Backlog of orders at $15.1 billion;
Revenues of $5.5 billion;
Non-GAAP net income of $269
million;
GAAP net income of $275
million;
Non-GAAP net EPS of $6.03; GAAP net EPS of $6.18
HAIFA,
Israel, March 28, 2023 /PRNewswire/
-- Elbit Systems Ltd. ("Elbit Systems" or the
"Company") (NASDAQ: ESLT) (TASE: ESLT), the international
high technology company, reported today its consolidated results
for the fourth quarter and full year ended December 31,
2022.
In this release, the Company is providing US-GAAP results as
well as additional non-GAAP financial data, which are intended to
provide investors a more comprehensive view of the Company's
business results and trends. For a description of the Company's
non-GAAP definitions see page 6 below, "Non-GAAP financial data".
Unless otherwise stated, all financial data presented is US-GAAP
financial data.
Management Comment:
Bezhalel (Butzi) Machlis, President and CEO of Elbit
Systems, commented:
"A healthy business environment and growing demand for Elbit
Systems' portfolio of leading technological capabilities resulted
in a record order backlog of $15.1
billion. We increased our business development efforts to
realize the significant opportunities created by growing defense
budgets around the world.
Our 2022 financial results also reflect global supply chain
disruptions and labor cost inflation. We accelerated investment in
a range of operational initiatives to improve
performance.
Increasing customer interest and the growing scale of new
contracts reflect Elbit Systems' successful transformation in
recent years from a systems supplier to a comprehensive solution
provider and supports future growth prospects."
Fourth quarter 2022 results:
Revenues in the fourth quarter of 2022 were
$1,506.4 million, as compared to
$1,494.3 million in the fourth
quarter of 2021.
Non-GAAP(*) gross profit amounted to
$387.8 million (25.7% of revenues) in
the fourth quarter of 2022, as compared to $381.1 million (25.5% of revenues) in the fourth
quarter of 2021. GAAP gross profit in the fourth quarter of
2022 was $380.6 million (25.3% of
revenues), as compared to $374.3
million (25.1% of revenues) in the fourth quarter of
2021.
Research and development expenses, net were
$125.4 million (8.3% of revenues) in
the fourth quarter of 2022, as compared to $114.0 million (7.6% of revenues) in the fourth
quarter of 2021.
Marketing and selling expenses, net were $87.7 million (5.8% of revenues) in the fourth
quarter of 2022, as compared to $80.8
million (5.4% of revenues) in the fourth quarter of
2021.
General and administrative expenses, net were
$75.8 million (5.0% of revenues) in
the fourth quarter of 2022, as compared to $72.4 million (4.8% of revenues) in the fourth
quarter of 2021.
Other operating income in the fourth quarter of
2022, which amounted to $28.6 million
was a result of a grant received by a subsidiary in Israel, which is associated with the Company
meeting a significant milestone in a facility relocation plan.
Non-GAAP(*) operating income was $103.1 million (6.8% of revenues) in the fourth
quarter of 2022, as compared to $120.1
million (8.0% of revenues) in the fourth quarter of 2021.
GAAP operating income in the fourth quarter of 2022 was
$120.3 million (8.0% of revenues), as
compared to $107.3 million (7.2% of
revenues) in the fourth quarter of 2021.
Financial expenses, net were $26.8 million in the fourth quarter of 2022, as
compared to $19.6 million in the
fourth quarter of 2021. The increase in 2022 was mainly a result of
higher interest rates.
Other expenses, net were $14.5
million in the fourth quarter of 2022, as compared to other
income, net of $9.7 million in the
fourth quarter of 2021. Other expenses in the fourth quarter of
2022 were mainly a result of revaluation of investments in
affiliated companies held under the fair value method.
Taxes on income in the fourth quarter of 2022 were tax
benefits of $4.5 million, as compared
to tax expenses of $92.2 million in
the fourth quarter of 2021. Tax expenses in the fourth quarter of
2021 included a one-time expense of approximately $80.0 million related to the amendment of
legislation regarding exempt earnings from "Approved Enterprises"
and "Privileged Enterprises" in Israel ("Exempt Earnings").
Equity in net earnings of affiliated companies and
partnerships was $1.8 million in
the fourth quarter of 2022, as compared to $3.1 million the fourth quarter of 2021.
Non-GAAP(*) net income attributable to the
Company's shareholders in the fourth quarter of 2022 was
$75.0 million (5.0% of revenues), as
compared to $94.9 million (6.4% of
revenues) in the fourth quarter of 2021. GAAP net income
attributable to the Company's shareholders in the fourth
quarter of 2022 was $85.3 million
(5.7% of revenues), as compared to $8.2
million (0.5% of revenues) in the fourth quarter of 2021.
The lower level of net income in the fourth quarter of 2021 was
mainly a result of the tax expense mentioned under "Taxes on
income" above.
Non-GAAP(*) diluted net earnings per share
attributable to the Company's shareholders were
$1.68 for the fourth quarter of 2022,
as compared to $2.14 for the fourth
quarter of 2021. GAAP diluted earnings per share attributable to
the Company's shareholders in the fourth quarter of 2022 were
$1.91, as compared to $0.18 in the fourth quarter of 2021.
Full year 2022 results:
Revenues for the year ended December 31, 2022 were $5,511.5 million, as compared to $5,278.5 million in the year ended December 31, 2021.
