SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
F O R M 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR
15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of March 2005
ELTEK LTD.
(Name of Registrant)
Sgoola Industrial Zone, Petach Tikva, Israel
(Address of Principal Executive Office)
Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F.
Form 20-F [X] Form 40-F [_]
Indicate by check mark if the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101(b)(1):
Indicate by check mark if the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101(b)(7):__
Indicate by check mark whether by furnishing the information contained in
this Form, the registrant is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes [_] No [X]
If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b): 82-______________
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
ELTEK LTD.
(Registrant)
By: /s/ Arieh Reichart
------------------
Arieh Reichart
President and Chief Executive Officer
Date: March 22, 2005
ELTEK LTD.
Amnon Shemer, CFO
+972-3-9395023
amnons@eltek.co.il
ELTEK RETURNS TO PROFITABILITY IN THE FOURTH QUARTER ON CONTINUED REVENUE GROWTH
FOURTH QUARTER 2004 NET INCOME OF $446,000 VS. NET LOSS OF $850,000 IN FOURTH
QUARTER 2003. QUARTERLY REVENUES RISE 27% YEAR OVER YEAR AND 8% SEQUENTIALLY TO
$8.1 MILLION
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PETACH-TIKVA, Israel, March 21, 2005-Eltek Ltd. (NASDAQ: ELTK), the leading
Israeli manufacturer of advanced circuitry solutions, today announced financial
results for the fourth quarter and fiscal year ended December 31, 2004.
FOURTH QUARTER 2004 FINANCIAL HIGHLIGHTS:
* Transition to profitability: quarterly net income of, $446,000 or $ 0.11
per NIS 1 par value of shares
* Increased revenue, both sequentially and year - over - year
* Second consecutive quarter of revenues growth
* Continued gross margin expansion
* Further reduction in bank debt
* Increased sales of flex - rigid printed circuits boards pursuant to long -
term projects
Eltek reported revenues for the three months ended December 31, 2004 of NIS 35
million ($8.1 million) compared with NIS 27.6 million ($6.4 million) during the
fourth quarter of 2003.
Net income for the fourth quarter totaled NIS 1.9 million ($446,000), or NIS
0.47 per NIS 1 par value of shares ($0.11) compared with a net loss of NIS 3.7
million ($850,000), or NIS (0.84) per NIS 1 par value of shares ($0.19) for the
same quarter in 2003. Net income for the fourth quarter, includes income of NIS
542 thousand ($126,000) attributable to the Company's portion of a recoverable
tax asset, which arose from the loss incurred by Kubatronik.
Revenues for the year ended December 31, 2004, were NIS 125 million ($29.0
million) compared with revenues of NIS 108.3 million ($25.1 million) in 2003.
Net loss for the year ended December 31, 2004 was NIS 5.9 million ($1.4
million), or NIS (1.36) per NIS 1 par value of shares ($ 0.32) compared with a
net loss of NIS 13.0 million ($3.0 million) or NIS (3.61) per NIS 1 par value of
shares ($ 0.84) in 2003.
"The results for the fourth quarter of 2004 signify an important achievement for
Eltek," said Arieh Reichart, President and Chief Executive Officer of Eltek. "
First, we reached profitability, and second, this is a second consecutive
quarter with top and bottom line improvements. We have displayed substantial
operating leverage, expanded our gross and operating margins, and further
diversified our customer base." Mr. Reichart continued, "We credit our
profitability and continued revenue growth to a relentless focus on executing
our strategy of shifting the Company's product mix towards higher margin
flex-rigid boards which require high end technology along with increasing our
international operations."
Mr. Reichart concluded, "We enter 2005 as a profitable company. We have built an
encouraging foundation for our next phase of growth and profitability, and
intend to continue to leverage on our leading position in the flex-rigid boards
industry. "
Amnon Shemer, CFO of Eltek commented, "We can now see that our efforts in
implementing the Company's strategy of focusing on this lucrative niche of
flex-rigid boards have finally paid off. This quarter is the first quarter after
a long difficult period that has generated net income. "
"Our 2004 growth benefited from the increase in contribution of flex - rigid
printed circuits boards pursuant to long - term projects. International sourced
revenues in 2004 accounted for 46% of our revenue, compared to 33% in 2003.
Purchase orders pursuant to long term projects tend to be supplied on a weekly
basis over some period of time, contributing to our production efficiency as
well as to our overall corporate productivity. The Company's improved operating
results allowed it to reduce its bank debt by repaying $ 1.6 million of debt
during 2004," he added.
About the Company
Eltek is Israel's leading manufacturers of printed circuit boards, the core
circuitry of most electronic devices. It specializes in the complex
high-end of PCB manufacturing, i.e., HDI, multi-layered and flex-rigid
boards. Eltek's technologically advanced circuitry solutions are used in
today's increasingly sophisticated and compact electronic products. The
Company has invested heavily in upgrading its production facilities over
the past five years.
For more information, visit Eltek's World Wide Web site at
www.eltekglobal.com
Certain matters discussed in this news release are forward-looking
statements that involve a number of risks and uncertainties including, but
not limited to statements regarding expected results in future quarters,
risks in product and technology development and rapid technological change,
product demand, the impact of competitive products and pricing, market
acceptance, the sales cycle, changing economic conditions and other risk
factors detailed in the Company's filings with the United States Securities
and Exchange Commission.
