-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, L+LBKLinY4Uad8LP4QBeQe2rT+UMU1F9bkG9szurmtjcoF3Kx5ZM463KbfIQkLLG lMpeaB+cjnGuuSJBNukCqw== 0000910662-03-000037.txt : 20030210 0000910662-03-000037.hdr.sgml : 20030210 20030210120517 ACCESSION NUMBER: 0000910662-03-000037 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20030210 FILED AS OF DATE: 20030210 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MAGAL SECURITY SYSTEMS LTD CENTRAL INDEX KEY: 0000896494 STANDARD INDUSTRIAL CLASSIFICATION: COMMUNICATIONS EQUIPMENT, NEC [3669] IRS NUMBER: 000000000 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 6-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-21388 FILM NUMBER: 03546405 BUSINESS ADDRESS: STREET 1: P O BOX 70 STREET 2: INDUSTRIAL ZONE CITY: YAHUD ISRAEL STATE: L3 ZIP: 5600 MAIL ADDRESS: STREET 1: P.O. BOX 70, STREET 2: INDUSTRIAL ZONE CITY: YAHUD STATE: L3 ZIP: 56100 6-K 1 frm6kmagal.txt FORM 6-K W/ EARNINGS RELEASE ================================================================================ 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 February 2003 MAGAL SECURITY SYSTEMS LTD. (Name of Registrant) P.O. Box 70, Industrial Zone, Yahud 56100 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 X 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 X If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- ____________ ================================================================================ Magal Security Systems Ltd. 6-K Items 1. Magal Security Systems Ltd. Press Release re Magal Annouces US16 Million Contract to Protect Otopeni International Airport in Romania dated January 21, 2003. 2. Magal Security Systems Ltd. Press Release re 2002 Fourth Quarter and Year-End Results dated February 10, 2003. ITEM 1 Press Release Source: Magal Security Systems Ltd. Magal Security Systems Ltd. Announces US$16 Million Contract to Protect Otopeni International Airport in Romania Tuesday January 21, 8:32 am ET YAHUD, Israel, Jan. 21 /PRNewswire-FirstCall/ -- Magal Security Systems, Ltd. (Nasdaq: MAGS; TASE: MAGS), today announced that it has signed a contract to protect the Otopeni International Airport in Bucharest, Romania. The total contract totals approximately US$16 million and is expected to be completed by the end of the year 2004. Mr. Jacob Even-Ezra, Chairman of Magal, stated: "This order is one of the largest orders Magal has received from an airport outside of Israel, strengthening our position in the security market as a provider of turnkey solutions for airports worldwide. As expected, this order demonstrates the growing need for security measures for airports as a result of the 9/11 terror events." This turnkey project, which includes different types of security systems, will be integrated by MagNet, Magal's computerized Security Management Systems (SMS). The Romanian airport joins other airports that are already successfully using Magal's systems to protect their perimeters from unauthorized intrusions, such as O'Hare International Airport in Chicago, Korea's Kimpo International Airport and Inchon International Airport, Israel's International Ben-Gurion Airport and others. About Magal Security Systems, Ltd.: Magal Security Systems Ltd. (Magal) is engaged in the development, manufacturing and marketing of computerized security systems, which automatically detect, locate and identify the nature of unauthorized intrusions. Magal also supplies Video Monitoring Services through Smart Interactive Systems, Inc., a subsidiary established in the U.S. in June 2001. The Company's products are currently used in more than 70 countries worldwide to protect national borders, airports, correctional facilities, nuclear power stations and other sensitive facilities from terrorism, theft and other threats. Israeli-based Magal has subsidiaries in the U.S., Canada, the U.K., Germany, Mexico and an office in China. Revenues for fiscal year 2001 were $41 million, with net income of $3.2 million. Magal trades in the U.S. on the NASDAQ National Market since 1993 and in Israel on the Tel-Aviv Stock Exchange (TASE) since July 2001, in both under the symbol MAGS. This press release contains forward-looking statements, which are subject to risks and uncertainties. Such statements are based on assumptions and expectations which may not be realized and are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual results, financial and otherwise, may differ from the results discussed in the 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 Report on Form 8-K filed with the Securities and Exchange Commission. ITEM 2 MAGAL SECURITY SYSTEMS LTD. ANNOUNCES 2002 FOURTH