For distribution of revenues by areas of operation and by
geographic regions see the tables on page 14.
The majority of the revenues in 2022 were in the Airborne
systems and C4ISR systems areas of operation. The growth in
revenues in the C4ISR systems area was mainly due to increased
sales of UAS systems to customers in Europe and higher sales of Sparton's products
in the U.S.
On a geographic basis, the decrease in North America was mainly a result of lower
sales of medical instrumentation. The increase in Europe was mainly a result of higher sales
related to the flight school project in Greece and sales of UAS, as well as armored
vehicles and artillery.
Cost of revenues for the year ended December 31, 2022 was $4,138.3 million (75.1% of revenues), as compared
to $3,920.5 million (74.3% of
revenues) in the year ended December 31,
2021.
Non-GAAP(*) gross profit for the year ended
December 31, 2022 was
$1,405.0 million (25.5% of revenues),
as compared to $1,384.7 million
(26.2% of revenues) in the year ended December 31, 2021. GAAP gross profit in
2022 was $1,373.3 million (24.9% of
revenues), as compared to $1,358.0
million (25.7% of revenues) in 2021. The GAAP and Non-GAAP
gross profit in 2022 includes expenses of approximately
$35 million related to the effect of
the significant increase in the Company's share price on employees'
stock price linked compensation plans.
Research and development expenses, net for the year
ended December 31, 2022 were
$435.7 million (7.9% of revenues), as
compared to $395.1 million (7.5% of
revenues) in the year ended December 31,
2021.
Marketing and selling expenses, net for the year ended
December 31, 2022 were
$326.0 million (5.9% of revenues), as
compared to $291.8 million (5.5% of
revenues) in the year ended December 31,
2021.
General and administrative expenses, net for the year
ended December 31, 2022 were
$313.0 million (5.7% of revenues), as
compared to $267.4 million (5.1% of
revenues) in the year ended December 31,
2021. General and administrative expenses in 2022 include
expenses of approximately $16 million
related to the Company's stock price linked compensation plans.
Other operating income, net for the year ended
December 31, 2022 amounted to
$68.9 million, as compared to
$14.7 million for the year ended
December 31, 2021. Other operating
income in 2022 resulted mainly from capital gains related to the
sale of buildings and investments by subsidiaries in Israel and in the United Kingdom and a grant received by a
subsidiary in Israel. Other
operating income in 2021 was a result of capital gain related to
the sale of a building by a subsidiary in Israel.
Non-GAAP(*) operating income for the year ended
December 31, 2022 was $356.6 million (6.5% of revenues), as compared to
$450.8 million (8.5% of revenues) in
the year ended December 31, 2021.
GAAP operating income in 2022 was $367.5 million (6.7% of revenues), as compared to
$418.5 million (7.9% of revenues) in
2021. GAAP and Non-GAAP operating income in 2022 was reduced by
expenses of approximately $62 million
related to the Company's stock price linked compensation plans.
Financial expenses, net for the year ended
December 31, 2022 were
$51.4 million, as compared to
$40.4 million in the year ended
December 31, 2021. Financial
expenses, net in 2022 included gains from changes in fair value of
financial assets of approximately $6.1
million as compared to a gain of $18.8 million in 2021. Financial expenses, net in
2022 were also higher as compared to 2021 as a result of the
increase in interest rates in 2022.
Other expenses, net in 2022 were $23.6 million, as compared to other income, net
of $5.3 million in 2021. The expenses
in 2022, resulted mainly from revaluation of holdings in affiliated
companies, and expenses related to non-service costs of pension
plans.
Taxes on income for the year ended December 31, 2022 were $24.1 million (effective tax rate of 8.2%), as
compared to $131.4 million (effective
tax rate of 34.3%) in the year ended December 31, 2021. Taxes on income in 2021
included an expense of approximately $80.0
million related to the "release" of Exempt Earnings. Taxes
on income in 2022 were reduced by a tax benefit related to
adjustments for prior years following a tax settlement in some of
the Company's subsidiaries in Israel with the Israeli tax authorities.
Equity in net earnings of affiliated companies and
partnerships for the year ended December
31, 2022 was $7.0
million, as compared to $22.6
million in the year ended December
31, 2021. Equity in net earnings in 2021 included a gain of
approximately $10.9 million related
to the sale of an affiliated company.
Non-GAAP(*) net income attributable to the
Company's shareholders for the year ended December 31, 2022 was $268.9 million (4.9% of revenues), as compared to
$367.6 million (7.0% of revenues) in
the year ended December 31, 2021.
GAAP net income attributable to the Company's
shareholders in the year ended December
31, 2022 was $275.4 million
(5.0% of revenues), as compared to $274.4
million (5.2% of revenues) in the year ended December 31, 2021. Net income in 2022 was reduced
by net expenses of approximately $56
million related to the Company's stock price linked
compensation plans.
Non-GAAP(*) diluted net earnings per
share attributable to the Company's
shareholders for the year ended December 31, 2022 were $6.03, as compared to $8.30 for the year ended December 31, 2021. GAAP diluted net
earnings per share attributable to the Company's
shareholders in the year ended December
31, 2022 were $6.18, as
compared to $6.20 in the year ended
December 31, 2021. Diluted net
earnings per share in 2022, were reduced by $1.26 as a result of the expenses related to the
Company's stock price linked compensation plans.
