NETANIA, Israel, May 31, 2023
/PRNewswire/ -- TAT Technologies Ltd. (NASDAQ: TATT) ("TAT" or the
"Company"), a leading provider of products and services to the
commercial and military aerospace and ground defense industries,
reported today its unaudited results for the three-month period
ended March 31, 2023.
Financial highlights for the first quarter of
2023:
- Revenues for Q1 2023 increased by 26.6% to $25.2 million compared to $19.9 million in Q1 2022.
- Gross profit for Q1 2023 increased to $4.3 million (16.9% of revenues) compared to
$3 million in Q1 2022 (15.2% of
revenues).
- Adjusted EBITDA for Q1 2023 increased by 328% to $2.2 million compared to $0.5 million in Q1 2022.
- Net income for Q1 2023 was $0.66
million compared to a net loss of $1.6 million in Q1 2022.
- Operational cash flow was positive $1.4
million compared to $0 million
in Q1 2021.
Mr. Igal Zamir, TAT's CEO and
President commented on the results: "We are excited with the
results of the first quarter of 2023. As our industry continues to
ramp up, it is the second consecutive quarter that we continue to
increase our revenues, improve gross profits, and improve EBITDA
and net income. Cash flow from operations continues to be
positively strong. The world's supply chain challenges continue to
negatively affect our results and customer satisfaction. As of the
end of March 2023 our past due
customers' orders amount to $33
million.
Our order backlog and LTA continue to grow as the demand for our
products and services rapidly increases and as we enter the second
half of the year, we expect to see the fruits of the strategic
deals that we signed with Honeywell both for the APU 331-500 and
APU 131. These strategic deals represent a major growth engine and
are expected to yield a much better profitability."
Mr. Zamir continued: "We are optimistic with the coming quarters
of 2023 and expect substantial growth in revenues and EBITDA
compared to 2022".
Non-GAAP Financial Measures
To supplement the consolidated financial statements presented in
accordance with GAAP, the Company also presents Adjusted
EBITDA. The adjustments to the Company's GAAP results are
made with the intent of providing both management and investors a
more complete understanding of the Company's underlying operational
results, trends and performance. Adjusted EBITDA is calculated as
net income excluding the impact of: the Company's share in results
of affiliated companies, share-based compensation, taxes on income,
financial (expenses) income, net, and depreciation and
amortization. Adjusted EBITDA, however, should not be considered as
alternative to net income and operating income for the period and
may not be indicative of the historic operating results of the
Company; nor it is meant to be predictive of potential future
results. Adjusted EBITDA is not measure of financial performance
under generally accepted accounting principles and may not be
comparable to other similarly titled measures for other companies.
See reconciliation of Adjusted EBITDA in pages 13 below.
About TAT Technologies LTD
TAT Technologies Ltd. is a leading provider of services and
products to the commercial and military aerospace and ground
defense industries. TAT operates under four segments: (i) Original
equipment manufacturing ("OEM") of heat transfer solutions and
aviation accessories through its Gedera facility; (ii) MRO services
for heat transfer components and OEM of heat transfer solutions
through its Limco subsidiary; (iii) MRO services for aviation
components through its Piedmont subsidiary; and (iv) Overhaul and
coating of jet engine components through its Turbochrome
subsidiary. TAT controlling shareholders is the FIMI Private Equity
Fund.
TAT's activities in the area of OEM of heat transfer solutions
and aviation accessories primarily include the design, development
and manufacture of (i) broad range of heat transfer solutions, such
as pre-coolers heat exchangers and oil/fuel hydraulic heat
exchangers, used in mechanical and electronic systems on board
commercial, military and business aircraft; (ii) environmental
control and power electronics cooling systems installed on board
aircraft in and ground applications; and (iii) a variety of other
mechanical aircraft accessories and systems such as pumps, valves,
and turbine power units.
TAT's activities in the area of MRO Services for heat transfer
components and OEM of heat transfer solutions primarily include the
MRO of heat transfer components and to a lesser extent, the
manufacturing of certain heat transfer solutions. TAT's Limco
subsidiary operates an FAA-certified repair station, which provides
heat transfer MRO services for airlines, air cargo carriers,
maintenance service centers and the military.
