RAMAT
GAN, Israel, Sept. 22,
2022 /PRNewswire/ -- Senstar Technologies
(NASDAQ: SNT), a leading international provider of
comprehensive physical, video, and access control security products
and solutions, today announced its financial results for the three
and six months ended June 30, 2022.
Management will hold an investors' conference call later today (at
10 a.m. Eastern Time) to discuss the
results.
Business Highlights (all comparisons are for Q2 2022 versus
Q2 2021):
- Second quarter revenue was $9.1
million compared with $10.1
million.
- Cost of goods sold and operating expenses increased primarily
due to the absence of Canadian subsidies that the Company received
in Q2 2021 and the global increase in material costs.
- Net income from continuing operations was $0.4 million compared to $0.7 million.
- EBITDA was $0.5 million compared
with $2.5 million.
- Cash and cash equivalents of $17.9
million, or $0.77 per share,
and zero debt as of June 30,
2022.
Mr. Dror Sharon, Chief Executive
Officer of Senstar Technologies, stated, "To date in 2022, we have
closed several large projects in our key verticals. Due to a number
of factors, new business is taking longer to close, particularly in
the U.S., where many projects are tied to federal funding. As a
result, second-quarter revenue declined by 10% to $9.1 million. Importantly, we have not lost
business, and we continue to expect awards in our favor in the
coming months. Subsidies received in the second quarter of 2021
from the Canada Emergency Wage
Subsidy program of approximately $0.6
million expired in the third quarter of 2021 and made for a
challenging year-over-year comparison of cost of goods sold and
operating expenses. Additionally, cost of goods sold were
impacted by higher prices, despite our mitigating some of the
increase by raising prices. We expect a more normalized run rate of
expenses going forward.
"For the remainder of 2022, our pipeline is robust with several
large orders in the process of closing, and we continue to win
significant contracts in the energy vertical, as well as critical
infrastructure and logistics," continued Mr. Sharon. "EMEA and APAC
are strong regions where we have closed new business in critical
infrastructure, energy, and logistics. New solutions like our
Sensor Fusion Engine and FiberPatrol sensor detection are gaining
industry attention and will be future growth drivers on top of new
products that will be launched in the next few months. We see good
business momentum for the remainder of 2022 and anticipate improved
gross and EBITDA margins in the remainder of 2022."
Second Quarter 2022 Results Summary
Revenue for the second quarter of 2022 was $9.1 million, a decrease of 9.7% compared with
$10.1 million in the second quarter
of 2021. Second quarter gross profit was $5.5 million, or 60.0% of revenue, compared with
$7.1 million, or 69.8% of revenue.
The decrease in gross margin was primarily due to our receipt of
subsidies from the Canada
Emergency Wage Subsidy program in the second quarter of 2021, a
portion of which was allocated to cost of goods sold. These funds
were not distributed in 2022. Gross margin was also impacted by
higher costs and a shift in the mix of products sold during the
quarter.
Operating expenses for the second quarter of 2022 were
$5.4 million, an increase of 11.2%
compared to the prior year's second quarter operating expenses of
$4.8 million. The increase in
operating expenses is primarily attributable to the termination of
the Canada Emergency Wage Subsidy
program in 2021, which program provided subsidies, a portion of
which was allocated to operating expenses in the second quarter of
2021, as well as an increase in travel and sales-related expenses
compared to the 2021 period.
Operating income was $0.1 million
for the second quarter of 2022 compared to $2.2 million in the second quarter of 2021.
Financial expense was $0.1 million
compared to $0.2 million in the
second quarter of 2021.
Income from continuing operations was $0.4 million in the second quarter of 2022
compared to $0.7 million in the
year-ago quarter.
Net income in the second quarter of 2022 was $0.2 million or $0.01 per share versus $11.8 million, or $0.51 per share in the second quarter of last
year. Net income in the 2021 period includes net income from
discontinued operations of $11.1
million.
EBITDA from continuing operations for the second quarter was
$0.5 million versus $2.5 million for the second quarter of 2021.
