Quarterly Report • May 29, 2014
Quarterly Report
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The Company is a "Small Corporation" as this term is defined in the Amendment to the Securities Regulations (Periodic and Immediate Reports) (Amendment), 2014 (hereinafter – "the Amendment"). On March 9, 2014 the Board of Directors of the Company adopted all the reliefs prescribed in the Amendment. For additional details see Immediate Report dated March 9, 2014 (Reference No. 2014-01-009177), which is hereby included by way of reference).
| Chapter / Paragraph |
Content | Page |
|---|---|---|
| Chapter A | Preface | 3 |
| 1.1 1.2 1.3 |
General Description of the Company and Its Business Environment Main Events in the Period of the Report and up to Its Publication |
3 3 4 |
| Chapter B | Board of Directors' Report | 7 |
| 2.1 2.2 2.3 2.4 2.5 2.6 |
Financial Position Liquidity and Sources of Financing Dedicated Disclosure to the Debenture Holders Quarterly Report on the Balance of the Company's Liabilities by maturity Dates Projected Cash Flow Details of the Approval Process of the Company's Financial Statements |
7 11 12 14 14 14 |
| Chapter C | Financial Statements as of March 31, 2014 (Unaudited) |
17 |
| 3.1 3.2 3.3 3.4 3.5 3.6 3.7 3.8 |
Review Report Condensed consolidated interim statement of financial position Condensed consolidated interim statement of operations Condensed consolidated interim statement of other comprehensive income (loss) Condensed consolidated interim statement of changes in equity Condensed consolidated interim statement of cash flows Notes to the Financial Statements Financial data from the consolidated financial interim statements attributed to the company itself - Special Report Pursuant to Regulation 38D (unaudited) |
19 20 22 23 24 26 28 33 |
| Chapter D | Statements by the CEO and CFO of the Corporation for the |
First Quarter of 2014 42
This report contains forward-looking information within the meaning of Section 32A of the Israeli Securities Law, 1968, including forecasts, assessments, estimates, expectations or other information pertaining to future events or issues, the realization of which is uncertain and not solely under the Company's control, if at all. This information is identified as such where it is used in this report. Although such information is based on data available to the Company as of the date of the report, and reflects the Company's intents and assessments as of such date, the actual occurrences and/or results may differ substantially from those presented in the report or implied therefrom as projected or anticipated, since their realization is subject, inter alia, to uncertainties and other factors beyond the Company's control as set out in this report below.
Company Name: Unitronics (1989) (R"G) Ltd. (hereinafter: "the Company" or "Unitronics")
Company No.: 520044199
Address: Unitronics Building, Arava Street, Airport City, P.O.B. 300, Israel 70100
Email Address: [email protected]
Telephone: 03 977 8888
Facsimile: 03 977 8877
Unitronics engages, through its Products Department, in the design, development, production, marketing and sale of industrial automation products, mainly programmable logic controllers (hereinafter: "PLCs"). PLCs are computer-based electronic products (hardware and software) used in the command and control of machines performing automatic tasks, such as production systems and automatic systems for industrial storage, retrieval and logistics, and automated parking facilities. The Company also engages, through its Systems Department, in design, construction and maintenance services in the framework of projects for automation, computerization and integration of computerized production and/or logistics systems, mainly automated warehouses, and automated distribution centers. In addition, the Company engages, through wholly owned subsidiaries, in the design, development, production, establishment and maintenance services of automated parking solution systems.
The Company's PLCs are distributed and sold through the Company's own marketing system and via Unitronics Inc., a wholly-owned subsidiary incorporated in the US, as well as through a chain of distributors comprising 165 distributors (of which 105 in the US) in approx. fifty countries (including Israel) throughout Europe, Asia, South and Central America, North America and Africa. The Systems Department services are provided mainly to customers in Israel, and, in a few cases, outside of Israel as well. The services of the Parking Solutions Department are primarily provided to customers in Israel and in the US.
The Company mainly operates from facilities located in "Unitronics Building," an office and industrial building which is leased, in part, by the Company, and a different part therein is leased to the Company. The Unitronics Building is situated at Airport City next to the David Ben-Gurion Airport, and it houses the Company's offices and all its other facilities in Israel. For additional details see sections 1.13.1 and 1.13.2 in Chapter A of the Company's Periodic Report for 2013, which was published by the Company on March 27, 2014, reference no: 2014-01-027369 (hereinafter – "the Periodic Report").
As of May 2004, the Company's shares are traded on the Tel Aviv Stock Exchange, and as of September 1999 on the Belgian Stock Exchange (first on the EuroNM Belgium Stock Exchange and, starting from the year 2000, on the EuroNext Stock Exchange in Brussels, Belgium).
On February 20, 2013, the Company entered into an agreement with a third party unrelated to the Company or to the interested parties therein (hereinafter "the Sale Agreement") for the sale of the Company's rights in a real estate property covering 11,000 square meters, in the Hevel Modiin – Tirat Yehuda Industrial Zone and the in the plans held by the Company in connection with the planning of the said property for a total consideration of NIS 18,550,000 plus VAT as required by law. The validity of the Sale Agreement was subject to the Board of Directors' approval of the Agreement no later than March 2, 2014. On February 23, 2014 the Board of Directors' approval as aforesaid was granted (for additional details on the Sale Agreement see Amending Immediate Report dated February 23, 2014 on an Event or Matter Outside the Ordinary Corporate Business, reference no.: 2014-01-044938, which is included herein by way of reference).
On March 23, 2014 the Company made the second principal payment of five on the debentures (Series 3), which were issued by the Company under a Shelf Prospectus published on February 22, 2011 and amended on March 17, 2011 (hereinafter – "the 2011 Shelf Prospectus") and a Shelf Offering Report published by the Company on March 22, 2011 pursuant to the 2011 Shelf Prospectus. For a full version of the 2011 Shelf Prospectus see company report dated February 22, 2011, reference no.: 2011-01- 0582690 and March 17, 2011, reference no.: 2011-01-084435. For a full version of the 2011 Shelf Offering Report see company report dated March 22, 2011, reference no.: 2011-01-088428. Following this payment, there are 33,865,200 outstanding debentures (Series 3) (for additional details see Immediate Report on the Status of Capital and Registers of Securities of the Corporation and Changes Therein, which is hereby included by way of reference, dated March 23, 2014, reference no: 2014-01-021297).
Subsequent to the balance sheet date, on May 7, 2014, Ms. Miri Ben David, the Company's controller, ceased to hold office. For further details see immediate report dated April 8, 2014, regarding a senior officer that ceased to hold office, reference no. 2014-01-041706, included herein by way of reference.
Subsequent to the balance sheet date, on May 4, 2014, Mr. Avi Peleg was appointed as the Company's controller. For further details see immediate report dated April 13, 2014, regarding the appointment of a senior officer, reference no. 2014-01-046305, included herein by way of reference.
On March 25, 2014, the Company's remuneration committee decided, in accordance with the provisions of Regulations 1B(5) and 1B(1) of the Companies Regulations (Relief for Transactions with Interested Parties), 2000 (the "Relief Regulations") to approve the renewal and extension of the Company's directors and officers liability insurance policy ("the Policy") for all the Company's directors and officers (those who are not controlling shareholders and also those who are controlling shareholders and their relatives), effective from July 1, 2013 to June 30, 2014 and to approve the renewal and extension of said policy for an additional 12-month period, from July 1, 2014 to June 30, 2015, in accordance with the Company's remuneration policy, which was approved in the Company's shareholders meeting on December 9, 2013 (for the wording of the approved remuneration policy, see appendix to an immediate report dated November 17, 2013, reference no.: 2013-01-193608, which is included herein by way of reference). In addition, further to the remuneration committee's approval as aforesaid, on March 25, 2014, the Company's board of directors approved, in accordance with the provisions of Regulation 1B(5) of the Relief Regulations, the renewal and extension of the policy for the Company's directors and officers who are controlling shareholders or their relatives, effective from July 1, 2013 to June 30, 2014 and approved the renewal and extension of said policy for an additional 12-month period, from July 1, 2014 to June 30, 2015, in accordance with the Company's remuneration policy (for details see Immediate Report on a Transaction with a Controlling Shareholder or Director that Does Not Require the Approval of the General Meeting, dated March 25, 2014, reference no.: 2014-01- 023721, which is included herein by way of reference).
On February 23, 2014 the Company's board of directors resolved to adopt a dividend distribution policy, commencing from the date of publication of the 2013 Periodic Report, as follows:
The Company shall distribute to its shareholders from the net profit attributable to the Company's shareholders, based on the consolidated audited annual financial statements of the Company, excluding profits from revaluation of assets (hereinafter –"the Profit") dividend at the rate of 33% of the Profit in respect of each calendar year, in excess of NIS 3,000,000 (three million New Israeli Shekels). The terms of distribution of the dividend, including the number and dates of the payments shall be determined by the Board of Directors of the Company specifically for each distribution.
