ELTEK LTD — Regulatory Filings 2007

Mar 27, 2007

6-K 1 zk73577.htm Created by EDGAR Ease Plus (EDGAR Ease+) Project: \Backup\office\EDGAR Filing\Eltek Ltd\73577\a73577.eep Control Number: 73577 Rev Number: 1 Client Name: Eltek Ltd Project Name: 6-K Firm Name: Zadok-Keinan Ltd 6-K MARKER FORMAT-SHEET="Scotch Rule Top-TNR" FSL="Workstation" MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation"

SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

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F O R M 6-K

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REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934

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For the month of March 2007

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ELTEK LTD. (Name of Registrant)

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Sgoola Industrial Zone, Petach Tikva, Israel (Address of Principal Executive Office)

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Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

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Form 20-F x Form 40-F o

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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): o

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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): o

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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.

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Yes o No x

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If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-___

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This Form 6-K is being incorporated by reference into the Registrant’s Form S-8 Registration Statements File Nos. 333-12012 and 333-123559.

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SIGNATURES

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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.

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ELTEK LTD. (Registrant) By: /s/ Amnon Shemer —————————————— Amnon Shemer Chief Financial Officer

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Date: March 27, 2007

ELTEK Ltd. Amnon Shemer, CFO +972-3-9395023 amnons@eltek.co.il

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Eltek Reports 83% Growth in Net Income for Full Year 2006

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— 2006 net income increased to $2.3 million from net income of $1.2 million in 2005

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— Q4: Company records 10 th consecutive quarter of year-over -year revenue growth, 9 th straight quarter of profitability and operating income of $877,000, up 31% from Q4-2005

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— Q4 net income of $632,000, up 16% year-over -year

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PETACH-TIKVA, Israel, March 27, 2006 (BUSINESS WIRE) – Eltek Ltd., the leading Israeli manufacturer of advanced Flex-Rigid circuitry solutions, today announced its financial results for the fourth quarter and fiscal year ended December 31, 2006.

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Highlights for the Quarter:

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— 10 th consecutive quarter of year-over-year revenue growth - revenues reached the Company's highest fourth quarter levels ever

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— 9 th consecutive quarter of profitability

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— Quarterly net income of $632,000 , $0.11 per basic share or $0.09 per fully diluted share

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Eltek reported revenues for the three months ended December 31, 2006 of NIS 43.4 million ($10.3 million) compared with NIS 39.6 million ($9.4 million) for the fourth quarter of 2005. The increase in revenues primarily reflects the growth of Eltek’s marketing efforts in the high end of flex – rigid PCBs niche.

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Net income for the fourth quarter totalled NIS 2.7 million ($632,000), or NIS 0.38 per fully diluted share ($0.09) compared with a net income of NIS 2.3 million ($544,000), or NIS 0.34 per fully diluted share ($0.08) for the same quarter in 2005. The fourth quarter of 2006 was the Company’s 9th consecutive quarter of profitability.

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Highlights for the Year:

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— Significantly improved profitability in 2006

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— 2006 net income increased to $2.3 million from net income of $1.2 million in 2005

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— 2006 operating income increased to $2.9 million from operating income of $1.8 million in 2005

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Revenues for the year ended December 31, 2006, were NIS 173.9 million ($41.2 million) compared with revenues of NIS 144.4 million ($34.2 million) in 2005. The increase in revenues primarily reflects the growth of Eltek’s marketing efforts in the high end of flex – rigid PCBs niche.

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Net income for the year ended December 31, 2006 was NIS 9.6 million ($2.3 million), or NIS 1.39 per fully diluted share ($ 0.33) compared with net income of NIS 5.3 million ($1.2 million) or NIS (0.81) per share ($0.19) in 2005.

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Arieh Reichart , President and Chief Executive Officer of Eltek, commented, “2006 was a successful year for us in which we achieved record revenue, consistently delivered year over year quarterly growth and increased profitability. I am especially pleased with the improvement in our gross margin and profitability in Q4-2006 in light of the continued adverse impact of the ongoing weakness of the U.S. dollar versus the Israeli shekel.”

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Reichart concluded, “Going forward, we believe that 2007 will be an important year for Eltek. We see various new long -term growth opportunities in our existing markets in the U.S and Europe, via relationships we fostered and strengthened throughout 2006 and successful deliveries of several strategic pilot runs. With the measures we are taking in the first half of 2007 to grow our production capacity along with strengthening our sales team, we believe that we are well positioned to capitalize on the higher margin opportunities in the high-end PCB market.”

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Amnon Shemer , CFO of Eltek commented: “We concluded a strong year on the financial front, as 2006 sales reached a new level and we managed to grow our yearly operating and net income by 63% and 83%, respectively, from 2005. During Q4 we improved our gross and operating margins in spite of the negative impact of the continued devaluation of the U.S. dollar against the NIS, and to a lesser extent higher raw material costs.”

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Shemer concluded, “During 2006 we invested $3.0 million in new capital expenditures, including $1.1 million in the fourth quarter, mainly for manufacturing equipment. In order to meet the growing demand for our high end PCBs, we are now expanding our operation facility by approximately 15,000 square feet, which expansion is expected to bear fruit in the second half of 2007, and selectively adding employees to our manufacturing, supply chain and sales groups to manage expected sales increases in the second-half of 2007.”