Cash and cash equivalents and restricted cash as of June 30, 2022, were $17.9
million, or $0.77 per share,
compared with $26.4 million, or
$1.13 per share, at December 31, 2021. The decline in cash and cash
equivalents reflects the significant reduction in other accounts
payable and accrued expenses and increased inventories and accounts
receivable.
Earnings Conference Call Information:
To participate, please use one of the following teleconferencing
numbers. The call will begin promptly at 10:00 am Eastern Time; 5:00 pm Israel Time; 3:00
pm UK Time. The Company requests that participants dial in
10 minutes before the conference call commences and use the
conference ID number 13732521.
Participant Dial-in Numbers: Toll Free:
1-877-407-9716
Toll/International: 1-201-493-6779
Israel Toll Free: 1 809 406
247
UK Toll Free: 0 800 756 3429
The conference call will also be available via a live webcast at
https://viavid.webcasts.com/starthere.jsp?ei=1566615&tp_key=58db4bf17a.
Replay Dial-in Numbers: Toll Free:
1-844-512-2921
Toll/International: 1-412-317-6671
Replay Pin Number: 13732521
A replay of the call will be available on September 22, 2022, after 1:00 pm Eastern time through October 6, 2022, at 11:59
pm Eastern time, and available on the Senstar Technologies
website at https://senstartechnologies.com/earnings-calls/.
About Senstar Technologies
With innovative perimeter intrusion detection systems
(including fence sensors , buried sensors ,
and above ground
sensors ), intelligent video-management , video
analytics , and access control ,
Senstar offers a comprehensive suite of proven,
integrated solutions that reduce complexity, improve
performance and unify support. For 40 years, Senstar has
been safeguarding people, places and property for
organizations around the world, with a special focus
in utilities , logistics , corrections, and energy markets.
For more information, visit the Company's website at
www.senstartechnologies.com.
Use of Non-GAAP Financial Information
The Company reports financial results in accordance with U.S.
GAAP. To supplement the consolidated financial statements presented
in accordance with GAAP, the Company presents the Non-GAAP
presentation of EBITDA. This non-GAAP measure is not in accordance
with, nor is it a substitute for, a GAAP measure. The Company uses
EBITDA to evaluate and manage the Company's operations internally.
The Company is also providing this information to assist investors
in performing additional financial analysis. Reconciliation between
the company's results on a GAAP and non-GAAP basis is provided in a
table below.
Forward Looking Statements
This press release contains forward-looking statements, which
are subject to risks and uncertainties. Such statements are based
on assumptions and expectations which may not be realized and are
inherently subject to risks and uncertainties, many of which cannot
be predicted with accuracy and some of which might not even be
anticipated. Future events and actual results, financial and
otherwise, may differ from the results discussed in the
forward-looking statements. A number of these risks and other
factors that might cause differences, some of which could be
material, along with additional discussion of forward-looking
statements, are set forth in the Company's Annual Report on Form
20-F filed with the Securities and Exchange Commission. In
addition, there is uncertainty about the spread of the COVID19
virus and the impact it will have on the Company's operations, the
demand for the Company's products, global supply chains and
economic activity in general.
For more information:
Senstar
Technologies:
Doron Kerbel,
Adv.
