Elbit Systems reported its consolidated results for the first quarter ended March 31, 2016.
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Revenues were $721.2 million, as compared to $706.6 million in the first quarter of 2015.
Non-GAAP gross profit amounted to $220.1 million (30.5% of revenues) in the first quarter of 2016, as compared to $206.4 million (29.2% of revenues) in the first quarter of 2015.
GAAP gross profit in the first quarter of 2016 was $212.2 million (29.4% of revenues), as compared to $201.2 million (28.5% of revenues) in the first quarter of 2015.
The improvement in the gross profit rate was mainly due to mix of product sold in the quarter and overall improvement of operations.
Research and development expenses, net were $56.0 million (7.8% of revenues) in the first quarter of 2016, as compared to $55.6 million (7.9% of revenues) in the first quarter of 2015.
Marketing and selling expenses, net were $61.0 million (8.5% of revenues) in the first quarter of 2016, as compared to $51.3 million (7.3% of revenues) in the first quarter of 2015. The marketing and selling expenses in the first quarter of last year were unusually low as a percentage of revenues.
General and administrative expenses, net were $38.9 million (5.4% of revenues) in the first quarter of 2016, as compared to $34.4 million (4.9% of revenues) in the first quarter of 2015. The increase in the General and administrative expenses in the first quarter of 2016 was mainly due to cost of the phantom bonus retention plan associated with G&A expenses.
Other operating income, net in the first quarter of 2016 amounted to $7 million. The amount reflects a net gain related to the revaluation of investment in an Israeli subsidiary that was deconsolidated in the quarter due to third party investment.
Non-GAAP(*) operating income was $66.9 million (9.3% of revenues) in the first quarter of 2016, as compared to $69.5 million (9.8% of revenues) in the first quarter of 2015. GAAP operating income in the first quarter of 2016 was $63.3 million (8.8% of revenues), as compared to $59.8 million (8.5% of revenues) in the first quarter of 2015.
Financial expenses, net were $1.7 million in the first quarter of 2016, as compared to $5.7 million in the first quarter of 2015.
The lower financial expenses in the first quarter of 2016 were mainly a result of gain from various currencies exchange rate differences.
Other income, net in the first quarter of 2016 is a result of a capital gain related to the sale of real estate that was acquired in prior years.
Taxes on income were $12.7 million (effective tax rate of 19.4%) in the first quarter of 2016, as compared to $8.6 million (effective tax rate of 15.9%) in the first quarter of 2015.
The effective tax rate is affected by the mix of the tax rates in the various jurisdictions in which the Company's entities generate taxable income and prior years adjustments in the first quarter of 2015.
Net income attributable to non-controlling interests was $0.5 million in the first quarter of 2016, as compared to $0.9 million in the first quarter of 2015.
Non-GAAP net income attributable to the Company's shareholders in the first quarter of 2016 was $51.2 million (7.1% of revenues), as compared to $52.6 million (7.4% of revenues) in the first quarter of 2015.
GAAP net income in the first quarter of 2016 was $52.3 million (7.3% of revenues), as compared to $44.6 million (6.3% of revenues) in the first quarter of 2015.
Non-GAAP diluted net earnings per share attributable to the Company's shareholders were $1.20 for the first quarter of 2016, as compared to $1.23 for the first quarter of 2015. GAAP diluted earnings per share in the first quarter of 2016 were $1.22, as compared to $1.04 for the first quarter of 2015.
The Company's backlog of orders for the quarter ended March 31, 2016, totaled $6,775 million, as compared to $6,270 million as of March 31, 2015. Approximately 65% of the current backlog is attributable to orders from outside Israel. Approximately 63% of the current backlog is scheduled to be performed during 2016 and 2017.
Operating cash flow for the quarter ended March 31, 2016, was $24.5 million, as compared to $83.9 million in the quarter ended March 31, 2015. ■