The implementation of the said dividend policy is subject to: (a) the provisions of any applicable law, including the Company's compliance with the distribution tests set forth in Section 302 (A) of the Companies Law, 1999 ("the Companies Law") on the date of each distribution; (b) the Company's obligations to the holders of debentures, including financial covenants which the Company assumed and/or shall assume (for additional details on the Company's obligations towards the Company's debenture holders (Series 3 and 4) see section 1.20.6 and 1.20.8 (respectively) of the Periodic Report; (c) the Company's existing and anticipated obligations towards third parties, which are not the Company's shareholders or debenture holders; (d) the financing needs, investment plans and business plans of the Company, such that said distribution shall not prevent the Company from executing its plans and meeting its planned needs as shall be from time to time; (e) the Company's activities, cash flows and cash balance; and (f) other business considerations as shall be reviewed from time to time by the Board of Directors of the Company at its sole discretion.
The Board of Directors of the Company reserves the right to review the aforesaid policy from time to time, to change the policy at its sole discretion and to decide on a different use for the Company's profits.
The said policy came into effect from the date of publication of the Company's Annual Report. Based on the Company's financial statements for 2013, the Company's profits for 2013 did not reach the threshold allowing dividend distribution in accordance with the said policy.
Notwithstanding the aforesaid, the Company may distribute dividend whose amount deviates from the amount prescribed in the aforementioned policy, whether by paying a bigger dividend or smaller dividend than the aforesaid or by refraining from dividend payment or changing the date of the distribution and/or the distributed amount. It is clarified that nothing in the aforesaid provisions shall derogate from the Company's power to buy back Company shares, subject to the provisions of any applicable law. Insofar as such buybacks are made, they shall constitute part of the distributed amount, which is the subject of the aforesaid policy, for all intents and purposes. (For details see Immediate Report on an Event or matter Outside the Ordinary Corporate Business, dated February 23, 2014, reference no.: 2014-01-044944, which is included herein by way of reference).
Total assets according to the Company's consolidated balance sheet as of March 31, 2014, amounted to approx. NIS 196.592 million compared with approx. NIS 206.153 million as of December 31, 2013.
The balance of cash, cash equivalents and marketable securities increased and amounted to approx. NIS 75.999 million as of March 31, 2014, compared with approx. NIS 64.667 million as of December 31, 2013. Most of the increase stems from a positive cash flow from investment activities, primarily the sale of a real estate property as detailed in section 1.3.1 above, net of the cash flows used in financing activities, as explained in section 2.2 below.
Inventory recorded an immaterial increase and totaled approx. 18.904 million as of March 31, 2014 compared to approx. 18.456 million as of December 31, 2013.
A decrease was recorded in inventory of work in progress, which amounted to approx. NIS 12.170 million as of March 31, 2014, compared with approx. NIS 15.313 million as of December 31, 2013, and reflects progress in the execution of projects on the reporting date only.
The balance of fixed assets decreased to approx. NIS 19.475 million as of March 31, 2014, compared with approx. 40.247 million as of December 31, 2013. Most of the decrease stems from the sale of a real estate property as specified in section 1.3.1 above.
An increase was recorded in the balance of intangible assets, which amounted to NIS 46.837 million as of March 31, 2014, compared with approx. NIS 44.423 million as of December 31, 2013. The increase in this item is mainly attributable to the recording of the Company's development assets where the development costs satisfy the conditions for recognition as an intangible asset, offset by current amortization.
An increase was recorded in the balance of trade payables, which amounted to approx. NIS 20.628 million as of march 31, 2014, compared with approx. NIS 15.452 million as of December 31, 2013. The increase in this item is primarily due to an increase in trade payables in the Systems and Products segment.
Current maturities of long-term liabilities as of March 31, 2014 amounted to approx. NIS 20.558 million compared with approx. NIS 15.210 million as of December 31, 2013. The increase primarily stems from current maturities in respect of debentures (Series 4) that were recorded for the first time.
Non-current liabilities as of March 31, 2014 totaled approx. NIS 79.916 million, compared with NIS 98.553 million as of December 31, 2013. The decrease in non-current liabilities stems from the payment of two of the five principal installments on the debentures (Series 3) as detailed in section 1.3.2 above and from current maturities in respect of debentures (Series 4) that were recorded for the first time.
The Company's working capital did not change materially and as of March 31, 2014 totaled approx. NIS 57.163 million compared with approx. NIS 57.140 million as of December 31, 2013.
The Company's shareholders' equity increased slightly to approx. NIS 44.058 million as of March 31, 2014, compared with approx. NIS 43.763 million as of December 31, 2013. Most of the increase stems from the profit for the period as specified below.
The Company's revenues in the quarter that ended March 31, 2014, amounted to approx. 40.548 million compared to approx. NIS 32.393 million in the same quarter of 2013 (a 25% increase). Most of the growth in the quarter stems from an increase in revenues generated by the Systems segment and the Parking Solutions segment, as detailed below.
Company revenues from the Products segment in the quarter ended March 31, 2014, amounted to approx. NIS 24.619 million, a 6% increase compared to approx. NIS 23.290 million in the corresponding quarter of 2013. Most of this growth stems from an increase in product sales.
Revenues from the Systems segment in the quarter ended March 31, 2014, amounted to approx. NIS 12.131 million, a 37% increase compared to approx. NIS 8.862 million in the first quarter of 2013. The growth in revenues from the Systems segment stem from changes in the rate of progress in the construction of several logistic systems by the Company's systems department, mainly in connection with the planning and construction of logistics systems for key customers in Israel (for details see Sections 1.10.9 of the Company's Periodic Report), and in the rate of orders made by customers for the construction of systems in the reporting period, which is explained, among others by the relative volatility of this segment.
Revenues from the Parking Solutions segment amounted to approx. NIS 3.713 million in the quarter ended on March 31, 2014 compared to NIS 136 thousand in the first quarter of 2013. The changes in revenues from the Parking Solutions segment compared with the corresponding quarter of 2013 are mainly due to the expansion of business activity in this market (which until then was immaterial) and changes in the progress of planning and construction of automated marketing systems.
Revenues from the Products segment in the quarter ended March 31, 2014, accounted for 61% of total Company revenues in this quarter, whereas revenues from the Systems segment in the same period accounted for 30% of total revenues and revenues from the Parking Solutions segment accounted for 9% of revenues in the period. In the same period of 2013, revenues from the Products segment were 72% of total Company revenues for the quarter whereas revenues from the Systems segment accounted for 28% of total revenues and revenues from the Parking Solutions segment were less than 1%. Overall for the year 2013, revenues from Products accounted for some 61% of total revenues, revenues from Systems accounted for 35% of total revenues and revenues from Parking Solutions were 3% from total revenues for the period.
Total gross profit in the quarter ended March 31, 2014 grew to approx. NIS 11.340 million (28% of revenues for the period), compared with approx. NIS 7.783 million in the corresponding quarter of 2013 (24% of revenues for the period).
The increase in gross profit margins is mainly due to an improvement in the gross profit margins of the Systems segment as specified in section 2.1.3.2 below.
Net development costs in the quarter ended March 31, 2014, amounted to approx. NIS 1.301 million, compared with approx. NIS 2.254 million in the corresponding quarter of 2013. During the reporting period, an intangible asset in respect of development costs was recognized in the amount of approx. NIS 4.378 million, compared with NIS 4.030 million in the corresponding period of 2013. Total development costs in the reporting period reflect the continued development of technologies required to support the Company's operations, with a corresponding adjustment of the Company's development staff, which is designed to address its business plans in the different fields of operation. For details on the Company's assessment of development expenses, see items 1.9.17 and 1.11.15 in Chapter A of the Periodic Report.
Selling and marketing expenses in the quarter ended March 31, 2014 amounted to approx. NIS 4.395 million (about 11% of revenues), compared with approx. NIS 3.881 million (about 12% of revenues) in the corresponding quarter of 2013. The growth is mainly attributed to the Products segment, to meet the Company's business plans in this market. For details on selling and marketing expenses, see section 2.2.3.5 of the Periodic Report.
Administrative and general expenses in the quarter ended March 31, 2014 remained almost unchanged and they amounted to approx. NIS 2.626 million, compared with approx. NIS 2.701 million in the corresponding quarter of 2013.
In the quarter ended March 31, 2014 the operating profit increased, and amounted to approx. NIS 827 thousand (about 2% of revenues), compared to an operating loss of approx. NIS 1.060 million in the same quarter of 2013.
The growth in the operating profit in the reported quarter primarily stems from an increase in gross profit.
Net financing expenses in the quarter ended March 31, 2014, amounted to approx. NIS 385 thousand, compared with net financing expenses of approx. NIS 2.968 million in the first quarter of 2013. Most of the increase in this item stems from financing expenses in the first quarter of 2013 as a result of revaluation and exchange rate differences in respect of embedded derivatives (the Company has sale contracts in currencies other than its functional currency. These contracts in the Systems segment include foreign-currency embedded derivatives).
In the quarter ended March 31, 2014 taxes on income did not change materially and totaled NIS 190 thousand, while in the first quarter of 2013 there were no taxes on income.