TAT's activities in the area of MRO services for aviation
components include the MRO of APUs, landing gears and other
aircraft components. TAT's Piedmont subsidiary operates an
FAA-certified repair station, which provides aircraft component MRO
services for airlines, air cargo carriers, maintenance service
centers and the military.
TAT's activities in the area of overhaul and coating of jet
engine components includes the overhaul and coating of jet engine
components, including turbine vanes and blades, fan blades,
variable inlet guide vanes and afterburner flaps.
For more information of TAT Technologies Ltd., please visit our
web-site: www.tat-technologies.com
Contact:
Mr. Ehud Ben-Yair
Chief Financial Officer
Tel: 972-8-862-8503
ehudb@tat-technologies.com
Safe Harbor for Forward-Looking Statements
This press release contains forward-looking statements which
include, without limitation, statements regarding possible or
assumed future operation results. These statements are hereby
identified as "forward-looking statements" for purposes of the safe
harbor provided by the Private Securities Litigation Reform Act of
1995. These forward-looking statements involve risks and
uncertainties that could cause our results to differ materially
from management's current expectations. Actual results and
performance can also be influenced by other risks that we face in
running our operations including, but are not limited to, general
business conditions in the airline industry, changes in demand for
our services and products, the timing and amount or cancellation of
orders, the price and continuity of supply of component parts used
in our operations, the change of control that will occur on the
sale by the receiver of the Company's shares held by our previously
controlling stockholders, and other risks detailed from time to
time in the Company's filings with the Securities Exchange
Commission, including, its annual report on form 20-F and its
periodic reports on form 6-K. These documents contain and identify
other important factors that could cause actual results to differ
materially from those contained in our projections or
forward-looking statements. Stockholders and other readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date on which they are made.
We undertake no obligation to update publicly or revise any
forward-looking statement.
|
TAT
TECHNOLOGIES AND ITS SUBSIDIARIES
CONDENSED
CONSOLIDATED BALANCE SHEET
(In
thousands)
|
|
|
March
31,
|
|
December
31,
|
|
|
2023
|
|
2022
|
|
|
(unaudited)
|
|
(audited)
|
|
|
ASSETS
|
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
|
|
Cash and cash
equivalents
|
$ 9,196
|
|
$ 7,722
|
|
|
Accounts receivable,
net
|
17,643
|
|
15,622
|
|
|
Inventory,
net
|
42,848
|
|
45,759
|
|
|
Other current assets
and prepaid expenses
|
4,912
|
|
6,047
|
|
|
|
|
|
|
|
Total current
assets
|
74,599
|
|
75,150
|
|
|
|
|
|
|
|
NON-CURRENT
ASSETS:
|
|
|
|
|
|
Restricted
deposit
|
302
|
|
304
|
|
|
Investment in
affiliates
|
1,733
|
|
1,665
|
|
|
Funds in respect of
employee rights upon retirement
|
710
|
|
780
|
|
|
Deferred income
taxes
|
1,207
|
|
1,229
|
|
|
Intangible assets,
net
|
1,722
|
|
1,623
|
|
|
Property, plant and
equipment, net
|
42,560
|
|
43,423
|
|
|
Operating lease right
of use assets
|
2,257
|
|
2,477
|
|
|
|
|
|
