in the first quarter of 2014 and to $61.9 million for the comparable period in 2013. The difference between the second quarter of 2014 and the comparable quarter in 2013 is mostly attributed to the decrease in revenues in our Services Division.
On a non-GAAP basis, operating income was $1.5 million in the second quarter as compared to operating income of $0.5 million in the first quarter of 2014 and of $1.9 million in the comparable quarter of 2013. On a non-GAAP basis, net income for the quarter was $0.6 million or an income of $0.01 per diluted share compared to a net loss of $0.6 million or a loss of $0.01 per diluted share in the first quarter of 2014 and to a net loss of $0.9 million or $0.02 per diluted share in the comparable period in 2013.
GAAP operating loss for the second quarter was $0.5 million as compared to an operating loss of $1.5 million in the first quarter of 2014 and of $0.1 million in the comparable period in 2013. GAAP net loss from continuing operations for the quarter was $1.4 million, or a loss of $0.03 per diluted share, compared to a net loss from continuing operations of $2.6 million, or a loss of $0.06 per diluted share for the first quarter of 2014 and compared to a net loss from continuing operations of $2.9 million, or a loss of $0.07 per diluted share in the comparable period in 2013.
EBITDA for the second quarter was $3.9 million compared to $2.8 million in the first quarter of 2014 and to $5.3 million in the comparable period in 2013.
Erez Antebi, Chief Executive Officer of Gilat stated, “Our improved results in the second quarter come from both of our Commercial and Defense Divisions, as well as from the cost-reduction measures we took last year. Our Defense business continued to grow, with increase in demand for both On-The-Pause as well as On-The-Move solutions.”
Antebi concluded, “We anticipate the second half of 2014 to be stronger than the first half thanks to significant revenues to be generated by projects in Peru and Colombia as well as growth in the commercial and defense activities. We are confident that we are on track to meet our previously stated 2014 management objectives.”
Key Recent Announcements:
Gilat Announces a Breakthrough in LTE Backhauling using its Capricorn TDMA VSAT
Gilat Upgrades Wireless Nation’s Broadband Services for Consumers and Businesses
Gilat’s Low-profile Maritime Terminals Deployed
The GAAP financial results include the effect of non-cash stock options expenses, amortization of intangible assets resulting from the purchase price allocation, restructuring costs and net income (loss) from discontinued operations.
Conference Call and Webcast Details:
Gilat management will host a conference call today at 13:30 GMT/ 09:30 EDT/ 16:30 IDT (Israel Daylight Time) to discuss the results. International participants are invited to access the call at (972) 3-918-0644, and US-based participants are invited to access the call by dialing (888) 407-2553. A replay of the conference call will be available beginning at approximately 16:00 GMT/ 12:00 EDT/ 19:00 IDT today, until 16:00 GMT/ 12:00 EDT/ 19:00 IDT August 15, 2014. International participants are invited to access the replay at (972) 3-925-5900 and US-based participants are invited to access the replay by dialing (888) 326-9310. A replay of the call may also be accessed as a webcast via Gilat’s website at gilat.com and will be archived for 30 days.
(1) The attached summary financial statements were prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP). The attached summary financial statements are unaudited. To supplement the consolidated financial information and statements presented in accordance with GAAP, the Company presents its EBITDA before the impact of non-cash stock based compensation, depreciation and amortization, other income and other costs related to acquisition transactions. 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.
We regularly use supplemental non-GAAP financial measures internally to understand manage and evaluate our business and make operating decisions. We believe these non-GAAP financial measures provide consistent and comparable measures to help investors understand our current and future operating cash flow performance. These non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies.
(2) Operating income before depreciation, amortization, non-cash stock based compensation as per ASC 718 and other costs related to acquisition transactions (‘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. . A reconciliation of specific adjustments to GAAP results is provided in the tables below.
Gilat Satellite Networks Ltd (NASDAQ, 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 85 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. For more information, please visit us at gilat.com
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
KCSA Strategic Communications
Phil Carlson – Vice President
Vincent G. Piazza- Account Executive