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Arotech Corporation Reports Results For The First Quarter, 2013

       Arotech Corporation Reports Results For The First Quarter, 2013

Revenues up 37% over same period last year; net profit of $0.4 million

PR Newswire

ANN ARBOR, Mich., May 13, 2013

ANN ARBOR, Mich., May 13, 2013 /PRNewswire/ --Arotech Corporation (NasdaqGM:
ARTX), a provider of quality defense and security products for the military,
law enforcement and security markets, today reported results for the quarter
ended March 31, 2013.

First Quarter 2013 Results

Revenues for the first quarter of 2013 were $22.1 million, compared to $16.1
million for the corresponding period in 2012, an increase of 37%.

Gross profit for the first quarter of 2013 was $5.3 million, or 24% of
revenues, compared to $4.3 million, or 27% of revenues, for the corresponding
period in 2012.

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization
(Adjusted EBITDA) for the quarter was $1.5 million, compared to $481,000 for
the corresponding period of 2012, an improvement of 314%. Arotech believes
that information concerning Adjusted EBITDA enhances overall understanding of
its current financial performance. Arotech computes Adjusted EBITDA, which is
a non-GAAP financial measure, as reflected in the table below.

The Company reported an operating profit for the first quarter of 2013 of
$841,000, compared to an operating loss of $(889,000) for the corresponding
period in 2012.

The Company's net income for the first quarter of 2013 was $404,000, or $0.03
per share, compared to a net loss of $(1.1 million), or $(0.08) per share, for
the corresponding period in 2012.

"We are extremely pleased with our results this quarter, following on from a
strong latter half of 2012," stated Robert Ehrlich, Chairman and CEO Arotech
Corporation. "We demonstrated significant year-on-year improvement in revenues
as well as a strong level of profitability. 2013 has started off well and
our scope of business is significantly larger than it was a year ago. Our
activities in both simulation and batteries remain strong and we continue to
see growth with much long-term potential. Based on our current backlog and
combined with our performance in the first quarter, we are becoming ever more
confident that we are on the right track," concluded Mr. Ehrlich.

Backlog

Backlog of orders totaled approximately $76.3 million as of March 31, 2013, as
compared to $77.3 million at March 31, 2012.

Cash Position at Quarter End

As of March 31, 2013, the Company had $378,000 in cash and $489,000 in
restricted collateral deposits, as compared to December 31, 2012, when the
Company had $1.6 million in cash and $186,000 in restricted collateral
deposits. The Company's cash position improved in the thirty days following
the end of the quarter.

The Company also had $1.1 million in available, unused bank lines of credit
with its main bank as of March 31, 2013, under a $15.0 million credit facility
granted to its FAAC subsidiary, which was secured by the Company's assets and
the assets of the Company's other subsidiaries and guaranteed by the Company.

The Company had trade receivables of $14.3 million as of March 31, 2013,
compared to $9.6 million as of December 31, 2012. The Company had a current
ratio (current assets/current liabilities) of 1.36 as of March 31, 2013 and
1.37 as of December 31, 2012.

Conference Call

The Company will host a conference call today, May 13, 2013 at 5:00 p.m. EDT.
Those wishing to access the conference call should dial 1-888-281-1167 (U.S.)
or +1-347-293-1926 (international) a few minutes before the 5:00 p.m. EDT
start time. A replay of the conference call will be available starting the
following day and will be available for five days. 

The replay telephone number is 1-888-295-2634 (U.S) and +972-3-925-5921
(international).

Following that, the call will also be archived and available in the investor
relations section of the Company's website at http://www.arotech.com. 

About Arotech Corporation

Arotech Corporation is a leading provider of quality defense and security
products for the military, law enforcement and homeland security markets.
Arotech provides multimedia interactive simulators/trainers and advanced
zinc-air and lithium batteries and chargers. Arotech operates through two
major business divisions: Training and Simulation, and Batteries and Power
Systems.

Arotech is incorporated in Delaware, with corporate offices in Ann Arbor,
Michigan and research, development and production subsidiaries in Alabama,
Florida, Michigan and Israel.