|
|
Total non-current
assets
|
50,491
|
|
51,501
|
|
|
Total
assets
|
$
125,090
|
|
$ 126,651
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
|
Current maturities of
long-term loans
|
$ 1,975
|
|
$ 1,876
|
|
|
Credit line from
bank
|
6,112
|
|
6,101
|
|
|
Accounts
payable
|
9,112
|
|
10,233
|
|
|
Accrued
expenses
|
9,395
|
|
9,686
|
|
|
Operating lease
liabilities
|
866
|
|
904
|
|
|
Provision for
restructuring plan
|
132
|
|
190
|
|
|
|
|
|
|
|
Total current
liabilities
|
27,592
|
|
28,990
|
|
|
|
|
|
|
|
NON CURRENT
LIABILITIES:
|
|
|
|
|
|
Long-term loans
|
18,764
|
|
19,408
|
|
|
Liability in respect of
employee rights upon retirement
|
1,069
|
|
1,148
|
|
|
Operating lease
liabilities
|
1,347
|
|
1,535
|
|
|
|
|
|
|
|
Total
non-current liabilities
|
21,180
|
|
22,091
|
|
|
Total
liabilities
|
$
48,772
|
|
51,081
|
|
|
|
|
|
|
|
EQUITY:
|
|
|
|
|
|
Share
capital
|
2,842
|
|
2,842
|
|
|
Additional paid-in
capital
|
66,335
|
|
66,245
|
|
|
Treasury stock at
cost
|
(2,088)
|
|
(2,088)
|
|
|
Accumulated other
comprehensive income
|
(26)
|
|
(26)
|
|
|
Retained
earnings
|
9,255
|
|
8,597
|
|
|
Total shareholders'
equity
|
76,318
|
|
75,570
|
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
$
125,090
|
|
$ 126,651
|
|
|
|
|
|
|
|
TAT TECHNOLOGIES AND
ITS SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except
share and per share data)
|
|
|
Three months
ended
|
|
Year
ended
|
|
|
March
31,
|
|
December
31,
|
|
|
2023
|
|
2022
|
|
2022
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Audited)
|
|
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
|
Products
|
$ 7,291
|
|
$ 6,319
|
|
$
25,460
|
|
|
Services
|
17,926
|
|
13,635
|
|
59,096
|
|
|
25,217
|
|
19,954
|
|
84,556
|
|
|
|
|
|
|
|
|
|
Cost of
goods:
|
|
|
|
|
|
|
|
Products
|
6,274
|
|
5,744
|
|
21,631
|
|
|
Services
|
14,685
|
|
11,165
|
|
46,997
|
|
|
20,959
|
|
16,909
|
|
68,628
|
|
|
Gross Profit
|
4,258
|
|
3,045
|
|
15,928
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Research and
development, net
|
99
|
|
(27)
|
|
479
|
|
|
Selling and
marketing
|
1,159
|
|
1,335
|
|
5,629
|
|
|
General and
administrative
|
2,459
|
|
2,385
|
|
9,970
|
|
|
Other income
|
(406)
|
|
(81)
|
|
(90)
|
|
|
Restructuring and other
expenses
|
-
|
|
927
|
|
1,715
|
|
|
3,311
|
|
4,539
|
|
17,703
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
948
|
|
(1,494)
|
|
(1,775)
|
|
|
|
|
|
|
|
|
|
Interest
expenses
|
(366)
|
|
(104)
|
|
(902)
|
|
|
Other financial income
(expenses), net
|
(19)
|
|
170
|
|
1,029
|
|
|
|
|
|
|
|
|
|
Income (loss) before
taxes on income (tax benefit)
|
563
|
|
(1,428)
|
|
(1,648)
|
|
|
|
|
|
|
|
|
|
Taxes on income (tax
benefit)
|
(27)
|
|
107
|
|
98
|
|
|
|
|
|
|
|
|
|
Income (loss) before
share of equity investment
|
590
|
|
(1,535)
|
|
(1,746)
|
|
|
|
|
|
|
|
|
|
Share in results of
affiliated companies
|
68
|
|
(27)
|
|
184
|
|
|
Net income (loss) from
continued operation
|
$ 658
|
|
$ (1,562)
|
|
$ (1,562)
|
|
|
Net income from
discontinued operation
|
-
|
|
-
|
|
-
|
|
|
Net income
(loss)
|
$ 658
|
|
$
(1,562)
|
|
$ (1,562)
|
|
|
|
|
|
|
|
|
|
Basic and diluted
income per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per
share basic and diluted
|
$
0.074
|
|
$ (0.17)
|
|
$
(0.175)
|
|
|
|
|
|
|
|
|
|
Weighted average number
of shares outstanding :
|
