zk1517664.htm


SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549
 


F O R M 6-K

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

For the month of November 2015

TAT TECHNOLOGIES LTD.
(Name of Registrant)

      P.O.BOX 80, Gedera 70750 Israel
(Address of Principal Executive Office)

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

Form 20-F x    Form 40-F o

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

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

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.

Yes o    No x

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

 

 
TAT Technologies Ltd.

6-K Items

1.
Press Release dated November 27, 2015 re TAT Technologies Ltd. Reports Third Quarter 2015 Results.
 
ITEM 1

Press Release
Source: TAT Technologies Limited

TAT Technologies Reports third Quarter 2015 Results

GEDERA, Israel, Friday, November  27, 2015 - TAT Technologies Ltd. (NASDAQ: TATT - News) (the “Company”), a leading provider of services and products to the commercial and military aerospace and ground defense industries, reported today its results for the three month and nine month periods ended September 30, 2015.
 
Financial Highlights for the Third quarter of 2015:
 
Total Revenue: $22 million compared to $20.3 million in the third quarter of 2014, increase of 8%.

Operating income: $0.5 million compared to $0.6 million in the third quarter of 2014.
 
Net income: $0.2 million compared to $(0.4) million in the third quarter of 2014.
 
Earnings per share basic and diluted: $0.02 per share compared to $(0.05) per share in the third quarter of 2014.

EBITDA: $1.1 million compared to $1.2 million in the third quarter of 2014.

Cash and cash equivalents and short-term bank deposits: During the third quarter of 2015, the cash balance decreased in $ 0.8 million, from $29.7 million as of June 30, 2015 to $28.9 million as of September 30, 2015.

Closing of Chromalloy Israel Acquisition: On October 19, 2015 the Company completed the acquisition of Chromalloy Israel for approximately US $3.5 million. In addition, TAT will pay an earn-out, capped at $2 million, in the event that Chromalloy Israel meets certain annual revenue targets in 2015 and 2016.
 
Following the completion of the transaction, Chromalloy Israel changed its name to Turbochrome Ltd.

 
2

 

Financial Highlights for the nine months of 2015:
 
Total Revenue: $63.9 million compared to $59.3 million in the nine months of 2014.

Operating income: $2.7 million compared to $1.7 million in the nine months of 2014.
 
Net income: $2.8 million compared to $0.3 million in the nine months of 2014.

EBITDA: $4.6 million compared to $3.2 million in the nine months of 2014.
 
Earnings per share basic and diluted: $0.32 per share compared to $0.03 per share in the nine months of 2014.

Cash and cash equivalents and short-term bank deposits: During the first nine months of 2015, the cash balance increased in $ 0.9 million, from $28 million as of December 31, 2014 to $28.9 million as of September 30, 2015.
 
About TAT Technologies LTD
 
TAT Technologies Ltd. is a leading provider of services and products to the commercial and military aerospace and ground defense industries. TAT operates under three segments:  (i) Original Equipment Manufacturing or “OEM” of Heat Management Solutions (ii) Heat Transfer Services and Products (iii) Maintenance, Repair and Overhaul or “MRO” services of Aviation Components and (iv) overhaul and coating of certain jet engine components.

TAT’s activities in the area of OEM of Heat Management Solutions primarily include the design, development, manufacture and sale of (i) a broad range of heat transfer components (such as heat exchangers, pre-coolers and oil/fuel hydraulic coolers) used in mechanical and electronic systems on-board commercial, military and business aircraft; (ii) environmental control and cooling systems on board aircraft and for ground applications; and (iii) a variety of other electronic and mechanical aircraft accessories and systems such as pumps, valves, power systems and turbines.

TAT’s activities in the area of Heat Transfer Services and Products include the maintenance, repair and overhaul of heat transfer equipment and in a lesser extent, the manufacturing of certain heat transfer products. TAT’s Limco subsidiary operates FAA certified repair station, which provides heat transfer MRO services and products for airlines, air cargo carriers, maintenance service centers and the military.

TAT’s activities in the area of MRO services for Aviation Components include the maintenance, repair and overhaul of APUs, Landing Gear and other aircraft components. TAT’s Piedmont subsidiary operates an FAA certified repair station, which provides aircraft component MRO services for airlines, air cargo carriers, maintenance service centers and the military.

TAT’s activities in the area of jet engine overhaul includes the overhaul and coating of jet engine components, including turbine vanes and blades, fan blades, variable inlet guide vanes, afterburner flaps and other components.

