6-K 1 zk2227440.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 March 2022

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- ____________


6-K Items

1.
Press Release dated March 9, 2022, re TAT Technologies Ltd. Reports Full Year 2021 Results.


2

Press Release
Source: TAT Technologies Limited

TAT Technologies Reports Full Year 2021 Results

GEDERA, Israel, March 9, 2022 - 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 audited results for the twelve months ended December 31, 2021.

Key Financial Highlights:

•
Total revenues for the twelve months ended December 31, 2021, were $78 million compared to $75.3 million for the twelve months ended December 31, 2020, an increase of 3.6%.

•
Gross profit for the twelve months ended December 31, 2021, were $11.3 million (14.5% of revenues) compared to $8.4 million (11.2% of revenues) for the twelve months ended December 31, 2020, an increase of 35%. The Gross margin for 2021 without a onetime impact of the restructuring plan was $12.5 million (16% out of revenues). The improvement in gross margin is mainly attribute to government grants that the company received during the year and to cost cutting measures that were taken during the year.

•
Adjusted EBITDA for the twelve months ended December 31, 2021, was $3.3 million compared to $1.1 million for the twelve months ended December 31, 2020. An improvement of 296%.

•
GAAP net loss from continued operations for the twelve months ended December 31, 2021, was $4 million ($2.2 million without a onetime impact of our restructuring plan) compared to GAAP net loss from continued operations of $3.5 million for the twelve months ended December 31, 2020. A decrease of 62% in net loss from continued operations without a onetime impact of our restructuring plan.

•
Cash net of debt for December 31, 2021, was $0.5 million compared to $16.2 million for December 31, 2020. During the years 2020 and 2021, the Company made significant capital investments related to the three large strategic agreements with Honeywell and the restructuring plan.

Mr. Igal Zamir, CEO and President of TAT Technologies stated, "2021 was a unique and challenging year for the aerospace industry and for TAT. While volumes and prospects improved during 2021, volatility and uncertainty continued to be part of our business environment". Mr. Zamir continues:  " during 2021 we closed additional two strategic deals with Honeywell for the MRO and lease activity of APU331-500 (which are mainly used in the Boeing 777 fleet) and APU131 (which are mainly used in the Boeing 737 and the Airbus 320 fleets). We are already benefiting from the fruit of the lease activity, and we are building the production infrastructure to be able to provide MRO services for these APUs during 2022. We believe that these deals will consist of a major growth factor for TAT as the aerospace industry will shape up. In parallel we are in the final phase of closing a production facility in Israel reducing our operational foot print to three major facilities with significant cost savings. We continue to ramp up our Heat Exchange capabilities in our Limco facility in Tulsa Oklahoma. We are expecting to see the impact of these strategic transaction in our financial results starting from the second half of 2022".

3
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, depreciation and amortization, inventory impairment from exit and dismissal activity and customers relationship write off. 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 page 11.

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 controlling shareholders is the FIMI Private Equity Fund.

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 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 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.

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.

4

TAT TECHNOLOGIES AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEET
(In thousands)

   
December 31,
  
   
2021
    
2020
  
             
ASSETS
            
             
CURRENT ASSETS:
            
   Cash and cash equivalents
  
$
12,872
    
$
24,128
  
   Accounts receivable, net of allowance for credit losses of $389
   and $306 thousands as of December 31, 2021 and December 31, 2020 respectively
    
13,887
      
11,355
  
   Inventory, net
    
41,003
      
41,223
  
   Other current assets and prepaid expenses
    
4,219
      
2,737
  
                 
   Total current assets
    
71,981
      
79,443
  
                 
NON-CURRENT ASSETS:
                
   Restricted deposit
    
343
      
176
  
   Investment in affiliates
    
695
      
771
  
   Funds in respect of employee rights upon retirement
    
1,157
      
1,186
  
   Deferred income taxes
    
1,252
      
566
  
Property, plant and equipment, net
    
30,462
      
25,737
  
Operating lease right of use assets
    
3,114
      
6,767
  
Intangible assets, net
    
1,829
      
1,475
  
    Total non-current assets
    
38,852
      
36,678
  
                 
   Total assets
  
$
110,833
    
$
116,121
  


5

TAT TECHNOLOGIES AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEET
(In thousands)

