6 Sep 2017 07:00
6 September 2017
Amiad Water Systems Ltd.
("Amiad" or the "Company")
Interim Results
Amiad (AIM: AFS), a leading global producer of water treatment and filtration solutions, announces its interim results for the six months ended 30 June 2017.
Financial Summary
· Revenue increased 6.2% to $55.7m (H1 2016: $52.4m)
· Gross margin improved to 39.6% (H1 2016: 39.2%)
· Operating profit increased 51.0% to $2.8m (H1 2016: $1.9m)
· Profit before tax increased 93.9% to $3.2m (H1 2016: $1.7m)
· Fully diluted earnings per share of $0.098 (H1 2016: $0.049)
· Net debt at 30 June 2017 was $8.1m (31 December 2016: $8.8m)
· Cash and cash equivalents at 30 June 2017 were $15.7m (31 December 2016: $16.1m)
Operational Summary
· Growth in sales reflecting progress across all core segments
· Irrigation segment sales, which accounted for 57.8% of total revenue, increased in all but one territory
· Increased sales in the Industrial segment in China, India and Israel offset weakness elsewhere resulting in overall growth in the segment
· Sales in the Municipal segment were 33.6% higher than H1 2016, primarily due to a significant increase in the US
· Oil & Gas segment sales grew 13.4% due to growth in Australia and also the US
· Completed in-house metal fabrication facility, which is now fully operational, that will enable increased efficiency and quality
Strategic Plan
· Review completed by new CEO
· Clear roadmap to grow revenues to $150m by 2022 with continued focus on profitability
· Primary focus on Irrigation segment and North America - offers a significant opportunity across all segments
· Ballast Water segment offering will be enhanced over the next six months to target this potentially significant market, however if progress cannot be delivered over this period then resources will be refocused elsewhere
Dori Ivzori, Chief Executive Officer of Amiad, said: "I am pleased to report this set of results that represents an inflection point for Amiad. We achieved sales growth across all of our core segments and saw a substantial increase in profitability thanks to the foundations that we laid last year and continued tight cost control. At the same time, we completed our in-house metal fabrication facility, which is now fully operational and will contribute to improved efficiency in the second half of the year and beyond.
"Looking ahead, we entered the second half of 2017 with a higher backlog than at the same time last year and are receiving increasing customer interest in our products. While we expect to be negatively impacted in the second half from the weakness of the US Dollar against the New Israeli Shekel, there is sufficient demand in the business to compensate for this and, consequently, we anticipate reporting full year growth for 2017 in line with market expectations. As a result, the Board looks to the future with confidence and to delivering shareholder value."
Enquiries
Amiad Water Systems Ltd. | |
Dori Ivzori, Chief Executive Officer Irit Ben-Dov, Chief Financial Officer | +972 4 690 9500 |
Stifel Nicolaus Europe Ltd. | |
Stewart Wallace, Ben Maddison | +44 20 7710 7600 |
Luther Pendragon Ltd. | |
Harry Chathli, Claire Norbury | +44 20 7618 9100 |
About Amiad
Amiad Water Systems (AIM: AFS) is a leading global producer of automatic, self-cleaning water treatment and filtration products and systems. Through its engineering skills and ability to innovate, Amiad provides cost-effective "green" solutions for the industrial, municipal, irrigation, oil & gas and ballast water markets. In these segments its patented products are being integrated into the core of systems for filtration and water treatment, micro irrigation and membrane protection, wastewater and potable water treatment, cooling systems and sea water filtration.
Headquartered in Israel, Amiad provides these solutions through nine subsidiaries and a comprehensive network of over 170 distributors to customers in more than 80 countries.
For additional information or product details, please visit www.amiad.com.
