Electronics Line 3000 Ltd.
Electronics Line 3000 Ltd.: Interim report for the first three months of 2015
Electronics Line 3000 Ltd. / Release of an announcement according to Article 37x of the WpHG [the German Securities Trading Act] 28.05.2015 11:59 Interim report according to Article 37x of the WpHG, transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. --------------------------------------------------------------------------- Interim report for the first three months of 2015 - Revenues decreased to US$ 2.5 million (Q1 2014: US$ 3.5 million) - Gross profit margin decreased to 40% (Q1 2014: 42%) - Net profit increased to US$ 0.3 million (Q1 2014: US$ 0.2 million) - Net cash from operating activities reached US$ 0.2 million (Q1 2014: minus US$ 0.3 million) - Outlook for FY 2015 currently unchanged, although Q1 results were below management expectation - RISCO Ltd. proposed merger to Electronics Line 3000 Ltd. Rishon LeZion, Israel (May 28, 2015) - Electronics Line 3000 Ltd. (the 'Company' or 'Electronics Line') (XETRA: ELN), a global provider of wireless security with remote management solutions, today announces the results for the first three months of fiscal year 2015 ('Reporting Period'). Revenues declined to US$ 2.5 million in the Reporting Period, compared to revenues of US$ 3.5 million during Q1/2014, and the Company managed to decrease its operational expenses thus improving the operational and net profit. Financial Highlights - Amounting to US$ 2.5 million, a drop of 28% compared to revenues of US$ 3.5 million during Q1/2014, the Company's revenues in the Reporting Period were below management expectations. The decrease in revenues is mainly attributable to decrease in orders' volumes from the Company's strategic customers. - The gross profit for the Reporting Period amounted to US$ 1.0 million (gross profit margin: 40%) compared to US$ 1.5 million (gross profit margin: 42%) in Q1/2014. The slight margin decrease resulted from currency exchange effects. - The net profit amounted to US$ 0.3 million in the Reporting Period (Net margin of 10%), compared to US$ 0.2 million for Q1/2014 (Net margin of 5%). The increase in net profit mainly resulted from efficiency gains attributable to the new sales model, which enabled the Company to cut operational costs. - During the Reporting Period, net cash from operating activities was US$ 0.2 million compared to net cash flow of US$ 0.3 million used for operating activities during Q1/2014. - The Company's cash as of March 31, 2015 was US$ 0.4 million, compared to US$ 0.2 million on December 31, 2014. Positive cash flow was in line with Company's net profit. - The Company's total equity increased from US$ 4.4 million as of December 31, 2014 to US$ 4.7 million on March 31, 2015. Accordingly, the equity ratio improved from 63% to 81% in the Reporting Period. Outlook The results of the Reporting Period were below management expectations. Currently, the Company still expects a stabilization of revenues of $12.0 million. The territorial expansion of the distribution agreement with RISCO is expected to have a positive impact as it enables the Company to fully rely on the parent company's sales channels. The Company continues focusing on its two-way-wireless iConnect product line and its PIR camera detector with a built-in camera for video verification, in addition to the release of new complimentary products such as the two-way repeater for extending the detectors' range and the two-way vibration detector, all sustaining market expansions and increased sales. However, in view of the economic difficulties in many European markets and the continuing recession in southern Europe, the Company also realizes that there are risks for the development of sales in those countries. Electronics Line was approached by RISCO Ltd. ('RISCO'), its controlling shareholder, with a proposal to consider a merger between the Company and a fully owned subsidiary of RISCO (the 'Subsidiary'). The proposed merger contemplates the purchase by RISCO of all of the Company's issued and outstanding share capital held by the public for a cash consideration of 0.46 Euro per share, as a result of which the Subsidiary would be merged with and into the Company and the Company would become a wholly owned subsidiary of RISCO and its controlling shareholders. On May 21st, the Audit Committee of the Company and the Board of Directors of the Company approved the proposed terms of the merger and resolved to submit the merger agreement to the shareholders general meeting for voting. The Company will summon a general meeting of shareholders in the coming weeks. At this stage, there is no assurance that the proposed merger will be approved and finalized. For more information please contact: Ms. Sari Ellenberg investor.relations@electronics-line.com About Electronics Line (EL): EL is a pioneer in next-generation security solutions for the residential and small commercial markets. The Company designs and produces cutting-edge solutions for security and control of living and working environments. The EL line provides comprehensive security protection, as well as sophisticated system and home management functionality, for optimal comfort, safety and peace of mind. This new industry standard is further upgraded with enhanced remote management capabilities that give homeowners instant access to their system from anywhere in the world. Upgrading Everyday Security EL solutions enable new levels of control and maintenance in protected sites through the ELAS, a proprietary remote management server. The Company enjoys a unique market position in supplying ELAS-governed systems for the home and workplace, which provide the multiple benefits of a virtual security presence, convenient home automation, and energy efficiency, all customized by the end-user and/or the service provider. EL's wireless solutions offer enhanced detection and PSTN/IP/GSM/GPRS-based event reporting, along with advanced remote management tools. The back-office support and customized branding of EL solutions provide superior security with significant business benefits and market expansion potential. Global Partnerships Nearly three decades of cutting-edge leadership have earned EL a solid market position, allowing users worldwide to benefit from EL's ongoing development of upgraded security solutions. The Company maintains long-term partnerships worldwide. EL has made emerging technology, user-friendly design and exceptional quality the benchmarks for serving its international network of clients and partners. Drawing on a tradition of pioneering expertise, EL specialists also provide security integration consultancy, installation service, training and technological support. EL was established in 1982 and is headquartered in Israel. The Company is publicly traded on the Frankfurt Stock Exchange (ELN) and is part of the RISCO Group, an established leader in the international security market. Disclaimer: This release contains forward-looking statements, which express the current beliefs and expectations of management. Such statements involve a number of known and unknown risks and uncertainties that could cause the Company's future results, performance or achievements to differ significantly from those expressed or implied by such 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 and its other filings and releases. Forward-looking statements speak only as of the date on which they are made and the Company undertakes no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. 28.05.2015 The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------------- Language: English Company: Electronics Line 3000 Ltd. 14 Hachoma St. 75655 Rishon LeZion Israel Internet: www.electronics-line.com End of Announcement DGAP News-Service ---------------------------------------------------------------------------
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