Backlog of orders for the year ended December 31, 2022 totaled $15.1 billion, as compared to $13.7 billion as of December 31, 2021. Approximately 75% of the
current backlog is attributable to orders from outside Israel.
Approximately 60% of the current backlog is scheduled to be
performed during 2023 and 2024.
Net cash provided by operating activities in the
year ended December 31, 2022 was
$240.1 million, as compared to
$416.9 million in the year ended
December 31, 2021. Operating cashflow
in 2022 includes higher collection of customers debts offset by
higher payments to suppliers.
Impact of the Covid-19 Pandemic on the Company:
In recent years, the Coronavirus disease 2019 (COVID-19) has had
significant negative impacts on the worldwide economy, resulting in
disruptions to supply chains and financial markets, significant
travel restrictions, facility closures and shelter-in place orders
in various locations. Such disruptions also led to global shortages
of electronics and other components, increased costs and extended
lead times. Elbit Systems continues to monitor the macro-economic
implications of the COVID-19 pandemic.
In parallel to the measures we have taken to maintain business
continuity and deliveries to our customers, we also continue to
work on efficiency initiatives with a number of our suppliers.
During 2021 and 2022 our defense activities, which account for
most of our business, were not materially impacted by the pandemic,
although some of our businesses experienced certain disruptions due
to government directed safety measures, travel restrictions and
supply chain delays.
We believe that as of December 31,
2022, Elbit Systems had a healthy balance sheet, adequate
levels of cash and access to credit facilities that provide
liquidity when necessary. We have given high priority to cash
management and adequate cash reserves to run the business.
The extent of the impact of COVID-19 on the Company's
performance depends on future developments including the duration
and spread of the pandemic, the measures adopted by governments to
limit the spread of the pandemic, including implementation of
vaccinations, and resulting actions that may be taken by our
customers and our supply chain, all of which contain uncertainties.
As noted in our annual report on Form 20-F, the preparation of
financial reports requires us to make judgments, assumptions and
estimates that affect the amounts reported. For our financial
results for the year ended December 31,
2022, we considered the economic impact of the COVID-19
pandemic on our critical and significant accounting estimates. The
expected impact of the COVID-19 pandemic did not have a material
effect on our judgments, assumptions and estimates reflected in the
results. However, our future results may differ materially from our
estimates. As events continue to evolve in connection with the
COVID-19 pandemic, the estimates we use in future periods may
change materially.
* Non-GAAP financial data:
The following non-GAAP financial data, including Adjusted gross
profit, Adjusted operating income, Adjusted net income, and
Adjusted diluted earnings per share,is presented to enable
investors to have additional information on our business
performance as well as a further basis for periodical comparisons
and trends relating to our financial results. We believe such data
provides useful information to investors and analysts by
facilitating more meaningful comparisons of our financial results
over time. The non-GAAP adjustments exclude amortization expenses
of intangible assets related to acquisitions that occurred mainly
in prior periods, capital gains related primarily to the sale of
investments, Covid-19 related expenses, revaluations of investments
in affiliated companies, non-operating foreign exchange gains or
losses, one-time tax expenses, and the effect of tax on each of
these items. We present these non-GAAP financial measures because
management believes they supplement and/or enhance management's,
analysts' and investors' overall understanding of the Company's
underlying financial performance and trends and facilitate
comparisons among current, past, and future periods.
Specifically, management uses Adjusted gross profit, Adjusted
operating income, and Adjusted net income attributable to the
Company's shareholders to measure the ongoing gross profit,
operating profit and net income performance of the Company because
the measure adjusts for more significant non-recurring items,
amortization expenses of intangible assets relating to prior
acquisitions, and non-cash expense which can fluctuate year to
year.
We believe Adjusted gross profit, Adjusted operating income, and
Adjusted net income attributable to the Company's shareholders are
useful to existing shareholders, potential shareholders and other
users of our financial information because they provide measures of
the Company's ongoing performance that enable these users to
perform trend analysis using comparable data.
Management uses Adjusted diluted earnings per share to evaluate
further adjusted net income attributable to the Company's
shareholders while considering changes in the number of diluted
shares over comparable periods.
We believe adjusted diluted earnings per share is useful to
existing shareholders, potential shareholders and other users of
our financial information because it also enables these users to
evaluate adjusted net income attributable to Company's shareholders
on a per-share basis.
The non-GAAP measures used by the Company are not based on any
comprehensive set of accounting rules or principles. We believe
that non-GAAP measures have limitations in that they do not reflect
all of the amounts associated with our results of operations, as
determined in accordance with GAAP, and that these measures should
only be used to evaluate our results of operations in conjunction
with the corresponding GAAP measures.
Investors are cautioned that, unlike financial measures prepared
in accordance with GAAP, non-GAAP measures may not be comparable
with the calculation of similar measures for other companies. They
should consider non-GAAP financial measures in addition to, and not
as replacements for or superior to, measures of financial
performance prepared in accordance with GAAP.
