AROTECH CORPORATION REPORTS
FOR THE FOURTH QUARTER AND FULL YEAR, 2010
Net loss slashed more than half
on flat revenues -
Backlog at $44.0 million
14, 2011 - 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 and
full year ended December 31, 2010.
Full Year Results
Revenues for 2010 were $73.7 million,
compared to $74.5 million for 2009, a decrease of 1%.
Gross profit for 2010 was $20.6
million, or 28% of revenues, compared to $20.1 million, or 27% of
revenues, for 2009, a one point increase in the gross margin percentage.
Earnings Before Interest, Taxes,
Depreciation and Amortization (EBITDA) for the year was $2.9 million,
compared to $3.0 million for the corresponding period last year.
Arotech believes that information concerning EBITDA enhances overall
understanding of its current financial performance. Arotech computes
EBITDA, which is a non-GAAP financial
measure, as reflected in the table below.
The Company reported an operating loss for 2010 of $(774,000), compared
to an operating profit of $167,000 in 2009.
The Company's net loss for 2010
was $(1.1) million, or $(0.08) per share, compared to a net loss
of $(3.1) million, or $(0.24) per share, for 2009.
"We are very pleased that
we managed to reduce our net loss by over 64% despite a very weak
fourth quarter, the result of unexpected delays in certain orders
as well as a substantial charge in respect of litigation that was
taken in the fourth quarter," said Arotech Chairman and CEO
Robert S. Ehrlich. "We expect most of these orders to be filled
in the first half of this year, leading to a modest recovery for
the first and second quarter and a more favorable second half of
the year," continued Ehrlich. "Furthermore, our balance
sheet improved greatly during the year and there are a number of
exciting opportunities unfolding in all of our divisions that we
hope to see materialize in 2011 and beyond," concluded Ehrlich.
Fourth Quarter Results
Revenues for the fourth quarter
reached $17.3 million, compared to $20.9 million for the corresponding
period in 2009, a decrease of 17%.
Gross profit for the fourth quarter
was $5.1 million, or 29% of revenues, compared to $5.7 million,
or 28% of revenues, for the corresponding period in 2009, a one
point increase in the gross margin percentage.
Earnings Before Interest, Taxes,
Depreciation and Amortization (EBITDA) for the quarter was $710,000,
compared to $634,000 for the corresponding period of 2009, an improvement
of nearly 12%.
The Company reported an operating
loss for the fourth quarter of $(267,000), compared to an operating
profit of $420,000 for the corresponding period in 2009.
The Company's net loss for the
fourth quarter of 2010 was $(431,000), or $(0.03) per share, compared
to a net profit of $761,000, or $0.06 per share, for the corresponding
period in 2009.
Backlog of orders totaled approximately
$44.0 million as of December 31, 2010 compared to $55.5 million
as of December 31, 2009.
Cash Position at Year End
As of December 31, 2010, the Company
had $6.3 million in cash and $1.8 million in restricted cash, as
compared to December 31, 2009, when the Company had $1.9 million
in cash and $2.0 million in restricted cash.
The Company had trade receivables
of $13.8 million as of December 31, 2010, compared to $14.0 million
as of December 31, 2009. The Company had a current ratio (current
assets/current liabilities) of 1.75, up from the December 31, 2009
current ratio of 1.70.
The Company ended 2010 with $2.5
million in bank debt and $2.4 million in long-term debt outstanding
as compared to 2009 when the Company had $4.1 million in bank debt
and $4.2 million in long-term debt outstanding.
The Company will host a conference
call tomorrow, Tuesday, March 15, 2011 at 11:00 a.m. EDT. Those
wishing to access the conference call should dial 1-877-407-0778
(U.S.) or +1-201-689-8565 (international) a few minutes before the
11:00 a.m. EDT start time. A replay of the conference call will
be available starting Tuesday, March 15, 2011 at 12:30 p.m. EDT
until Tuesday, March 22, 2011 at 11:59 p.m. The replay telephone
number is 1-877-660-6853 (U.S) and +1-201-612-7415 (international).
The replay ID pass code is 368895 and the account number is 286.
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 interac-tive simulators/trainers, lightweight armoring
and advanced zinc-air and lithium batteries and chargers. Arotech
operates through three major business divisions: Armor, Training
and Simula-tion, and Battery and Power Systems.
Arotech is incorporated in Delaware,
with corporate offices in Ann Arbor, Michigan and research, development
and production subsidiaries in Alabama, Michigan and Israel.
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, including
the effect of any share re-purchases by Arotech. Forward-looking
statements reflect management's current knowledge, assumptions,
judgment and expectations regarding future performance or events.
Although management believes that the expectations re-flected 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 mate-rially. These risks and uncertainties include,
but are not limited to, risks relating to: product and technology
devel-opment; 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; dilution
resulting from issuances of Arotech's common stock upon conversion
or payment of its outstanding convertible debt, which would be increasingly
dilutive if and to the extent that the market price of Arotech's
stock decreases; and other risk factors detailed in Arotech's most
recent Annual Report on Form 10-K for the fiscal year ended December
31, 2009 and other filings with the Se-curities and Exchange Commission.
Arotech assumes no obligation to update the information in this
release. Refer-ence to the Company's website above does not constitute
incorporation of any of the information thereon into this press
CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)