 
3

 
 
For more information of TAT Technologies Ltd., please visit our web-site: www.tat-technologies.com
 
Guy Nathanzon – CFO
TAT Technologies Ltd.
Tel: 972-8-862-8500
guyn@tat-technologies.com
 
Safe Harbor for Forward-Looking Statements

This press release contains forward-looking statements which include, without limitation, statements regarding possible or assumed future operation results. These statements are hereby identified as "forward-looking statements" for purposes of the safe harbor provided by the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties that could cause our results to differ materially from management's current expectations. Actual results and performance can also be influenced by other risks that we face in running our operations including, but are not limited to, general business conditions in the airline industry, changes in demand for our services and products, the timing and amount or cancellation of orders, the price and continuity of supply of component parts used in our operations, the change of control that will occur on the sale by the receiver of the Company’s shares held by our previously controlling stockholders, and other risks detailed from time to time in the company's filings with the Securities Exchange Commission, including, its annual report on form 20-F and its periodic reports on form 6-K. These documents contain and identify other important factors that could cause actual results to differ materially from those contained in our projections or forward-looking statements. Stockholders and other readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. We undertake no obligation to update publicly or revise any forward-looking statement.

 
4

 
 
TAT TECHNOLOGIES AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEET
(Unaudited, in thousands)

   
September 30,
   
December 31,
 
   
2015
   
2014
 
         
(Revised)
 
ASSETS
           
Current Assets:
           
Cash and cash equivalents
  $ 23,821     $ 22,894  
Short-term bank deposits
    5,109       5,089  
Accounts receivable-trade (net of allowance for doubtful accounts of  $269 as of September 30, 2015 and $125 as of December 31, 2014)
    19,416       15,657  
Other accounts receivable and prepaid expenses
    4,668       4,298  
Inventories, net
    35,895       35,477  
                 
Total current assets
    88,909       83,415  
                 
Long-term assets:
               
Investment in an affiliated company
    -       2,556  
Investment in investee company
    423       -  
Funds in respect of employee rights upon retirement
    2,505       2,496  
Long-term deferred tax
    1,156       1,550  
Property, plant and equipment, net
    12,025       11,524  
                 
Total Long-term assets
    16,109       18,126  
                 
Total assets
  $ 105,018     $ 101,541  
                 
LIABILITIES AND EQUITY
               
                 
Current Liabilities:
               
Accounts payables trade
    5,041       5,886  
Other accounts payable and accrued expenses
    6,984       5,651  
Total current liabilities
    12,025       11,537  
                 
Long-term liabilities:
               
      Other accounts payable
    59       34  
Liability in respect of employee rights upon retirement
    2,708       2,655  
Long-term deferred tax liability
    1,812       1,774  
                 
Total long-term liabilities
    4,579       4,463  
                 
Total liabilities
    16,604       16,000  
                 
EQUITY:
               
Share capital
    2,793       2,793  
Additional paid-in capital
    64,517       64,491  
Treasury stock at cost
    (2,088 )     (2,088 )
Accumulated other comprehensive loss
    1       -  
Retained earnings
    23,191       20,345  
Total equity
    88,414       85,541  
                 
Total liabilities and equity
  $ 105,018     $ 101,541  

 
5

 
 
TAT TECHNOLOGIES AND ITS SUBSIDIARIES
 
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited, in thousands, except share data)
 
   
Three months ended
   
Nine months ended
   
Year ended
 
   
September 30,
   
December 31,
 
   
2015
   
2014
   
2015
   
2014
   
2014
 
         
(Revised)
         
(Revised)
   
(Revised)
 
Revenues:
 
 
                         
Products
  $ 8,254     $ 7,483     $ 22,980     $ 23,015     $ 31,363  
Services
    13,694       12,841       40,924       36,326       49,363  
      21,948       20,324       63,904       59,341       80,726  
                                         
Cost  of goods:
                                       
Products
    7,003       5,976       18,591       17,725       23,616  
Services
    11,547       10,621       33,946       30,577       40,906  
      18,550       16,597       52,537       48,302       64,522  
Gross Profit
    3,398       3,727       11,367       11,039       16,204  
                                         
Operating expenses:
                                       
Research and development, net
    247       324       570       885       1,070  
Selling and marketing
    647       776       2,130       2,415       3,203  
General and administrative
    2,033       1,999       5,981       6,099       8,123  
Other income
    (1 )     (4 )     -       (11 )     (11 )
      2,926       3,095       8,681       9,388       12,385  
Operating income
    472       632       2,686       1,651       3,819  
                                         
Financial income (expenses), net
    17       (812 )     (232 )     (783 )     (1,294 )
Loss from dilution of interests in affiliated company
    -       -       -       (45 )     -  
                                         
Income (loss) before taxes on income
    489       (180 )     2,454       823       2,525  
                                         
