Eltek Ltd. Reports 2024 First Quarter Financial Results
Eltek (NASDAQ: ELTK), a global leader in advanced PCB solutions, reported its Q1 2024 financial results. Revenues rose by 3% to $11.8 million compared to Q1 2023. Operating profit increased by 8% to $1.7 million, and net income grew by 11% to $1.7 million, translating to $0.27 per fully diluted share. Net cash from operating activities was $1.3 million. Highlights include a $1.6 million repeat order from a defense client and plans to expand the workforce by 15% to meet rising demand. The company also aims to acquire a PCB manufacturer in the U.S. and expand its Israeli operations. However, Eltek faces challenges with construction delays and integrating new production lines, though progress remains steady.
- Revenues up 3% to $11.8 million.
- Operating profit increased by 8% to $1.7 million.
- Net income grew by 11% to $1.7 million or $0.27 per fully diluted share.
- Gross profit margin improved to 28%.
- EBITDA rose to $2.1 million, representing 18% of revenues.
- Net cash from operating activities was $1.3 million.
- Secured a $1.6 million repeat order from a defense client.
- No outstanding debt; cash and short-term deposits at $19.9 million.
- Construction delays affecting new production lines.
- Manpower constraints limiting production capacity.
- Slight delay in investment program for new equipment.
Eltek Ltd.'s Q1 2024 financial performance shows a moderate growth trajectory with a
The gross profit margin stands at
However, the growth rate in revenues is relatively slow, which could be a concern for investors seeking higher returns. The announcement of securing a significant repeat order worth
Looking forward, Eltek's plans for workforce expansion and the integration of new production lines suggest a strategic move to overcome current limitations and support growth. Yet, the potential delays in these investments could pose short-term challenges. Overall, the company's financial health is stable, but growth potential may be tempered by operational constraints and the pace of infrastructure developments.
Eltek Ltd.'s performance in the first quarter of 2024 showcases a solid, if unremarkable, business trajectory. The company's focus on the defense sector, as evidenced by the substantial repeat order, is noteworthy given the sector's resilience and high demand, particularly in the current geopolitical climate. This focus aligns with broader industry trends where defense spending remains robust, potentially providing Eltek with a stable and lucrative revenue stream.
However, the company's production constraints are a critical factor to consider. The need to increase the workforce by
Eltek's strategy to seek acquisitions in the American market indicates a strategic expansion plan aimed at enhancing its market presence in North America. Such a move could potentially provide the company with access to new customers and markets, fostering growth. However, the success of this strategy will heavily depend on the identification and integration of suitable acquisition targets, which can be complex and time-consuming.
In summary, while Eltek's financial results reflect stability and cautious optimism, the company's growth prospects will be closely tied to its ability to manage operational constraints and successfully execute its expansion plans.
PETACH TIKVA,
![Eltek Logo Eltek Logo](https://mma.prnewswire.com/media/881148/Eltek_Logo.jpg)
First Quarter 2024 Highlights
- Revenues were
, up$11.8 million 3% over Q1 2023 - Operating profit was
, up$1.7 million 8% over Q1 2023 - Net income was
or$1.7 million per fully diluted share, up$0.27 11% over Q1 2023 - Net cash provided by operating activities amounted to
.$1.3 million
"We have ended another successful quarter with net income of
"Looking ahead to 2024 and 2025, we anticipate significant challenges as we undertake extensive construction work and integrate additional new production lines and machines. Our focus is on ensuring the smooth installation of new equipment while sustaining full production capacity on our existing lines. Despite a slight delay of several months in our investment program, our progress remains steady, with the successful installation of the first of three ordered coating lines during the quarter," continued Mr. Yaffe.
