6-K 1 zk1719995.htm 6-K

 
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 May 2017

TAT TECHNOLOGIES LTD.
(Name of Registrant)
 
      P.O.BOX 80, Gedera 70750 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 ☒ 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 ☒

If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- ____________
 
 
TAT Technologies Ltd.

6-K Items

1.
Press Release dated May 17, 2017 re TAT Technologies Ltd. Reports First Quarter 2017 Results and Declares a Cash Dividend of $3 Million.

1
 
ITEM 1

Press Release
Source: TAT Technologies Limited

TAT Technologies Reports First Quarter 2017 Results and Declares a $3 Million Cash Dividend

GEDERA, Israel, May 17, 2017 - TAT Technologies Ltd. (NASDAQ: TATT - News) (“TAT” or the “Company”), a leading provider of products and services to the commercial and military aerospace and ground defense industries, reported today its unaudited results for the three month period ended March 31, 2017. The Company also declared a cash dividend of $3 million payable on June 21, 2017 to shareholders of record on June 7, 2017.

Financial highlights for the first quarter of 2017 (unaudited):
 
 
Total Revenue: $27.1 million compared to $23.6 million in the first quarter of 2016, growth of 14.8% in revenues compared to the first quarter of 2016.
 
 
Adjusted EBITDA: $2.9 million compared to adjusted EBITDA of $1.1 million in the first quarter of 2016.
 
 
Net income: $1.2 million compared to $0.04 million in the first quarter of 2016.
 
 
Net income (Non-GAAP): $1.3 million compared to $0.1 million in the first quarter of 2016.
 
 
Earnings per share basic and diluted: $0.14 per share compared to $0.01 per share in the first quarter of 2016.
 
 
Earnings per share basic and diluted (Non-GAAP): $0.14 per share compared to $0.01 in the first quarter of 2016.
 
 
Net cash provided by (used in) operating activities: $3.1 million compared to $ (0.2) million in the first quarter of 2016.
 
Long-Term Projects: Following a periodic assessment of its long-term projects, the Company updated its estimates of profits expected to be earned from certain long-term contract. This assessment resulted in a decrease in revenues for the first quarter of 2017 in an amount of $0.5 million and a decrease of $0.4 million in net income.

Declaration of dividend: The Board of Directors approved a distribution of cash dividend in the total amount of $3 million (approximately NIS 10.8 million), or $0.33981 per share (approximately NIS 1.22672 per share), for all of the shareholders of TAT Technologies. The dividend will be paid to shareholders of record on June 7, 2017. TAT Technologies will pay the dividend on June 21, 2017.
 
2
 
Mr. Igal Zamir, TAT’s CEO and President commented on the results: “We had a strong first quarter with sales growing 14.8% compared to the first quarter of 2016, mainly due to strong results in our heat exchangers, landing gear and jet engine blades businesses. In addition, our efficiency and cost reduction measures continue to bear fruit. We are also working to improve cash flow and during the quarter our cash and short term bank deposits have increased by $2.4 million. All this enabled us to declare a $3 million dividend and return value to our shareholders.”
 
Non-GAAP Financial Measures

To supplement the consolidated financial statements presented in accordance with GAAP, the Company also presents a Non-GAAP presentation of Net Income and Adjusted EBITDA.  The adjustments to the Company’s GAAP results are made with the intent of providing both management and investors a more complete understanding of the Company’s underlying operational results, trends and performance.  Non-GAAP Net Income excludes changes, income or losses, as applicable, related to one or more of the following: (1) share-based compensation expenses and/or (2) certain tax impact and/or (3) acquisition related expenses and/or (4) share in results of equity investment of affiliated companies. Adjusted EBITDA is calculated as net income before the Company's share in results and sale of equity investment of affiliated companies, share-based compensation, taxes on income, financial (expenses) income, net, and depreciation and amortization.  Non-GAAP Net Income and Adjusted EBITDA, however, should not be considered as alternatives to net income and operating income for the period and may not be indicative of the historic operating results of the Company; nor they are meant to be predictive of potential future results.  Non-GAAP Net Income and Adjusted EBITDA are not measures of financial performance under generally accepted accounting principles and may not be comparable to other similarly titled measures for other companies. See reconciliation of GAAP Net Income to Non-GAAP Net Income and Adjusted EBITDA in pages 9 and 13 below.

