HAIFA, Israel, Nov. 11, 2015 /PRNewswire/ -- Elbit Systems Ltd. (the "Company") (NASDAQ and TASE: ESLT), the international high technology company, reported today its consolidated results for the quarter ended September 30, 2015.

In this release, the Company is providing US-GAAP results as well as additional non-GAAP financial data, which are intended to provide investors a more comprehensive understanding and material insight of the Company's business results and trends. The third quarter results include for the first time the impact of the Company's acquisition of the cyber and intelligence business from Nice. The financial results of such acquisition place emphasis on certain non-GAAP measures, and the Company has adopted in this release the commonly used format of presenting non-GAAP measures before the applicable GAAP measures. Unless otherwise stated, all financial data presented is GAAP financial data. For non-GAAP financial measures and reconciliation see pages 3 and 4 below.

Management Comment:

Bezhalel (Butzi) Machlis, President and CEO of Elbit Systems, commented: "We are pleased with our third quarter results, in particular our close to 6% growth in revenues, as well as our long-term trend of improving profitability, demonstrating that our business remains on solid footing. Our growth was driven in part by our ongoing increase in backlog, which has continued over the past three years, and by the acquisition of the cyber and intelligence business from Nice. The improvements in profitability were supported by our focus on efficient operations, leveraging synergies between our various divisions, as well as a favorable exchange rate environment.

Our results in the third quarter reflect a strong performance in Asia-Pacific, driven by increased defense spending in this region over the past few years. We are also witnessing a growing renewal of interest for our technologies and operational solutions in Europe, which creates the potential for future growth in this important market."

Third quarter 2015 results:

Revenues in the third quarter of 2015 were $764.8 million, as compared to $722.7 million in the third quarter of 2014, a growth of 5.8% mainly due to growth in revenues of land systems to Asia-Pacific. This growth was partially offset by a decrease in our C4ISR systems sold to Latin America customers.

Non-GAAP gross profit amounted to $233.5 million (30.5% of revenues) in the third quarter of 2015, as compared to $208.4 million (28.8% of revenues) in the third quarter of 2014. GAAP gross profit in the third quarter of 2015 was $223.3 million (29.2% of revenues), as compared to $203.0 million (28.1% of revenues) in the third quarter of 2014. The increase in the gross profit rate was mainly due to the mix of programs sold in the quarter and operational improvements.

Research and development expenses, net were $61.0 million (8.0% of revenues) in the third quarter of 2015, as compared to $55.8 million (7.7% of revenues) in the third quarter of 2014.

Marketing and selling expenses, net were $60.6 million (7.9% of revenues) in the third quarter of 2015, as compared to $51.8 million (7.2% of revenues) in the third quarter of 2014.

General and administrative expenses, net were $36.4 million (4.8% of revenues) in the third quarter of 2015, as compared to $35.3 million (4.9% of revenues) in the third quarter of 2014.

Non-GAAP  operating income was $80.3 million (10.5% of revenues) in the third quarter of 2015, as compared to $70.8 million (9.8% of revenues) in the third quarter of 2014. GAAP operating income in the third quarter of 2015 was $65.3 million (8.5% of revenues), as compared to $60.1 million (8.3% of revenues) in the third quarter of 2014.

Financial expenses, net were $6.1 million in the third quarter of 2015, as compared to $23.4 million in the third quarter of 2014. The relatively high finance expenses in the third quarter of 2014 resulted primarily from the accelerated depreciation of the New Israeli Shekel related to the Company's U.S. Dollar derivative activities as well as the impact of exchange rate differences on balance sheet items.

Taxes on income were $10.3 million (effective tax rate of 17.3%) in the third quarter of 2015, as compared to $0.1 million in the third quarter of 2014.  The lower tax rate in the third quarter of 2014 was mainly as a result of settlement of tax audits, including adjustments for prior years, in some of the Company's subsidiaries in Israel and the mix of the tax rates in the various jurisdictions in which the Company's entities generate taxable income.

Equity in net earnings of affiliated companies and partnerships was $1.7 million in the third quarter of 2015, as compared to of $1.0 million in the third quarter of 2014.

Net income attributable to non-controlling interests was $1.0 million in the third quarter of 2015, as compared to $2.9 million in the third quarter of 2014.

Non-GAAP net income attributable to the Company's shareholders in the third quarter of 2015 was $62.3 million (8.1% of revenues), as compared to $43.9 million (6.1% of revenues) in the third quarter of 2014. GAAP net income attributable to the Company's shareholders in the third quarter of 2015 was $49.7 million (6.5% of revenues), as compared to $35.0 million (4.8% of revenues) in the third quarter of 2014.