   
December 31,
  
   
2021
    
2020
  
             
LIABILITIES AND EQUITY
            
             
CURRENT LIABILITIES:
            
  Current maturities of long-term loans
  
$
691
    
$
1,477
  
  Credit line from bank
    
6,008
      
3,000
  
   Accounts payable
    
9,093
      
12,222
  
   Accrued expenses
    
6,959
      
6,691
  
   Operating lease liabilities
    
1,169
      
1,614
  
   Provision for restructuring plan
    
657
      
-
  
  Liabilities belong to discontinued operation
    
-
      
179
  
  Total current liabilities
    
24,577
      
25,183
  
                 
NON-CURRENT LIABILITIES:
                
   Long-term loans
    
5,979
      
3,489
  
   Liability in respect of employee rights upon retirement
    
1,504
      
1,410
  
   Operating lease liabilities
    
1,989
      
5,758
  
                 
   Total non-current liabilities
    
9,472
      
10,657
  
                 
COMMITMENTS AND CONTINGENCIES LIABILITIES (NOTE 15)
                
                 
Total liabilities
    
34,049
      
35,840
  
                 
EQUITY:
                
Ordinary shares of NIS 0.9 par value:
Authorized: 13,000,000 shares at December 31, 2021 and at December 31, 2020; Issued: 9,149,169 shares at December 31, 2021 and at December 31, 2020; Outstanding: 8,874,696 shares at December 31, 2021 and at December 31, 2020
    
2,809
      
2,809
  
Additional paid-in capital
    
65,871
      
65,711
  
Treasury shares, at cost, 274,473 shares at December 31, 2021 and 2020
    
(2,088
)
    
(2,088
)
Accumulated other comprehensive income
    
33
      
128
  
Retained earnings
    
10,159
      
13,721
  
Total shareholders' equity
    
76,784
      
80,281
  
                 
Total liabilities and shareholders' equity
  
$
110,833
    
$
116,121
  

6

TAT TECHNOLOGIES AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except share and per share data)

   
Year ended December 31,
  
   
2021
    
2020
    
2019
  
                   
Revenue:
                  
Products
  
$
25,870
    
$
22,739
    
$
25,019
  
Services
    
52,103
      
52,620
      
72,460
  
     
77,973
      
75,359
      
97,479
  
                         
Cost of revenue:
                        
Products
    
23,761
      
20,751
      
21,557
  
Services
    
42,942
      
46,173
      
60,622
  
     
66,703
      
66,924
      
82,179
  
                         
Gross profit
    
11,270
      
8,435
      
15,300
  
                         
Operating expenses:
                        
Research and development, net
    
517
      
185
      
113
  
Selling and marketing
    
5,147
      
4,369
      
4,929
  
General and administrative
    
8,354
      
7,612
      
7,654
  
Other (income) expenses
    
(468
)
    
315
      
-
  
Restructuring expenses, net
    
1,755
      
-
      
-
  
                         
     
15,305
      
12,481
      
12,696
  
                         
Operating income (loss)
    
(4,035
)
    
(4,046
)
    
2,604
  
                         
Financial expenses
    
(683
)
    
(999
)
    
(1,270
)
Financial income
    
143
      
229
      
848
  
                         
Income (loss) before taxes on income (tax benefit)
    
(4,575
)
    
(4,816
)
    
2,182
  
                         
Taxes on income (tax benefit)
    
(662
)
    
(1,517
)
    
589
  
                         
Income (loss) before share of equity investment
    
(3,913
)
    
(3,299
)
    
1,593
  
                         
Share in results of equity investment of affiliated companies
    
(76
)
    
(185
)
    
(132
)
                         
Net income (loss) from continued operation
  
$
(3,989
)
  
$
(3,484
)
  
$
1,461
  

7


TAT TECHNOLOGIES AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands)

    Year ended December 31,
 
   
2021
    
2020
    
2019
  
Net income (loss) from discontinued operation
  
$
427
    
$
(1,845
)
  
$
(655
)
Net income (loss)
  
$
(3,562
)
  
$
(5,329
)
  
$
806
  
                         
Net income (loss) per share basic and diluted from continued operation
  
$
(0.45
)
  
$
(0.39
)
  
$
0.17
  
Net income (loss) per share basic and diluted from discontinued operation
  
$
0.05
    
$
(0.21
)
  
$
(0.07
)
Net income (loss) per share basic and diluted
  
$
(0.4
)
  