About TAT Technologies LTD
 
TAT Technologies Ltd. is a leading provider of services and products to the commercial and military aerospace and ground defense industries. TAT operates under four segments: (i) Original equipment manufacturing (“OEM”) of heat transfer solutions and aviation accessories through its Gedera facility; (ii) MRO services for heat transfer components and OEM of heat transfer solutions through its Limco subsidiary; (iii) MRO services for aviation components through its Piedmont subsidiary; and (iv) Overhaul and coating of jet engine components through its Turbochrome subsidiary.

TAT’s activities in the area of OEM of heat transfer solutions and aviation accessories primarily include the design, development and manufacture of (i) broad range of heat transfer solutions, such as pre-coolers heat exchangers and oil/fuel hydraulic heat exchangers, used in mechanical and electronic systems on board commercial, military and business aircraft; (ii) environmental control and power electronics cooling systems installed on board aircraft in and ground applications; and (iii) a variety of other mechanical aircraft accessories and systems such as pumps, valves, and turbine power units.

TAT’s activities in the area of MRO Services for heat transfer components and OEM of heat transfer solutions primarily include the MRO of heat transfer components and to a lesser extent, the manufacturing of certain heat transfer solutions. TAT’s Limco subsidiary operates an FAA-certified repair station, which provides heat transfer MRO services for airlines, air cargo carriers, maintenance service centers and the military.

TAT’s activities in the area of MRO services for aviation components include the MRO of APUs, landing gears and other aircraft components. TAT’s Piedmont subsidiary operates an FAA-certified repair station, which provides aircraft component MRO services for airlines, air cargo carriers, maintenance service centers and the military.
 
3

TAT’s activities in the area of overhaul and coating of jet engine components includes the overhaul and coating of jet engine components, including turbine vanes and blades, fan blades, variable inlet guide vanes and afterburner flaps.
 
For more information of TAT Technologies Ltd., please visit our web-site:
www.tat-technologies.com
 
Guy Nathanzon, CFO
TAT Technologies Ltd.
Tel: 972-8-862-8500
guyn@tat-technologies.com
 
Safe Harbor for Forward-Looking Statements

This press release contains forward-looking statements which include, without limitation, statements regarding possible or assumed future operation results. These statements are hereby identified as "forward-looking statements" for purposes of the safe harbor provided by the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties that could cause our results to differ materially from management's current expectations. Actual results and performance can also be influenced by other risks that we face in running our operations including, but are not limited to, general business conditions in the airline industry, changes in demand for our services and products, the timing and amount or cancellation of orders, the price and continuity of supply of component parts used in our operations, the change of control that will occur on the sale by the receiver of the Company’s shares held by our previously controlling stockholders, and other risks detailed from time to time in the Company's filings with the Securities Exchange Commission, including, its annual report on form 20-F and its periodic reports on form 6-K. These documents contain and identify other important factors that could cause actual results to differ materially from those contained in our projections or forward-looking statements. Stockholders and other readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. We undertake no obligation to update publicly or revise any forward-looking statement.
 
4
 
TAT TECHNOLOGIES AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEET
(In thousands)

 
March 31,
    
December 31,
  
   
2017
    
2016
  
   
(unaudited)
    
(audited)
  
ASSETS
            
CURRENT ASSETS:
            
Cash and cash equivalents
  
$
23,813
    
$
21,433
  
Short-term bank deposits
    
964
      
964
  
Accounts receivable, net
    
21,019
      
21,572
  
Other current assets and prepaid expenses
    
3,109
      
1,687
  
Inventory, net
    
37,944
      
39,269
  
                 
Total current assets
    
86,849
      
84,925
  
                 
NON-CURRENT ASSETS:
                