"We continue to seek a suitable PCB manufacturing company to acquire in the American market to enhance our presence in
First Quarter 2024 GAAP Financial Results
- Revenues for the first quarter of 2024 were
, compared to$11.8 million in the first quarter of 2023;$11.5 million - Gross profit for the first quarter of 2024 was
($3.3 million 28% of revenues) compared to ($3.0 26% of revenues) in the first quarter of 2023; - Operating profit for the first quarter of 2024 was
compared to operating profit of$1.7 million in the first quarter of 2023;$1.6 million - Net income for the first quarter of 2024 was
or$1.7 million per fully diluted share compared to net income of$0.27 or$1.6 million per fully diluted share in the first quarter of 2023;$0.27 - Cash and short-term bank deposits amounted to
as of March 31, 2024, with no outstanding debt.$19.9 million
First Quarter 2024 Non-GAAP Financial Results
EBITDA for the first quarter of 2024 was
Conference Call
Today, Tuesday, May 21, 2024, at 8:30am Eastern Time (15:30pm Israel Time, 5:30am Pacific Time), Eltek will conduct a conference call to discuss the results. The call will feature remarks by Eli Yaffe, Chief Executive Officer and Ron Freund, Chief Financial Officer.
To participate, please call the following teleconference numbers. Please allow for additional time to connect prior to the call:
United States: 1-866-860-9642
Israel: 03-918-0691
International: +972-3-918-0691
To Access a Replay of the Call
A replay of the call will be available for 30 days on the Investor Info section on Eltek's corporate website at http://www.nisteceltek.com approximately 24 hours after the conference call is completed.
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 an Israeli leading company 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
Eltek was founded in 1970. The Company's headquarters, R&D, production and marketing center are located in
For more information, visit Eltek's web site at www.nisteceltek.com
Forward Looking Statement
Some of the statements included in this press release may be forward-looking statements that involve a number of risks and uncertainties including, but not limited to 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. Any forward-looking statements set forth in this press release speak only as of the date of this press release. The information found on our website is not incorporated by reference into this press release and is included for reference purposes only.
About our Non-GAAP Financial Information
The Company reports financial results in accordance with
Investor Contact
Ron Freund
Chief Financial Officer
Investor-Contact@nisteceltek.com
+972-3-939-5023
Eltek Ltd. | |||||||||
Consolidated Statements of Income | |||||||||
Three months ended | |||||||||
March 31, | |||||||||
2024 | 2023 | ||||||||
Revenues | 11,783 | 11,470 | |||||||
Costs of revenues | (8,531) | (8,455) | |||||||
Gross profit | 3,252 | 3,015 | |||||||
Research and development, expenses, net | (15) | (9) | |||||||
Selling, general and administrative expenses | (1,516) | (1,417) | |||||||
Operating income | 1,721 | 1,589 | |||||||
Financial income, net | 350 | 287 | |||||||
Income before income taxes | 2,071 | 1,876 | |||||||
Income tax expenses | 332 | 314 | |||||||
Net Income | 1,739 | 1,562 | |||||||
Earnings per share: | |||||||||
Basic net income per ordinary share | 0.27 | 0.27 | |||||||
Diluted net income per ordinary share | 0.27 | 0.27 | |||||||
Weighted average number of ordinary shares used to compute | |||||||||
basic net income per ordinary share (in thousands) | 6,376 | 5,850 | |||||||
Weighted average number of ordinary shares used to compute | |||||||||
diluted net income per ordinary share (in thousands) | 6,491 | 5,852 | |||||||
Eltek Ltd. | |||||||||
Consolidated Balance Sheets | |||||||||
March 31, | December 31, | ||||||||
2024 | 2023 | ||||||||
Assets | |||||||||
Current assets: | |||||||||
Cash and cash equivalents | 10,610 | 9,278 | |||||||
Short-term bank deposits | 9,264 | 2,862 | |||||||