Reconciliation of
GAAP to Non-GAAP (Unaudited) Supplemental Financial
Data:
|
(US Dollars in
millions, except for per share amounts)
|
|
|
Three months
ended
December 31, 2022
|
|
Three months
ended
December 31, 2021
|
|
Year ended
December 31, 2022
|
|
Year ended
December 31, 2021
|
GAAP gross
profit
|
$
380.6
|
|
$
374.3
|
|
$ 1,373.3
|
|
$ 1,358.0
|
Adjustments:
|
|
|
|
|
|
|
|
Amortization of
purchased intangible assets(*)
|
7.2
|
|
6.8
|
|
31.7
|
|
26.7
|
Non-GAAP gross
profit
|
$
387.8
|
|
$
381.1
|
|
$ 1,405.0
|
|
$ 1,384.7
|
Percent of
revenues
|
25.7 %
|
|
25.5 %
|
|
25.5 %
|
|
26.2 %
|
|
|
|
|
|
|
|
|
GAAP operating
income
|
$
120.3
|
|
$
107.3
|
|
$
367.5
|
|
$
418.5
|
Adjustments:
|
|
|
|
|
|
|
|
Amortization of
purchased intangible assets(*)
|
11.4
|
|
12.8
|
|
49.2
|
|
47.0
|
Capital gain
|
—
|
|
—
|
|
(31.5)
|
|
(14.7)
|
Non-recurring
grant
|
(28.6)
|
|
—
|
|
(28.6)
|
|
—
|
Non-GAAP operating
income
|
$
103.1
|
|
$
120.1
|
|
$
356.6
|
|
$
450.8
|
Percent of
revenues
|
6.8 %
|
|
8.0 %
|
|
6.5 %
|
|
8.5 %
|
|
|
|
|
|
|
|
|
GAAP net income
attributable to Elbit Systems'
shareholders
|
$
85.3
|
|
$
8.2
|
|
$
275.4
|
|
$
274.4
|
Adjustments:
|
|
|
|
|
|
|
|
Amortization of
purchased intangible assets(*)
|
11.4
|
|
12.8
|
|
49.2
|
|
47.0
|
Capital gain
|
—
|
|
—
|
|
(20.5)
|
|
(24.9)
|
Revaluation of
investments measured under fair value method
|
14.8
|
|
(12.5)
|
|
10.2
|
|
(17.3)
|
Non-operating foreign
exchange (gains) losses
|
(3.0)
|
|
7.2
|
|
(10.5)
|
|
10.6
|
Non-recurring
grant
|
(28.6)
|
|
—
|
|
(28.6)
|
|
—
|
Tax effect and other
tax items, net
|
(4.9)
|
|
79.2
|
|
(6.3)
|
|
77.8
|
Non-GAAP net
income attributable to Elbit
Systems' shareholders
|
$
75.0
|
|
$
94.9
|
|
$
268.9
|
|
$
367.6
|
Percent of
revenues
|
5.0 %
|
|
6.4 %
|
|
4.9 %
|
|
7.0 %
|
|
|
|
|
|
|
|
|
GAAP diluted net
EPS
|
$
1.91
|
|
$
0.18
|
|
$
6.18
|
|
$
6.20
|
Adjustments,
net
|
(0.23)
|
|
1.96
|
|
(0.15)
|
|
2.10
|
Non-GAAP diluted net
EPS
|
$
1.68
|
|
$
2.14
|
|
$
6.03
|
|
$
8.30
|
|
(*) While
amortization of acquired intangible assets is excluded from the
measures, the revenue of the acquired companies is reflected in the
measures
and the acquired assets contribute to revenue
generation.
|
Recent Events:
On December 21, 2022, the
Company announced that it was awarded a framework contract with a
maximum value of approximately $410
million (approximately 1.89 billion Lei) to supply up to
seven "Watchkeeper X" tactical unmanned aircraft systems (UAS) for
the Romanian Ministry of National Defense, with a validity of five
years. No specific purchase order under the contract was awarded at
the time the framework contract was announced.
On December 22, 2022, the
Company announced that it was awarded a contract valued at
approximately $36 million to supply
four F-16 Full Mission Simulators (FMS) to the Polish Air Force
(PLAF). The contract will be performed over a 28-month period.
On January 3, 2023, the
Company announced that it was awarded a contract valued at
approximately $107 million to
provide, operate and maintain the new Main Battle Tank (MBT)
simulation and training centers of the Israeli Defense Forces'
(IDF) Armored Corps. The new training centers will train commanders
and soldiers of the Armored Corps and will maintain readiness
of both regular and reserve units. The centers will be
delivered over a three-year period and the contract includes
operation and maintenance services for an additional period of
fifteen years.
On January 10,
2023, the Company announced that it was awarded a
contract in an amount of approximately $180
million from the Israeli Ministry of Defense (IMOD) to
provide, operate and maintain the new Mission Training Center (MTC)
for the Israeli Air Force's (IAF) F-16 fleet. The contract will be
delivered over a three-year period with an additional fifteen year
period that will include operation and maintenance services.
On January 11, 2023, the
Company announced that it was awarded a contract in an amount of
approximately $70 million to supply
rockets to the armed forces of a European country. The contract
will be performed over a period of 3 years.
On January 17, 2023, the
Company announced that it signed a contract in an amount of
approximately $95 million with the
Israeli Ministry of Defense (IMOD) to supply and maintain advanced
Electro-optical systems for the Israeli Defense Forces (IDF)
infantry forces. The contract will be performed over a period of 10
years.
