Elbit Systems reported its consolidated results for the fourth quarter ended December 31, 2017.
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Revenues in the fourth quarter of 2017 were $1,009.6 million, as compared to $953.7 million in the fourth quarter of 2016.
Non-GAAP gross profit amounted to $288.7 million (28.6% of revenues) in the fourth quarter of 2017, as compared to $288.5 million (30.3% of revenues) in the fourth quarter of 2016. GAAP gross profit in the fourth quarter of 2017 was $283.5 million (28.1% of revenues), as compared to $280.8 million (29.4% of revenues) in the fourth quarter of 2016.
The decline in the gross profit rate was mainly as a result of the mix of programs sold in the quarter.
Research and development expenses, net, were $72.5 million (7.2% of revenues) in the fourth quarter of 2017, as compared to $67.0 million (7.0% of revenues) in the fourth quarter of 2016.
Marketing and selling expenses, net, were $81.2 million (8.0% of revenues) in the fourth quarter of 2017, as compared to $88.8 million (9.3% of revenues) in the fourth quarter of 2016.
General and administrative expenses, net, were $26.2 million (2.6% of revenues) in the fourth quarter of 2017, as compared to $37.6 million (3.9% of revenues) in the fourth quarter of 2016.
The significant decrease in general and administrative expenses in the fourth quarter of 2017 resulted mainly from revaluation of liabilities related to assets and activities acquired in prior years.
Non-GAAP operating income was $110.5 million (10.9% of revenues) in the fourth quarter of 2017, as compared to $97.3 million (10.2% of revenues) in the fourth quarter of 2016.
GAAP operating income in the fourth quarter of 2017 was $103.6 million (10.3% of revenues), as compared to $87.5 million (9.2% of revenues) in the fourth quarter of 2016.
Financial expenses, net, were $9.7 million in the fourth quarter of 2017, as compared to $9.2 million in the fourth quarter of 2016.
Taxes on income were $25.4 million in the fourth quarter of 2017, as compared to $9.8 million in the fourth quarter of 2016.
Taxes in the fourth quarter of 2017 included a $10.9 million adjustment to deferred tax assets as a result of the tax reform in the U.S. Taxes in the fourth quarter of 2016 were somewhat lower than typical, mainly due to settlements of tax audits for prior years.
Equity in net earnings of affiliated companies and partnerships was $1.4 million in the fourth quarter of 2017, as compared to a net loss of $0.6 million in the fourth quarter of 2016.
Net income attributable to non-controlling interests was $0.5 million in the fourth quarter of 2017, as compared to $0.7 million in the fourth quarter of 2016.
Non-GAAP net income attributable to the company's shareholders in the fourth quarter of 2017 was $86.1 million (8.5% of revenues), as compared to $77.7 million (8.2% of revenues) in the fourth quarter of 2016.
GAAP net income attributable to the company's shareholders in the fourth quarter of 2017 was $69.4 million (6.9% of revenues), as compared to $67.1 million (7.0% of revenues) in the fourth quarter of 2016.
Non GAAP diluted net earnings per share attributable to the company's shareholders were $2.01 for the fourth quarter of 2017, as compared to $1.82 for the fourth quarter of 2016.
GAAP diluted earnings per share attributable to the company's shareholders in the fourth quarter of 2017 were $1.62, as compared to $1.57 in the fourth quarter of 2016.
Revenues for the year ended December 31, 2017 were $3,377.8 million, as compared to $3,260.2 million in the year ended December 31, 2016.
Cost of revenues for the year ended December 31, 2017 was $2,379.9 million (70.5% of revenues), as compared to $2,300.6 million (70.6% of revenues) in the year ended December 31, 2016.
Non-GAAP gross profit for the year ended December 31, 2017 was $1,020.1 million (30.2% of revenues), as compared to $990.8 million (30.4% of revenues) in the year ended December 31, 2016. GAAP gross profit in 2017 was $997.9 million (29.5% of revenues), as compared to $959.6 million (29.4% of revenues) in 2016.
Research and development expenses, net, for the year ended December 31, 2017 were $265.1 million (7.8% of revenues), as compared to $255.8 million (7.8% of revenues) in the year ended December 31, 2016.
Marketing and selling expenses, net, for the year ended December 31, 2017 were $280.2 million (8.3% of revenues), as compared to $271.0 million (8.3% of revenues) in the year ended December 31, 2016.
General and administrative expenses, net, for the year ended December 31, 2017 were $133.3 million (3.9% of revenues), as compared to $151.4 million (4.6% of revenues) in the year ended December 31, 2016.
The significant decrease in general and administrative expenses in 2017 was mainly a result of revaluation of liabilities related to assets and activities acquired in prior years, net of an increase in wages and benefits as a result of the changes in the NIS-U.S. dollar exchange rate.
Other operating income, net, for the year ended December 31, 2016 amounted to $17.6 million. This was the result of net gains related to valuation of shares in two of our Israeli subsidiaries in the energy and automotive areas, due to third party investments.
Non-GAAP operating income for the year ended December 31, 2017 was $347.9 million (10.3% of revenues), as compared to $322.6 million (9.9% of revenues) in the year ended December 31, 2016.
GAAP operating income in 2017 was $319.3 million (9.5% of revenues), as compared to $299.0 million (9.2% of revenues) in 2016. ■