Netanya, Israel, May 23, 2018 – RADA Electronic Industries Ltd. (NASDAQ: RADA) announced today its financial results for the quarter ended March 31, 2018.

Strong Revenue Growth of 29% Year-over-Year;

Investor conference call to be held today at 10am ET;   Netanya, Israel, May 23, 2018 – RADA Electronic Industries Ltd. (NASDAQ: RADA) announced today its financial results for the quarter ended March 31, 2018. Management Comments

Dov Sella, RADA's Chief Executive Officer commented, “We are pleased with the results of the first quarter, showing a very strong 29% growth in revenues over the first quarter of last year, with an improved level of gross margins. Looking ahead, we expect to maintain our growth momentum into the second quarter, with revenues of approximately $6.5 million, compared to $5.3 million in the second quarter of 2017, up approximately 22% over last year.”

Continued Mr. Sella, “We recently opened a new subsidiary in the United States and we have already received initial new orders from some US customers. Our pipeline is deep and strong, with significant revenue potential over the coming years. We are targeting active protection systems (APS) for the US Army and others, Mobile Short-Range Air Defense (M-SHORAD) for the US army and US Marine Corps, as well as SHORAD and C-UAV/Drones globally. These are all operational solutions with significant potential for incorporating our tactical radars which work On-The-Move (OTM). As we move through 2018, I am confident that our continuous and long-term investments in software-defined, multi-mission tactical radars for the maneuver force will reap rewards in the quarters and years to come. Beyond the growth engines, we are also pleased with the stability of our digital video recorders business, where we are developing our next-generation solutions to various aircraft manufacturers globally.”

 2018 First Quarter Summary 

Revenues totaled $6.0 million in the first quarter of 2018, up 29% compared to revenues of $4.7 million in the first quarter of 2017.

Gross Profit totaled $2.2 million in the first quarter of 2018 (gross margin of 36.2%) up 31% compared to gross profit of $1.7 million (gross margin of 35.7%) in the first quarter of 2017. Operating expenses totaled $2.0 million in the first quarter of 2018 (32.8% of revenues) compared with $1.3 million (28.2% of revenues) in the first quarter of 2017. The primary factor in the increase was higher R&D expenses, which amounted to 10% of revenues compared with 4% in the first quarter of last year. On an absolute basis, marketing and sales as well as G&A expenses also increased. Sales and marketing expenses increased to 11% of revenues from 9% in the same quarter last year, while G&A expenses decreased to 12% of revenues from 15% in the same quarter of last year.   Operating income totaled $0.2 million in the first quarter of 2018 compared to operating income of $0.3 million in the first quarter of 2017. Net income attributable to RADA’s shareholders in the first quarter of 2018 was $0.2 million, or $0.01 per share, compared to net income of $0.4 million, or $0.02 per share, in the first quarter of 2017. In terms of liquidity and capital resources, as of March 31, 2018, the Company had cash and cash equivalents, of $13.4 million or $0.41 per share, compared with $12.4 million or $0.40 per share as of December 31, 2017. As of March 31, 2018, the Company did not have any financial liabilities. Cash flow from operations for the quarter was a positive $0.4 million.   Investor Conference Call The Company will host a conference call later today, starting at 10:00 am ET (5pm Israel time). Dov Sella, Chief Executive Officer and Avi Israel, Chief Financial Officer, will host the call and will be available to answer questions after presenting the results. Dial in numbers are: US 1-888-281-1167; UK 0800-917-9141; Israel 03-918-0685 and International +972-3-918-0685.  

For those unable to participate, the teleconference will be available for replay on RADA’s website at http://www.rada.com beginning 48 hours after the call.

About RADA Electronic Industries Ltd.

RADA Electronic Industries Ltd. is an Israel-based defense electronics company. The Company specializes in the development, production, and sales of tactical land radar for force and border protection, and avionics systems (including inertial navigation systems) for fighters and UAVs. 

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.

 

Company Contact:    

Avi Israel - CFO           

RADA Electronic Industries Ltd.

