PETACH-TIKVA, ISRAEL -- Eltek reported third-quarter quarter revenues fell 17% year-over-year to $7.7 million due to equipment failures that slowed deliveries.
Excluding revenue from the company's Kubatronik venture, sales were down 8.3%.
The gross loss was $32,000, down from a gross profit of $880,000 a year ago. Excluding a $348,000 one-time amortization of a software system, gross profit was $316.000. The operating loss was $1.2 million, compared to an operating loss of $338,000 in the third quarter 2016 ($193,000 excluding Kubatronik). The net loss widened to $1.2 million from a loss of $446,000 last year, ($317,000 excluding Kubatronik.
EBITDA was -$422,000, compared to $164,000 in the third quarter 2016 ($239,000 excluding Kubatronik).
Net cash used in operating activities was $1.3 million, compared to net cash from operations of $643,000 last year.
"The third quarter was very challenging for our company due to several significant equipment failures, which impacted our ability to supply our customers' orders and affected our on-time delivery performance," said Yitzhak Nissan, chairman and chief executive. "In addition, the unsatisfactory operating results resulted into a $1.3 million impact on our operating cash flows. As a result, in November, the company obtained an additional $850,000 line of credit that was guaranteed by Nistec, Eltek's controlling shareholder."
In response to the production issues, the PCB manufacturer has made several changes to its manufacturing operations and the vast majority of the delayed orders were delivered in October. Order backlog as of Sept. 30 is up versus 2016, and operating costs are lower.