PETACH-TIKVA, Israel, May 1 /PRNewswire-FirstCall/ --
Eltek Ltd., (Nasdaq: ELTK) the leading Israeli manufacturer of advanced
circuitry solutions, today announced a further stage implementation of its
comprehensive re-organization plan aimed at bringing the Company's current
structure and level of activity more closely in line with market conditions.
This reorganization includes personnel reduction, progressive wage
reduction, and cost savings. The initiatives included in this plan fall
within the broader framework of a reorganization strategy, which the Company
began to implement several months ago.
Mr. Arieh Reichart, President and CEO of Eltek, said, "The actions that we
implemented today represent a difficult step, but one that is essential due to
the ongoing weakness in the global technology sector.
"We believe that this plan will significantly decrease Eltek's expenses,
and will allow us to achieve positive cash flow. This will allow us to focus
our efforts on promoting renewed Company growth."
Mr. Reichart added, "In spite of the difficulties and the uncertainties
that characterize the market in which the Company operates, Eltek is
encouraged by the initial results of its efforts to increase exports to Europe
and the United States.
"In June, 2002 we completed the acquisition of 76% of Kubatronik, a German
Company that specializes in manufacturing of multi-layer, flex-rigid and High
Density Interconnect (HDI) printed circuit boards. This acquisition allows
Eltek to leverage Kubatronik's marketing capabilities as we work to increase
our presence in Europe.
Mr. Reichart concluded by saying, "We believe that the implementation of
the latest step in our comprehensive re-organization plan which we are
announcing today, coupled with the expected completion of capital raise of
$500,000 in mid-May, and progress in negotiations with our banks to refinance
part of our outstanding debt, will improve our financial condition and give us
the necessary financial platform that will allow Eltek to grow its business as
market conditions improve."
Eltek is one of Israel's leading manufacturers of printed circuit boards,
the core circuitry of most electronic devices. It specializes in the complex
high-end of PCB manufacturing, i.e., HDI, multi-layered and flex-rigid boards.
Eltek's technologically advanced circuitry solutions are used in today's
increasingly sophisticated and compact electronic products. The Company has
invested heavily in upgrading its production facilities over the past five
Certain matters discussed in this news release are forward-looking
statements that involve a number of risks and uncertainties including, but not
limited to statements regarding expected results in future quarters, 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 United States Securities and Exchange Commission filings.
SOURCE Eltek Ltd.