On January 24,
2023, the Company announced that its subsidiary
Elbit Systems Sweden AB ("Elbit Systems Sweden"), was awarded a
contract valued at approximately $48
million by the Swedish Defence Materiel Administration
(FMV), to supply Technical High Mobility Shelters (THMS) to the
Swedish Army. The contract will be performed over a period of 3
years and includes options for further extensions.
On March 2, 2023, the
Company announced that it was awarded two contracts with an
aggregate value of $252 million to
supply artillery rocket systems to a European NATO member country.
Under the first contract in an amount of $119 million, Elbit Systems will supply a
battalion's worth of ATMOS (Autonomous Truck Mounted Howitzer)
155mm/52 caliber truck-mounted howitzers systems. The contract will
be performed over a period of two years. Under the second contract
in an amount of $133 million, Elbit
Systems will provide two batteries worth of PULSTM
artillery rocket-launcher systems including a package of rockets
and missiles. The contract will be performed over a period of three
years.
On March 2, 2023, the
Company announced that its Romanian subsidiary, Elmet International
SRL., was awarded a follow-on contract valued at $120 million from General Dynamics European Land
Systems (GDELS) to supply unmanned turrets, Remote Controlled
Weapon Stations (RCWS) and mortar systems for the 'Piranha V'
Armored Personnel Carrier (APC) of the Romanian Armed Forces. The
work will performed in Romania
over a three-year period.
Dividend:
The Board of Directors declared a dividend of $0.5 per share. The dividend's record date is
April 18, 2023. The dividend will be
paid on May 1, 2023, after deduction
of taxes at the source, at the rate of 16.8%.
Conference Call:
The Company will be hosting a conference call today,
Tuesday, March 28, 2023, at
9:00 a.m. Eastern Time. On the call,
management will review and discuss the results and will be
available to answer questions.
To participate, please call one of the teleconferencing numbers
that follow. If you are unable to connect using the toll-free
numbers, please try the international dial-in number.
US Dial-in Number:
1-866-744-5399
Canada Dial-in Number:
1-866-485-2399
Israel
Dial-in Number:
03-918- 0644
International Dial-in
Number: 972-3- 918- 0644
at 9:00am Eastern
Time; 6:00am Pacific Time;
4:00pm Israel Time
The conference call will also be broadcast live on Elbit
Systems' website at https://www.elbitsystems.com. An online
replay will be available from 24 hours after the call ends.
Alternatively, for two days following the call, investors will
be able to dial a replay number to listen to the call. The dial-in
numbers are: 1-888-782-4291 (US and Canada) or +972-3-925-5900 (Israel and
International).
Investor conference
Starting at 10:00am Israel time
(4:00am Eastern Time) Tuesday, March 28, 2023, Elbit Systems will host
an investor conference in Israel.
The event will be streamed live in Hebrew with a simultaneous
English translation. A recording of the event will be available
shortly after the event concludes. The live webcast and recording
will be available in the Investor Relations section of Elbit
Systems' website at http://www.elbitsystems.com.
Investors and analysts that wish to ask questions related to
topics discussed at the investor conference are welcome to present
their questions during the Q&A part of the financial results
conference call.
Annual Report
The Company's Annual Report on Form 20-F (including its
financial statements for the fiscal year ended December 31, 2022) will be filed in April,
2023.
About Elbit Systems
Elbit Systems Ltd. is an international high technology company
engaged in a wide range of defense, homeland security and
commercial programs throughout the world. The Company, which
includes Elbit Systems and its subsidiaries, operates in the areas
of aerospace, land and naval systems, command, control,
communications, computers, intelligence surveillance and
reconnaissance ("C4ISR"), unmanned aircraft systems, advanced
electro-optics, electro-optic space systems, EW suites, signal
intelligence systems, data links and communications systems,
radios, cyber-based systems and munitions. The Company also focuses
on the upgrading of existing platforms, developing new technologies
for defense, homeland security and commercial applications and
providing a range of support services, including training and
simulation systems.
For additional information,
visit: https://elbitsystems.com, follow us
on Twitter or visit our
official Facebook, YouTube and LinkedIn Channels.
Attachments:
Consolidated balance sheets
Consolidated statements of income
Consolidated statements of cash flow
Consolidated revenue distribution by areas of operation and by
geographical regions
Company Contact:
Joseph
Gaspar, Senior Executive VP – Business
Management
Tel:
+972-77-2946663
j.gaspar@elbitsystems.com
Dr. Yaacov (Kobi)
Kagan, EVP & Chief Financial
Officer
Tel:
+972-77-2946663
kobi.kagan@elbitsystems.com
Rami
Myerson, Director, Investor Relations
Tel:
+972-77-2948984
rami.myerson@elbitsystems.com
Dalia Bodinger,
VP, Communications & Brand
Tel:
+972-77-2947602
dalia.bodinger@elbitsystems.com
|
IR Contact:
Ehud
Helft
EK Global Investor
Relations
Tel:
1-212-378-8040
elbitsystems@egkir.com
|
This press release may contain forward–looking statements
(within the meaning of Section 27A of the Securities Act of 1933,
as amended, Section 21E of the Securities Exchange Act of 1934, as
amended and the Israeli Securities Law, 1968) regarding Elbit
Systems Ltd. and/or its subsidiaries (collectively the Company), to
the extent such statements do not relate to historical or current
facts. Forward-looking statements are based on management's current
expectations, estimates, projections and assumptions about future
events. Forward–looking statements are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act
of 1995, as amended. These statements are not guarantees of future
performance and involve certain risks, uncertainties and
assumptions about the Company, which are difficult to predict,
including projections of the Company's future financial results,
its anticipated growth strategies and anticipated trends in its
business. Therefore, actual future results, performance and trends
may differ materially from these forward–looking statements due to
a variety of factors, including, without limitation: scope and
length of customer contracts; governmental regulations and
approvals; changes in governmental budgeting priorities; general
market, political and economic conditions in the countries in which
the Company operates or sells, including Israel and the United States among others; changes in
global health and macro-economic conditions; differences in
anticipated and actual program performance, including the ability
to perform under long-term fixed-price contracts; changes in the
competitive environment; and the outcome of legal and/or regulatory
proceedings. The factors listed above are not all-inclusive, and
further information is contained in Elbit Systems Ltd.'s latest
annual report on Form 20-F, which is on file with the U.S.