$
(0.6
)
  
$
0.1
  
                         
Weighted average number of shares outstanding:
                        
Basic and diluted
    
8,874,696
      
8,874,696
      
8,874,696
  


8

TAT TECHNOLOGIES AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands)

    Year ended December 31,
 
   
2021
    
2020
    
2019
  
Net income (loss)
  
$
(3,562
)
  
$
(5,329
)
  
$
806
  
Other comprehensive income (loss), net
                        
Net unrealized gains (losses) from derivatives
    
(76
)
    
232
      
372
  
Reclassification adjustments for gains from derivatives included in net income
    
(19
)
    
(130
)
    
(140
)
Total other comprehensive income (loss)
  
$
(95
)
  
$
102
    
$
232
  
Total comprehensive income (loss)
  
$
(3,657
)
  
$
(5,227
)
  
$
1,038
  

9
TAT TECHNOLOGIES AND ITS SUBSIDIARIES
 
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(In thousands, except share data)

   
Ordinary shares
          
Accumulated
                    
   
Number of shares issued
    
Amount
    
Additional paid-in capital
    
other comprehensive income (loss)
    
Treasury shares
    
Retained earnings
    
Total equity
  
                                           
BALANCE AT DECEMBER 31, 2018
    
9,122,501
    
$
2,809
    
$
65,535
    
$
(206
)
  
$
(2,088
)
  
$
18,244
    
$
84,294
  
CHANGES DURING THE YEAR ENDED DECEMBER 31, 2019:
                                                        
Comprehensive income
    
-
      
-
      
-
      
232
      
-
      
806
      
1,038
  
 Share based compensation
    
-
      
-
      
38
      
-
      
-
      
-
      
38
  
BALANCE AT DECEMBER 31, 2019
    
9,149,169
    
$
2,809
    
$
65,573
    
$
26
    
$
(2,088
)
  
$
19,050
    
$
85,370
  
CHANGES DURING THE YEAR ENDED DECEMBER 31, 2020:
                                                        
Comprehensive income (loss)
    
-
      
-
      
-
      
102
      
-
      
(5,329
)
    
(5,227
)
 Share based compensation
    
-
      
-
      
138
      
-
      
-
      
-
      
138
  
BALANCE AT DECEMBER 31, 2020
    
9,149,169
    
$
2,809
    
$
65,711
    
$
128
    
$
(2,088
)
    
13,721
    
$
80,281
  
CHANGES DURING THE YEAR ENDED DECEMBER 31, 2021:
                                                        
Comprehensive loss
    
-
      
-
      
-
      
(95
)
    
-
      
(3,562
)
    
(3,657
)
Share based compensation
    
-
      
-
      
160
      
-
      
-
      
-
      
160
  
BALANCE AT DECEMBER 31, 2021
    
9,149,169
    
$
2,809
    
$
65,871
    
$
33
    
$
(2,088
)
    
10,159
    
$
76,784
  

10

TAT TECHNOLOGIES AND ITS SUBSIDIARIES
 
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

   
Year ended December 31,
  
   
2021
    
2020
    
2019
  
                   
CASH FLOWS FROM OPERATING ACTIVITIES:
                  
Net income (loss) from continued operations
  
$
(3,989
)
  
$
(3,484
)
  
$
1,461
  
                         
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
                        
Depreciation and amortization
    
4,881
      
4,065
      
4,292
  
Gain from change in fair value of derivatives
    
(19
)
    
(34
)
    
(311
)
Non cash finance expense
    
(73
)
    
566
      
354
  
Lease modification
    
(1,315
)
    
-
      
-
  
Provision for restructuring expenses
    
657
      
-
      
-
  
Change in provision for doubtful accounts
    
248
      
(8
)
    
38
  
Share in results of affiliated companies
    
76
      
185
      
132
  
Share based compensation
    
160
      
138
      
38
  
Liability in respect of employee rights upon retirement
    
94
      
(341
)
    
(897
)
Impairment of intangible assets
    
-
      
298
      
-
  
Impairment of fixed assets
    
1,820
      
-
      
-
  
Capital gain from sale of fixed assets
    
(468
)
    
-
      
-
  
Deferred income taxes, net
    
(686
)
    
(1,438
)
    
(450
)
Government loan forgiveness
    
(1,442
)
    