V.P. General Counsel
& Company Secretary
Tel:
+972-74-794-5200
Doron.Kerbel@senstar.com
|
IR
Contact:
Kim Rogers
Managing
Director
Hayden IR
+1
541-904-5075
Kim@HaydenIR.com
|
SENSTAR
TECHNOLOGIES
|
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(All numbers except
EPS expressed in thousands of US$)
|
|
|
|
|
|
Three
Months
Ended June
30,
|
|
Six
Months
Ended June
30,
|
|
2022
|
|
2021
|
%
change
|
|
2022
|
|
2021
|
%
change
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
9,124
|
|
10,102
|
(6)
|
|
15,909
|
|
16,642
|
(4)
|
Cost of
revenue
|
3,649
|
|
3,047
|
25
|
|
5,967
|
|
5,525
|
8
|
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
5,475
|
|
7,055
|
(21)
|
|
9,942
|
|
11,117
|
(11)
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Research
and development, net
|
1,087
|
|
976
|
13
|
|
2,182
|
|
1,983
|
10
|
Selling
and marketing
|
2,220
|
|
2,448
|
35
|
|
4,519
|
|
4,581
|
(1)
|
General
and administrative
|
2,061
|
|
1,405
|
11
|
|
3,806
|
|
3,008
|
27
|
Total operating
expenses
|
5,368
|
|
4,829
|
22
|
|
10,507
|
|
9,572
|
10
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
107
|
|
2,226
|
|
|
(565)
|
|
1,545
|
|
Financial expenses,
net
|
(109)
|
|
(222)
|
|
|
(348)
|
|
(203)
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes
|
(2)
|
|
2,004
|
|
|
(913)
|
|
1,342
|
|
|
|
|
|
|
|
|
|
|
|
Income tax benefits
(taxes on income)
|
430
|
|
(1,335)
|
|
|
244
|
|
(1,405)
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations
|
428
|
|
669
|
|
|
(669)
|
|
(63)
|
|
Income (loss) from
discontinued operations, net
|
(264)
|
|
11,119
|
|
|
(264)
|
|
9,882
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
164
|
|
11,788
|
|
|
(933)
|
|
9,819
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss)
attributable to redeemable non-controlling
interests and non-controlling interests
|
-
|
|
(21)
|
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Senstar's shareholders
|
164
|
|
11,809
|
|
|
(933)
|
|
9,819
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net
income (loss) per share from
continuing operations
|
$0.02
|
|
$0.03
|
|
|
($0.03)
|
|
$0.00
|
|
Basic and diluted net
income (loss) per share from
discontinued operations, net
|
($0.01)
|
|
$0.48
|
|
|
($0.01)
|
|
$0.42
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted
net income (loss) per share
|
$0.01
|
|
$0.51
|
|
|
($0.04)
|
|
$0.42
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares used in computing
basic net income (loss) per share
|
23,309,987
|
|
23,163,985
|
|
|
23,305,981
|
|
23,163,985
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares used in computing
diluted net income (loss) per share
|
23,309,987
|
|
23,163,985
|
|
|
23,305,981
|
|
23,163,985
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SENSTAR
TECHNOLOGIES
|
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(All numbers except
EPS expressed in thousands of US$)
|
|
|
Three
Months
Ended June
30,
|
|
|
Six
Months
Ended June
30,,
|
|
|
2022
%
|
|
2021
%
|
|
|
2022
%
|
|
2021
%
|
|
|
|
|
|
|
|
|
|
|
|
Gross
margin
|
60.0
|
|
69.8
|
|
|
62.5
|
|
66.8
|
|
Research and
development, net as a % of revenues
|
11.9
|
|
9.7
|
|
|
13.7
|
|
11.9
|
|
Selling and marketing
as a % of revenues
|
24.3
|
|
24.2
|
|
|
28.4
|
|
27.5
|
|
General and
administrative as a % of revenues
|
22.6
|
|
13.9
|
|
|
23.9