|
|
|
|
|
|
|
Basic and
Diluted
|
8,911,546
|
|
8,886,546
|
|
8,911,546
|
|
|
|
|
|
|
|
|
|
TAT TECHNOLOGIES AND
ITS SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF COMPREHENSIVE INCOME
(In
thousands)
|
|
|
Three months
ended
|
|
Year
ended
|
|
|
March
31,
|
|
December
31,
|
|
|
2023
|
|
2022
|
|
2022
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Audited)
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$ 658
|
|
$ (1,562)
|
|
$ (1,562)
|
|
|
Other comprehensive
income (loss)
|
|
|
|
|
|
|
|
Net unrealized losses
from derivatives
|
-
|
|
(32)
|
|
(89)
|
|
|
Reclassification
adjustments for gains included in net
income and inventory
|
-
|
|
-
|
|
30
|
|
|
Total
comprehensive income (loss)
|
$
658
|
|
$ (1,594)
|
|
$ (1,621)
|
|
|
|
|
|
|
|
|
|
TAT TECHNOLOGIES AND
ITS SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(In thousands, except
share data)
|
|
|
|
Share
capital
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
shares
issued
|
|
Amount
|
|
Additional
paid-in
capital
|
|
Accumulated
other
comprehensive
income (loss)
|
|
Treasury
shares
|
|
Retained
earnings
|
|
Total
equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BALANCE AT DECEMBER
31, 2010
|
|
9,149,169
|
|
$ 2,809
|
|
$
65,711
|
|
$
128
|
|
$
(2,088)
|
|
$
13,329
|
|
$80,281
|
|
|
CHANGES DURING THE
YEAR ENDED DECEMBER 31, 2021:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive
loss
|
|
-
|
|
-
|
|
-
|
|
(95)
|
|
-
|
|
(3,562)
|
|
(3,657)
|
|
|
Share based
compensation
|
|
-
|
|
-
|
|
160
|
|
-
|
|
-
|
|
-
|
|
160
|
|
|
BALANCE AT DECEMBER
31, 2021
|
|
9,149,169
|
|
$ 2,809
|
|
$
65,871
|
|
$
33
|
|
$
(2,088)
|
|
$
10,159
|
|
$76,784
|
|
|
CHANGES DURING THE
YEAR ENDED
DECEMBER 31, 2022:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive
loss
|
|
-
|
|
-
|
|
-
|
|
(59)
|
|
-
|
|
(1,562)
|
|
(1,621)
|
|
|
Exercise of
option
|
|
36,850
|
|
33
|
|
156
|
|
-
|
|
-
|
|
-
|
|
189
|
|
|
Share based
compensation
|
|
-
|
|
-
|
|
218
|
|
-
|
|
-
|
|
-
|
|
218
|
|
|
BALANCE AT DECEMBER
31, 2022
|
|
9,186,019
|
|
$ 2,842
|
|
$
66,245
|
|
$
(26)
|
|
$
(2,088)
|
|
$
8,597
|
|
$75,570
|
|
|
CHANGES DURING THE
PERIOD ENDED
MARCH 31, 2023
(unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive
profit
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
658
|
|
658
|
|
|
Exercise of
option
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
Share based
compensation
|
|
-
|
|
-
|
|
90
|
|
-
|
|
-
|
|
-
|
|
90
|
|
|
BALANCE AT MARCH 31,
2023
(unaudited)
|
|
9,186,019
|
|
$ 2,842
|
|
$
66,335
|
|
$
(26)
|
|
$
(2,088)
|
|
9,255
|
|
$76,318
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TAT TECHNOLOGIES
AND ITS SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In
thousands)
|
|
|
|
Three months
ended
|
|
Year
ended
|
|
|
|
March
31,
|
|
December
31,
|
|
|
|
2023
|
|
2022
|
|
2022
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(audited)
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Net income (loss) from
continued operations
|
|
658
|
|
(1,562)
|
|
(1,562)
|
|
|
|
|
|
|
|
|
|
|
Adjustments to
reconcile net income (loss) to net cash provided
by (used in) operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
1,041
|
|
973
|
|
3,706
|
|
|
Loss (gain) from change
in fair value of derivatives
|
|
-
|
|
17
|
|
8
|
|
|
Provision for doubtful