Securities and Exchange Commission. All forward–looking statements
speak only as of the date of this release. Although the Company
believes the expectations reflected in the forward-looking
statements contained herein are reasonable, it cannot guarantee
future results, level of activity, performance or achievements.
Moreover, neither the Company nor any other person assumes
responsibility for the accuracy and completeness of any of these
forward-looking statements. The Company does not undertake to
update its forward-looking statements.
Elbit Systems Ltd., its logo, brand, product, service and
process names appearing in this Press Release are the trademarks or
service marks of Elbit Systems Ltd. or its affiliated companies.
All other brand, product, service and process names appearing are
the trademarks of their respective holders. Reference to or use of
a product, service or process other than those of Elbit Systems
Ltd. does not imply recommendation, approval, affiliation or
sponsorship of that product, service or process by Elbit Systems
Ltd. Nothing contained herein shall be construed as conferring by
implication, estoppel or otherwise any license or right under any
patent, copyright, trademark or other intellectual property right
of Elbit Systems Ltd. or any third party, except as expressly
granted herein.
(FINANCIAL TABLES TO FOLLOW)
ELBIT SYSTEMS
LTD.
|
CONSOLIDATED BALANCE
SHEETS
|
(In thousands of US
Dollar)
|
|
|
As of
December 31, 2022
Unaudited
|
|
As of
December 31, 2021
Audited
|
Assets
|
|
|
|
Cash and cash
equivalents
|
$
211,108
|
|
$
258,993
|
Short-term bank
deposits
|
1,040
|
|
1,185
|
Trade and unbilled
receivables and contract assets, net
|
2,574,605
|
|
2,770,124
|
Other receivables and
prepaid expenses
|
298,698
|
|
279,228
|
Inventories,
net
|
1,946,326
|
|
1,670,474
|
Total current
assets
|
5,031,777
|
|
4,980,004
|
|
|
|
|
Investments in
affiliated companies, partnerships and other companies
|
159,604
|
|
182,553
|
Long-term trade and
unbilled receivables and contract assets
|
374,054
|
|
316,074
|
Long-term bank deposits
and other receivables
|
112,525
|
|
133,505
|
Deferred income taxes,
net
|
20,025
|
|
65,274
|
Severance pay
fund
|
227,786
|
|
301,192
|
Total
|
893,994
|
|
998,598
|
|
|
|
|
Operating lease right
of use assets
|
405,446
|
|
416,383
|
Property, plant and
equipment, net
|
949,207
|
|
902,684
|
Goodwill and other
intangible assets, net
|
1,935,227
|
|
2,019,675
|
Total assets
|
$
9,215,651
|
|
$
9,317,344
|
|
|
|
|
Liabilities and
Equity
|
|
|
|
Short-term bank credit
and loans
|
$
115,076
|
|
$
27,676
|
Current maturities of
long-term loans and Series B, C and D Notes
|
76,555
|
|
78,682
|
Operating lease
liabilities
|
69,322
|
|
76,778
|
Trade
payables
|
1,067,818
|
|
1,023,679
|
Other payables and
accrued expenses
|
1,171,357
|
|
1,314,321
|
Contract
liabilities
|
1,777,161
|
|
1,502,955
|
Total
|
4,277,289
|
|
4,024,091
|
|
|
|
|
Long-term loans, net of
current maturities
|
264,541
|
|
356,624
|
Series B, C and D
Notes, net of current maturities
|
415,537
|
|
528,324
|
Employee benefit
liabilities
|
618,088
|
|
884,353
|
Deferred income taxes
and tax liabilities, net
|
72,965
|
|
141,451
|
Contract
liabilities
|
217,075
|
|
293,984
|
Operating lease
liabilities
|
344,585
|
|
386,644
|
Other long-term
liabilities
|
247,896
|
|
155,610
|
Total
|
2,180,687
|
|
2,746,990
|
|
|
|
|
Elbit Systems Ltd.'s
equity
|
2,755,221
|
|
2,531,635
|
Non-controlling
interests
|
2,454
|
|
14,628
|
Total equity
|
2,757,675
|
|
2,546,263
|
Total liabilities and
equity
|
$
9,215,651
|
|
$
9,317,344
|
ELBIT SYSTEMS
LTD.