Non-GAAP diluted net earnings per share ("EPS") attributable to the Company'sshareholders were $1.46 for the third quarter of 2015, as compared with $1.03 for the third quarter of 2014. GAAP diluted EPS attributable to the Company's shareholders in the third quarter of 2015 were $1.16, as compared to $0.82 for the third quarter of 2014.

The Company's backlog of orders as of September 30, 2015, totaled $6.4 billion as compared to $6.2 billion as of September 30, 2014. Approximately 68% of the current backlog is attributable to orders from outside Israel. Approximately 48% of the current backlog is scheduled to be performed during the last quarter of 2015 and during 2016.

Cash flow from operating activities for the nine months ended September 30, 2015, was $255.7 million, as compared to $0.2 million used for operating activities in the nine months ended September 30, 2014.

Non-GAAP financial data:

The following non-GAAP financial data is presented to enable investors to have additional information on the Company's business performance as well as a further basis for periodical comparisons and trends relating to the Company's financial results. The Company believes such data provides useful information to investors by facilitating more meaningful comparisons of the Company's financial results over time. Such non-GAAP information is used by the Company's management to make strategic decisions, forecast future results and evaluate the Company's current performance. However, investors are cautioned that, unlike financial measures prepared in accordance with GAAP, non-GAAP measures may not be comparable with the calculation of similar measures for other companies.

The non-GAAP financial data includes adjustments regarding non-GAAP gross profit, non-GAAP operating income, non-GAAP net income and non-GAAP diluted EPS. In preparing these non-GAAP measures, the Company factors out certain items that have a non-recurring impact on the income statements, various non-cash items, significant effects of retroactive tax legislation and changes in accounting guidance and other items, which in management's judgment, are items that are considered to be outside of the review of core operating results. The table below presents a reconciliation between these non-GAAP financial measures and the most directly comparable GAAP measures.

These non-GAAP measures are not based on any comprehensive set of accounting rules or principles. The Company believes that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with the Company's results of operations, as determined in accordance with GAAP, and that these measures should only be used to evaluate the Company's results of operations in conjunction with the corresponding GAAP measures.  Investors should consider non-GAAP financial measures in addition to, and not as replacements for or superior to, measures of financial performance prepared in accordance with GAAP.

Investors are encouraged to review the Company financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure.

Reconciliation of GAAP to Non-GAAP (Unaudited) Supplemental Financial Data:

(US Dollars in millions)

* GAAP diluted net EPS is presented below in the Consolidated Statements of Income table on page 9.

Recent Events:

On July 1, 2015, the Company announced, further to its announcement of May 21, 2015 that it completed the acquisition of the Nice's Cyber and Intelligence business. The results of the acquired activities were included in the Company's 2015 third quarter consolidated results.

On August 16, 2015, the Company announced that it was awarded an approximately $27 million contract for the supply of command and control systems and ATMOS long-range artillery systems to an Asia-Pacific country. This contract is a follow-on contract for this customer and will be performed over a three-year period.

On August 27, 2015, the Company announced that it was awarded an Israeli Ministry of Public Security and the Israeli Police contract, valued at approximately $115 million, to supply leasing and maintenance services for the Israeli Police Force's aircraft. The contract, awarded following a public tender, will be performed over a twenty-year period, and will include acquiring six new helicopters, adapting them to meet the Police requirements and performing routine maintenance.

On August 30, 2015, the Company announced that its wholly-owned subsidiary, CYBERBIT Ltd. ("CYBERBIT"), was recently awarded two contracts. One of the contracts was awarded by the National Police of a European country, and the second contract was awarded by a law enforcement agency of an African country. Each of the contracts, which are in a total amount that is not material to Elbit Systems, will be performed over a two-year period.

On September 6, 2015, the Company announced that it was awarded a contract from a European country to supply an Unmanned Aircraft System (UAS)-based cutting-edge intelligence solution. Valued at approximately $78 million, the contract will be performed over a two-year period by Elbit Systems' ISTAR Division, established several months ago, as a result of combining Elbit Systems' Electro-optics -Elop and UAS Divisions.

On September 25, 2015, the Company announced that it was awarded a contract from a customer in the Latin American region, in an amount of approximately $70 million, for the supply of intelligence integrated systems, for homeland security applications.

