Company sales for the third quarter of 2009 reached $678 million, compared to $877 million for the third quarter of 2008, a 23 percent decrease. Sales for the first 9 months of 2009 (the "Reported Period") totaled $2.1 billion, compared to $2.8 billion for the same period in 2008. The decrease is attributed to the crisis in the global civil aviation market.
Gross profit for the third quarter of 2009 reached $86 million (13 percent of sales), compared to $117 million (13 percent of sales) for the third quarter of 2008. Gross profit for the Reported Period reached $312 million (15 percent of sales), compared to $390 million (14 percent of sales) for the same period of 2008. The increase in the rate of gross profit is attributable to vigorous implementation of operational streamlining in all Company activities.
R&D expenses for the third quarter of 2009 reached $29 million (4 percent of sales), compared to $26 million (3 percent of sales) for the third quarter of 2008. The 10 percent increase in the rate of R&D expenses reflects the significance of investment in new and innovative products and in advanced technologies to secure the future of the Company. Investments in R&D for the Reported Period totaled $85 million.
Marketing, general & administrative expenses for the third quarter of 2009 reached $47 million, compared to $48 million for the third quarter of 2008. Such Expenses for the Reported Period totaled $139 million, compared to $146 million for the same period in 2008. The 5 percent decrease in expenses is attributable to streamlining and cost saving measures.
Employee retirement expenses for the Reported Period totaled $28 million, compared to $41 million for the same period of 2008, within the framework of a reorganization plan.
Net financial income for the third quarter of 2009 reached $15 million, compared to $3 million for the third quarter of 2008. Net financial income for the Reported Period totaled
$17 million, and is mainly attributable to currency protection transactions and to income from securities.
Pre-tax income for the third quarter of 2009 grew by 8 percent to $26 million (4 percent of sales), compared to $24 million (3 percent of sales) for the third quarter of 2008.
Income taxes for the third quarter of 2009 totaled $10 million. Income taxes for the Reported Period totaled $24 million, compared to $4 million for the same period in 2008. The $12 million growth in income taxes is attributable to the economic streamlining law, incorporating an amendment to the income tax ordinance, which decreased the company's tax assets.
Net income for the third quarter of 2009 reached $16 million, similar to the net profit for the third quarter of 2008. Net income for the Reported Period totaled $53 million.
Backlog as of September 30, 2009, grew from $7.1 billion as of December 31, 2008 to a record high of $ 8.1 billion. The net $1 billion increase in backlog is attributable to substantial transactions in the military market.
Cash flow from operating activities for the Reported Period totaled $186 million, compared to $164 million for the same period of 2008. The improvement in cash flow reflects the company's robust financial position.
During the third quarter of 2009 IAI conducted several successful international demonstrations of "Heron" Unmanned Aerial Vehicle (UAV), among others for the Spanish Air Force and the immigration police in the Canary Islands, the Federal Police in Brazil, El Salvador, and others. IAI also participated in a large number of international exhibitions, where it exhibited a variety of new products and technologies. The Company’s participation in the third Latrun conference should be noted, where IAI unveiled the "Jumper" autonomous artillery for ground forces. At the conference, IAI also demonstrated "Mosquito" micro-UAV.
In October 2009 IAI launched the new G-250 business jet. The aircraft's first flight is scheduled for later this year.
Below are balance sheet data:
|
|
As at September 30, 2009 |
As at September 30, 2008 |
|
|
In Millions of $ |
% of the Balance Sheet |
In Millions of $ |
% of the Balance Sheet |
|
Total balance sheet |
3,820 |
100 |
3,606 |
100 |
|
Current Assets |
2,859 |
75 |
2,752 |
76 |
|
of which: Cash and cash equivalents and short term investments |
1,151 |
30 |
1,213 |
34 |
|
Current liabilities |
2,558 |
67 |
2,359 |
65 |
|
Long Term Liabilities |
565 |
15 |
607 |
17 |
|
of which: Bonds |
254 |
7 |
264 |
7 |
|
Shareholders’ equity |
697 |
18 |
640 |
18 |
Below is a summary of business results (in $ million):
|
|
For the nine month period ended
September 30
|
For the three month period ended
September 30 |
|
|
2009 |
2008 |
2009 |
2008 |
|
|
$ |
% |
$ |
% |
$ |
% |
$ |
% |
|
Sales |
2,120 |
100 |
2,782 |
100 |
678 |
100 |
877 |
100 |
|
Gross profit |
312 |
15 |
390 |
14 |
86 |
13 |
117 |
13 |
|
R&D expenses |
85 |
4 |
88 |
3 |
29 |
4 |
26 |
3 |
|
Administrative, marketing and general expenses |
139 |
7 |
146 |
5 |
47 |
7 |
48 |
5 |
|
Other expenses / (income), net |
(1) |
0 |
(5) |
0 |
(2) |
0 |
1 |
0 |
|
Employees' retirement |
28 |
1 |
41 |
1 |
1 |
0 |
16 |
2 |
|
Income from ordinary activities |
61 |
3 |
120 |
4 |
11 |
2 |
26 |
3 |
|
Financial income / (expenses), net |
17 |
1 |
(41) |
(1) |
15 |
2 |
(3) |
0 |
|
Affiliated Companies |
(1) |
0 |
0 |
0 |
(0) |
0 |
1 |
0 |
|
Income before income taxes |
77 |
4 |
79 |
3 |
26 |
4 |
24 |
3 |
|
Income taxes |
(24) |
(1) |
(4) |
0 |
(10) |
(1) |
(8) |
(1) |
|
Net income |
53 |
3 |
75 |
3 |
16 |
2 |
16 |
2 |