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About the Company

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Eltek is Israel’s leading manufacturer of printed circuit boards, the core circuitry of most electronic devices. It specializes in the complex high-end of PCB manufacturing, i.e., HDI, multi-layered and flex-rigid boards. Eltek’s technologically advanced circuitry solutions are used in today’s increasingly sophisticated and compact electronic products.. For more information, visit Eltek’s World Wide Web site at www.eltekglobal.com .

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NOTE A: Convenience Translation to Dollars

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For the convenience of the reader, the reported NIS figures of December 31, 2006 have been presented in U.S. Dollars, translated at the representative rate of exchange as of December 31, 2006 (NIS 4.225 = U.S. Dollar 1.00). The U.S. Dollar ( $) amounts presented should not be construed as representing amounts receivable or payable in U.S. Dollars or convertible into U.S. Dollars, unless otherwise indicated.

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Certain matters discussed in this news release are forward-looking statements that involve a number of risks and uncertainties including, but not limited to statements regarding expected results in future quarters, risks in product and technology development and rapid technological change, product demand, the impact of competitive products and pricing, market acceptance, the sales cycle, changing economic conditions and other risk factors detailed in the Company’s filings with the United States Securities and Exchange Commission.

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Eltek ltd. Consolidated Statements of Operations (In thousands, except per share data)

Year ended December 31,						Three months ended December 31,
2005 NIS Audited		2006 NIS Unaudited		2006 U.S.$ Unaudited		2005 NIS		2006 NIS Unaudited		2006 U.S.$
Revenues	144,429		173,944		41,171		39,570		43,410		10,275
Costs or revenues	(115,733	)	(136,526	)	(32,313	)	(30,983	)	(32,928	)	(7,794	)
Gross profit	28,696		37,418		8,858		8,587		10,482		2,481
Research and development
expenses, net	(646	)	(687	)	(163	)	(161	)	(193	)	(46	)
Selling, general and
administrative expense	(19,862	)	(24,308	)	(5,754	)	(5,445	)	(6,583	)	(1,558	)
Amortization of goodwill	(593	)	-		-		(146	)	-		-
Operating income	7,595		12,423		2,941		2,835		3,706		877
Financial expenses, net	(2,656	)	(2,396	)	(568	)	(628	)	(606	)	(143	)
	4,939		10,027		2,373		2,207		3,100		734
Other income (expense), net	103		24		6		69		(7	)	(2	)
Income before tax expenses	5,042		10,051		2,379		2,276		3,093		732
Tax expenses	-		(703	)	(166	)	0		(703	)	(166	)
Income after tax expenses	5,042		9,348		2,213		2,276		2,390		566
Minority interests	218		266		63		24		279		66
Net income	5,260		9,614		2,276		2,300		2,669		632
Basic net earnings per share*	0.94		1.71		0.41		0.41		0.47		0.11
Diluted net earnings per share*	0.81		1.39		0.33		0.34		0.38		0.09
Weighted average shares used to
compute basic net earnings per share	5,575		5,617		5,617		5,602		5,624		5,624
Weighted average shares used to
compute diluted net earnings per share	6,785		6,954		6,954		6,815		6,961		6,961

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• Ordinary shares, par value of NIS 0.6 each.

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Eltek ltd. Consolidated Condensed Balance Sheets (in thousands)

Reported amounts	December 31,	December 31,	December 31,
	2005 (Audited) NIS	2006 (Unaudited) NIS	2006 (Unaudited) US $
Assets
Current assets
Cash and cash equivalents	7,258		8,576	2,030
Receivables: Trade	22,990	*	32,562	7,707
Other	1,926	*	1,103	261
Inventories	16,051		15,910	3,766
Prepaid expenses	986		813	192
Total current assets	49,211		58,964	13,956
Deferred taxes	697		-	-
Property and equipment, net	32,969		34,997	8,283
Goodwill	3,735		3,816	903
Total assets	86,612		97,777	23,142

*Reclassified

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Eltek ltd. Consolidated Condensed Balance Sheets (in thousands)

Reported amounts	December 31,	December 31,		December 31,
	2005 (Audited) NIS	2006 (Unaudited) NIS		2006 (Unaudited) US $
Liabilities and Shareholder's equity
Current liabilities
Short-term credit and current maturities of
long-term debts	17,561		11,731		2,776
Trade payables	25,176		25,100		5,942
Other liabilities and accrued expenses	10,914		12,539		2,968
Convertible note	-		1,844		436
Total current liabilities	53,651		51,214		12,122
Long-term liabilities
Long term debt, excluding current maturities	7,607		12,862		3,068
Employee severance benefits, net	274		344		82
Total liabilities	7,881		13,306		3,150
Minority interests	1,547		1,312		310
Convertible note	1,820		-		-
Shareholder's equity
Ordinary shares, NIS 0.6 par value. Authorized
50,000,000 shares, issued and outstanding
5,624,011 shares at December 31,2006 and
5,602,511 shares at December 31,2005	29,765		29,778		7,048
Additional paid in capital	54,553		54,981		13,013
Capital reserves related to loans from
controlling shareholders	10,010		10,010		2,369
Cumulative foreign currency translation
adjustments	1,916		2,093		495
Capital reserve	6,685		6,685		1,582
Accumulated deficit	(81,216	)	(71,602	)	(16,947	)
Total shareholders` Equity	21,713		31,945		7,560
Total liabilities and shareholders equity	86,612		97,777		23,142

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