Receivables: Trade, net of provision for doubtful accounts | 9,977 | 10,898 | |||||||
Other | 471 | 689 | |||||||
Inventories | 6,420 | 6,135 | |||||||
Prepaid expenses | 372 | 245 | |||||||
Total current assets | 37,114 | 30,107 | |||||||
Long term assets: | |||||||||
Severance pay fund | 56 | 57 | |||||||
Deferred tax assets and long term tax receivables, net | 889 | 1,098 | |||||||
Operating lease right of use assets | 6,280 | 6,555 | |||||||
Total long term assets | 7,225 | 7,710 | |||||||
Fixed assets, less accumulated depreciation | 10,996 | 9,354 | |||||||
Total Assets | 55,335 | 47,171 | |||||||
Liabilities and Shareholder's equity | |||||||||
Current liabilities: | |||||||||
Accounts payable: Trade | 5,343 | 7,503 | |||||||
Other | 5,389 | 5,689 | |||||||
Short-term operating lease liabilities | 778 | 789 | |||||||
Total current liabilities | 11,510 | 13,981 | |||||||
Long-term liabilities: | |||||||||
Employee severance benefits | 457 | 447 | |||||||
Long-term operating lease liabilities | 5,606 | 5,871 | |||||||
Total long-term liabilities | 6,063 | 6,318 | |||||||
Shareholders' equity: | |||||||||
Ordinary shares, outstanding 6,704,830 at March 31, 2024 and 6,020,693 at December 31, 2023 Additional paid-in capital | 6,003 | 5,443 | |||||||
32,584 | 23,587 | ||||||||
Cumulative foreign currency translation adjustments | 245 | 783 | |||||||
Capital reserve | 2,032 | 1,900 | |||||||
Accumulated deficit | (3,102) | (4,841) | |||||||
Total shareholders' equity | 37,762 | 26,872 | |||||||
Total liabilities and shareholders' equity | 55,335 | 47,171 | |||||||
Eltek Ltd. | |||||||||
Unaudited Non-GAAP EBITDA Reconciliations | |||||||||
Three months ended | |||||||||
March 31, | |||||||||
2024 | 2023 | ||||||||
GAAP net Income | 1,739 | 1,562 | |||||||
Add back items: | |||||||||
Financial income, net | (350) | (287) | |||||||
Income tax expenses | 332 | 314 | |||||||
Depreciation and amortization | 365 | 329 | |||||||
Non-GAAP EBITDA | 2,086 | 1,918 | |||||||
Eltek Ltd. | |||||||||
Consolidated Statements of Cash Flows | |||||||||
Three months ended | |||||||||
March 31, | |||||||||
2024 | 2023 | ||||||||
Cash flows from operating activities: | |||||||||
Net Income | 1,739 | 1,562 | |||||||
Adjustments to reconcile net income to net cash flows | |||||||||
provided by operating activities: | |||||||||
Depreciation and amortization | 365 | 329 | |||||||
Stock-based compensation | 132 | 72 | |||||||
Decrease in deferred tax assets and long term tax receivable | 322 | 306 | |||||||
819 | 707 | ||||||||
Decrease (increase) in operating lease right-of-use assets | 1 | (33) | |||||||
Decrease (increase) in trade receivables | 736 | 112 | |||||||
Decrease (increase) in other receivables and prepaid expenses | 75 | (525) | |||||||
Decrease (increase) in inventories | (396) | (313) | |||||||
Increase (decrease) in trade payables | (1,491) | 412 | |||||||
Increase (decrease) in other liabilities and accrued expenses | (201) | 847 | |||||||
Increase (decrease) in employee severance benefits, net | 18 | 5 | |||||||
(1,258) | 505 | ||||||||
Net cash provided by operating activities | 1,300 | 2,774 | |||||||
Cash flows from investing activities: | |||||||||
Purchase of fixed assets | (2,731) | (305) | |||||||
Investment in short-term bank deposits, net | (6,490) | - | |||||||
Net cash used in investing activities | (9,221) | (305) | |||||||
Cash flows from financing activities: | |||||||||
Exercise of options | 246 | - | |||||||
Repayment of long-term loans from bank | - | (1,580) | |||||||
Issuance of shares, net | 9,180 | - | |||||||
Net cash provided by (used in) financing activities | 9,426 | (1,580) | |||||||
Effect of translation adjustments | (173) | (196) | |||||||
Net increase (decrease) in cash and cash equivalents | 1,332 | 693 | |||||||
Cash and cash equivalents at the beginning of the period | 9,278 | 7,366 | |||||||
Cash and cash equivalents at the end of the period | 10,610 | 8,059 |
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SOURCE Eltek Ltd.
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