NRADA Electronic Industries Ltd. (NASDAQ: RADA) announced today its financial results for the three and six months periods ended June 30, 2020.
Highlights of the second quarter of 2020
- Quarterly revenues up 75% year-over-year to a record $17.5 million
- Net income of $0.7 million and Adjusted EBITDA of $1.75 million – 10% of revenue
- 2020 revenue guidance increased to over $70 million, implying over 58% growth year-over-year, with continued sequential revenue growth throughout the remainder of the year
- US manufacturing facility at full operation to supply US market demand.
Management Comments
Dov Sella, RADA’s Chief Executive Officer commented, “We are very pleased with our results and the positive momentum in our business, which led to a significant 75% year-over-year revenue growth and sequential quarterly growth of 16%. Our strong revenue growth, stable gross margins and stabilizing operating expenses are yielding strong EBITDA improvement. We reported Adjusted EBITDA of $1.7 million in the quarter, which was more than double that of the first quarter.”
Continued Mr. Sella, “Our radars enable life-saving active protection solutions for advanced military tactical forces and critical infrastructure, and are in the heart of current modernization programs, especially in the USA. The strong demand for our radars is being driven by significant and urgent counter-UAV, SHORAD and C-RAM needs in the US and other geographies. Our orders in-hand have enabled us to increase our 2020 revenue guidance to over $70 million. As our end-markets become mainstream, we expect the growth to continue throughout the remainder of this year and into 2021. Our net cash level of $30 million is sufficient for our working capital and R&D needs to support our expected strong growth.”
2020Second Quarter Summary
Revenues totaled $17.5 million in the quarter compared with revenues of $10 million in the second quarter of 2019, an increase of 75%.
Gross profit totaled $6.2 million in the quarter (36% of revenues), an increase of 73% compared to gross profit of $3.6 million in the second quarter of 2019 (36% of revenues).
Operating income was $0.6 million in the quarter compared to an operating loss of $0.8 million in the second quarter of 2019.
Net income attributable to RADA’s shareholders in the quarter was $0.7 million, or $0.02per share, compared to a net loss of $0.6 million, or $0.01 per share, in the second quarter of 2019.
Adjusted EBITDA was $1.7 million in the quarter compared to adjusted EBITDA loss of $0.3 million in the second quarter of 2019.
2020 First Half Summary
Revenues totaled $32.6 million in the first half of 2020 compared with revenues of $18.7 million in the first half of 2019, an increase of 74%.
Gross profit totaled $11.6 million in the first half (36% of revenues), an increase of 72% compared to gross profit of $6.7 million in the first half of 2019 (36% of revenues).
Operating income was $0.7 million in the first half of 2020 compared to an operating loss of $1.4 million in the first half of 2019.
Adjusted EBITDA was $2.6 million in the first half of 2020 compared to adjusted EBITDA loss of $0.3 million in the first half of 2019.
Net income attributable to RADA’s shareholders in the first half was $0.9 million, or $0.02per share, compared to a net loss of $1 million, or $0.03 per share, in the first half of 2019.
As of June 30, 2020, RADA had net cash and cash equivalents of $29.5 millioncompared to $13.8 million as of year-end 2019. The inventory level has increased to $26.5 million from $17.2 million as at the end of 2019. RADA management decided to strategically increase the inventory level to support the future expected growth and to ensure full availability of components, given the current environment and the need to mitigate against any negative influence of the Covid-19 pandemic on the supply chain.