Taxes on income
    317       315       1,099       810       1,360  
                                         
Net income (loss) after taxes on income
    172       (495 )     1,355       13       1,165  
Share in results and sale of equity investment of affiliated company
    -       48       1,491       267       267  
                                         
Net income (loss)
  $ 172     $ (447 )   $ 2,846     $ 280     $ 1,432  
                                         
Basic and diluted income (loss) per share
                                       
                                         
Net income (loss) per share
  $ 0.02     $ (0.05 )   $ 0.32     $ 0.03     $ 0.16  
                                         
Weighted average number of shares outstanding
                                       
Basic
    8,808,344       8,805,236       8,808,344       8,805,236       8,805,495  
Diluted
    8,810,824       8,805,236       8,809,844       8,830,610       8,826,542  

 
6

 
 
TAT TECHNOLOGIES AND ITS SUBSIDIARIES
 
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, in thousands)

   
Three months ended
   
Nine months ended
   
Year ended December 31,
 
   
September 30,
       
   
2015
   
2014
   
2015
   
2014
   
2014
 
         
(Revised)
         
(Revised)
   
(Revised)
 
CASH FLOWS FROM OPERATING ACTIVITIES:
                             
Net income (loss)
  $ 172     $ (447 )   $ 2,846     $ 280     $ 1,432  
                                         
Adjustments to reconcile net income to net cash provided by operating activities:
                                       
                                         
Depreciation
    675       527       1,890       1,543       2,069  
Exchange differentials of loans
    -       -       -       (1 )     (1 )
Gain (loss) on sale of property and equipment
    -       -       -       (7 )     10  
Interest from short-term bank deposits and restricted deposits
    (5 )     -       (20 )     (69 )     (128 )
Provision for doubtful accounts
    144       -       144       -       -  
Share in results and sale of equity investment of affiliated company
    -       (48 )     (1,491 )     (222 )     (267 )
Share based compensation expenses
    11       17       26       28       38  
Liability in respect of employee rights upon retirement
    (68 )     (115 )     53       (112 )     (485 )
Deferred income taxes, net
    30       (19 )     672       (267 )     1,229  
Changes in operating assets and liabilities:
                                       
    Amounts due to (from) related parties, net
    -       -       -       5       5  
    Decrease (increase) in trade accounts receivable
    (1,261 )     643       (3,903 )     4,082       2,730  
Decrease (increase) in other accounts receivable, prepaid expenses and other
    35       (1,568 )     (276 )     (2,338 )     (833 )
Decrease (increase) in inventories, net
    779       (770 )     (418 )     (1,404 )     (6,009 )
    Increase (decrease) in trade accounts payable
    (396 )     (940 )     (801 )     (2,115 )     (509 )
    Increase (decrease) in other accounts payable and accrued expenses
    (236 )     1,121       1,052       1,257       (715 )
    Increase (decrease) in other long-term liabilities
    39       (7 )     25       (18 )     (24 )
                                         
Net cash provided by (used in) operating activities
  $ (81 )   $ (1,606 )   $ (201 )   $ 642     $ (1,458 )
                                         
CASH FLOWS FROM INVESTING ACTIVITIES:
                                       
Proceeds from sale of subsidiary (A)
    -       -       -       2,176       2,176  
Proceeds from sale of equity investment of affiliated company
    -       -       3,624       -       -  
Funds in respect of employee rights upon retirement
    76       97       (61 )     80       352  
Proceeds from sale of property and equipment
    3       -       9       7       19  
Purchase of property and equipment
    (745 )     (350 )     (2,444 )     (2,234 )     (3,021 )
Maturities of short-term deposits
    -       -       -       -       5,098  
Cash flows provided by (used in) investing activities
  $ (666 )   $ (253 )   $ 1,128     $ 29     $ 4,624  
                                         
Cash flows used in financing activities
    -       -       -     $ (2,909 )   $ (2,909 )
                                         
Net increase (decrease) in cash and cash equivalents
    (747 )     (1,859 )     927       (2,238 )     257  
                                         
Cash and cash equivalents at beginning of period
    24,568       22,258       22,894       22,637       22,637  
                                         
Cash and cash equivalents at end of period
  $ 23,821     $ 20,399     $ 23,821     $ 20,399     $ 22,894  

(A) Proceeds from sale of subsidiary
                             
Assets held for sale (excluding cash in the amount of $2,823)
    -       -       -       7,136       7,136  
Liabilities held for sale
    -       -       -       (3,428 )     (3,428 )
Non-controlling interest
    -       -       -       (1,532 )     (1,532 )
      -       -       -     $ 2,176     $ 2,176  

 
7

 
 
Revision of financial statements
 
During Q3 2015, the Company identified an error related to the classification of US employees' social benefits expenses. Previously, the Company classified these expenses in ‘general and administrative expenses’ instead of classifying a part of them in ‘Cost of goods’ (product and services) for employees allocated to this line item. This change in classification also impacted the capitalization of inventory balances. There was no material impact on the statement of cash flows.
 