ELTEK LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
CONVENIENCE CONVENIENCE
TRANSLATION TRANSLATION
-------- --------
YEAR ENDED THREE MONTHS ENDED
DECEMBER 31, DECEMBER 31,
-------------------------------- --------------------------------
2003 2004 2004 2003 2004 2004
NIS NIS U.S. $ NIS NIS U.S. $
(UNAUDITED) (UNAUDITED) (UNAUDITED) (UNAUDITED) (UNAUDITED) (UNAUDITED)
-------- -------- -------- -------- -------- --------
**ADJUSTED *REPORTED **ADJUSTED *REPORTED
AMOUNTS AMOUNTS AMOUNTS AMOUNTS
-------- -------- -------- -------- -------- --------
Revenues 108,303 125,002 29,015 27,646 35,017 8,127
Costs of revenues (102,643) (109,998) (25,533) (26,318) (28,238) (6,554)
-------- -------- -------- -------- -------- --------
Gross profit 5,660 15,004 3,482 1,328 6,779 1,573
Research and development, net 18 - - - - -
Selling, general and administrative
expenses (14,996) (18,265) (4,240) (3,575) (5,046) (1,171)
Amortization of goodwill (584) (593) (138) (177) (152) (35)
-------- -------- -------- -------- -------- --------
Operating income (loss) (9,902) (3,854) (896) (2,424) 1,581 367
Financial expenses, net (2,989) (2,948) (684) (1,115) (458) (106)
-------- -------- -------- -------- -------- --------
Income (loss) before other income
(expenses), net (12,891) (6,802) (1,580) (3,539) 1,123 261
Other income (expenses), net (20) 52 12 (183) 13 3
-------- -------- -------- -------- -------- --------
Income (loss) before taxes on income (12,911) (6,750) (1,568) (3,722) 1,136 264
Taxes on income (194) 713 166 (93) 713 166
-------- -------- -------- -------- -------- --------
Net income (loss) after taxes on income (13,105) (6,037) (1,402) (3,815) 1,849 430
Minority share in subsidiary's net results 118 182 42 155 70 16
-------- -------- -------- -------- -------- --------
Net income (loss) for the period (12,987) (5,855) (1,360) (3,660) 1,919 446
======== ======== ======== ======== ======== ========
Basic and diluted loss per NIS 1 par
value of the share capital*** (3.61) (1.36) (0.32) (0.84) 0.47 0.11
======== ======== ======== ======== ======== ========
Total par value of shares used to
compute basic and diluted net loss per
NIS 1 par value of share 3,569 4,131 4,131 4,281 4,131 4,131
======== ======== ======== ======== ======== ========
* With respect to discontinuance of adjustment for the effect of inflation as
from CPI of December 2003.
** Amounts adjusted to the effect of inflation in terms of NIS of December
2003.
*** Ordinary shares of a par value of NIS 0.6 each.
ELTEK LTD.
CONSOLIDATED CONDENSED BALANCE SHEETS
(In thousands)
CONVENIENCE
TRANSLATION
-------
DECEMBER 31, DECEMBER 31,
----------------------- -------
2003 2004 2004
UNAUDITED UNAUDITED UNAUDITED
NIS NIS U.S. $
------- ------- -------
ADJUSTED REPORTED
AMOUNTS** AMOUNTS*
------- ------- -------
ASSETS
CURRENT ASSETS
Cash and cash equivalents 4,371 4,274 992
Receivables: Trade 19,787 23,835 5,533
Other 2,262 1,158 269
Inventories 13,158 13,633 3,164
Prepaid expenses 693 563 131
------- ------- -------
Total current assets 40,271 43,463 10,089
------- ------- -------
Deferred Taxes 753 175
------- ------- -------
Property and equipment, net 43,381 31,569 7,328
------- ------- -------
Goodwill 4,972 4,656 1,081
------- ------- -------
TOTAL ASSETS 88,624 80,441 18,673
======= ======= =======
LIABILITIES AND SHAREHOLDER'S EQUITY
CURRENT LIABILITIES
Short-term credit and current maturities of long-term
debts 19,461 19,589 4,547
Trade payables 22,314 23,577 5,473
Other liabilities and accrued expenses 8,555 11,083 2,572
------- ------- -------
Total current liabilities 50,330 54,249 12,592
------- ------- -------
LONG- TERM LIABILITIES
Long term debt, excluding current maturities 13,692 6,687 1,552
Employee severance benefits, net 940 1,048 243
------- ------- -------
Total long-term liabilities 14,632 7,735 1,795
------- ------- -------
MINORITY INTERESTS 1,970 1,900 441
------- ------- -------
CONVERTIBLE NOTE 2,295 1,566 364
------- ------- -------
SHAREHOLDER'S EQUITY
Ordinary shares, NIS 0.6 par value. Authorized
50,000,000 shares, issued and outstanding 5,491,711
shares as of December 31, 2004 (4,885,651 shares as
of December 31, 2003) 29,334 29,698 6,894
Additional paid in capital 51,985 52,500 12,187
Capital reserves related to loans from controlling
shareholders 10,010 10,010 2,324
Cumulative foreign currency translation adjustments 2,004 2,574 597
Capital reserve 6,685 6,685 1,552
Accumulated deficit (80,621) (86,476) (20,073)
------- ------- -------
Total shareholder's equity 19,397 14,991 3,481
------- ------- -------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 88,624 80,441 18,673
======= ======= =======
* With respect to discontinuance of adjustment for the effect of inflation as
from CPI of December 2003.
** Amounts adjusted to the effect of inflation in terms of NIS of December
2003.