Investor Relations Contacts:

Ehud Helft & Kenny Green

CCG Investor Relations

Tel: 1 646 201 9246

arotech@gkir.com

Except for the historical information herein, the matters discussed in this
news release include forward-looking statements, as defined in the Private
Securities Litigation Reform Act of 1995. Forward-looking statements reflect
management's current knowledge, assumptions, judgment and expectations
regarding future performance or events. Although management believes that the
expectations reflected in such statements are reasonable, readers are
cautioned not to place undue reliance on these forward-looking statements, as
they are subject to various risks and uncertainties that may cause actual
results to vary materially. These risks and uncertainties include, but are not
limited to, risks relating to: product and technology development; the
uncertainty of the market for Arotech's products; changing economic
conditions; delay, cancellation or non-renewal, in whole or in part, of
contracts or of purchase orders (including as a result of budgetary cuts
resulting from automatic sequestration under the Budget Control Act of 2011);
and other risk factors detailed in Arotech's most recent Annual Report on Form
10-K for the fiscal year ended December 31, 2012 and other filings with the
Securities and Exchange Commission. Arotech assumes no obligation to update
the information in this release. Reference to the Company's website above does
not constitute incorporation of any of the information thereon into this press
release.

TABLES TO FOLLOW



CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)
(U.S. Dollars, except share data)
                                          Three months ended March 31,
                                          2013               2012
Revenues                                  $ 22,053,131      $ 16,107,708
Cost of revenues                          16,776,967         11,819,066
Research and development expenses         533,385            591,153
Selling and marketing expenses            1,237,006          1,284,894
General and administrative expenses       2,387,811          3,000,606
Amortization of intangible assets         276,494            301,371
Total operating costs and expenses        21,211,663         16,997,090
Operating income (loss)                   841,468            (889,382)
Other income                              1,233              192
Financial expense, net                    (189,137)          (36,836)
Total other expense                       (187,904)          (36,644)
Income (loss) from continuing operations  653,564            (926,026)
before income tax expense
Income tax expense                        174,777            197,577
Income (loss) from continuing operations  478,787            (1,123,603)
Income (loss) from discontinued           (74,743)           64,160
operations, net of income tax
Net income (loss)                         404,044            (1,059,443)
Other comprehensive income, net of income
tax
Foreign currency translation adjustment   211,676            167,075
Comprehensive income (loss)               $   615,720     $  (892,368)
Basic net income/loss per share –         $      0.03  $     (0.08)
continuing operations
Basic net income/loss per share –         –                  0.01
discontinued operations
Basic net income/loss per share           $      0.03  $     (0.07)
Diluted net income/loss per share –       $      0.03  $     (0.08)
continuing operations
Diluted net income/loss per share –       –                  0.01
discontinued operations
Diluted net income/loss per share         $      0.03  $     (0.07)
Weighted average number of shares used in 15,569,153         14,654,803
computing basic net income/loss per share
Weighted average number of shares used in
computing diluted net income/loss per     16,171,893         14,654,803
share

Reconciliation of Non-GAAP Financial Measure – Continuing Operations

To supplement Arotech's consolidated financial statements presented in
accordance with U.S. GAAP, Arotech uses a non-GAAP measure, Earnings (Loss)
Before Interest, Taxes, Depreciation and Amortization (EBITDA). This non-GAAP
measure is provided to enhance overall understanding of Arotech's current
financial performance and its progress towards GAAP profitability.
Reconciliation of EBITDA to the nearest GAAP measure follows:

                                      Three months ended March 31,
                                      2013                 2012
Net income (loss) continuing (GAAP    $      478,787  $    (1,123,603)
measure)
Add back:
Financial expense – including         189,137              36,836
interest
Income tax expenses                   174,777              197,577
Depreciation and amortization expense 571,256              574,378
Other adjustments^*                   97,058               795,433
Total adjusted EBITDA                 $    1,511,015   $      480,621

^

^* Includes stock compensation expense, one-time transaction expenses and
other non-cash expenses.



SOURCE Arotech Corporation

Website: http://www.arotech.com
 
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