Tel: +972-9-8921111

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Investor Relations Contact:

Ehud Helft/Gavriel Frohwein

GK Investor & Public Relations

Tel: +1 646 688 3559

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CONSOLIDATED BALANCE SHEETS

U.S. dollars in thousands, except share and per share data

ASSETS

 

March 31, 2018

 

December 31, 2017

   

Unaudited

 

 

CURRENT ASSETS:

       

Cash and cash equivalents

 

$     13,415

 

$    12,417

Restricted cash

 

322

 

   322

Trade receivables (net of allowance for doubtful accounts of $14 at March 31, 2018 and December 31, 2017)

 

6,095

 

7,286

Costs and estimated earnings in excess of billings on uncompleted contracts

 

1,126

 

   995

Other receivables and prepaid expenses

 

459

 

   330

Inventories

 

7,782

 

7,910

Current assets related to discontinued operations

 

2,333

 

2,468

         

Total current assets

 

31,532

 

31,728

         

LONG-TERM ASSETS:

       

Long-term receivables and other deposits

 

71

 

68

Property, plant and equipment, net

 

3,820

 

3,915

Long-term assets related to discontinued operations

 

356

 

319

Total long term assets

 

4,247

 

4,302

         

Total assets

 

$     35,779

 

$     36,030

         

LIABILITIES AND SHAREHOLDERS' EQUITY

       

 

       

CURRENT LIABILITIES:

       

Trade payables

 

$      1,758

 

$      2,904

Other accounts payable and accrued expenses

 

2,678

 

2,814

Advances from customers, net

 

-

 

41

Current liabilities related to discontinued operations

 

369

 

328

         

Total current liabilities

 

4,805

 

6,087

         

LONG-TERM LIABILITIES:

       

Accrued severance pay and other long-term liabilities

 

786

 

758

Total long-term liabilities

 

786

 

758

 

       

RADA SHAREHOLDERS' EQUITY

       

Share capital -

       

Ordinary shares of NIS 0.03 par value - Authorized: 37,500,000 shares at March 31, 2018 and December 31, 2017; Issued and outstanding: 32,882,914 at March 31, 2018 and 31,392,040 at December 31, 2017.

 

348

 

335

Additional paid-in capital

 

105,842

 

104,923

Accumulated other comprehensive income

 

286

 

392

Accumulated deficit

 

(76,904)

 

(77,124)

 

       

Total RADA shareholders’ equity

 

29,572

 

28,526

Non-controlling interest

 

616

 

659

 

Total equity

 

30,188

 

29,185

 

Total liabilities and equity

 

$     35,779

 

$     36,030

CONSOLIDATED STATEMENTS OF OPERATIONS

U.S. dollars in thousands, except share and per share data

 

Three months ended

March 31,

 

Year ended December 31,

 
 

2018

 

2017

 

2017

 
 

Unaudited

 

 

 
             

Revenues

  $     6,020 

 

 $       4,675 

 

    $    26,182 

 
             

Cost of revenues

    3,841

 

3,006

 

    17,919

 
             

Gross profit

2,179

 

1,669

 

      8,263

 
             

Operating expenses:

           

   Research and development

592

 

198

 

1,575

 

   Marketing and selling

634

 

436

 

2,137

 

   General and administrative

748

 

686

 

2,568

 
             

Total operating expenses

1,974

 

1,320

 

6,280

 
             

Operating income

205

 

349

 

1,983

 

Amortization of shareholders' convertible loans discount and beneficial conversion feature

-

 

10

 

103

 

Other financial expenses (income), net

(8)

 

(39)

 

53

 
             

Net income from continuing operations

213

 

378

 

1,827

 

Net income (loss) from discontinued operations

 (9)

 

12

 

515

 
             

Net income

  $        204

 

    $          390

 

    $     2,342

 

Net income (loss) attributable to non-controlling interest

          (16)

 

                 2

 

103

 

Net income attributable to RADA Electronic Industries' shareholders

 $         220

 

    $        388

 

    $     2,239

 

Basic net income from continuing operations per Ordinary share

  $        0.01

 

    $       0.02

 

    $      0.07

 

Diluted net income from continuing operations per Ordinary share

  $        0.01

 

  $       0.02

 

    $      0.06

 

Basic and diluted net income from discontinued operations per Ordinary share

  $        0.00

 

  $       0.00

 

    $      0.02

 

Basic net income per Ordinary share

  $        0.01

 

  $       0.02

 

    $      0.09

 

Diluted net income per Ordinary share

  $        0.01

 

  $       0.02

 

    $      0.08

 

Weighted average number of Ordinary shares used for computing basic net income per share

 

32,604,550

 

21,666,124

 

24,956,915

Weighted average number of Ordinary shares used for computing diluted net income per share

 

33,202,955

 

24,641,207

 

28,126,509