In the reported quarter, the Company posted a net profit totaling approx. NIS 252 thousand, compared to a loss prox. NIS 4.028 million in the first quarter of 2013.
In the Company's opinion, the changes in the profit and loss results in the reported quarter primarily stem from the increase in profit from operating activities after deducting the decrease in financing expenses, as stated above.
As mentioned above, the Company's main commercial activity is conducted by means of three business departments: the Products Department, the Systems Department and the Parking Solutions Department. For further details regarding the Company's operating segments, see Chapter A, sections 1.8, 1.9, 1.10 and 1.11 of the Company's Periodic Report.
Details on the various segments' results appear hereunder.
In the reported period the Products Segment's operating results increased and amounted to a profit of approx. NIS 7.944 million, compared with a profit of approx. NIS 6.791 million in the corresponding quarter of 2013.
The change in the operating results of the Products segment in the reported quarter is due to an increase in revenues in this segment and some improvement in the gross profit margin which, in the Company's opinion, is attributable to the effect of fluctuations in the main currencies in which sales are made vis-à-vis the NIS.
In the reported period the System Segment's operating results increased and amounted to a profit of approx. NIS 1.155 million, compared with a loss of approx. NIS 1.389 million in the corresponding quarter of 2013.
The increase in the segment's profit stems, in the Company's opinion, from a YoY increase in revenues which generated a higher gross profit margin, together with a decrease in fixed expenses attributed to this segment.
The operating results of the Parking Solutions Segment remained virtually unchanged and amounted to a loss of approx. NIS 923 thousand in the reported quarter, compared with a loss of approx. NIS 1.162 million in the first quarter of 2013.
The balance of cash, cash equivalents and marketable securities of the Company as of March 31, 2014, totaled approx. NIS 75.999 million, compared with approx. NIS 64.667 million as of December 31, 2013. The growth primarily stems from positive cash flows from operating activities and investment activities after deducting negative cash flows used in financing activities, as explained below.
Cash flows from operating activities in the quarter ended March 31, 2014, amounted to a negative cash flow of approx. NIS 9.652 million. The positive cash flow primarily stemmed non-cash expenses (mainly depreciation and capital losses) and changes in assets and liability items (mainly a decrease in inventory of work in progress and an increase in trade payables).
Cash flows arising from investment activities in the quarter ended March 31, 2014, amounted to positive cash flows of approx. NIS 14.954 million. The positive cash flows primarily stem from the sale of a real estate property offset by investment in development assets during the period.
The cash flows used for financing activities in the quarter ended March 31, 2014, amounted to approx. NIS 12.938 million. The negative cash flow was mainly used to make the second of five payments of the (Series 3) debenture principal, as specified in section 1.3.2 of Chapter A above.
On March 31, 2014, total credit lines available to the Company for its operating activities amounted to approx. NIS 27.9 million, of which a total of NIS 27.5 million was used to secure the Company's obligations in projects carried out by the Systems and Parking Solutions segments.
| (1) | Security | Debentures (Series 3) |
|---|---|---|
| A | Issue date | March 2011 |
| B | Total par value on issue date | 0042244555 |
| Par value as of the reporting | 33,865,200 | |
| C | date | |
| Par value according to linkage | 35,348,555 | |
| D | terms – as of the report date |
|
| Accrued interest as of the | 43,000 | |
| E | report date | |
| Liability value as of the report | 34,493,000 | |
| F | date | |
| G | Stock Exchange value | 37,658,000 |
| Type of interest, including | 5.65% annual interest | |
| H | description | |
| Payment dates of outstanding | Three equal annual payments as of March | |
| I | principal | 23, 2015 |
| Future interest payment dates | Every 23rd of March and September | |
| commencing from September 23, 2014 and | ||
| J | until March 23, 2017 (inclusive) | |
| Details of linkage basis of | Principal and interest linked to the Consumer | |
| interest and principal | Price Index at a base rate of no less than | |
| 212.73 (February 2011 index according to | ||
| K | the 1993 basis) | |
| Are the debentures | Not convertible | |
| L | convertible? | |
| Corporation's right to perform | Exist (for details regarding the terms of the | |
| early redemption | Company to exercise its right to early | |
| redemption, see section 12 of the Shelf | ||
| Offering Report dated March 22, 2011, |
||
| M | Reference No. 2011-01-088428) | |
| N | Has a guarantee been given for | No |
| payment of the liability in the | ||
| trust deed? | ||
| O | Is the liability material to the Company? |
Yes |
| (2) | The trustee in charge of the |
Reznick, Paz, Nevo Trust Ltd |
| debenture series in the trust | 14, Yad Harutzim St, Tel Aviv 67778 | |
| company; the trustee's contact | Tel: 03-6389200; Fax: 03-6393316 | |
| details | Email: [email protected] |
favor of any third party whatsoever, without the trustee's prior written consent, save with regard to charges on land and/or equipment that will be purchased by the Company subsequent to the date of signing the trust deed, the pledging thereof will serve solely for the purpose of securing the funding to be given for purchasing the asset that is the object of the charge – and which the Company will be permitted to create without any restrictions in favor of any person or corporation. Subject to the aforesaid, the Company shall be entitled to create, without any limitation, additional charges of any type on its assets, all or part thereof, without derogating from the Company's ability to undertake towards third parties to refrain from creating additional charges and without derogating from the aforesaid undertakings which the Company made to the banks prior to the date of signing the Debenture Trust Deed (Series 3).
| (1) | Security | Debentures (Series 4) |
|---|---|---|
| A | Issue date | January 2013 |
| B | Total par value on issue date | 004,404555 |
| Par value as of the reporting | 004,404555 | |
| C | date | |
| Par value according to linkage | 53,667,000 | |
| D | terms – as of the report date |
|
| Accrued interest as of the | 472,000 | |
| E | report date | |
| Liability value as of the report | 52,374,000 | |
| F | date | |
| G | Stock Exchange value | 55,909,000 |
| Type of interest, including | 5.4% annual interest | |
| H | description | |
| Payment dates of outstanding | Six unequal annual installments payable on | |
| principal | January 31 of each year from 2015 to 2020 | |
| (inclusive), at the following rates by years in |
||
| chronological order: (a) 12.5% of the | ||
| principal, (b) 12.5% of the principal, (c) | ||
| 12.5% of the principal (d) 20.5% of the | ||
| principal, (e) 21% of the principal, (f) 21% of | ||
| I | the principal. | |
| Future interest payment dates | Every January 31 and July 31 from July 31, | |
| J | 2014 until (and including) January 31, 2020 |
|
| Details of linkage basis of | Principal and interest linked to the Consumer | |
| interest and principal | Price Index from 219.80 (December 2012 |
|
| index according to the 1993 base) without |
||
| K | protection | |
| Are the debentures | Not convertible | |
| L | convertible? | |
| Corporation's right to perform | Exists (for details regarding the terms of the |
|
| early redemption | Company to exercise its right to early | |
| redemption, see section 12 of the Shelf | ||
| Offering Report dated January 24, 2013, |
||
| M | Reference No. 2013-01-021699) | |
| N | Has a guarantee been given for | No |
| payment of the liability in the | ||
| trust deed? | ||
| Is the liability material to the | Yes | |
| O | Company? | |
| (2) | The trustee in charge of the | Custodian – Mishmeret Trust Company Ltd. |
| debenture series in the trust | 48 Menachem Begin Road, Tel Aviv 66184, |
| company; the trustee's contact | |
|---|---|
| details |
For details on the Company's liabilities by repayment dates, as of March 31, 2014, see report dated May 29, 2014, which the Company published concurrently with the publication of this report.
The Board of Directors determined, following an examination of the warning signs specified in Regulation 10(b) (14) of the Securities Regulations (Periodic and Immediate Reports), 1970, regarding disclosure of the projected cash flows for repayment of the Company's obligations, that no waning sign exists, that the Company has no liquidity problems and is able to meet its obligations, including the full payment of its liabilities in respect of the issuance of Debentures (Series 3 and 4). An examination as stated is performed by the Board of Directors on a quarterly basis, at the time of approval of the financial statements published by the Company for the quarter in question.
The Company's financial statements were prepared by the Company's CFO. The statements were reviewed by the Company's auditor, who is given full access to all data and information in the Company, including meetings with the Company's employees and managers, as required by him. Subsequent to the auditor's review, the financial statements were submitted to the members of the Financial Statements Review Committee.
Once the Companies Regulations (Directives and Conditions Concerning the Procedure for Approving Financial Statements), 2010, came into effect, the Audit Committee was appointed by the Company's Board of Directors (during its meeting on November 11, 2010) to also serve as a Balance Sheet Committee for Review of the Financial Statements (hereafter: "the Committee"), said committee having a composition and significance that are consistent with said regulations, in all matters related to the Financial Statements as at December 31, 2010, and thereafter. As of the reporting date, the following directors serve on this committee:
| Name | CPA Zvi | CPA Yoel | CPA |
|---|---|---|---|
| Livneh | Sela | Moshe | |
| Braaz | |||
| An independent or an | No | External | External |
| external director | director | director | |
| Chairman of the Committee | No | No | Yes |
| for Review of the Financial | |||
| Statements | |||
| Has accounting and financial | Yes | Yes | Yes |
| expertise | |||
| Did he provide a statement | Yes | Yes | Yes |
| prior to his nomination? |
* For details regarding the education and experience of the members of the Committee for Review of the Financial Statements, see section 4.10 of Chapter D of the Periodic Report.
