PETACH-TIKVA, Israel, Nov 27, 2017 /PRNewswire/ — Eltek Ltd. (NASDAQ: ELTK), a global manufacturer and supplier of technologically advanced solutions in the field of printed circuit boards, announced today its financial results for the quarter ended September 30, 2016.
Mr. Yitzhak Nissan, Chairman of the Board and Chief Executive Officer, commented: “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. In addition, the unsatisfactory operating results resulted into a $1.3 million impact on our operating cash flows. As a result, in November 2017, the Company obtained an additional NIS 3.0 million ($850,000) line of credit that was guaranteed by Nistec, Eltek’s controlling shareholder.
We have recently made several changes in our manufacturing operations to address the difficulties encountered in the third quarter and the vast majority of the delayed orders were successfully supplied during October 2017. Based on these changes, we are better organized to supply higher sales in the fourth quarter, compared to the third quarter. Furthermore, the backlog of orders as of September 30, 2017 was higher than that at September 30, 2016.
In addition to the changes made to the manufacturing operations, we were able to reduce our operating costs compared to the third quarter of 2016.
During the third quarter, the Company received a $1.3 million order from one of our existing customers in the United States. Additionally, it should be noted that the governmental project, which we announced in July 2017, is progressing as scheduled.
Cash and cash equivalents as of September 30, 2017 were $1.0 million compared to $842,000 as of September 30, 2016. Taking into account the Company’s current cash position, management believes that the Company needs to generate quarterly revenues of at least $8.8 million in order to continue operations without external financing. Management believes that the revenue goals for the fourth quarter will be achieved.
The results to the third quarter and the first nine months of 2017 do not include the operations of Kubatronik Leiterplatten GmbH, which were included in Eltek’s results for the comparable periods in 2016. Therefore, we have provided selected financial information on a proforma basis, excluding Kubatronik’s results for 2016,” Mr. Nissan concluded.
Highlights of the Third Quarter of 2017
Revenues for the third quarter of 2017 were $7.7 million, compared