Operational Review
In the first half of 2017, the Company achieved growth in all of its core segments and in most geographies except the US, Singapore, Europe and Brazil due to weakness in the Industrial segment in those territories. As a result, total revenue increased 6.2% year-on-year. However, thanks to progress made in 2016 in adjusting the cost structure, maintaining control over expenses and benefiting from its foreign exchange hedging over the period, the Company achieved 93.9% growth in profit before tax. The Company also completed its in-house metal fabrication facility, which is now fully operational and will contribute to improved efficiency during the second half of 2017 onwards. Amiad continued to invest in R&D in line with its policy and is developing new products, particularly for the Irrigation segment, that are to be launched from 2018, that form part of the Company's strategic plan as described below.
Segment Performance
The Irrigation and Industrial segments generated $32.2m and $17.8m respectively during the period (H1 2016: $30.3m and $17.5m), accounting for 57.8% and 31.9% of the Company's revenue (H1 2016: 57.9% and 33.4%). The growth in the Irrigation segment was across all geographies, except India. In the Industrial segment, an increase in sales in China, India and Israel offset weakness elsewhere resulting in slight growth overall.
The Municipal segment sales were $3.7m (accounting for 6.7% of H1 2017 total revenue), compared with $2.8m in H1 2016, with the increase due to growth in the US. Revenue in the Oil & Gas segment was $2.0m, or 3.5% of total sales, compared with $1.7m (3.3% of total revenue) in H1 2016 with the growth due to an increase in sales in Australia but also the US. The Ballast Water segment continued to experience difficult trading conditions with revenues of $0.01m (H1 2016: $0.03m).
Global Activity
US
In the US, the Company took a strategic decision to restructure the Industrial segment sales team and channel partner network to support targeted growth in 2018 and beyond. As a result of this reorganisation, sales in this segment were significantly lower during the period compared with the prior year. However, this was partly offset by growth in revenues in the other segments, particularly in the Municipal segment where a few medium-sized projects were delivered in the first half of 2017. Consequently, total revenues amounted to $11.3m compared with $11.8m in H1 2016.
EMEA
Revenues in EMEA grew by 9.7% in aggregate over H1 2016, which was due to weakness in Europe being offset primarily by an increase in Israel but also Turkey.
The growth in Israel was principally across the Irrigation and Industrial segments as well generating sales in the Municipal segment.
In Europe, sales in the Irrigation segment continued to increase slightly as the sales office established in the region continued to build on the success of the prior year, and the Municipal segment also experienced growth, however this was offset by sustained weakness in the Industrial and Oil & Gas segments in this region.
As previously announced, during the period the Company was notified about issues with the certification used by its French subsidiary company (the "Subsidiary") to confirm compliance of certain products ("Products"), sold by the Subsidiary, with the French Attestation de Conformité Sanitaire ("ACS") standard. Following an initial investigation, the Company put in place new management oversight of its French and European operations, and appointed Amiad's VP Operations & COO as interim President of the Subsidiary. In addition, application for the requisite ACS certification for the relevant Products was submitted and the Company is pleased to report that it has received the first of the two certificates. Amiad continues to work with its customers to minimise the disruption to ongoing projects.
Asia
Sales in China and India grew by 22.1% and 15.3% respectively over the same period of last year, primarily due to an increase in the Industrial segment. In China, the strengthening economy resulted in an increase in investment, especially in the steel industry that has traditionally been the strongest sector for Amiad in China. In India, the Company won a number of large Municipal and Industrial projects that it commenced supplying during the first half of 2017.
However, on aggregate, sales in Asia decreased due to a significant reduction in revenues in Singapore as a result of a slight delay in a few major projects that Amiad now expects to complete in the second half of the year.
Australia
In Australia, revenues were 13.5% higher than the comparable period of the prior year. This was primarily due to growth in the Oil & Gas segment. The Irrigation segment also continued to perform well, with sales remaining level with the prior year, while the Industrial and Municipal segments declined slightly.
The above analysis shows the Company's sales by business unit.