 Investment in affiliates
    
1,086
      
1,019
  
Funds in respect of employee rights upon retirement
    
2,732
      
2,660
  
 Deferred income taxes
    
1,032
      
896
  
Intangible assets, net
    
1,146
      
1,179
  
Property, plant and equipment, net
    
20,927
      
21,298
  
                 
Total non-current assets
    
26,923
      
27,052
  
                 
Total assets
  
$
113,772
    
$
111,977
  
                 
LIABILITIES AND EQUITY
                
                 
CURRENT LIABILITIES:
                
Accounts payable
    
6,941
      
8,406
  
Accrued expenses
    
11,066
      
9,836
  
                 
Total current liabilities
    
18,007
      
18,242
  
                 
NON CURRENT LIABILITIES:
                
   Other long-term liabilities
    
187
      
151
  
Liability in respect of employee rights upon retirement
    
3,096
      
2,994
  
Deferred income taxes
    
2,132
      
1,938
  
                 
 Total non-current liabilities
    
5,415
      
5,083
  
                 
Total liabilities
    
23,422
      
23,325
  
                 
EQUITY:
                
Share capital
    
2,797
      
2,797
  
Additional paid-in capital
    
64,817
      
64,760
  
Treasury stock at cost
    
(2,088
)
    
(2,088
)
Accumulated other comprehensive loss
    
367
      
(73
)
Retained earnings
    
24,457
      
23,256
  
Total shareholders' equity
    
90,350
      
88,652
  
                 
Total liabilities and shareholders' equity
  
$
113,772
    
$
111,977
  
                 

5
 
TAT TECHNOLOGIES AND ITS SUBSIDIARIES
 
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except share and per share data)

   
Three months ended
    
Year ended
  
   
March 31,
    
December 31,
  
   
2017
    
2016
    
2016
  
   
(Unaudited)
    
(Unaudited)
    
(Audited)
  
                   
Revenues:
                  
Products
  
$
9,550
    
$
8,069
    
$
30,431
  
Services
    
17,531
      
15,565
      
65,363
  
     
27,081
      
23,634
      
95,794
  
                         
Cost of goods:
                        
Products
    
6,911
      
6,691
      
23,788
  
Services
    
14,613
      
13,008
      
52,969
  
     
21,524
      
19,699
      
76,757
  
Gross Profit
    
5,557
      
3,935
      
19,037
  
                         
Operating expenses:
                        
Research and development, net
    
229
      
264
      
1,140
  
Selling and marketing
    
1,142
      
1,010
      
3,876
  
General and administrative
    
2,267
      
2,410
      
10,023
  
Other loss (income)
    
28
      
1
      
(138
)
     
3,666
      
3,685
      
14,901
  
Operating income
    
1,891
      
250
      
4,136
  
                         
Financial expenses, net
    
(172
)
    
(19
)
    
(154
)
                         
Income before taxes on income
    
1,719
      
231
      
3,982
  
                         
Taxes on income
    
498
      
186
      
3,865
  
                         
Income before equity investment
    
1,221
      
45
      
117
  
                         
Share in results of affiliated companies
    
(20
)
    
-
      
(55
)
                         
Net income
  
$
1,201
    
$
45
    
$
62
  
                         
Basic and diluted income per share
                        
                         
Net income per share
  
$
0.14
    
$
0.01
    
$
0.01
  
                         
Weighted average number of shares outstanding
                        
Basic
    
8,828,444
      
8,828,444
      
8,828,444
  
Diluted
    
8,865,808
      
8,828,444
      
8,830,764
  


6

 
TAT TECHNOLOGIES AND ITS SUBSIDIARIES
 
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands)

   
Three months ended
    
Year ended
  
   
March 31,
    
December 31,
  
   
2017
    
2016
    
2016
  
   
(Unaudited)
    
(Unaudited)
    
(Audited)
  
                   
Net income
  
$
1,201
    
$
45
    
$
62
  
Other comprehensive income
                        
Net unrealized gains (losses) from derivatives
    
(97
)
    
365
      
174
  
Reclassification adjustments for gains included in net income and inventory
    
537
      
(47
)
    