QUARTER AND YEAR-END RESULTS -2002 Revenues Increases 5% to a Record of $43 Million- -Revenues up 41% and Net Income up 64% from the Third Quarter- Yahud, Israel, February 10, 2003 - Magal Security Systems Ltd. (Nasdaq NM:MAGS; TASE:MAGS) today announced its consolidated financial results for the three- and twelve-month periods ended December 31, 2002. When presenting the financial results, Mr. Jacob Even-Ezra, Chairman of Magal, said, "As was expected, the fourth quarter 2002 was substantially better than the third quarter. Revenues for the fourth quarter increased quarter-over-quarter by 41 percent, gross profit by 31 percent, operating income by 77 percent and net income by 64 percent." Mr. Even-Ezra added, "Based on our current backlog, which includes the Israeli seam line contract and the $16 million turnkey project for the protection of the Otopeni International airport in Romania, we have every reason to believe that 2003 will be stronger than the year we just closed." Year-over-year revenues for the fourth quarter increased by 23 percent, and reached a record of US$13.4 million, compared to $10.9 million in the fourth quarter of 2001. Year-over-year gross profit for the fourth quarter increased 6 percent, from $5.3 million in the fourth quarter of 2001, to $ 5.6 million in the fourth quarter of 2002. Research and development expenses for the fourth quarter of 2002 increased by 43 percent and reached $852,000, compared to $597,000 in the same quarter of 2001. General and administrative expenses for the fourth quarter increased 30 percent to $1.7 million, from $1.3 million in the fourth quarter of 2001. Total operating expenses increased 13 percent from the fourth quarter of 2001 and reached $5.1 million. Operating income declined by 41 percent to $448,000 compared to the fourth quarter of 2001, while net income declined 56 percent to $359,000 or $0.05 per fully diluted share in the fourth quarter of 2002, compared with $823,000 or $0.10 per fully diluted share in the same period last year. Revenues for the full year 2002 increased by 5 percent to $43 million, while gross profit declined by 2 percent to $19 million in 2002. Research and development expenses in 2002 increased by 2 percent and general and administrative expenses remained unchanged compared to 2001. Selling and marketing expenses for 2002 increased by 9 percent to $8.6 million due to increased selling and marketing expenses arising from the operation of Smart Interactive Systems, Inc. Page 1 of 4 Operating income declined by 35 percent to $2.3 million in 2002 compared with $3.6 million in 2001. Income before taxes in the year 2002 decreased by 30 percent to $2.5 million and net income declined by 40 percent to $1.9 million or $0.24 per fully diluted share in 2002, compared to $3.2 million or $0.41 per fully diluted share in 2001. Commenting on the results, Mr. Even-Ezra said, "The big difference in net income was caused by the operations of our new U.S. - based subsidiary, Smart Interactive Systems, Inc., which provides video monitoring services. Excluding losses generated by Smart, income before taxes for the year 2002 would have reached $4.0 million compared to $4.2 million in 2001, which is a slight decrease of about 4 percent." "Management believes 2003 will be the last year in which Smart will cause losses to the group and starting 2004, Smart will begin contributing to the financial results of the group." Mr. Even-Ezra concluded. About Magal Security Systems, Ltd.: - ----------------------------------- Magal Security Systems Ltd. (Magal) is engaged in the development, manufacturing and marketing of computerized security systems, which automatically detect, locate and identify the nature of unauthorized intrusions. Magal also supplies video monitoring services through Smart Interactive Systems, Inc., a subsidiary established in the U.S. in June 2001. The Company's products are currently used in more than 70 countries worldwide to protect national borders, airports, correctional facilities, nuclear power stations and other sensitive facilities from terrorism, theft and other threats. Israeli-based Magal has subsidiaries in the U.S., Canada, the U.K., Germany, Mexico and an office in China. Magal trades under the symbol MAGS in the U.S. on the Nasdaq National Market since 1993 and in Israel on the Tel-Aviv Stock Exchange (TASE) since July 2001. This press release contains forward-looking statements, which are subject to risks and uncertainties. Such statements are based on assumptions and expectations which may not be realized and are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual results, financial and otherwise, may differ from the results discussed in the 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 on Form 20-F filed with the Securities and Exchange Commission. Contacts: Magal Security Systems, Ltd Breakstone & Ruth International Raya Asher, CFO Susan Borinelli, Investor Relations Tel: +972-3-539-1444 Tel: (646) 536 7018 Fax: +972-3-5366245 E-mail: sborinelli@breakstoneruth.com E-mail: magalssl@trendline.co.il Jessica Anderson, Media Relations Tel: (646) 536-7002 E-mail: janderson@breaskstoneruth.com -FINANCIAL TABLES FOLLOW- Page 2 of 4