Financial Review
Revenue for the six months ended 30 June 2017 increased by 6.2% to $55.7m compared with $52.4m for H1 2016. As stated above, the growth was due to improvement across the Company's segments (excluding Ballast Water), although there was variation within the different geographies.
Gross margin was 39.6% (H1 2016: 39.2%). The slight improvement was due to continued tight cost control and gains from operational efficiencies. However, spending on R&D increased as Amiad invested in sustaining its product innovation to support future sales. In the second half of 2017, the Company expects further improvement as Amiad begins to recognise the full benefits from the construction of its new metal fabrication facility, but this will be offset by the negative impact of the foreign currency exchange rate of the US Dollar against the New Israeli Shekel as described below. In H1 2017, hedging generated income of $700,000 to offset the $1.0m loss at the operating level compared with the equivalent period of the previous year.
Operating profit increased by 51.0% to $2.8m (H1 2016: $1.9m) and profit before tax increased by 93.9% to $3.2m compared with $1.7m for the same period of the prior year. Fully diluted earnings per share were $0.098 compared with $0.049 in H1 2016.
Foreign currency exchange movements - primarily the US Dollar against the New Israeli Shekel - had a negative impact on the Company's reported operating profit, but this did not affect the reported profit before tax due to the net finance income, primarily as a result of hedging arrangements. However, the Company does not have the same level of hedging arrangements in place for the second half of 2017 and so anticipates foreign currency movements to have a negative impact of approximately $1.5m on full year reported profit on a constant currency basis compared with full year 2016.
Further to the announcement of 12 July 2017, the Company expects to incur exceptional legal and other costs related to the certification issue in France of approximately $0.4m for full year 2017. Based on currently available information, the Company does not anticipate there to be a material impact on the Company's results for the 2017 financial year in relation to this matter.
As at 30 June 2017, cash and cash equivalents were $15.7m (31 December 2016: $16.1m). Net debt at 30 June 2017 was $8.1m (31 December 2017: $8.8m), however the Company expects a slight increase by year-end due to the negative affect of the currency exchange and the need to support R&D and other investment associated with the strategic plan.
Strategic Plan
Following the appointment of Dori Ivzori as CEO in Q4 2016, Amiad has been conducting an internal review to assess the position of the Company and determine the strategy for growth going forward. That process is now concluded.
The strategic aim of the Company is to be a profitable, growing business generating at least $150m in annual revenue within the next five years - which the Company would expect to achieve both through organic growth as well as complementary acquisitions. To achieve this, the Company has three strategic areas of focus:
· Irrigation segment: Amiad will strengthen its position in this core segment through internal development and potentially by acquisition to ensure it has the right products and channels to market. The Company intends to launch new products targeting this market from 2018.
· North America: The Company will invest in all segments, including Irrigation, in the appropriate regions, and develop its offering to target new sectors within its segments. Amiad believes the North America region represents a substantial market opportunity for its products, and will offer a stronger and faster return on its investment than other geographies.
· Ballast water segment: Over the next six months, Amiad will focus on enhancing its offer to this market - which represents a significant opportunity - and gain the requisite certifications and partner approvals. If these targets have not been met within this time period, the Company will refocus these resources on other markets.
The Company will continue to be active in the non-Irrigation segments, but will concentrate on fewer sectors and territories within its segments to focus its efforts on areas where it can be most successful. However, Amiad will continue to service its customers in the traditional areas, including in markets that it does not expect to invest actively in growing.
In addition, Amiad will continue to focus on reorganising the business to improve the cost structure, efficiency, its customer support and engineering capability.
Outlook
During the first half of 2017, Amiad received a greater number of orders than during H1 2016 and entered the second half of 2017 with a higher value of backlog than at the same time of the prior year. With Amiad receiving increased customer interest as segments within many geographies experience a return to investment, the momentum of the first half has been sustained into the second half. While the Company expects to be negatively impacted in the second half from the weakness of the US Dollar against the New Israeli Shekel, with a reduced hedging offset, there is sufficient demand in the business to compensate for this and, consequently, Amiad anticipates reporting full year growth for 2017 in line with market expectations.