|
|
18.1
|
|
Operating
margin
|
1.2
|
|
22.0
|
|
|
-
|
|
9.3
|
|
Net margin from
continuing operations
|
4.7
|
|
6.6
|
|
|
-
|
|
-
|
|
SENSTAR
TECHNOLOGIES
|
RECONCILIATION OF
EBITDA FROM CONTINUING OPERATION TO INCOME (LOSS) FROM
CONTINUING OPERATION
|
(All numbers
expressed in thousands of US$)
|
|
|
Three
Months
Ended June
30,
|
|
|
Six
Months
Ended June
30,
|
|
2022
|
|
2021
|
|
|
2022
|
|
2021
|
|
|
|
|
|
|
|
|
|
GAAP income (loss)
from continuing operations
|
428
|
|
669
|
|
|
(669)
|
|
(63)
|
Less:
|
|
|
|
|
|
|
|
|
Financial
(expenses), net
|
(109)
|
|
(222)
|
|
|
(348)
|
|
(203)
|
Income tax
benefits (taxes on income)
|
430
|
|
(1,335)
|
|
|
244
|
|
(1,405)
|
Depreciation and amortization
|
(353)
|
|
(316)
|
|
|
(761)
|
|
(628)
|
EBITDA from continuing
operations
|
460
|
|
2,542
|
|
|
196
|
|
2,173
|
SENSTAR
TECHNOLOGIES
|
UNAUDITED CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(All numbers
expressed in thousands of US$)
|
|
|
June
30,
|
|
December
31,
|
|
2022
|
|
2021
|
CURRENT
ASSETS:
|
|
|
|
Cash and cash
equivalents
|
$17,939
|
|
$26,397
|
Restricted cash and
deposits
|
5
|
|
6
|
Trade receivables,
net
|
9,923
|
|
7,723
|
Unbilled accounts
receivable
|
8
|
|
26
|
Other accounts
receivable and prepaid expenses
|
2,270
|
|
2,010
|
Inventories
|
7,321
|
|
5,751
|
|
|
|
|
Total current
assets
|
37,466
|
|
41,913
|
|
|
|
|
Long term
ASSETS:
|
|
|
|
|
|
|
|
Deferred tax
assets
|
491
|
|
502
|
Operating lease
right-of-use assets
|
1,045
|
|
1,228
|
|
|
|
|
Total long-term
assets
|
1,536
|
|
1,730
|
|
|
|
|
PROPERTY AND
EQUIPMENT, NET
|
1,867
|
|
2,109
|
|
|
|
|
INTANGIBLE ASSETS,
NET
|
1,650
|
|
2,186
|
|
|
|
|
GOODWILL
|
11,249
|
|
11,449
|
|
|
|
|
Total assets
|
$53,768
|
|
$59,387
|
SENSTAR
TECHNOLOGIES
|
UNAUDITED CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(All numbers
expressed in thousands of US$)
|
|
|
June
30,
|
|
December
31,
|
|
2022
|
|
2021
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
|
|
|
Trade
payables
|
$2,738
|
|
$2,710
|
Customer
advances
|
263
|
|
390
|
Deferred
revenues
|
2,458
|
|
2,704
|
Other accounts payable
and accrued expenses
|
10,083
|
|
13,203
|
Short-term operating
lease liabilities
|
246
|
|
276
|
|
|
|
|
Total current
liabilities
|
15,788
|
|
19,283
|
|
|
|
|
LONG-TERM
LIABILITIES:
|
|
|
|
Deferred
revenues
|
1,461
|
|
1,690
|
Deferred tax
liabilities
|
807
|
|
899
|
Accrued severance
pay
|
465
|
|
523
|
Long-term operating
lease liabilities
|
816
|
|
969
|
Other long-term
liabilities
|
243
|
|
266
|
|
|
|
|
Total long-term
liabilities
|
3,792
|
|
4,347
|
|
|
|
|
SHAREHOLDERS'
EQUITY
|
|
|
|
Share Capital: Ordinary
shares of NIS 1 par value -
|
|
|
|
|
Authorized: 39,748,000
shares at June 30, 2022 and December 31, 2021;
Issued and outstanding: 23,309,987 shares at June 30, 2021 and
23,301,653
shares at December 31, 2021
|
6,799
|
|
6,796
|
Additional paid-in
capital
|
30,468
|
|
30,394
|
Accumulated other
comprehensive loss
|
431
|
|
1,222
|
Foreign currency
translation adjustments (stand-alone financial
statements)
|
9,765
|
|
9,687
|
Accumulated
deficit
|
(13,275)
|
|
(12,342)
|
|
|
|
|
TOTAL SHAREHOLDERS'
EQUITY
|
34,188
|
|
35,757
|
|
|
|
|
TOTAL LIABILITIES
AND SHAREHOLDERS' EQUITY
|
$53,768
|
|
$59,387
|
|
|
|
|
|
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SOURCE Senstar Technologies Ltd.