(243
)
     Total other comprehensive income (loss)
  
$
1,641
    
$
363
    
$
(7
)
                         

7
 
TAT TECHNOLOGIES AND ITS SUBSIDIARIES
 
 RECONCILIATION OF GAAP TO NON-GAAP RESULTS (UNAUDITED)
(In thousands, except share and per share data)

   
Three months ended
    
Year ended
  
   
March 31,
    
December 31,
  
   
2017
    
2016
    
2016
  
                   
Reported net income on GAAP basis
  
$
1,201
    
$
45
    
$
62
  
Adjustments:
                        
Tax adjustments re non-GAAP adjustments (1)
    
-
      
-
      
2,685
  
Other expenses (Acquisition related expenses)
    
-
      
-
      
(105
)
Share in results of equity investment of affiliated company
    
20
      
-
      
55
  
Share based compensation
    
57
      
14
      
105
  
 Non-GAAP net income
  
$
1,278
    
$
59
    
$
2,802
  
                         
 Non-GAAP net income per share
  
$
0.14
    
$
0.01
    
$
0.32
  
                         
Weighted average number of shares outstanding
                        
 Basic
    
8,828,444
      
8,828,444
      
8,828,444
  
 Diluted
    
8,865,808
      
8,828,444
      
8,830,764
  

 
(1)
During the second quarter of 2016 the Company distributed dividend from its foreign subsidiaries earnings. As a result, the company accrued deferred tax liability due to actual distribution of earnings from foreign subsidiaries of the Company and due to the possibility of future distribution of earnings from such foreign subsidiaries.
     

8
 
TAT TECHNOLOGIES AND ITS SUBSIDIARIES
 
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(In thousands, except share data)

   
TAT Technologies Ltd. Shareholders
        
                                           
   
Share capital
          
Accumulated
                    
   
Number of shares issued
    
Amount
    
Additional paid-in capital
    
other comprehensive income (loss)
    
Treasury shares
    
Retained earnings
    
Total equity
  
                                           
BALANCE AT DECEMBER 31, 2014 (audited)
    
9,082,817
    
$
2,793
    
$
64,491
    
$
-
    
$
(2,088
)
  
$
20,345
    
$
85,541
  
CHANGES DURING THE YEAR ENDED DECEMBER 31, 2015 (audited):
                                                        
Comprehensive income (loss)
    
-
      
-
      
-
      
(4
)
    
-
      
5,849
      
5,845
  
Share based compensation expenses
    
-
      
-
      
38
      
-
      
-
      
-
      
38
  
BALANCE AT DECEMBER 31, 2015 (audited)
    
9,082,817
      
2,793
      
64,529
      
(4
)
    
(2,088
)
    
26,194
      
91,424
  
CHANGES DURING THE YEAR ENDED DECEMBER 31, 2016 (unaudited):
                                                        
Comprehensive income (loss)
    
-
      
-
      
-
      
(69
)
    
-
      
62
      
(7
)
Share based compensation expenses
    
-
      
-
      
105
      
-
      
-
      
-
      
105
  
 Exercise of option
    
20,100
      
4
      
126
      
-
      
-
      
-
      
130
  
 Dividend distributed
    
-
      
-
      
-
      
-
      
-
      
(3,000
)
    
(3,000
)
BALANCE AT DECEMBER 31, 2016 (audited)
    
9,102,917
      
2,797
      
64,760
      
(73
)
    
(2,088
)
    
23,256
      
88,652
  
CHANGES DURING THE THREE MONTHS ENDED MARCH 31, 2017 (unaudited):
                                                        
Comprehensive income
                            
440
              
1,201
      
1,641
  
 Share based compensation
     expenses
                    
57
                              
57
  
BALANCE AT MARCH 31, 2017 (unaudited)
    
9,102,917
    
$
2,797
    
$
64,817
    
$
367
    
$
(2,088
)
  
$
24,457
    
$
90,350
  

 
9
 
TAT TECHNOLOGIES AND ITS SUBSIDIARIES
 
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
 
   
Three months ended
    
Year ended
  
   
March 31,
    
December 31,
  
   
2017
    
2016
    
2016
  
   
(Unaudited)
    