Looking further ahead, with the improvement in its core markets and with its new strategic plan in place, the Company is confident of achieving sustained growth and delivering shareholder value over the medium to long term.
AMIAD WATER SYSTEMS LTD.
CONDENSED CONSOLIDATED BALANCE SHEET
JUNE 30, 2017
June 30 | December 31, | ||
2017 | 2016 | 2016 | |
(Unaudited) | (Audited) | ||
U.S. dollars in thousands | |||
Assets | |||
CURRENT ASSETS: | |||
Cash and cash equivalents | 15,674 | 16,201 | 16,091 |
Financial assets at fair value through | |||
profit or loss | 452 | 220 | 85 |
Trade and other receivables: | |||
Trade | 37,909 | 37,839 | 33,939 |
Other | 5,145 | 4,167 | 4,331 |
Current income tax assets | 446 | 165 | 417 |
Inventories | 25,941 | 25,381 | 24,938 |
T o t a l Current Assets | 85,567 | 83,973 | 79,801 |
NON-CURRENT ASSETS: | |||
Investment in joint venture | 10 | 10 | 10 |
Severance pay fund, net | 396 | 93 | 361 |
Long-term receivables | 60 | 47 | 59 |
Property, plant and equipment | 11,065 | 10,354 | 10,783 |
Intangible assets | 14,034 | 15,226 | 14,532 |
Deferred income tax assets | 2,493 | 2,319 | 2,222 |
T o t a l Non Current Assets | 28,058 | 28,049 | 27,967 |
T o t a l Assets | 113,625 | 112,022 | 107,768 |
|
|
| ||
Eli Opper | Dori Ivzori | Irit Ben-Dov | ||
Chairman of the Board | CEO and Director | Chief Finance Officer |
Date of approval of the interim financial information by the Company's Board of Directors: September 5, 2017
AMIAD WATER SYSTEMS LTD.
CONDENSED CONSOLIDATED BALANCE SHEET
JUNE 30, 2017
June 30 | December 31, | ||
2017 | 2016 | 2016 | |
(Unaudited) | (Audited) | ||
U.S. dollars in thousands | |||
| Liabilities and equity | |||
CURRENT LIABILITIES: | |||
Bank credit and current maturities of | |||
borrowings from banks | 11,314 | 10,438 | 11,253 |
Financial liabilities at fair value through profit or | |||
loss - derivatives | 104 | 115 | 66 |
Trade and other payable: | |||
Trade | 16,138 | 15,191 | 13,854 |
Other | 12,856 | 10,602 | 10,278 |
Liability to the CEO of a subsidiary | -,- | 1,306 | -,- |
Current income tax liability | 675 | 772 | 816 |
T o t a l Current Liabilities | 41,087 | 38,424 | 36,267 |
NON-CURRENT LIABILITIES: | |||
Borrowings from banks | |||
(net of current maturities) | 12,432 | 16,207 | 13,596 |
Liability to the CEO of a subsidiary | -,- | 1,508 | -,- |
Deferred income tax liabilities | 6 | -,- | 6 |
Accrued severance pay, net | 409 | 380 | 369 |
T o t a l Non Current Liabilities | 12,847 | 18,095 | 13,971 |
T o t a l Liabilities | 53,934 | 56,519 | 50,238 |
EQUITY: | |||
Capital and reserves attributable to | |||
equity holders of the Company: | |||
Share capital | 2,798 | 2,798 | 2,798 |
Capital reserves | 28,531 | 28,483 | 28,520 |
Transaction with non-controlling interest | (259) | (180) | (259) |
Currency translation reverse | (5,539) | (4,224) | (6,288) |
Retained earnings | 31,358 | 28,465 | 29,857 |
56,889 | 55,342 | 54,628 | |
Non-controlling interests | 2,802 | 161 | 2,902 |
Total Equity | 59,691 | 55,503 | 57,530 |
Total Liabilities and Equity | 113,625 | 112,022 | 107,768 |
AMIAD WATER SYSTEMS LTD.