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (All numbers except EPS expressed in thousands of US$) Year Ended Dec. 31, Quarter Ended Dec. 31, Audited Unaudited 2002 2001 2002 2001 Revenues 42,966 41,020 13,362 10,883 Cost of revenues 23,924 21,505 7,788 5,600 ------- -------- ------ ------- Gross profit 19,042 19,515 5,574 5,283 Operating expenses: Research and development, net 3,128 3,054 852 597 Selling and marketing 8,642 7,933 2,619 2,658 General and administrative 4,938 4,949 1,655 1,275 ------- -------- ------ ------- Total operating expenses 16,708 15,936 5,126 4,530 ------- -------- ------ ------- Operating income 2,334 3,579 448 753 Financial income (expenses), net 199 40 (81) (22) ------- -------- ------ ------- Income before taxes 2,533 3,619 367 731 Taxes on income 645 452 8 (92) ------- -------- ------ ------- Net income 1,888 3,167 359 823 ======= ======== ====== ======= Basic net earnings per share 0.25 0.42 0.05 0.11 ======= ======== ====== ======= Weighted average number of shares outstanding used in Computing basic net earnings per share (in 7,637 7,512 7,659 7,577 thousands) ======= ======== ====== ======= Diluted net earnings per share 0.24 0.41 0.05 0.10 ======= ======== ====== ======= Weighted average number of shares outstanding used in Computing diluted net earnings per share (in 7,834 7,694 7,763 7,853 thousands) ======= ======== ====== =======
Financial Ratios - ---------------- Year Ended December 31, Quarter Ended December 31, ----------- ------------ ----------- ------------ 2002 2001 2002 2001 ----------- ------------ ----------- ------------ Gross Margin 44.3% 47.6% 41.7% 48.5% Research and development, net as a % of 7.3% 7.4% 6.4% 5.5% Revenues Selling and Marketing as a % of Revenues 20.1% 19.3% 19.6% 24.4% General and administrative as a % of 11.5% 12.1% 12.4% 11.7% Revenues Operating Margin 5.4% 8.7% 3.4% 6.9% Net income Margin 4.4% 7.7% 2.7% 7.6% Total Bank Debt to Total Capitalization 0.43 0.35 0.43 0.35 Current Ratio 1.86 2.31 1.86 2.31
Page 3 of 4 MAGAL SECURITY SYSTEMS LTD. CONDENSED CONSOLIDATED BALANCE SHEETS (All numbers expressed in thousands of US$) December 31, December 31, 2002 2001 ------------ ------------- Audited Audited ------------ ------------- CURRENT ASSETS: Cash and cash equivalents 2,519 2,738 Short-term bank deposits 3,708 8,289 Trade receivables: Related parties 57 58 Other 9,076 6,113 Unbilled accounts receivable 7,691 5,586 Other accounts receivable 2,256 575 Inventories 8,251 8,549 Deferred income taxes 602 473 ------------ ------------- Total current assets 34,160 32,381 ------------ ------------- LONG TERM INVESTMENTS AND TRADE RECEIVABLES: 1,510 2,213 Long-term bank deposits 8,649 3,560 Severance pay fund 1,724 1,592 ------------ ------------- Total long term investments and trade receivables 11,883 7,365 ------------ ------------- PROPERTY AND EQUIPMENT, NET 8,989 8,550 ------------ ------------- OTHER ASSETS, NET 4,709 5,051 ------------ ------------- Total assets 59,741 53,347 ============ ============= CURRENT LIABILITIES: Short-term bank credit 9,266 2,405 Current maturities of long-term bank loans 1,091 3,859 Trade payables 4,192 3,394 Other payables and accrued expenses 3,784 4,332 ------------ ------------- Total current liabilities 18,333 13,990 ------------ ------------- LONG-TERM LOANS 4,698 5,038 ------------ ------------- ACCRUED SEVERANCE PAY 1,679 1,619 ------------ ------------- SHAREHOLDERS' EQUITY: Share capital 2,600 2,583 Additional paid-in capital 21,791 21,670 Deferred stock compensation (3) (20) Accumulated other comprehensive loss (1,007) (1,294) Retained earnings 11,650 9,761 ------------ ------------- Total shareholders' equity 35,031 32,700 ------------ ------------- TOTAL LIABILITIES & SHAREHOLDERS' EQUITY 59,741 53,347 ============ ============= Page 4 of 4 SIGNATURES 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. MAGAL SECURITY SYSTEMS LTD. (Registrant) By: Jacob Even-Ezra --------------- Jacob Even-Ezra Chairman of the Board and Chief Executive Officer Date: February 10, 2003 -----END PRIVACY-ENHANCED MESSAGE-----