Magal Security Systems Reports


The following excerpt is from the company's SEC filing.

YAHUD, ISRAEL, March 27, 2014 -- Magal Security Systems, Ltd. (NASDAQ NMS: MAGS) today announced its financial results for the three and twelve month periods ended December 31, 2013. Management will hold an investors’ conference call later today, at 11:00 a.m. Eastern Time and 5:00 p.m. Israel time, to discuss the results.

Revenues for the fourth quarter of 2013 were $13.0 million, a decrease of 41.5% compared with revenues of $22.2 million in the fourth quarter of 2012.

Gross profit in the fourth quarter was $4.5 million, or 34.5% of revenues, a decrease of 55.9% compared to gross profit of $10.1 mil lion, or 45.7% of revenues, in the fourth quarter of 2012. The change in gross margin between quarters is a function of changes in the revenue mix.

Operating loss in the fourth quarter was $2.4 million, compared to operating profit of $3.2 million, or 14.5% of revenues, in the fourth quarter of 2012.

Net loss in the fourth quarter was $2.3 million, or $0.15 per share, compared with net income of $1.3 million, or $0.08 per share in the fourth quarter of 2012.

Gross profit for the year ended December 31, 2013 was $20.5 million, representing 39.7% of revenues, compared with $33.5 million, representing 43.2% of revenues in 2012.

Operating loss for the year ended December 31, 2013 was $4.5 million, compared with operating income of $5.6 million in 2012.

Net loss for the year ended December 31, 2013 was $4.5 million, or $0.28 per share, compared with net income of $4.1 million, or $0.26 per share, in 2012.

Cash and short term deposits, net of bank debt, as of December 31, 2013, decreased to $36.3 million, or $2.25 per share, compared with cash and short term deposits, net of current bank debt, of $41.0 million, or $2.55 per share, on December 31, 2012.

Commenting on the results, Mr. Eitan Livneh, President and CEO of Magal, said, “2013 was a weak year for us, due to sluggish economies in many of our target geographies combined with delays in several projects. However, on the positive side, I am encouraged by the recent strong pick-up in activity. Magal has emerged from the recent global financial crisis with a strong cash position and is in a good position to take advantage of the current economic up-trends. Looking ahead, we have much to be optimistic about.”

Continued Mr. Livneh, “Our backlog has grown strongly in recent months, and projects which were delayed in 2013 are now beginning to move ahead. Across all our geographies, we are seeing positive signs of improvement. We are putting significant effort on our cyber security activity and have started to see good traction and initial sales of our CyberSeal products. Finally, we are actively engaged in pursuing synergistic acquisitions and I hope to realize some of the fruits of these efforts in 2014. At this point in time, I am very optimistic based on the many opportunities ahead of us and expect that we will resume our growth as we move forward in 2014.”

The Company will host a conference call later today, March 27, 2014, at 11:00 a.m. Eastern Time and 5:00 p.m. Israel time.

A replay of the call will be available from the day after the call for three months. The link to the replay will be accessible from Magal’s website at: www.magal-s3.com.

Magal S3 is a leading international provider of solutions and products for physical and cyber security, as well as safety and site management. Over the past 42 years, Magal S3 has delivered tailor-made security solutions and turnkey projects to hundreds of satisfied customers in over 80 countries – under some of the most challenging conditions.

Magal S3 offers comprehensive integrated solutions for critical sites, managed by Fortis4G – our 4th generation, cutting-edge hybrid PSIM with SEIM (Physical Security Information Management system integrated with Security Information & Event Management). The solutions leverage our broad portfolio of homegrown PIDS (Perimeter Intrusion Detection Systems), advanced outdoors CCTV / IVA technology and Cyber Security solutions.

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.