CONDENSED CONSOLIDATED INCOME STATEMENTFOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017
| Six months ended | Year ended |
| ||||||||
| June 30 | December 31, |
| ||||||||
| 2017 | 2016 | 2016 |
| |||||||
| (Unaudited) | (Audited) |
| ||||||||
| U.S dollars in thousandsexcept per share data |
| |||||||||
Revenue | 55,670 | 52,409 | 105,590 | ||||||||
Cost of sales | 33,627 | 31,876 | 64,077 | ||||||||
Gross Profit | 22,043 | 20,533 | 41,513 | ||||||||
Research and development, net | 1,795 | 1,680 | 3,402 | ||||||||
Selling and marketing costs | 12,698 | 12,237 | 24,423 | ||||||||
Administrative and general expenses | 4,791 | 4,794 | 9,953 | ||||||||
Other gains (losses) | 34 | 28 | (34) | ||||||||
Operating Profit | 2,793 | 1,850 | 3,701 | ||||||||
Finance income | 1,100 | 698 | 1,009 | ||||||||
Finance costs | (656) | (879) | (1,622) | ||||||||
Finance income (costs), net | 444 | (181) | (613) | ||||||||
Profit (loss) before income taxes | 3,237 | 1,669 | 3,088 | ||||||||
Income tax expense | 725 | 449 | 677 | ||||||||
Profit for the period | 2,512 | 1,220 | 2,411 | ||||||||
Other comprehensive income (loss)- | |||||||||||
Items that will not be reclassified to profit or loss: | |||||||||||
Re-measurements of post-employment benefit obligations | -,- | -,- | 260 | ||||||||
Items that may be subsequently reclassified to profit or loss: | |||||||||||
Currency translation differences | 769 | (81) | (2,147) | ||||||||
Other comprehensive income (loss) for the period | 769 | (81) | (1,887) | ||||||||
Total comprehensive income for the period | 3,281 | 1,139 | 524 | ||||||||
Profit attributable to: | |||||||||||
Equity holders of the Company | 2,226 | 1,210 | 2,342 | ||||||||
Non-controlling interests | 286 | 10 | 69 | ||||||||
2,512 | 1,220 | 2,411 | |||||||||
Total comprehensive income attributable to: | |||||||||||
Equity holders of the Company | 2,975 | 1,131 | 459 | ||||||||
Non-controlling interest | 306 | 8 | 65 | ||||||||
3,281 | 1,139 | 524 | |||||||||
|
| ||||||||||
| U.S dollars |
| |||||||||
| Earnings (loss) per share attributable to the equity |
| |||||||||
| holders of the company during the period: |
| |||||||||
| Basic | 0.098 | 0.053 | 0.103 |
| ||||||
| Diluted | 0.098 | 0.049 | 0.095 |
| ||||||
(Continued) - 1
AMIAD WATER SYSTEMS LTD.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITYFOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017
Attributable to owners of the parent | ||||||||||||||||
Currency | Transaction with | Non- | ||||||||||||||
Number of | Share | Capital | translation | Non-controlling | Retained | controlling | ||||||||||
shares | capital | Reserve | reserve | Interest | earning | Total | interest | Total equity | ||||||||
U.S dollars in thousands | ||||||||||||||||
BALANCE AT JANUARY 1, 2017 (audited) | 22,663,651 | 2,798 | 28,520 | (6,288) | (259) | 29,857 | 54,628 | 2,902 | 57,530 | |||||||
CHANGES DURING THE SIX MONTH ENDED | ||||||||||||||||
JUNE 30, 2017 (unaudited): | ||||||||||||||||
Comprehensive income - | ||||||||||||||||
Profit for the period | 2,226 | 2,226 | 286 | 2,512 | ||||||||||||
Currency translation differences | 749 |
| 749 | 20 | 769 | |||||||||||
