Magal Security Systems Reports First Quarter 2010 Results
YAHUD, Israel, June 9, 2010 /PRNewswire-FirstCall/ -- Magal Security Systems Ltd. (NASDAQ GMS: MAGS, TASE: MAGS) today announced its consolidated financial results for the three month period ended March 31, 2010.
Revenues for the first quarter of 2010 totaled US$9.8 million and gross profit for the first quarter of 2010 was US$3.7 million, or 37.4% of revenues. Operating loss for the first quarter of 2010 was US$1.6 million. Financing expenses in the three months ended March 31, 2010 amounted to US$0.8 million. As a result, the net loss for the first quarter of 2010 was US$2.4 million, or $0.23 per share.
Commenting on the results, Mr. Eitan Livneh, President and CEO of Magal, said, "Two weeks ago we announced the implementation of the second phase of our restructuring plan, which is designed to enable our company to execute on its new strategic plan and cope with global trends, specifically the European economic slowdown. Our strategic intent is to expand the international sensor sales and refocus on projects in preferred regions. As part of this plan, we announced internal organizational changes, as well as a workforce reduction in Israel. We anticipate that these changes will be reflected in Magal's financial results in the second half of 2010.
"Looking ahead, we intend to introduce an advanced fence mounted security sensor with the capability to pin-point intruders in the second half of 2010 and to continue to build on our success with the Fortis in the Safe City and other home land security applications. We also intend to improve our capabilities in the Intelligent Video Analytics space and introduce a new IP (Internet Protocol) version of our Dream Box. I and the rest of the management team at Magal remain enthusiastic about the company's future," concluded Mr. Livneh.
The Company will host a conference call today at 10am ET. On the call, management will review and discuss the results and will be available to answer investor questions.
To participate, please call one of the following teleconferencing numbers. Please begin placing your calls at least 10 minutes before the conference call commences. If you are unable to connect using the toll-free numbers, please try the international dial-in number.
US Dial-in Number: 1-888-668-9141
Israel Dial-in Number: 03-918-0609
UK Dial-in Number: 0-800-917-5108
International Dial-in Number: +972-3-918-0609
at 10:00 am Eastern Time; 7:00 am Pacific Time; 3:00pm UK Time; 5:00 pm Israel Time
A replay of the call will be available from the day after the call. The link to the replay will be accessible from Magal's website at: http://www.magal-s3.com.
About Magal S3
Magal S3 is a leading international provider of security, safety and site management solutions and products (NASDAQ: MAGS).
Over the past 40 years, Magal S3 has delivered tailor-made solutions to hundreds of satisfied customers in over 80 countries.
Magal S3 offers a broad portfolio of unique products used to protect sensitive installations in some of the world's most demanding locations and harshest climates. This portfolio covers the following three categories:
- Perimeter Intrusion Detection Systems (PIDS) - a variety of
smart barriers and fences, fence mounted detectors, virtual gates,
buried and concealed detection systems
- Close Circuit TV (CCTV) - a comprehensive management
platform with a leading Intelligent Video Analysis (IVA) and Video
Motion Detection (VMD) engine
- Physical Security Information Management (PSIM) - a
proprietary site management system that enhances command, control and
decision making during both routine operations and crisis situations
This press release contains forward-looking statements, which are subject to risks and uncertainties. Such statements are based on assumptions and expectations which may not be realized and are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual results, financial and otherwise, may differ from the results discussed in the forward-looking statements. A number of these risks and other factors that might cause differences, some of which could be material, along with additional discussion of forward- looking statements, are set forth in the Company's Annual Report on Form 20-F filed with the Securities and Exchange Commission.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(All numbers except EPS expressed in
thousands of US$)
Three months
ended March 31,
2010
Revenues 9,774
Cost of revenues 6,114
Gross profit 3,660
Operating expenses:
Research and
development, net 1,096
Selling and marketing 2,389
General and
administrative 1,770
Total operating expenses 5,255
Operating loss (1,595)
Financial expenses, net 769
Loss before income taxes (2,364)
Income tax -
Net loss (2,364)
Less: net income
attributable to
non-controlling interest 16
Net income (loss)
attributable to Magal
Ltd. shareholders (2,380)
Basic net loss per share
from $(0.23)
Three
months
ended March
31, 2010
%
Gross margin 37.4
Research and development,
net as a % of revenues 11.2
Selling and marketing as a %
of revenues 24.4
General and administrative
as a % of revenues 18.1
Operating margin (16.3)
Net margin before tax (24.2)
Net margin (24.4)
CONDENSED CONSOLIDATED BALANCE SHEETS
(All numbers expressed in thousands of US$)
December
March 31, 31,
2010 2009
CURRENT ASSETS:
Cash and cash equivalents $ 7,486 $ 11,869
Short term bank deposits 1,804 1,807
Restricted deposit 3,027
Trade receivables 10,682 12,328
Unbilled accounts receivable 6,830 5,892
Other accounts receivable and prepaid 3,984 1,573
expenses
Deferred income taxes 280 272
Inventories 10,954 10,912
Total current assets 45,047 44,653
Long term investments and receivables:
Long-term trade receivables 1,690 1,753
Long-term loan 200 200
Long-term deposits 24 40
Severance pay fund 2,356 2,476
Total long-term investments and 4,270 4,469
receivables
PROPERTY AND EQUIPMENT, NET 9,196 9,178
OTHER ASSETS, NET 257 269
GOODWILL 2,012 2,053
ASSETS ATTRIBUTABLE TO DISCONTINUED - 28
OPERATIONS
Total assets $60,782 $60,650
CURRENT LIABILITIES:
Short-term bank credit $ 7,955 $ 8,234
Current maturities of long-term bank debt 661 1,824
Trade payables 2,593 4,018
Other accounts payable and accrued 14,984 10,110
expenses
Total current liabilities 26,193 24,186
LONG-TERM LIABILITIES:
Long-term bank debt 384 548
Accrued severance pay 3,479 3,562
Total long-term liabilities 3,863 4,110
LIABILITIES ATTRIBUTABLE TO DISCONTINUED - 45
OPERATIONS
SHAREHOLDERS' EQUITY 30,726 32,309
TOTAL LIABILITIES AND SHAREHOLDERS' $60,782 $60,650
EQUITY
Total bank debt to total 0.29 0.33
capitalization
Current ratio 1.72 1.85
For more information:
Magal Security Systems Ltd.
Ilan Ovadia, CFO
Tel: +972-3-539-1444
E-mail: [email protected]
Web: http://www.magal-s3.com
Financial Communication Public & Investor Relations
Hadas Friedman
Tel: +972-3-695-4333 Ext. 6
E-mail: [email protected]
Web: http://www.fincom.co.il
SOURCE Magal Security Systems Ltd
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