As part of the process of approval of the financial statements as of March 31, 2014, a Committee meeting was held on May 27, 2014. A comprehensive discussion of material issues took place in order to formulate the Committee's recommendations to the Board of Directors, for the purpose of its approval of the financial statements; later, the Committee approved its recommendations.
The following people were invited to, and attended, the Committee meeting on May 27, 2014: members of the Committee (CPAs Yoel Sela, Zvi Livneh and Moshe Braaz), the other members of the Board of Directors (Mr. Haim Shani, Ms. Bareket Shani and Ms. Edna Ramot); Mr. Yair Itzkovitch, CFO; CPA Avi Peleg, Company Controller, Mr. Nir Weisberger, Company attorney, CPA Gal Amit from the Company's accounting firm; and Mr. Miguel Alhanti from the Company's Internal Audit Office.
The committee discussed and formulated its recommendations to the Board of Directors regarding the following matters: assessments and estimates made in connection with the financial statements; the integrity and appropriateness of the disclosure in the financial statements; the accounting policy adopted and the accounting treatment implemented in material issues; valuations including the underlying assessments and estimates. The draft financial statements and Committee recommendations were submitted to the Board for review four business days before the Board convened to discuss the financial statements, which is, in the Board's estimation, a reasonable timeframe to submit the recommendations to the Board of Directors.
The Company regards the Board of Directors as the entity in charge of overall control of the Company's financial statements. The members of the Company's Board of Directors and their respective duties in the Company are as follows:
Following the Board of Directors' review of the financial statements, a Board meeting was held for the purpose of presenting and discussing the financial statements. In a meeting on May 29, 2014, the Company management reviewed the main data of the financial statements. The Company's auditor attended the meeting and responded to the questions addresses to him by the Board of Directors (together with the Company's CEO and CFO, who responded to questions addressed to them). At the end of the discussion, the financial statements were unanimously approved by a vote of the Board of Directors.
_________________ _________________ Zvi Livneh Haim Shani Director Chairman and CEO
Date: May 29, 2014
(Unaudited)
(unaudited)
| 2 | Review Report |
|---|---|
| 3-4 | Condensed consolidated interim statement of financial position |
| 5 | Condensed consolidated interim statement of operations |
| 6 | Condensed consolidated interim statement of comprehensive income (loss) |
| 7-8 | Condensed consolidated interim statement of changes in equity |
| 9-10 | Condensed consolidated interim statement of cash flows |
| 11-15 | Notes to the financial statements |
We reviewed the attached financial information of Unitronics (1989) (R"G) Ltd. and its subsidiaries (hereinafter – "the Group") which include the condensed consolidated interim statement of financial position as at March 31, 2014 and the condensed consolidated interim statements of operations, comprehensive income, changes in equity and cash flows for the period of three months then ended. The Board of Directors and management are responsible for the preparation and presentation of the financial information for this interim period in accordance with IAS 34 "Financial reporting for interim periods", and they are responsible for the preparation of financial information for this interim period under Chapter D of the Israeli Securities Regulations (Periodic and Immediate Report) – 1970. Our responsibility is to express a conclusion on the financial information for the interim period, based on our review.
We prepared our review in accordance with Review Standard No.1 of the Institute of Certified Public Accountants in Israel "Review of financial information for interim periods prepared by the entity's auditor". The review of the financial information for interim periods comprises clarifications, mainly with the people responsible for financial and accounting matters, and from adopting analytical and other review procedures. A review is more limited in scope to a much larger extent than an audit performed in accordance with generally accepted auditing standards in Israel, and therefore does not enable us to be certain that we will know of all the significant matters which could have been identified in an audit. Consequently, we are not issuing an audit opinion.
Based on our review, nothing came to our notice which would cause us to think that the above financial information is not prepared, in all significant aspects, in accordance with IAS 34.
In addition to the remarks in the previous paragraph, based on our review, nothing came to our notice which cause us to think that the above financial information does not meet, in all significant aspects, the provisions of Disclosure under Chapter D of the Israeli Securities Regulations (Periodic and Immediate Reports) - 1970.
Amit, Halfon Certified Public Accountants (Israel)
Ramat Gan, May 29, 2014
61 Aba Hillel Silver St. Ramat-Gan 52506 Israel Tel: +972-3-6123939 Fax: +972-3-6125030 e-mail: office@ahcpa.co.il
Amit, Halfon is a member firm of the PKF International Limited network of legally independent firms and does not accept any responsibility or l iability for the actions or inactions on the part of any other individual member firm or firms.
| March 31, 2014 |
March 31, 2014 |
December 31, 2013 |
||
|---|---|---|---|---|
| (unaudited) | (unaudited) | (audited) | ||
| Convenience translation into Euro (1) |
(in thousands) | NIS | ||
| Current assets Cash and cash equivalents Restricted cash Marketable securities Accounts receivable - Trade Other Inventory Inventory - work in progress |
10,418 726 5,374 3,716 276 3,928 2,530 26,968 |
50,135 3,496 25,864 17,885 1,327 18,904 12,170 129,781 |
36,485 4,118 30,740 16,289 3,448 25,248 24,102 140,430 |
38,442 4,145 26,225 16,819 1,577 18,456 15,313 120,977 |
| Non-current assets Deferred taxes Long-term deposits Property and equipment, net Intangible assets, net |
20 84 4,047 9,732 13,883 40,851 |
94 405 19,475 46,837 66,811 196,592 |
- 182 40,496 37,108 77,786 218,216 |
94 412 40,247 44,423 85,176 206,153 |
Haim Shani Tzvi Livne Yair Itscovich Chairman of the Board of Directors and C.E.O.
Director Chief Financial Officer
Approved: May 29, 2014
(1) See note 1C.
| March 31, 2014 |
March 31, 2014 |
March 31, 2013 |
December 31, 2013 |
|
|---|---|---|---|---|
| (unaudited) | (unaudited) | (audited) | ||
| Convenience translation into Euro (1) |
(in thousands) | NIS | ||
| Current liabilities | ||||
| Current maturities of long-term loans | 583 | 2,807 | 4,426 | 3,346 |
| Current maturities of bonds Accounts payable - |
3,689 | 17,751 | 17,838 | 11,864 |
| Trade | 4,287 | 20,628 | 27,527 | 15,452 |
| Other | 6,319 | 30,410 | 28,161 | 31,889 |
| Embedded derivatives | 212 | 1,022 | 3,482 | 1,286 |
| 15,090 | 72,618 | 81,434 | 63,837 | |
| Non - current liabilities | ||||
| Loans from banks and others | 1,406 | 6,764 | 9,381 | 7,319 |
| Bonds | 14,361 | 69,115 | 85,013 | 87,251 |
| Liabilities for benefits to employees, net | 515 | 2,478 | 2,614 | 2,398 |
| Deferred taxes | 324 16,606 |
1,559 79,916 |
- 97,008 |
1,585 98,553 |
| Equity Share capital |
73 | 352 | 352 | 352 |
| Share premium | 10,512 | 50,588 | 50,588 | 50,588 |
| Capital reserve from translation of | ||||
| foreign operations | (321) | (1,545) | (1,159) | (1,588) |
| Company shares held by the company Reserve deriving from a transaction |
(1,463) | (7,042) | (7,042) | (7,042) |
| with a controlling party | 22 | 104 | 104 | 104 |
| Retained earnings (losses) | 332 | 1,601 | (3,069) | 1,349 |
| 9,155 | 44,058 | 39,774 | 43,763 | |
| 40,851 | 196,592 | 218,216 | 206,153 |
(1) See note 1C.
| For the three months period ended March 31, |
For the three months period ended March 31, |
For the year ended December 31, |
||
|---|---|---|---|---|
| 2014 | 2014 | 2013 | 2013 | |
| (unaudited) | (unaudited) | (audited) | ||
| (in thousands) | ||||
| Convenience translation into Euro (1) |
NIS | |||
| Revenues | 8,426 | 40,548 | 32,393 | 156,179 |
| Cost of revenues | 6,070 | 29,208 | 24,610 | 112,728 |
| Gross profit | 2,356 | 11,340 | 7,783 | 43,451 |
| Development expenses, net | 270 | 1,301 | 2,254 | 5,706 |
| Selling & marketing expenses | 913 | 4,395 | 3,881 | 17,056 |
| General & administrative expenses | 546 | 2,626 | 2,701 | 11,240 |
| Other expenses | 455 | 2,191 | 7 | 7 |
| Operating profit (loss) | 172 | 827 | (1,060) | 9,442 |
| Financing income | 200 | 962 | 1,246 | 2,681 |
| Financing expenses | 280 | 1,347 | 4,214 | 10,513 |
| Profit (loss) before taxes on income |
92 | 442 | (4,028) | 1,610 |
| Taxes on income | (39) | (190) | - | (1,444) |
| Net profit (loss) for the period | 53 | 252 | (4,028) | 166 |
| Profit per 1 ordinary share NIS 0.02 par value (NIS): |
||||
| Basic and diluted earnings per 1 ordinary share |
0.005 | 0.025 | (0.403) | 0.017 |
(1) See note 1C.