  Twelve Months Ended December 31, Three Months Ended December 31,   2013   2012 % change 2013 2012 % change Revenue $51,517 $77,697 (33.7) $12,994 $22,227 (41.5) Cost of revenue 31,059 44,163 (29.7) 8,514 12,078 (29.5)               Gross profit 20,458 33,534 (39.0) 4,480 10,149 (55.9) Operating expenses:                Research and development, net 4,409 4,041 9.1 1,205 928 29.8    Selling and marketing 12,781 16,528 (22.7) 3,105 3,953 (21.5)    General and administrative 7,787 7,408 5.1 2,599 2,042 27.3  Total operating expenses, net 24,977 27,977 (10.7) 6,909 6,923 (0.2)               Operating income (loss) (4,519) 5,557   (2,429) 3,226   Financial expense (income), net (59) 472   (147) 952                 Income (loss) before income taxes (4,460) 5,085   (2,282) 2,274                 Income tax expense 69 991   62 947                 Net income (loss) (4,529) 4,094   (2,344) 1,327   Less - loss attributable to non-controlling interests 66 -   (11) -                 Net income (loss) attributable to Magal shareholders'   (4,463)   4,094     (2,355)   1,327                               Basic net earnings per share $(0.28) $0.26   $(0.15) $0.08                 Diluted net earnings per share $(0.28) $0.26   $(0.15) $0.08                 Weighted average number of shares used in computing basic net earnings (loss) per share   16,138,944   16,003,482     16,147,522   16,091,796                 Weighted average number of shares used in computing diluted net earnings (loss) per share   16,138,944   16,030,816     16,147,522   16,108,130                

    Twelve Months Ended December 31     Three Months Ended December 31       2013 %     2012 %     2013 %     2012 %                             Gross margin     39.7       43.2       34.5       45.7   Research and development, net as a % of revenues     8.6       5.2       9.3       4.2   Selling and marketing as a % of revenues     24.8       21.3       23.9       17.8   General and administrative  as a % of revenues     15.1       9.5       20.0       9.2   Operating margin     (8.8 )     7.2       (18.7 )     14.5   Net  margin     (8.7 )     5.3       (18.1 )     6  

    December 31,     December 31,       2013     2012   CURRENT ASSETS:               Cash and cash equivalents   $ 32,235     $ 36,784   Short-term bank deposit     6,147       1,789   Restricted deposit     6,101       7,818   Trade receivables, net     12,634       17,920   Unbilled accounts receivable     2,388       2,394   Other accounts receivable and prepaid expenses     2,379       2,671   Inventories     8,352       8,535   Deferred income taxes     599       502                     Total current assets     70,835       78,413                        LONG TERM INVESTMENTS AND RECEIVABLES:                                    Long-term trade receivables     690       1,048   Long-term deposits and restricted bank deposits     35       48   Severance pay fund     2,589       2,220   Deferred income taxes     46       -                     Total long-term investments and receivables     3,360       3,316                     PROPERTY AND EQUIPMENT, NET     7,280       7,122                     OTHER INTANGIABLE ASSETS, NET     895       171                     GOODWILL     5,417       2,014                      TOTAL ASSETS   $ 87,787     $ 91,036  

    December 31,     December 31,       2013     2012                 CURRENT LIABILITIES:                           Short-term bank credit   $ 5,764     $ 5,358   Current maturities of long-term bank debt     506       33   Trade payables     3,916       6,725   Customer advances     4,226       6,895   Other accounts payable and accrued expenses     9,431       10,200   Deferred income taxes     34       -                     Total current liabilities     23,877       29,211                      LONG-TERM LIABILITIES:                 Long-term bank debt and other long-term payables     1,912       6   Deferred income taxes     301       210   Accrued severance pay     4,157       3,283                     Total long-term liabilities     6,370       3,499                     SHAREHOLDERS' EQUITY                   Ordinary shares of NIS 1 par value - Authorized: 39,748,000 shares at                     December 31, 2013 and December 31, 2012;                  Issued and outstanding: 16,147,522 shares at December 31, 2013                     and 16,098,022 shares at December 31, 2012     4,901       4,887   Additional paid-in capital     68,371       66,183   Accumulated other comprehensive income     7,114       4,749   Foreign currency translation adjustments (Company's stand alone                    financial statements)     1,349       2,224   Accumulated deficit     (24,180 )     (19,717 )                   Total Magal shareholders' equity     57,555       58,326   Non controlling interest     (15 )     -                     TOTAL SHAREHOLDERS' EQUITY     57,540       58,326                     TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY   $ 87,787     $ 91,036  

The above information was disclosed in a filing to the SEC. To see this filing in its entirety, click here. Magal Security Systems Ltd. next reports earnings on March 27, 2014.

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Other recent filings from the company include the following:

Magal Security Systems Ltd. Announces The Resignation Of A Director - Oct. 9, 2014
Report of foreign issuer [Rules 13a-16 and 15d-16] - Oct. 7, 2014
General statement of acquisition of beneficial ownership - Oct. 6, 2014

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