|
CONSOLIDATED
STATEMENTS OF INCOME
|
(In thousands of US
Dollars, except for share and per share amounts)
|
|
|
Year ended
December 31, 2022
Unaudited
|
|
Year ended
December 31, 2021
Audited
|
|
Three months
ended
December 31, 2022
Unaudited
|
|
Three months
ended
December 31, 2021
Unaudited
|
Revenues
|
$
5,511,549
|
|
$
5,278,521
|
|
$
1,506,430
|
|
$
1,494,273
|
Cost of
revenues
|
4,138,266
|
|
3,920,473
|
|
1,125,800
|
|
1,119,924
|
Gross profit
|
1,373,283
|
|
1,358,048
|
|
380,630
|
|
374,349
|
Operating
expenses:
|
|
|
|
|
|
|
|
Research and
development, net
|
435,650
|
|
395,087
|
|
125,425
|
|
113,950
|
Marketing and selling,
net
|
326,020
|
|
291,751
|
|
87,745
|
|
80,754
|
General and
administrative, net
|
313,047
|
|
267,362
|
|
75,773
|
|
72,373
|
Other operating income,
net
|
(68,918)
|
|
(14,660)
|
|
(28,644)
|
|
—
|
Total operating
expenses
|
1,005,799
|
|
939,540
|
|
260,299
|
|
267,077
|
Operating
income
|
367,484
|
|
418,508
|
|
120,331
|
|
107,272
|
|
|
|
|
|
|
|
|
Financial expenses,
net
|
(51,364)
|
|
(40,393)
|
|
(26,759)
|
|
(19,614)
|
Other income (expense),
net
|
(23,562)
|
|
5,336
|
|
(14,466)
|
|
9,677
|
Income before income
taxes
|
292,558
|
|
383,451
|
|
79,106
|
|
97,335
|
Taxes on
income
|
(24,131)
|
|
(131,387)
|
|
4,547
|
|
(92,175)
|
Income after taxes on
income
|
268,427
|
|
252,064
|
|
83,653
|
|
5,160
|
|
|
|
|
|
|
|
|
Equity in net earnings
of affiliated companies and partnerships
|
7,042
|
|
22,599
|
|
1,818
|
|
3,123
|
|
|
|
|
|
|
|
|
Net income
|
$
275,469
|
|
$
274,663
|
|
$
85,471
|
|
$
8,283
|
|
|
|
|
|
|
|
|
Less: net income
attributable to non-controlling interests
|
(21)
|
|
(313)
|
|
(175)
|
|
(96)
|
Net income attributable
to Elbit Systems Ltd.'s shareholders
|
$
275,448
|
|
$
274,350
|
|
$
85,296
|
|
$
8,187
|
|
|
|
|
|
|
|
|
Earnings per share
attributable to Elbit Systems Ltd.'s shareholders:
|
|
|
|
|
|
|
Basic net earnings per
share
|
$
6.21
|
|
$
6.21
|
|
$
1.92
|
|
$
0.19
|
Diluted net earnings
per share
|
$
6.18
|
|
$
6.20
|
|
$
1.91
|
|
$
0.18
|
|
|
|
|
|
|
|
|
Weighted average number
of shares used in computation of:
|
|
|
|
|
|
|
Basic earnings per
share (in thousands)
|
44,322
|
|
44,204
|
|
44,343
|
|
44,213
|
Diluted earnings per
share (in thousands)
|
44,581
|
|
44,278
|
|
44,583
|
|
44,350
|
ELBIT SYSTEMS
LTD.
|
CONSOLIDATED
STATEMENTS OF CASH FLOW
|
(In thousands of US
Dollars)
|
|
|
Year ended
December 31, 2022
Unaudited
|
|
Year ended
December 31, 2021
Audited
|
CASH FLOWS FROM
OPERATING ACTIVITIES
|
|
|
|
Net income
|
$
275,469
|
|
$
274,663
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
Depreciation and
amortization
|
161,290
|
|
153,091
|
Stock-based
compensation
|
10,463
|
|
5,312
|
Amortization of Series
B, C and D related issuance costs, net
|
773
|
|
399
|
Deferred income taxes
and reserve, net
|
(2,219)
|
|
39,095
|
Gain on sale of
property, plant and equipment
|
(18,995)
|
|
(14,457)
|
Gain on sale of
investment and remeasurement of investment held under fair value
method
|
(7,360)
|
|
(15,153)
|
Equity in net earnings
of affiliated companies and partnerships, net of dividend received
(*)
|
11,368
|
|
7,724
|
Changes in operating
assets and liabilities, net of amounts acquired:
|
|
|
|
Decrease (increase) in
short and long-term trade and unbilled receivables and prepaid
expenses
|
97,151
|
|
(430,296)
|
Increase in
inventories, net
|
(305,058)
|
|
(336,221)
|
Increase (decrease) in
trade payables and other payables and accrued expenses
|
(123,289)
|
|
105,201
|
Severance, pension and
termination indemnities, net
|
(51,689)
|
|
9,834
|
Increase in contract