| For the three months period ended March 31, |
For the three months period ended March 31, |
For the year ended December 31, |
||
|---|---|---|---|---|
| 2014 | 2014 | 2013 | 2013 | |
| (unaudited) | (unaudited) | (audited) | ||
| (in thousands) | ||||
| Convenience translation into Euro (1) |
NIS | |||
| Net profit (loss) for the period | 53 | 252 | (4,028) | 166 |
| Other comprehensive income (loss) | ||||
| Items that may not be classified afterwards to profit or loss - |
||||
| Actuarial gains | - | - | 224 | |
| Items that may be reclassified to profit or loss in the future if certain conditions are met - |
||||
| Translation of foreign operations | 9 | 43 | (202) | (631) |
| Other comprehensive income (loss) for the period |
9 | 43 | (202) | (407) |
| Total comprehensive income (loss) for the period |
62 | 295 | (4,230) | (241) |
(1) See note 1C.
| Share capital |
Share premium |
Capital reserve from translation of foreign operation |
Company shares held by the company |
Reserve deriving from a transaction with a controlling party |
Retained earnings (loss) |
Total | |
|---|---|---|---|---|---|---|---|
| NIS, in thousands | |||||||
| Balance at January 1, 2013 (audited) | 352 | 50,588 | (957) | (7,042) | - | 959 | 43,900 |
| Net profit for the year | - | - | - | - | - | 166 | 166 |
| Other comprehensive income (loss) for the year |
- | - | (631) | - | - | 224 | (407) |
| Total comprehensive income (loss) for the year |
- | - | (631) | - | - | 390 | (241) |
| Capital benefit deriving from a transaction with a controlling party |
- | - | - | - | 104 | - | 104 |
| Balance at December 31, 2013 (audited) | 352 | 50,558 | (1,588) | (7,042) | 104 | 1,349 | 43,763 |
| Net profit for the period | - | - | - | - | - | 252 | 252 |
| Other comprehensive income for the period |
- | - | 43 | - | - | - | 43 |
| Total comprehensive income for the period |
- | - | 43 | - | - | 252 | 295 |
| Balance at March 31, 2014 (unaudited) | 352 | 50,588 | (1,545) | (7,042) | 104 | 1,601 | 44,058 |
| Balance at January 1, 2013 (audited) | 352 | 50,588 | (957) | (7,042) | - | 959 | 43,900 |
| Net loss for the period Other comprehensive loss for the period |
- - |
- - |
- (202) |
- - |
- - |
(4,028) - |
(4,028) (202) |
| Total comprehensive loss for the period | - | - | (202) | - | - | (4,028) | (4,230) |
| Capital benefit deriving from a transaction with a controlling party |
- | - | - | - | 104 | - | 104 |
| Balance at March 31, 2013 (unaudited) | 352 | 50,588 | (1,159) | (7,042) | 104 | (3,069) | 39,774 |
| Share capital |
Share premium |
Capital reserve from translation of foreign operation |
Company shares held by the company |
Reserve deriving from a transaction with a controlling party |
Retained earnings |
Total | |
|---|---|---|---|---|---|---|---|
| Convenience translation into Euro (1), in thousands (unaudited) | |||||||
| Balance at December 31, 2013 (audited) | 73 | 10,512 | (330) | (1,463) | 22 | 279 | 9,093 |
| Net profit for the period Other comprehensive income for the |
- | - | - | - | - | 53 | 53 |
| period | - | - | 9 | - | - | - | 9 |
| Total comprehensive income for the period |
- | - | 9 | - | - | 53 | 62 |
| Balance at March 31, 2014 (unaudited) | 73 | 10,512 | (321) | (1,463) | 22 | 332 | 9,155 |
(1) See note 1C.
| For the three months period ended March 31, 2014 |
For the three months period ended March 31, 2014 |
2013 | For the year ended December 31, 2013 |
|
|---|---|---|---|---|
| (unaudited) | (unaudited) | (audited) | ||
| Convenience translation into |
(in thousands) | |||
| Euro (1) | NIS | |||
| Cash flows - operating activities Net profit (loss) for the period Adjustments necessary to show the cash flows - operating activities |
53 | 252 | (4,028) | 166 |
| (Appendix A) | 1,953 | 9,400 | (11,584) | 3,166 |
| Cash flows provided by (used in) operating activities |
2,006 | 9,652 | (15,612) | 3,332 |
| Cash flows - investing activities Sale of (investment in) marketable securities, net Purchase of property and equipment Sale of property and equipment Investment in restricted cash Repayment of restricted cash Repayment (investment) in long-term deposits Investment in intangible assets Cash flows provided by (used in) investing activities |
89 (16) 3,803 - 136 5 (910) 3,107 |
430 (76) 18,300 - 655 23 (4,378) 14,954 |
(184) (553) 77 (1,454) 700 5 (4,181) (5,590) |
5,453 (1,499) 77 (1,454) 700 20 (15,876) (12,579) |
| Cash flows - financing activities Repayment of long-term loans Bonds issue Repayment of bonds Cash flows provided by (used in) financing activities |
(240) - (2,448) (2,688) |
(1,155) - (11,783) (12,938) |
(1,136) 51,509 (11,643) 38,730 |
(4,476) 51,509 (18,031) 29,002 |
| Translation differences in respect of foreign operation cash balances |
5 | 25 | (56) | (326) |
| Change in cash and cash equivalents in the period Cash and cash equivalents at beginning of the |
2,430 | 11,693 | 17,472 | 19,429 |
| period | 7,988 | 38,442 | 19,013 | 19,013 |
| Cash and cash equivalents at end of the period |
10,418 | 50,135 | 36,485 | 38,442 |
(1) See note 1C.
| period ended March 31, 2014 |
period ended March 31, 2014 |
For the three months 2013 |
For the year ended December 31, 2013 |
|
|---|---|---|---|---|
| (unaudited) | (unaudited) | (audited) | ||
| (in thousands) | ||||
| Convenience translation into Euro (1) |
NIS | |||
| Appendix A - Adjustments necessary to show the cash flows - operating activities |
||||
| Income and expenses not involving cash flows: Depreciation and amortization Loss (profit) from marketable securities, net Change in liabilities for benefits to employees, net Capital loss Reevaluation of long-term loans and bonds Reevaluation of restricted cash Deferred taxes |
526 (14) 17 455 (128) (1) 39 |
2,533 (69) 80 2,191 (618) (6) 190 |
1,769 130 (26) 7 (791) (15) - |
8,374 (992) (53) 7 1,372 (42) 1,444 |
| Reevaluation of embedded derivatives | (55) | (264) | 2,013 | (183) |
| Changes in assets and liabilities: Increase in accounts receivable - trade Decrease (increase) in accounts receivable - other Decrease (increase) in inventory |
(218) 4 (90) |
(1,047) 21 (434) |
(1,675) (668) (3,044) |
(2,376) 1,020 3,223 |
| Decrease (increase) in inventory - work in progress Increase (decrease) in accounts payable - |
653 | 3,144 | (6,097) | 2,682 |
| trade Increase (decrease) in accounts payable - other |
1,076 (311) 1,953 |
5,177 (1,498) 9,400 |
(3,225) 38 (11,584) |
(15,301) 3,991 3,166 |
| Appendix B - Additional information regarding operating activities |
||||
| Cash paid during the period for: Interest |
597 | 2,872 | 1,939 | 5,221 |
| Taxes on income | 6 | 27 | 27 | 108 |
| Cash received during the period for: Interest and dividend |
118 | 567 | 691 | 1,280 |
| Appendix C - Non-cash operations | ||||
| Capital benefit deriving from a transaction with a controlling party |
- | - | 104 | 104 |
(1) See note 1C.
| As of | Israeli CPI | Exchange rate of one Euro |
Exchange rate of one U.S. dollar |
|---|---|---|---|
| Points (*) | NIS | NIS | |
| March 31, 2014 | 222.70 | 4.8124 | 3.487 |
| March 31, 2013 | 219.86 | 4.6612 | 3.648 |
| December 31, 2013 | 223.80 | 4.7819 | 3.471 |
| Change during the period | % | % | % |
| Three months ended March 31, 2014 | (0.49) | 0.64 | 0.46 |
| Three months ended March 31, 2013 | 0.02 | (5.27) | (2.28) |
| Year ended December 31 2013 | 1.82 | (2.82) | (7.02) |
(*) The index on an average basis of 1993 = 100.