The error only impacts one segment of the Company, Heat Transfer Services and Products. The Company will revise previously reported segment information in its Annual Report on Form 20-F for the year ended December 31, 2015.
 
The Company assessed the materiality of this error in accordance with the SEC’s Staff Accounting Bulletin 99 and Accounting Standards Codification Topic 250, Accounting Changes and Error Corrections, and concluded that the previously issued financial statements were not materially misstated.  In accordance with the SEC’s Staff Accounting Bulletin, the Company will correct these errors by revising the affected financial statements in the Company’s 2015 Annual Report on Form 20-F.
 
Following is the effect of the revision on the Company’s previously reported results:
 
Statements of income per share:
 
For the three and six months periods ended June 30, 2015:
 
   
Three months ended
   
Six months ended
 
   
June 30, 2015
   
June 30, 2015
 
   
As reported
previously
   
Adjustment
   
As revised
   
As reported
previously
   
Adjustment
   
As revised
 
Cost  of goods:
                                   
   Products
    5,964       70       6,034       11,444       144       11,588  
   Services
    11,153       168       11,321       22,046       353       22,399  
Gross profit
    4,353       (238 )     4,115       8,466       (497 )     7,969  
General and administrative
    2,261       (237 )     2,024       4,428       (480 )     3,948  
Operating income
    1,149       (1 )     1,148       2,231       (17 )     2,214  
Net income
    734       (1 )     733       2,691       (17 )     2,674  
Net income per share
    0.08       *       0.08       0.31       (0.01 )     0.30  
 
*Represents an amount less than $1.
 
For the three periods ended March 31, 2015:
 
   
Three months ended
 
   
March 31, 2015
 
   
As reported
previously
   
Adjustment
   
As revised
 
Cost  of goods:
                 
   Products
    5,480       74       5,554  
   Services
    10,893       185       11,078  
Gross profit
    4,113       (259 )     3,854  
General and administrative
    2,167       (243 )     1,924  
Operating income
    1,082       (16 )     1,066  
Net income
    1,957       (16 )     1,941  
Net income per share
    0.22       *       0.22  
 
*Represents an amount less than $1.
 
 
8

 
 
For the three and nine months periods ended September 30, 2014:
 
   
Three months ended
   
Nine months ended
 
   
September 30, 2014
   
September 30, 2014
 
   
As reported
previously
   
Adjustment
   
As revised
   
As reported
previously
   
Adjustment
   
As revised
 
Cost  of goods:
                                   
   Products
    5,911       65       5,976       17,511       214       17,725  
   Services
    10,458       163       10,621       30,114       463       30,577  
Gross profit
    3,955       (228 )     3,727       11,716       (677 )     11,039  
General and administrative
    2,216       (217 )     1,999       6,771       (672 )     6,099  
Operating income
    643       (11 )     632       1,656       (5 )     1,651  
Net (loss) income
    (436 )     (11 )     (447 )     285       (5 )     280  
Net income per share
    (0.05 )     *       (0.05 )     0.03       *       0.03  
 
*Represents an amount less than $1.
 
For the year ended December 31, 2014:
 
   
As reported
previously
   
Adjustment
   
As revised
 
Cost  of goods:
                 
   Products
    23,340       276       23,616  
   Services
    40,286       620       40,906  
Gross profit
    17,100       (896 )     16,204  
General and administrative
    9,019       (896 )     8,123  
Operating income
    3,819       *       3,819  
Net income
    1,432       *       1,432  
Net income per share
    0.16       *       0.16  
 
*Represents an amount less than $1.
 
Balance sheets and shareholders' capital
 
As of December 31, 2014:
 
   
As reported
Previously
   
Adjustment
   
As revised
 
Inventories, net
    35,404       73       35,477  
Total current assets
    83,342       73       83,415  
Total assets
    101,468       73       101,541  
Retained earnings
    20,272       73       20,345  
Total equity
    85,468       73       85,541  

 
9

 
 
SIGNATURE
 
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.
 
 
TAT TECHNOLOGIES LTD.
 
   
(Registrant)
 
       
  By:
/s/ Guy Nathanzon
 
   
Guy Nathanzon
 
   
Chief Financial Officer
 
 
Date: November 27, 2015
 
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