-
      
-
  
Changes in operating assets and liabilities:
                        
    Decrease (increase) in trade accounts receivable
    
(2,934
)
    
9,472
      
(2,037
)
Decrease (increase) in other current assets and prepaid expenses
    
(959
)
    
310
      
2,500
  
    Decrease (increase) in inventory
    
(681
)
    
1,868
      
(5,740
)
    Increase (decrease) in trade accounts payable
    
2,571
      
(5,336
)
    
3,349
  
    Increase (decrease) in accrued expenses
    
(218
)
    
(252
)
    
982
  
    Increase (decrease) in other long-term liabilities
    
8
      
(62
)
    
(118
)
Net cash provided by (used in) operating activities from continued operation
  
$
(2,269
)
  
$
5,947
    
$
3,593
  
                         
CASH FLOWS FROM INVESTING ACTIVITIES:
                        
Investment in affiliated company
    
-
      
-
      
(10
)
Proceeds from sale of property and equipment
    
1,163
      
-
      
-
  
Purchase of property and equipment
    
(16,247
)
    
(3,894
)
    
(3,269
)
Purchase of intangible assets
    
(555
)
    
(1,513
)
    
-
  
Net cash used in continued investing activities
  
$
(15,639
)
  
$
(5,407
)
  
$
(3,279
)

*Reclassified due to discontinued operation

The accompanying notes are an integral part of the consolidated financial statements.

11

TAT TECHNOLOGIES AND ITS SUBSIDIARIES
 
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

   
Year ended December 31,
  
   
2021
    
2020
    
2019
  
CASH FLOWS FROM FINANCING ACTIVITIES:
                  
Short-term credit received from banks
    
3,000
      
3,960
      
-
  
Proceeds from long-term loans received
    
3,042
      
3,692
          
Net cash provided by continued financing activities
  
$
6,042
    
$
7,652
      
-
  
                         
CASH FLOWS FROM DISCONTINUED ACTIVITIES:
                        
Net income (loss) from discontinued operation
    
427
      
(1,845
)
    
(655
)
Net cash provided by operating activities
    
350
      
1,998
      
484
  
Net cash used in investing activities
    
-
      
-
      
(134
)
Net cash provided by (used in) discontinued activities
  
$
777
    
$
153
    
$
(305
)
                         
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH
    
(11,089
)
    
8,345
      
9
  
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF YEAR
    
24,304
      
15,959
      
15,950
  
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH AT END OF YEAR
    
13,215
      
24,304
      
15,959
  
                         
SUPPLEMENTARY INFORMATION ON INVESTING ACTIVITIES NOT INVOLVING CASH FLOW:
                        
Purchase of property, plant and equipment on credit
  
$
199
    
$
6,575
    
$
942
  
Additions of operating lease right-of-use assets and operating lease liabilities
  
$
399
    
$
1,756
    
$
648
  
Classification inventory to fixed assets
  
$
829
      
-
      
-
  
                         
Supplemental disclosure of cash flow information:
                        
Interest paid
  
$
(251
)
  
$
(3
)
  
$
(28
)
Income taxes received (paid), net
  
$
-
    
$
(3
)
  
$
673
  

*Reclassified due to discontinued operation.

12

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

 
December 31,
    
December 31,
  
   
2021
    
2020
  
   
(audited)
    
(audited)
  
Net income (loss)
  
$
(3,562
)
  
$
(5,329
)
Adjustments:
                
Share in results of equity investment of affiliated companies
    
76
      
185
  
Taxes on income (tax benefit)
    
(662
)
    
(1,517
)
Financial expenses, net
    
540
      
770
  
Exit and disposal activity
    
-
      
765
  
Depreciation and amortization
    
5,420
      
4,259
  
Net loss (income) from discontinued operation
    
(427
)
    
1,845
  
Share base compensation
    
160
      
138
  
Restructuring expenses
    
1,755
      
-
  
                 
Adjusted EBITDA
    
3,300
      
1,116
  


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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.

For more information of TAT Technologies Ltd., please visit our web-site:
www.tat-technologies.com

Contact:
Mr. Ehud Ben-Yair
Chief Financial Officer
Tel: 972-8-862-8503
ehudb@tat-technologies.com

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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/ Ehud Ben-Yair
Ehud Ben-Yair
Chief Financial Officer

Date: March 9, 2022


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