C. Convenience translation in EURO
For the convenience of the reader, the NIS amounts for the last reported period have been translated to EURO by dividing each NIS amount by the representative exchange rate of the EURO as at March 31, 2014 (EURO 1 = NIS 4.8124).
The translated EURO amounts presented in these financial statements should not be construed as representing amounts receivable or payable in EURO unless otherwise indicated.
A. The interim consolidated financial statements are prepared in accordance with generally accepted accounting principles for the preparation of financial statements for interim periods as set in IAS 34 – "Financial reporting for interim periods" including the requirements of disclosure under Chapter D of the Israeli Securities Regulations (Periodic and Immediate Reports) - 1970.
The significant accounting principles and the methods of calculation which were implemented in the preparation of the interim financial statements are identical to those used in the preparation of the last annual financial statements, except as described in paragraph B below.
Amendments to IAS 32 - "Financial Instruments: Presentation regarding Offsetting Financial Assets and Financial Liabilities":
The IASB issued amendments to IAS 32 ("the amendments to IAS 32") regarding the offsetting of financial assets and financial liabilities. The amendments to IAS 32 clarify, among others, the meaning of "currently has a legally enforceable right of set-off" ("the right of set-off"). Among others, the amendments to IAS 32 prescribe that the right of set-off must be legally enforceable not only during the ordinary course of business of the parties to the contract but also in the event of bankruptcy or insolvency of one of the parties. The amendments to IAS 32 also state that in order for the right of set-off to be currently available, it must not be contingent on a future event, there may not be periods during which the right is not available, or there may not be any events that will cause the right to expire.
The amendments to IAS 32 are to be applied retrospectively from the financial statements for annual periods beginning on January 1, 2014 or thereafter. Earlier application is permitted.
The influence of the amendments Implementation was not material to the company.
Below the balances in the books and the fair value of financial instruments which are not presented in the financial statements according to their fair value, and there is a substantial difference between the carrying amount to fair value:
| March 31, 2014 | ||
|---|---|---|
| Book value | Fair value | |
| (unaudited) | ||
| NIS, (in thousands) | ||
| Financial liabilities (*) | ||
| Bonds linked to the Israeli CPI | 86,866 | 93,567 |
| March 31, 2013 | ||
| Book value | Fair value | |
| (unaudited) | ||
| NIS, (in thousands) | ||
| Financial liabilities (*) | ||
| Bonds linked to the Israeli CPI | 102,851 | 111,497 |
| December 31, 2013 | ||
| Book value | Fair value | |
| (audited) | ||
| NIS, (in thousands) | ||
| Financial liabilities (*) | ||
| Bonds linked to the Israeli CPI | 99,115 | 106,978 |
(*) The fair value is based on stock market value as at the report date.
B. Classification of financial instruments at fair value rating
The financial instruments presented in the statement of financial position at fair value or that are disclosed at their fair value, are classified, according to groups with similar characteristics to the rating of fair value, which is determined in accordance with the source of the data used in determining fair value:
Level 1: Quoted prices (without adjustments) in an active market of identical assets and liabilities.
Level 2: Data which is not quoted prices included in Level 1, which can be seen directly or indirectly.
Level 3: Data which is not based on market data which can be seen (evaluation techniques without the use of market data which can be seen).
The Company holds financial instruments measured at fair value according to the classifications as follows:
| Level 1 | Level 2 | Level 3 | Total | |
|---|---|---|---|---|
| As at March 31, 2014 (unaudited) | NIS, (in thousands) | |||
| Financial assets at fair value: | ||||
| Marketable securities | 25,864 | - | - | 25,864 |
| Forward contracts | - | 10 | - | 10 |
| Financial liabilities at fair value: | ||||
| Embedded derivatives | - | 1,022 | - | 1,022 |
| As at March 31, 2013 (unaudited) | ||||
| Financial assets at fair value: | ||||
| Marketable securities | 30,740 | - | - | 30,740 |
| Financial liabilities at fair value: | ||||
| Embedded derivatives | - | 3,482 | - | 3,482 |
| As at December 31, 2013 (audited) | ||||
| Financial assets at fair value: | ||||
| Marketable securities | 26,225 | - | - | 26,225 |
| Financial liabilities at fair value: | ||||
| Embedded derivatives | - | 1,286 | - | 1,286 |
During the specified periods, there were no transfers between Level 1 and Level 2, and there were no transfers to or from Level 3.
The Company has sales contracts denominated in currencies which are not the Company's functional currency. These contracts included imbedded derivatives which are measured based on the current spot rates, the yield curve of the relevant currencies and the margins between the currencies.
A. The Group defined the Company's CEO who makes the strategic decisions as the chief operating decision maker, of the Group. The CEO reviews the internal reports of the Group in order to evaluate performance and allocate recourses and determines the operating segments based on these reports.
The CEO examines the segments operating performance on the basis of measuring operating income, this measurement basis is not affected by one time expenses in the operating segments, such as the costs of structural change and an impairment in the value of assets, where the impairment in value results from a single one time event. Interest revenues and expenses and taxes are not included in the results in each of the operating segments examined by senior management.
| For the three months period ended March 31, |
For the three months period ended March 31, |
For the year ended December 31, |
|||
|---|---|---|---|---|---|
| 2014 | 2014 | 2013 | 2013 | ||
| (unaudited) | (unaudited) | (audited) | |||
| (in thousands) | |||||
| Convenience translation into Euro (1) |
NIS | ||||
| C. Revenues | |||||
| Products | 5,115 | 24,619 | 23,290 | 95,449 | |
| System integration projects | 2,521 | 12,131 | 8,862 | 55,096 | |
| Parking solutions | 772 | 3,713 | 136 | 5,195 | |
| Other | 18 | 85 | 105 | 439 | |
| Total revenues | 8,426 | 40,548 | 32,393 | 156,179 | |
| D. Segment results | |||||
| Products | 1,651 | 7,944 | 6,791 | 28,336 | |
| System integration projects | 240 | 1,155 | (1,387) | 5,002 | |
| Parking solutions | (192) | (923) | (1,162) | (4,716) | |
| Other | (1) | (4) | - | 25 | |
| Unallocated corporate expenses | (1,526) | (7,345) | (5,302) | (19,205) | |
| Operating profit (loss) | 172 | 827 | (1,060) | 9,442 | |
| Unallocated financing expenses, net | (80) | (385) | (2,968) | (7,832) | |
| Taxes on income | (39) | (190) | - | (1,444) | |
| Profit (loss) for the period | 53 | 252 | (4,028) | 166 |
(1) See note 1C
March 31, 2014
(Unaudited)
We reviewed the separate interim financial information presented under Regulation 38D to the Israeli Securities Regulations (Periodic and Immediate Reports), 1970 of Unitronics (1989) (R"G) Ltd. (hereinafter - "the Company") as at March 31, 2014 and for the period of three months then ended. The separate financial information is in the responsibility of the Company's Board of Directors and Management. Our responsibility is to express a conclusion on the separate interim financial information for the interim period, based on our review.
We prepared our review in accordance with Review Standard 1 of the Institute of Certified Public Accountants in Israel "Review of financial information for interim periods prepared by the entity's auditor". The review of the financial information for interim periods comprises clarifications, mainly with the people responsible for financial and accounting matters, and from adopting analytical and other review procedures. A review is more limited in scope to a much larger extent than an audit performed in accordance with generally accepted auditing standards, and therefore does not enable us to be certain that we will know of all the significant matters which could have been identified in an audit. Consequently, we are not issuing an opinion of an audit.
Based on our review, nothing came to our notice which would cause us to think that the above separate interim financial information is not prepared, in all significant aspects, in accordance with regulation 38D of the Israeli Securities Regulations (Periodic and Immediate Reports), 1970.
Amit, Halfon Certified Public Accountants (Israel)
Ramat Gan,
May 29, 2014
61 Aba Hillel Silver St. Ramat-Gan 52506 Israel Tel: +972-3-6123939 Fax: +972-3-6125030 e-mail: office@ahcpa.co.il
Amit, Halfon is a member firm of the PKF International Limited network of legally independent firms and does not accept any responsibility or liability for the actions or inactions on the part of any other individual member firm or firms.
| March 31, 2014 |
March 31, 2014 |
March 31, 2013 |
December 31, 2013 |
||
|---|---|---|---|---|---|
| (unaudited) | (unaudited) | (audited) | |||
| Convenience | (in thousands) | ||||
| translation into Euro (1) |
NIS | ||||
| Current assets | |||||
| Cash and cash equivalents | 9,156 | 44,060 | 32,462 | 6,2,23 | |
| Restricted cash | 726 | 3,496 | 4,118 | ,21,2 | |
| Marketable securities | 5,374 | 25,864 | 30,740 | ,32,,2 | |
| Accounts receivable - | |||||
| Trade | 2,741 | 13,189 | 12,135 | 1,2111 | |
| Other | 84 | 402 | 2,967 | 363 | |
| Accounts receivable - other - subsidiaries | 2,899 | 13,950 | 15,740 | 152321 | |
| Inventory | 3,558 | 17,123 | 23,022 | 132311 | |
| Inventory - work in progress | 1,753 | 8,437 | 22,727 | 1,2,25 | |
| 26,291 | 126,521 | 143,911 | 1132555 | ||
| Non-current assets | |||||
| Long-term deposits | 84 | 405 | 182 | ,1, |
| 41,185 | 198,198 | 216,296 | 112222 772,722 |
|
|---|---|---|---|---|
| 14,894 | 71,677 | 72,385 | 91,577 | |
| Intangible assets, net | 7,756 | 37,326 | 32,338 | 632,,1 |
| Long-term receivables - Subsidiaries | 3,117 | 15,000 | - | 122555 |
| Property and equipment, net | 3,937 | 18,946 | 39,865 | 612212 |
Haim Shani Tzvi Livne Yair Itscovich Chairman of the Board of Directors and C.E.O.
