PETACH-TIKVA, ISRAEL – Eltek reported first quarter revenues were $7.2 million, down 21.7% year-over-year.

Net profit was $223,000, a decrease of 58.8% compared to the first quarter of 2020. Operating profit was $136,000, a drop of 77.8%. EBITDA was $577,000, 8% of revenues, compared to EBITDA of $1 million, 11% of revenues, in the prior-year period.

"Despite the global challenges we encountered related to both the Covid-19 pandemic and the shortage of key raw materials, we were able to respond quickly, maintain operational efficiency and remain profitable in the first quarter," said CEO Eli Yaffe. "We expect revenues will rebound during the rest of the year, and lost sales will be recovered upon the expected availability of key raw material (Pyralux AP), which was in short supply, and with the authorization of the use of alternative raw materials by our customers. The approval process with our customers for the use of the alternative raw materials is proceeding as planned and is reducing our production costs. In addition, we are exploring ways to strengthen our position in the multibillion dollar PCB market in North America, and can serve as a rapid growth engine for Eltek.

"We are operating in a challenging business environment and making the necessary adjustments to increase revenues, expand our operating efficiencies, improve customer satisfaction and maintain sustained profitability. We plan to strengthen our sales activities and continue our investments in new equipment to expand our manufacturing facilities and infrastructure during the remainder of the year as part of our strategic growth plan. Our board of directors approved our obtaining a loan of NIS 10 million (approximately $3.1 million) from Bank Leumi B.M. The loan has a term of 10 years, with favorable terms, including a repayment schedule that starts after a 12-month grace period and carried interest of Prime +1.5%, which is waived for the first year of the loan."

Net cash provided by operating activities during the first quarter amounted to $2.5 million, compared to net cash provided by operating activities of $1.5 million in the first quarter of 2020. Cash and cash equivalents as of Mar. 31 were $6.4 million, compared to $4.7 million as of Dec. 31.

• Prev
• Next