Total comprehensive income | 749 | 2,226 | 2,975 | 306 | 3,281 | |||||||||||
Transaction with owners: | ||||||||||||||||
Recognition of compensation related employee stock and option grants | 11 | 11 | 11 | |||||||||||||
Dividend to a non-controlling interest | (406) | (406) | ||||||||||||||
Dividend ($0.032 per share) |
| (725) | (725) |
| (725) | |||||||||||
Total transactions with owners |
|
| 11 |
|
| (725) | (714) | (406) | (1,120) | |||||||
BALANCE AT JUNE 30, 2017 (unaudited) | 22,663,651 | 2,798 | 28,531 | (5,539) | (259) | 31,358 | 56,889 | 2,802 | 59,691 | |||||||
BALANCE AT JANUARY 1, 2016 (audited) | 22,663,651 | 2,798 | 28,437 | (4,145) |
(180) | 28,773 | 55,683 | 153 | 55,836 | |||||||
CHANGES DURING THE SIX MONTH ENDED | ||||||||||||||||
JUNE 30, 2016 (unaudited): | ||||||||||||||||
Comprehensive income - | ||||||||||||||||
Profit for the period | 1,210 | 1,210 | 10 | 1,220 | ||||||||||||
Currency translation differences | (79) |
| (79) | (2) | (81) | |||||||||||
Total comprehensive income | (79) | 1,210 | 1,131 | 8 | 1,139 | |||||||||||
Transaction with owners: | ||||||||||||||||
Recognition of compensation related employee stock and option grants | 46 | 46 | 46 | |||||||||||||
Dividend ($0.067 per share) |
| (1,518) | (1,518) | (1,518) | ||||||||||||
Total transactions with owners |
|
| 46 |
|
| (1,518) | (1,472) |
| (1,472) | |||||||
BALANCE AT JUNE 30, 2016 (unaudited) | 22,663,651 | 2,798 | 28,483 | (4,224) | (180) | 28,465 | 55,342 | 161 | 55,503 | |||||||
(Concluded) - 2
AMIAD WATER SYSTEMS LTD.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITYFOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017
| Attributable to owners of the parent | ||||||||||
| Transaction | ||||||||||
| Currency | with non- | Non- | ||||||||
| Number of | Share | Capital | translation | Controlling | Retained | controlling | ||||
| shares | capital | reserve | reserve | Interest | earning | Total | interest | Total equity | ||
|
| U.S dollars in thousands | |||||||||
Balance at 1 January 2016 | 22,663,651 | 2,798 | 28,437 | (4,145) | (180) | 28,773 | 55,683 | 153 | 55,836 | ||
Comprehensive income - | |||||||||||
Loss for the period | 2,342 | 2,342 | 69 | 2,411 | |||||||
Currency translation differences | (2,143) | (2,143) | (4) | (2,147) | |||||||
Remeasurement of net defined benefit liability |
| 260 | 260 |
| 260 | ||||||
Total comprehensive income | (2,143) | 2,602 | 459 | 65 | 524 | ||||||
Transaction with owners: | |||||||||||
Transaction with non-controlling interests | (79) | (79) | 2,684 | 2,605 | |||||||
Recognition of compensation related to | |||||||||||
employee stock and options grants | 83 | 83 | 83 | ||||||||
Dividend ($0.067 per share) |
|
|
|
|
| (1,518) | (1,518) |
| (1,518) | ||
Total transaction with owners |
|
| 83 |
| (79) | (1,518) | (1,514) | 2,684 | 1,170 | ||
Balance at 31 December 2016 | 22,663,651 | 2,798 | 28,520 | (6,288) | (259) | 29,857 | 54,628 | 2,902 | 57,530 | ||
AMIAD WATER SYSTEMS LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017
Six months ended | Year ended | ||||
June 30 | December 31, | ||||
2017 | 2016 | 2016 | |||
(Unaudited) | (Audited) | ||||