Director Chief Financial Officer
Approved: May 29, 2014.
(1) See note 1C.
The additional information to the financial information form an integral part thereof.
Unitronics (1989) (R"G) Ltd.
| March 31, 2014 |
March 31, 2014 |
March 31, 2013 |
December 31, 2013 |
||
|---|---|---|---|---|---|
| (unaudited) | (unaudited) | ||||
| Convenience translation |
(in thousands) | ||||
| into Euro (1) | NIS | ||||
| Current liabilities | |||||
| Current maturities of long term loans | 583 | 2,807 | 4,426 | 3,346 | |
| Current maturities of bonds Accounts payable - |
3,689 | 17,751 | 17,838 | 11,864 | |
| Trade | 3,642 | 17,525 | 25,377 | 13,343 | |
| Other | 4,612 | 22,196 | 23,307 | 25,669 | |
| Embedded derivatives | 212 | 1,022 | 3,482 | 1,286 | |
| 12,738 | 61,301 | 74,430 | 55,508 | ||
| Non-current liabilities Liabilities less assets associated with |
|||||
| subsidiaries | 2,686 | 12,923 | 5,084 | 9,753 | |
| Loans from banks and others | 1,406 | 6,764 | 9,381 | 7,319 | |
| Bonds | 14,361 | 69,115 | 85,013 | 87,251 | |
| Liabilities for benefits to employees, net | 515 | 2,478 | 2,614 | 2,398 | |
| Deferred taxes | 324 | 1,559 | - | 1,585 | |
| 19,292 | 92,839 | 102,092 | 108,306 | ||
| Equity | |||||
| Share capital | 73 | 352 | 352 | 352 | |
| Share premium | 10,512 | 50,588 | 50,588 | 50,588 | |
| Capital reserve from translation of | |||||
| foreign operations | (321) | (1,545) | (1,159) | (1,588) | |
| Company shares held by the company Reserve arising from a transaction with a |
(1,463) | (7,042) | (7,042) | (7,042) | |
| controlling party | 22 | 104 | 104 | 104 | |
| Retained earnings (losses) | 332 | 1,601 | (3,069) | 1,349 | |
| 9,155 | 44,058 | 39,774 | 43,763 | ||
| 41,185 | 198,198 | 216,296 | 207,577 |
(1) See note 1C.
| For the three months period ended March 31, |
For the three months period ended March 31, |
For the year ended December 31, 2013 |
||||
|---|---|---|---|---|---|---|
| 2014 | 2014 | 2013 | ||||
| (unaudited) | (unaudited) | (audited) | ||||
| Convenience translation into Euro (1) |
(in thousands) | NIS | ||||
| Revenues | 5,866 | 28,228 | 24,371 | 118,825 | ||
| Revenues from subsidiaries | 1,448 | 6,970 | 6,026 | 23,639 | ||
| Total revenues | 7,314 | 35,198 | 30,397 | 142,464 | ||
| Cost of revenues | 5,341 | 25,705 | 24,219 | 106,924 | ||
| Gross profit | 1,973 | 9,493 | 6,178 | 35,540 | ||
| Development expenses, net | 151 | 728 | 825 | 2,944 | ||
| Selling & marketing expenses | 406 | 1,952 | 1,751 | 7,519 | ||
| General & administrative expenses | 411 | 1,976 | 2,009 | 8,305 | ||
| General & administrative expenses to subsidiaries |
39 | 189 | 151 | 801 | ||
| Other expenses | 162 | 782 | 7 | 7 | ||
| Operating profit | 804 | 3,866 | 1,435 | 15,964 | ||
| Financing income | 232 | 1,117 | 1,246 | 3,136 | ||
| Financing expenses | 276 | 1,328 | 4,326 | 10,774 | ||
| Profit (loss) after financing, net | 760 | 3,655 | (1,645) | 8,326 | ||
| The Company's share of subsidiaries losses |
(668) | (3,213) | (2,383) | (6,622) | ||
| Profit (loss) before taxes on income | 92 | 442 | (4,028) | 1,704 | ||
| Taxes on income | (39) | (190) | - | (1,538) | ||
| Net profit (loss) for the period attributed to the company's shareholders (1) See note 1C. |
53 | 252 | (4,028) | 166 |
| For the three months period ended March 31, |
For the three months period ended March 31, |
For the year ended December 31, |
||
|---|---|---|---|---|
| 2014 | 2014 | 2013 | 2013 | |
| (unaudited) | (unaudited) | (audited) | ||
| (in thousands) | ||||
| Convenience translation into Euro (1) |
NIS | |||
| Net profit (loss) for the period attributed to the company's shareholders |
53 | 252 | (4,028) | 166 |
| Other comprehensive income (loss) | ||||
| Items that may not be classified afterwards to profit or loss - Actuarial gains |
- | - | - | 224 |
| Items that may be reclassified to profit or loss in the future if certain conditions are met - |
||||
| Translation of foreign operations | 9 | 43 | (202) | (631) |
| Other comprehensive income (loss) for the period |
9 | 43 | (202) | (407) |
| Total comprehensive income (loss) for the period attributed to the company's shareholders |
62 | 295 | (4,230) | (241) |
(1) See note 1C.
| For the three months period ended March 31, |
For the three months period ended March 31, |
For the year ended December 31, |
||
|---|---|---|---|---|
| 2014 | 2014 | 2013 | 2013 | |
| (unaudited) | (unaudited) | (audited) | ||
| Convenience translation into Euro (1) |
(in thousands) | |||
| Cash flows - operating activities Net profit (loss) for the period attributed to the company's shareholders Adjustments necessary to show the |
53 | 252 | (4,028) | 166 |
| cash flows - operating activities (Appendix A) Cash flows provided by (used in) operating activities of the company |
2,013 2,066 |
9,689 9,941 |
(11,153) (15,181) |
7,610 7,776 |
| Cash flows used in operating activities from transactions with subsidiaries |
(686) | (3,299) | (2,075) | (11,986) |
| Cash flows provided by (used in) operating activities |
1,380 | 6,642 | (17,256) | (4,210) |
| Cash flows - investing activities Sale of (investment in) marketable securities, net Purchase of property and equipment Sale of property and equipment Investment in restricted cash Repayment of restricted cash Repayment of long-term deposits Investment in intangible assets Cash flows provided by (used in) investing activities of the company Cash flows provided by investing activities from transactions with subsidiaries Cash flows provided by (used in) investing activities |
89 (13) 3,803 - 136 5 (552) 3,468 293 3,761 |
430 (62) 18,300 - 655 23 (2,655) 16,691 1,409 18,100 |
(184) (487) 77 (1,454) 700 5 (2,688) (4,031) - (4,031) |
5,453 (1,422) 77 (1,454) 700 20 (10,929) (7,555) - (7,555) |
| Cash flows - financing activities Repayment of long-term loans Bonds issue Repayment of bonds Cash flows provided by (used in) financing activities |
(240) - (2,448) (2,688) |
(1,155) - (11,783) (12,938) |
(1,136) 51,509 (11,643) 38,730 |
(4,476) 51,509 (18,031) 29,002 |
| Change in cash and cash equivalents Cash and cash equivalents at beginning of |
2,453 | 11,804 | 17,443 | 17,237 |
| the period Cash and cash equivalents at end of the period |
6,703 9,156 |
32,256 44,060 |
15,019 32,462 |
15,019 32,256 |
(1) See note 1C.