accounts
|
|
(3)
|
|
-
|
|
138
|
|
|
Share in results of
affiliated Company
|
|
(68)
|
|
27
|
|
(184)
|
|
|
Share based
compensation
|
|
90
|
|
49
|
|
218
|
|
|
Noncash finance
expense
|
|
(6)
|
|
(35)
|
|
-
|
|
|
Lease
modification
|
|
-
|
|
-
|
|
(82)
|
|
|
|
Increase (decrease) in
provision for restructuring expenses
|
|
(58)
|
|
(345)
|
|
(467)
|
|
|
Liability in respect of
employee rights upon retirement
|
|
(79)
|
|
(117)
|
|
(356)
|
|
|
Capital gain from sale
of fixed assets
|
|
(456)
|
|
(81)
|
|
(90)
|
|
|
|
Deferred income taxes,
net
|
|
22
|
|
107
|
|
23
|
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
Increase in trade accounts receivable
|
|
(2,012)
|
|
(895)
|
|
(2,659)
|
|
|
Decrease (increase) in other current assets and prepaid
expenses
|
|
1,205
|
|
(62)
|
|
(1,459)
|
|
|
Decrease (increase) in
inventory
|
|
2,959
|
|
(2,222)
|
|
(5,069)
|
|
|
Decrease (increase) in trade accounts payable
|
|
(1,121)
|
|
536
|
|
1,143
|
|
|
Increase (decrease) in accrued expenses
|
|
(290)
|
|
42
|
|
2,727
|
|
|
Decrease in other long-term liabilities
|
|
(115)
|
|
(161)
|
|
(902)
|
|
|
Net cash provided by
(used in) operating activities
|
|
$
1,767
|
|
$
(3,729)
|
|
$ (4,867)
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Proceeds from sale of
property and equipment
|
|
1,560
|
|
84
|
|
93
|
|
|
Purchase of property
and equipment
|
|
(1,433)
|
|
(4,010)
|
|
(16,213)
|
|
|
Purchase of intangible
assets
|
|
-
|
|
-
|
|
-
|
|
|
Cash flows provided
by (used in) investing activities
|
|
$
127
|
|
$
(3,926)
|
|
$
(16,120)
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Short-term credit
received (Repayments) from banks
|
|
-
|
|
(3,000)
|
|
(1,071)
|
|
|
Proceeds (repayments)
from long-term loans received
|
|
(422)
|
|
10,504
|
|
16,680
|
|
|
Exercise of
options
|
|
-
|
|
67
|
|
189
|
|
|
Cash flows provided
by (used in) financing activities
|
|
$
(422)
|
|
$
7,571
|
|
$ 15,798
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase
(decrease) in cash and cash equivalents and
restricted cash
|
|
1,472
|
|
(84)
|
|
(5,189)
|
|
|
Cash and cash
equivalents and restricted cash at beginning
of period
|
|
8,026
|
|
13,215
|
|
13,215
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents and restricted cash at the end of
period
|
|
$ 9,498
|
|
$ 13,131
|
|
8,026
|
|
|
TAT TECHNOLOGIES AND
ITS SUBSIDIARIES
RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA
(NON-GAAP)
(UNAUDITED)
(In
thousands)
|
|
|
Three months
ended
|
|
Year
ended
|
|
|
March
31,
|
|
December
31,
|
|
|
2023
|
|
2022
|
|
2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(Loss)
|
$ 658
|
|
$
(1,562)
|
|
$ (1,562)
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
Share in results and
sale of equity
investment of affiliated companies
|
(68)
|
|
27
|
|
(184)
|
|
|
Taxes on income (tax
benefit)
|
(27)
|
|
107
|
|
98
|
|
|
Financial expense/
(income), net
|
385
|
|
(66)
|
|
(127)
|
|
|
Depreciation and
amortization
|
1,041
|
|
1,025
|
|
3,878
|
|
|
Restructuring
expenses
|
-
|
|
927
|
|
1,715
|
|
|
Share based
compensation
|
90
|
|
49
|
|
218
|
|
|
Adjusted
EBITDA
|
$ 2,079
|
|
$ 507
|
|
$ 4,036
|
|
|
|
|
|
|
|
|
View original
content:https://www.prnewswire.com/news-releases/tat-technologies-reports-first-quarter-2023-results-301838282.html
SOURCE TAT Technologies Ltd.