liabilities
|
192,164
|
|
617,740
|
Net cash provided by
operating activities
|
240,068
|
|
416,932
|
CASH FLOWS FROM
INVESTING ACTIVITIES
|
|
|
|
Purchase of property,
plant and equipment and other assets
|
(205,110)
|
|
(188,624)
|
Acquisition of
subsidiaries and business operations, net of cash
consumed
|
(12,430)
|
|
(385,011)
|
Deferred payment on
acquisition
|
(50,749)
|
|
(60,560)
|
Investments in
affiliated companies and other companies, net
|
(4,466)
|
|
(1,828)
|
Proceeds from sale of a
subsidiary
|
81,487
|
|
—
|
Proceeds from sale of
property, plant and equipment
|
24,882
|
|
25,745
|
Proceeds from sale of
investments
|
11,651
|
|
16,177
|
Proceeds from sale of
long-term deposits, net
|
186
|
|
481
|
Investment in
short-term deposits, net
|
2,567
|
|
5,899
|
Net cash used in
investing activities
|
(151,982)
|
|
(587,721)
|
CASH FLOWS FROM
FINANCING ACTIVITIES
|
|
|
|
Issuance of
shares
|
24
|
|
20
|
Repayment of long-term
loans
|
(122,353)
|
|
(536,062)
|
Proceeds from long-term
bank loans
|
39,547
|
|
476,273
|
Issuance of series B,
C, D Notes, net of issuance costs
|
—
|
|
575,249
|
Repayment of Series B,
C and D Notes
|
(65,379)
|
|
—
|
Dividends
paid
|
(86,813)
|
|
(79,175)
|
Change in short-term
bank credit and loans, net
|
99,003
|
|
(285,317)
|
Net cash provided by
(used in) financing activities
|
(135,971)
|
|
150,988
|
NET DECREASE IN CASH
AND CASH EQUIVALENTS
|
(47,885)
|
|
(19,801)
|
CASH AND CASH
EQUIVALENTS AT THE BEGINNING OF THE YEAR
|
$
258,993
|
|
$
278,794
|
CASH AND CASH
EQUIVALENTS AT THE END OF THE YEAR
|
$
211,108
|
|
$
258,993
|
|
|
|
|
(*)
Dividend received from affiliated companies and
partnerships
|
$
18,409
|
|
$
30,323
|
ELBIT SYSTEMS
LTD.
|
DISTRIBUTION OF
REVENUES
|
(In millions of US
Dollars)
|
|
Consolidated
Revenues by Areas of Operation:
|
|
|
Year ended
December 31, 2022
|
|
%
|
|
Year ended
December 31, 2021
|
|
%
|
|
Three months
ended
December 31, 2022
|
|
%
|
|
Three months
ended
December 31, 2021
|
|
%
|
Airborne
systems
|
$ 2,012.5
|
|
36.5
|
|
$ 2,005.8
|
|
37.9
|
|
$
571.8
|
|
38.0
|
|
$
568.2
|
|
38.1
|
Land systems
|
1,216.6
|
|
22.1
|
|
1,254.7
|
|
23.8
|
|
303.9
|
|
20.2
|
|
353.1
|
|
23.6
|
C4ISR
systems
|
1,610.9
|
|
29.2
|
|
1,371.5
|
|
26.0
|
|
431.3
|
|
28.6
|
|
400.9
|
|
26.8
|
Electro-optics
systems
|
523.7
|
|
9.5
|
|
452.9
|
|
8.6
|
|
160.3
|
|
10.6
|
|
118.0
|
|
7.9
|
Other (mainly
non-defense
engineering and production services)
|
147.8
|
|
2.7
|
|
193.6
|
|
3.7
|
|
39.1
|
|
2.6
|
|
54.1
|
|
3.6
|
Total
|
$ 5,511.5
|
|
100.0
|
|
$ 5,278.5
|
|
100.0
|
|
$ 1,506.4
|
|
100.0
|
|
$
1,494.3
|
|
100.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
Revenues by Geographical Regions:
|
|
|
|
Year ended
December 31, 2022
|
|
%
|
|
Year ended
December 31, 2021
|
|
%
|
|
Three months
ended
December 31, 2022
|
|
%
|
|
Three months
ended
December 31, 2021
|
|
%
|
Israel
|
$ 1,071.9
|
|
19.4
|
|
$ 1,094.7
|
|
20.7
|
|
$
271.5
|
|
18.0
|
|
$
297.4
|
|
19.9
|
North
America
|
1,489.7
|
|
27.0
|
|
1,608.6
|
|
30.5
|
|
399.5
|
|
26.5
|
|
401.2
|
|
26.9
|
Europe
|
1,243.6
|
|
22.6
|
|
884.5
|
|
16.8
|
|
384.5
|
|
25.5
|
|
254.0
|
|
17.0
|
Asia-Pacific
|
1,405.5
|
|
25.5
|
|
1,443.5
|
|
27.3
|
|
367.4
|
|
24.4
|
|
453.2
|
|
30.3
|
Latin
America
|
119.9
|
|
2.2
|
|
126.7
|
|
2.4
|
|
43.1
|
|
2.9
|
|
34.3
|
|
2.3
|
Other countries
|
180.9
|
|
3.3
|
|
120.5
|
|
2.3
|
|
40.4
|
|
2.7
|
|
54.2
|
|
3.6
|
Total
|
$
5,511.5
|
|
100.0
|
|
$
5,278.5
|
|
100.0
|
|
$
1,506.4
|
|
100.0
|
|
$
1,494.3
|
|
100.0
|
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SOURCE Elbit Systems Ltd.