Dividend:

The Board of Directors declared a dividend of $0.37 per share for the third quarter of 2015. The dividend's record date is November 22, 2015. The dividend will be paid from income generated as Preferred Income, net of taxes and levies, at the rate of 20%, on December 7, 2015. 

Conference Call:

The Company will be hosting a conference call today, Monday, November 11, 2015 at 9:00 a.m. Eastern Time. On the call, management will review and discuss the results and will be available to answer questions.

To participate, please call one of the teleconferencing numbers that follow. If you are unable to connect using the toll-free numbers, please try the international dial-in number.

US Dial-in Numbers: 1 888 281 1167

UK Dial-in Number: 0 800 917 9141

ISRAEL Dial-in Number: 03 918 0644

INTERNATIONAL Dial-in Number:  +972 3 918 0644

at: 9:00 am Eastern Time; 6:00 am Pacific Time; 2:00 pm UK Time; 4:00 pm Israel Time

This call will also be broadcast live on Elbit Systems' web-site at http://www.elbitsystems.com. An online replay will be available from 24 hours after the call ends.

Alternatively, for two days following the call, investors will be able to dial a replay number to listen to the call. The dial-in numbers are:

1 888 326 9310 (US) or +972 3 925 5900 (Israel and International).

About Elbit Systems

Elbit Systems Ltd. is an international high technology company engaged in a wide range of defense, homeland security and commercial programs throughout the world. The Company, which includes Elbit Systems and its subsidiaries, operates in the areas of aerospace, land and naval systems, command, control, communications, computers, intelligence surveillance and reconnaissance ("C4ISR"), unmanned aircraft systems, advanced electro-optics, electro-optic space systems, EW suites, signal intelligence systems, data links and communications systems, radios and cyber-based systems. The Company also focuses on the upgrading of existing platforms, developing new technologies for defense, homeland security and commercial applications and providing a range of support services, including training and simulation systems. For additional information, visit: www.elbitsystems.com.

Attachments:

Consolidated balance sheets

Consolidated statements of income

Consolidated statements of cash flow

Consolidated revenue distribution by areas of operation and by geographical regions

This press release contains forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1943, as amended) regarding Elbit Systems Ltd. and/or its subsidiaries (collectively the Company), to the extent such statements do not relate to historical or current fact. Forward-looking statements are based on management's expectations, estimates, projections and assumptions. Forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. These statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Therefore, actual future results, performance and trends may differ materially from these forward-looking statements due to a variety of factors, including, without limitation: scope and length of customer contracts; governmental regulations and approvals; changes in governmental budgeting priorities; general market, political and economic conditions in the countries in which the Company operates or sells, including Israel and the United States among others; differences in anticipated and actual program performance, including the ability to perform under long-term fixed-price contracts; and the outcome of legal and/or regulatory proceedings. The factors listed above are not all-inclusive, and further information is contained in Elbit Systems Ltd.'s latest annual report on Form 20-F, which is on file with the U.S. Securities and Exchange Commission. All forward-looking statements speak only as of the date of this release. The Company does not undertake to update its forward-looking statements.

Elbit Systems Ltd., its logo, brand, product, service and process names appearing in this Press Release are the trademarks or service marks of Elbit Systems Ltd. or its affiliated companies.  All other brand, product, service and process names appearing are the trademarks of their respective holders.  Reference to or use of a product, service or process other than those of Elbit Systems Ltd. does not imply recommendation, approval, affiliation or sponsorship of that product, service or process by Elbit Systems Ltd. Nothing contained herein shall be construed as conferring by implication, estoppel or otherwise any license or right under any patent, copyright, trademark or other intellectual property right of Elbit Systems Ltd. or any third party, except as expressly granted herein.

(FINANCIAL TABLES TO FOLLOW)

ELBIT SYSTEMS LTD.

CONSOLIDATED BALANCE SHEETS

(In thousands of US Dollars)

ELBIT SYSTEMS LTD.

CONSOLIDATED STATEMENTS OF INCOME

(In thousands of US Dollars, except for share and per share amount)

ELBIT SYSTEMS LTD.

CONSOLIDATED STATEMENTS OF CASH FLOW

(In thousands of US Dollars)

ELBIT SYSTEMS LTD.

DISTRIBUTION OF REVENUES

Consolidated Revenues by Areas of Operation:

Consolidated Revenues by Geographical Regions:

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/elbit-systems-reports-third-quarter-2015-results-300176679.html

SOURCE Elbit Systems Ltd