(Unaudited)
    
(audited)
  
                   
CASH FLOWS FROM OPERATING ACTIVITIES:
                  
Net income
  
$
1,201
    
$
45
    
$
62
  
                         
Adjustments to reconcile net income to net cash provided by operating activities:
                        
                         
Depreciation and amortization
    
969
      
851
      
3,636
  
Loss on sale of property, plant and equipment
    
28
      
1
      
12
  
Interest from short-term bank deposits and restricted deposits
            
(11
)
    
(24
)
 Gain from change in fair value of derivatives
    
(16
)
    
(53
)
    
(152
)
Provision for doubtful accounts
    
18
      
43
      
(29
)
Share in results of affiliated Company
    
20
      
-
      
55
  
Share based compensation
    
57
      
14
      
105
  
Liability in respect of employee rights upon retirement
    
102
      
18
      
123
  
Deferred income taxes, net
    
58
      
(118
)
    
1,670
  
Changes in operating assets and liabilities:
                        
    Decrease (increase) in trade accounts receivable
    
535
      
(1,437
)
    
(2,392
)
    Decrease (increase) in other current assets and prepaid expenses
    
(942
)
    
(536
)
    
1,487
  
     Decrease (increase) in inventory
    
1,265
      
172
      
(2,707
)
    Increase (decrease) in trade accounts payable
    
(1,438
)
    
427
      
1,192
  
    Increase in accrued expenses
    
1,230
      
552
      
2,521
  
    Increase (decrease) in other long-term liabilities
    
36
      
(147
)
    
(38
)
Net cash provided by operating activities
  
$
3,123
    
$
(179
)
  
$
5,521
  
                         
 CASH FLOWS FROM INVESTING ACTIVITIES:
                        
Investment in affiliated company
    
(87
)
    
-
      
(905
)
Funds in respect of employee rights upon retirement
    
(36
)
    
(140
)
    
2
  
Proceeds from sale of property and equipment
            
1
      
17
  
Purchase of property and equipment
    
(620
)
    
(668
)
    
(5,702
)
 Maturities of short-term deposits
            
2,000
      
7,182
  
Cash flows provided by (used in) investing activities
  
$
(743
)
  
$
1,193
    
$
594
  
                         
 CASH FLOWS FROM FINANCING ACTIVITIES:
                        
Realization of contingency
    
-
      
-
      
(500
)
Payment of cash dividend
    
-
      
-
      
(3,000
)
 Exercise of options
    
-
      
130
      
130
  
Cash flows provided by (used in) financing activities
 
$
-
    
$
130
    
$
(3,370
)
                         
Net increase (decrease) in cash and cash equivalents
    
2,380
      
1,144
      
2,745
  
                         
Cash and cash equivalents at beginning of period
    
21,433
      
18,688
      
18,688
  
                         
Cash and cash equivalents at end of period
  
$
23,813
    
$
19,832
    
$
21,433
  

 
10
 
TAT TECHNOLOGIES AND ITS SUBSIDIARIES
 
 RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA (NON-GAAP)  (UNAUDITED)
(In thousands)

   
Three months ended
    
Year ended
  
   
March 31,
    
December 31,
  
   
2017
    
2016
    
2016
  
                   
Net income
  
$
1,201
    
$
45
    
$
62
  
Adjustments:
                        
Share in results and sale of equity investment of affiliated companies
    
20
              
55
  
Taxes on income
    
498
      
186
      
3,865
  
Financial expenses, net
    
172
      
19
      
154
  
Depreciation and amortization
    
969
      
851
      
3,636
  
Share based compensation
    
57
      
14
      
105
  
Adjusted EBITDA
  
$
2,917
    
$
1,115
    
$
7,877
  


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SIGNATURE
 
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.
 
 
TAT TECHNOLOGIES LTD.
(Registrant)
 
By: /s/ Guy Nathanzon
Guy Nathanzon
Chief Financial Officer

Date: May 17, 2017
 
 
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