| For the three months period ended March 31, |
For the three months period ended March 31, |
For the year ended December 31, |
|||
|---|---|---|---|---|---|
| 2014 | 2014 | 2013 | 2013 | ||
| (unaudited) | (unaudited) | (audited) | |||
| (in thousands) | |||||
| Convenience translation into Euro (1) |
NIS | ||||
| Appendix A - Adjustments necessary to show the cash flows - operating activities |
|||||
| Income and expenses not involving cash flows: The Company's share of subsidiaries |
|||||
| losses | 668 | 3,213 | 2,383 | 6,622 | |
| Depreciation and amortization | 484 | 2,332 | 1,730 | 7,987 | |
| Loss (Profit) from marketable securities, net Change in liabilities for benefits to |
(14) | (69) | 130 | (992) | |
| employees, net | 17 | 80 | (26) | (53) | |
| Capital loss | 162 | 782 | 7 | 7 | |
| Deferred taxes Reevaluation of long-term loans and bonds |
39 (128) |
190 (618) |
- (791) |
1,538 1,372 |
|
| Reevaluation of restricted cash | (1) | (6) | (15) | (42) | |
| Reevaluation of embedded derivatives | (55) | (264) | 2,013 | (183) | |
| Changes in assets and liabilities: | |||||
| Increase in accounts receivable - trade Decrease (increase) in accounts receivable |
(39) | (190) | (724) | (1,588) | |
| - other | - (*) | 2 | (824) | 1,343 | |
| Decrease (increase) in inventory | (105) | (505) | (2,941) | 3,106 | |
| Decrease (increase) in inventory - work in progress |
838 | 4,033 | (5,947) | 4,310 | |
| Increase (decrease) in accounts payable - | |||||
| trade | 869 | 4,182 | (3,739) | (15,773) | |
| Decrease in accounts payable - other | (722) | (3,473) | (2,409) | (44) | |
| 2,013 | 9,689 | (11,153) | 7,610 | ||
| Appendix B - Non-cash operations | |||||
| Providing long-term financing to a subsidiary | - | - | - | 15,000 | |
| Booking a capital benefit arising from a | |||||
| transaction with a controlling party | - | - | 104 | 104 |
(*) Less than one thousand dollars
(1) See note 1C.
For the convenience of the reader, the NIS amounts for the last reported period have been translated to EURO by dividing each NIS amount by the representative exchange rate of the EURO as at March 31, 2014 (EURO 1 = NIS 4.8124).
The translated EURO amounts presented in these financial statements should not be construed as representing amounts receivable or payable in EURO unless otherwise indicated.
I, HAIM SHANI, certify that:
The foregoing shall not detract from my statutory responsibility, or that of any other person.
May 29, 2014
_________________ HAIM SHANI, CEO
The foregoing shall not detract from my statutory responsibility, or that of any other person.
May 29, 2014
______________________ YAIR ITZKOVICH, CFO
PRESS RELEASE Airport City, Israel, May 29, 2014
UNITRONICS (1989) (R"G) LTD.
Airport City, Israel - May 29, 2014 - Unitronics published the attached Immediate Report pursuant to the requirements of Israeli law, in connection with the requirement to report the Corporation's liabilities status by dates of payment.
Unitronics (1989) (R"G) Ltd. is an Israeli company that designs, develops, produces and markets Programmable Logic Controllers (PLCs), the computer 'brains' that enable control of automated production lines, storage systems and machines. Unitronics' products include controllers designed to enable bi-directional man-machine interaction through simple user-friendly interface (including integrated graphic operator interface), as well as products embedded with Internet and Intranet capabilities, intended for remote diagnostics and communications on the Internet and Ethernet/LAN levels, and GSM enabled PLC's designed to allow remote control and m-commerce solutions. Unitronics' international distribution network composes of approximately 140 distributors and sales representatives spanning Europe, America, Israel and the Far East, as well as most of the states of the USA, whose efforts are coordinated and supported through Unitronics' wholly owned US subsidiary, Unitronics, Inc.
This press release contains certain forward-looking statements and information relating to the Company that are based on the beliefs of the Management of the Company as well as assumptions made by and information currently available to the Management of the Company. Such statements reflect the current views of the Company with respect to future events, the outcome of which is subject to certain risks and other factors which may be outside of the Company's control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results or outcomes may vary materially from those described herein as projected, anticipated, believed, estimated, expected or intended.
Pursuant to section 36A of the Israeli Securities Law, 1968.
Reporting period: March 31 th , for the year: 2014. Detailed Corporation's liabilities status by dates of payment is as follows:
A. Debentures issued by the reporting Corporation to the public and held by the public, excluding such Debentures held by the Corporation's parent company, its controlling shareholder, companies controlled by same or companies which are controlled by the Corporation ("Solo" report) (in NIS thousands)
| Fund Payments | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| NIS Index Linked |
NIS Index Unlinked |
Euro | USD | --- | --- | --- | Other | Gross Interest Payment (Without Tax Deduction) |
|
| First Year | 18,491 | 4,895 | |||||||
| Second Year |
18,491 | 3,867 | |||||||
| Third Year | 18,491 | 2,839 | |||||||
| Fourth Year | 11,002 | 1,811 | |||||||
| Fifth Year | |||||||||
| and So On | 22,540 | 1,826 | |||||||
| Total | 89,015 | 15,238 |
B. Private debentures and non banking-credit, excluding debentures or credit which was given by the Corporation's parent company, its controlling shareholder, companies controlled by same or companies which are controlled by the Corporation – based on data from the Corporation's separate financial reports ("Solo" report) (in NIS thousands)
| Fund Payments | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| NIS Index Linked |
NIS Index Unlinked |
Euro | USD | --- | --- | --- | Other | Gross Interest Payment (Without Tax Deduction) |
|
| First Year | |||||||||
| 62 | 3 | ||||||||
| Second | |||||||||
| Year | - | - | |||||||
| Third Year | - | - | |||||||
| Fourth Year | - | - | |||||||
| Fifth Year | |||||||||
| and So On | - | - | |||||||
| Total | 62 | 3 |
| Fund Payments | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| NIS Index Linked |
NIS Index Unlinked |
Euro | USD | --- | --- | --- | Other | Gross Interest Payment (Without Tax Deduction) |
||
| First Year | 2,365 | 380 | 258 | |||||||
| Second | ||||||||||
| Year | 1,230 | 380 | 200 | |||||||
| Third Year | 845 | 380 | 164 | |||||||
| Fourth Year | 734 | 285 | 129 | |||||||
| Fifth Year | ||||||||||
| and So On | 2,907 | - | 418 | |||||||
| Total | 8,081 | 1,425 | 1,169 |
| Fund Payments | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| NIS Index Linked |
NIS Index Unlinked |
Euro | USD | --- | --- | --- | Other | Gross Interest Payment (Without Tax Deduction) |
||
| First Year | ||||||||||
| Second Year |
||||||||||
| Third Year | ||||||||||
| Fourth Year | ||||||||||
| Fifth Year and So On |
||||||||||
| Total |
D. Bank credit – from banks abroad ("Solo" report) (in NIS thousands)
E. Summary table of tables A-D, Total credit- banking, non-banking and debentures ("Solo" report) (in NIS thousands)
| Fund Payments | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| NIS Index Linked |
NIS Index Unlinked |
Euro | USD | --- | --- | --- | Other | Gross Interest Payment (Without Tax Deduction) |
|
| First Year | |||||||||
| 18,491 | 62 | 2,365 | 380 | 5,156 | |||||
| Second | |||||||||
| Year | 18,491 | - | 1,230 | 380 | 4,067 | ||||
| Third Year | 18,491 | - | 845 | 380 | 3,003 | ||||
| Fourth Year | 11,002 | - | 734 | 285 | 1,940 | ||||
| Fifth Year | |||||||||
| and So On | 22,540 | - | 2,907 | - | 2,244 | ||||
| Total | |||||||||
| 89,015 | 62 | 8,081 | 1,425 | 16,410 |
| Fund Payments | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| NIS Index Linked |
NIS Index Unlinked |
Euro | USD | --- | --- | --- | Other | Gross Interest Payment (Without Tax Deduction) |
||
| First Year | ||||||||||
| Second Year |
||||||||||
| Third Year | ||||||||||
| Fourth Year | ||||||||||
| Fifth Year | ||||||||||
| and So On | ||||||||||
| Total |
G. External balance credit exposure of all consolidated companies, excluding companies which are reporting companies and excluding the reporting Corporation's data included in table F above (in NIS thousands)
| Fund Payments | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| NIS Index Linked |
NIS Index Unlinked |
Euro | USD | --- | --- | --- | Other | Gross Interest Payment (Without Tax Deduction) |
||
| First Year | ||||||||||
| Second | ||||||||||
| Year | ||||||||||
| Third Year | ||||||||||
| Fourth Year | ||||||||||
| Fifth Year | ||||||||||
| and So On | ||||||||||
| Total |
H. Total credit balance, banks, non banks and debentures of all consolidated companies, excluding companies which are reporting companies and excluding the reporting Corporation's data included in tables A-D above (in NIS thousands)
| Fund Payments | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| NIS Index Linked |
NIS Index Unlinked |
Euro | USD | --- | --- | --- | Other | Gross Interest Payment (Without Tax Deduction) |
||
| First Year | ||||||||||
| Second | ||||||||||
| Year | ||||||||||
| Third Year | ||||||||||
| Fourth Year | ||||||||||
| Fifth Year | ||||||||||
| and So On | ||||||||||
| Total |
(2) Cash and cash equivalents, marketable securities and short term deposits of all consolidated companies (in NIS thousands):75,999 (*) Restricted cash is excluded.
Respectfully,
Unitronics (1989) (R"G) Ltd.
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