• Increased full year revenue guidance from over $70 million to over $75 million
Netanya, Israel, November 10, 2020 – RADA Electronic Industries Ltd. (NASDAQ: RADA) announced today its financial results for the three and nine-months periods ended September 30, 2020.
Highlights of the third quarter of 2020 • Quarterly revenues up 81% year-over-year to a record $20.4 million; • Gross margin increases to 38% from 36%; • Net income of $2.1 million and adjusted EBITDA of $3.1 million – 15% of revenues, compared to adjusted EBITDA of $1.7 million and 10% of revenues in previous quarter; • 2020 revenue guidance increased to over $75 million, implying over 70% growth year-over-year.
Dov Sella, RADA’s Chief Executive Officer commented, “We are very pleased with our results and the positive momentum in our business, which led to unprecedented improvement across all financial parameters. The increased production volumes and manufacturing efficiencies are yielding higher gross margins, currently at 38%. Our strong revenue growth, improved gross margins and stabilizing operating expenses are yielding strong EBITDA growth which reached 15% of revenues this quarter.”
Continued Mr. Sella, “Our orders in-hand have enabled us to increase our 2020 revenue guidance to over $75 million. Our recent orders are starting to build significant backlog for 2021, substantiating our growth outlook. We expect our financial parameters to continue to improve throughout the remainder of 2020 and into 2021.”
Gross profit totaled $7.8 million (38% of revenues) in the quarter, an increase of 90% compared to gross profit of $4.1 million (36% of revenues) in the third quarter of 2019.
Operating income was $2.0 million in the quarter compared to an operating loss of $0.5 million in the third quarter of 2019.
Net income attributable to RADA’s shareholders in the quarter was $2.1 million, or $0.05 per share, compared to a net loss of $0.7 million, or $(0.02) per share, in the third quarter of 2019.
Adjusted EBITDA was $3.1 million in the quarter compared to adjusted EBITDA of $0.1 million in the third quarter of 2019.
2020 First Nine months Summary
Revenues totaled $52.9 million in the first nine months compared with revenues of $30.0 million in the first nine months of 2019, an increase of 77%.
Gross profit totaled $19.4 million (37% of revenues) in the first nine months, an increase of 79% compared to gross profit of $10.8 million (36% of revenues) in the first nine months of 2019.
Operating income was $2.7 million in the first nine months compared to an operating loss of $1.9 million in the first nine months of 2019.
Adjusted EBITDA was $5.7 million in the first nine months compared to adjusted EBITDA loss of $0.2 million in the first nine months of 2019.
Net income attributable to RADA’s shareholders in the first nine months was $3.0 million, or $0.07 per share compared to a net loss of $1.7 million, or $(0.05) per share, in the first nine months of 2019.
As of September 30, 2020, RADA had net cash and cash equivalents of $23.7 million compared to $13.8 million as of year-end 2019. The inventory level has increased to $29.3 million from $17.2 million as at the end of 2019. RADA management decided to strategically increase the inventory level to support the expected future growth and to ensure ongoing full availability of components, given the current economic environment and the need to mitigate against any negative influence of the Covid-19 pandemic on the supply chain.