U.S dollars in thousands | |||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||
Cash generated from operations (see note 5) | 3,590 | 556 | 6,166 | ||
Interest paid | (365) | (374) | (764) | ||
Interest received | 102 | 24 | 124 | ||
Income tax received (paid) | (557) | 114 | (635) | ||
Net cash generated from operating activities | 2,770 | 320 | 4,891 | ||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||
Purchase of property, plant and equipment | (1,426) | (856) | (2,564) | ||
Purchase of intangible assets | (68) | (113) | (225) | ||
Investments grants received | 89 | 125 | 127 | ||
Restricted deposit | (144) | 392 | 465 | ||
Proceeds from sale of property, plant and equipment | 18 | 4 | 38 | ||
Net cash used in investing activities | (1,531) | (448) | (2,159) | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||
Receipt of long-term borrowings | 2,015 | 9,014 | 9,014 | ||
Dividends paid to equity holders of the Company | (725) | (1,518) | (1,518) | ||
Dividends paid to minority interests | (406) | -,- | -,- | ||
Payments of long term borrowings | (3,421) | (6,977) | (11,394) | ||
Increase (decrease) in bank credit and short term borrowing, net | 305 | (1,246) | 1,370 | ||
Net cash generated used in financing activities | (2,232) | (727) | (2,528) | ||
EXCHANGE RATE GAIN (LOSS) ON CASH AND CASH EQUIVALENTS | 576 | 38 | (1,131) | ||
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | (417) | (817) | (927) | ||
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 16,091 | 17,018 | 17,018 | ||
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 15,674 | 16,201 | 16,091 | ||
| |||||
CASH FLOWS FROM OPERTIONS:
APPENDIX A:
Six months ended | Year ended | |||
June 30 | December 31, | |||
2017 | 2016 | 2016 | ||
(Unaudited) | (Audited) | |||
U.S. dollars in thousands | ||||
Profit for the period | 2,512 | 1,220 | 2,411 |
|
(a) Adjustments to reconcile net income to net cash |
| |||
generated from operating activities: |
| |||
Depreciation and amortization | 1,658 | 1,694 | 3,431 |
|
Interest paid | 365 | 374 | 764 |
|
Interest received | (102) | (24) | (124) |
|
Income taxes paid (received), net | 557 | (114) | 635 |
|
Share based payment, net | 11 | 46 | 83 |
|
Distribution of profits to a CEO of a subsidiary | -,- | (114) | (371) |
|
Changes in liability to the CEO of a subsidiary | -,- | 53 | 151 |
|
Increase in deferred income taxes, net | (213) | (874) | (814) |
|
Accrued severance pay, net | (13) | 56 | 65 |
|
Exchange rate differences on borrowings | (183) | (102) | 91 |
|
Loss (profit) from sale of property, plant and equipment | (16) | 5 | 19 |
|
Increase in assets at fair value |
| |||
through profit or loss | (329) | (171) | (85) |
|
1,735 | 829 | 3,845 |
| |
Changes in working capital: |
| |||
Decrease (increase) in accounts receivable: |
| |||
Trade | (3,351) | (1,782) | 878 |
|
Other | (532) | 223 | (491) |
|
Decrease (increase) in long-term receivable | 2 | (3) | (18) |
|
Increase (Decrease) in accounts payable: |
| |||
Trade | 1,617 | (379) | (980) |
|
Other | 2,263 | 1,077 | 1,127 |
|
Increase in inventories | (656) | (629) | (606) |
|
(657) | (1,493) | (90) |
| |
Cash generated from operations | 3,590 | 556 | 6,166 |
|