Magal S3 announced its financial results for the three and nine month periods ended September 2013.
THIRD QUARTER 2013 RESULTS SUMMARY
Revenues for the third quarter of 2013 were $12.8 million, compared to $23.5 million in revenues for the third quarter of 2012.
Gross profit in the quarter was $6.2 million, or 47.9% of revenues, compared to gross profit of $9.7 million, or 41.3% of revenues in the third quarter of 2012. The high gross margin in the current quarter was due to the recognition of deferred revenues from a large project which was completed in the quarter as well as changes in the revenue mix.
Operating loss in the quarter was $124 thousand, compared to an operating profit of $1.7 million in the third quarter of 2012.
Financial expense, net in the quarter amounted to $346 thousand compared to financial income of $38 thousand in the third quarter of 2012. The appreciation of the Israeli Shekel versus US Dollar caused the increase in financial expenses.
Net loss in the quarter was $316 thousand or $0.02 per share, compared with net income of $1.8 million, or $0.11 per share, in the third quarter of 2012.
Cash and short term deposits net of current bank debt, as of September 30, 2013, were $35.4 million, or $2.20 per share. This is compared with cash and short term deposits net of current bank debt of $34.2 million, or $2.12 per share, on June 30, 2013.
MANAGEMENT COMMENT
Mr. Eitan Livneh, President and CEO of Magal, said, "While we are disappointed that 2013 is shaping up to be a weaker year for us, I am encouraged by the recent increase in activity. In light of the lower level of revenues, we have kept close control over our expense levels and have minimized our losses. We have also maintained our balance sheet strength with over $35 million in net cash. Looking ahead to 2014, we have much to be optimistic about. We recently announced a number of orders which have increased our backlog. We are participating in securing the southern border of Israel, which holds strong future potential for additional revenues in the years to come and we are seeing improved prospects in our current pipeline. Furthermore, we believe that 2014 will be the year in which we will begin to see the fruits of our investment in CyberSeal, our Cyber Security activity, with the expected launch of our first product line in the first quarter of 2014. Accordingly, I am optimistic about our ability to resume our growth in 2014 and about our future growth potential."