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Published: 2021-11-09 07:00:31 ET

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6-K 1 zk2126777.htm 6-K

FORM 6 – K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report on Foreign Issuer

Pursuant to Rule 13a – 16 or 15d – 16

of the Securities Exchange Act of 1934

For the Month of November, 2021

Gilat Satellite Networks Ltd.

(Translation of Registrant’s Name into English)

Gilat House, Yegia Kapayim Street

Daniv Park, Kiryat Arye, Petah Tikva, Israel

(Address of Principal Corporate Offices)

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

Form 20-F ☒ Form 40-F ☐

Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes ☐ No ☒

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): N/A

Attached hereto is Registrant’s press release dated November 9, 2021 announcing Gilat’s Third Quarter 2021 results.

We consent to the incorporation by reference of the GAAP financial information included herein, in the Registration Statements on Form S-8 (Registration Nos. 333-180552, 333-187021, 333-204867, 333-210820, 333-217022, 333-221546, 333-223839, 333-231442, 333-236028, 333-253972 and 333-255740) and on Form F-3 (Registration No. 333-232597).

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.

	Gilat Satellite Networks Ltd.
	(Registrant)

Dated November 9, 2021	By: /s/ Yael Shofar
	Yael Shofar
	General Counsel

Gilat Reports Strong Revenue & Profitability Growth in Third

Quarter 2021

Revenue up 34% year-over-year to $49.9M, GAAP operating income

of $0.9 million and Adjusted EBITDA reached $4.0 million

Petah Tikva, Israel – November 9, 2021 – Gilat Satellite Networks Ltd. (NASDAQ: GILT, TASE: GILT), a worldwide leader in satellite networking technology, solutions and services, today reported its results for the third quarter of 2021.

Third Quarter Financial Highlights

•	Revenues of $49.9 million, a 34% increase from $37.3 million in Q3 2020 and 12% lower than $56.9 million in the previous quarter;

•	GAAP operating income of $0.9 million, a significant improvement compared with an operating loss of $10.9 million in Q3 2020 (which included $8.2 million of Comtech merger and acquisition expenses) and an operating loss of $0.3 million in the previous quarter;

•	Non-GAAP operating income of $1.5 million, compared with operating loss of $1.9 million in Q3 2020, and an operating income of $0.2 million in the previous quarter;

•	GAAP net income of $0.2 million, or $0.00 per diluted share, compared with a net loss of $11.6 million, or loss of $0.21 per share in Q3 2020 and net loss of $0.1 million in the previous quarter, or $0.00 per share;

•	Non-GAAP net income of $0.7 million, or $0.01 per diluted share, compared with a net loss of $2.6 million, or loss of $0.05 per share in Q3 2020, and compared with a net income of $0.4 million, or $0.01 per diluted share, in the previous quarter;

•	Adjusted EBITDA of $4.0 million compared with adjusted EBITDA of $0.6 million in Q3 2020; and adjusted EBITDA of $2.5 million in the previous quarter;

Management Commentary

Adi Sfadia, Gilat’s CEO, commented: “Our revenue this quarter showed significant year over year growth as we continue to increase profitability reaching an Adjusted EBITDA of $4 million. We are especially pleased with our success in signing new deals, some of which are potentially transformable in nature and strategic.

“I am most excited about major progress this quarter in the NGSO and VHTS market segments. Furthermore, we experienced improved performance and significant bookings in our strategic market segments including Cellular Backhual and IFC where we received several orders from key market players to be deliverd over the next few quarters.

“In our Peru operation we have made significant progress with awards of $28 million in multi-year service agreements, and achieved our target goal of approximately $50 million in annual recurring revenue from Peru, well before the stated target date.”

Continued Mr. Sfadia, “Although the global supply chain presents challenges, so far we have been able to mitigate these issues and we hope that this will continue to be the case. Looking ahead, given the recent wins and awards as well as the strong and improving momentum we are seeing across our business, we are increasingly confident that we will show significant growth in the top line and in the Adjusted EBITDA, both in Q4 of this year and in 2022.”

Key Recent Announcements

•	Tier-1 Mobile Operator in Asia Expands 4G Network with Gilat’s Cellular Backhaul Solution

•	Gilat Expands 4G Network with Tier-1 Mobile Operator in North America

•	Gilat Signs Service Agreements of Over $16 Million for Operating Transport-Networks to Support Broadband Services in Peru

•	Gilat Receives $12 Million Service Agreement for Operation of Transport Network in Cusco, Peru

•	Gilat Received $17 Million in Orders for Support of Low Earth Orbit Constellation

•	SES Awards Gilat Multi-Million Dollar Contract for Multiple Broadband Applications in Latin America

Conference Call Details

Gilat’s management will discuss its third quarter 2021 results and business achievements and participate in a questions and answers session:

Date:	Tuesday, November 9, 2021
Start:	9:30 AM ET / 4:30 PM IT
Dial-in:	US: 1-866-744-5399
	International: +972-3-918-0610

A simultaneous webcast of the conference call will be available on the Gilat website at www.gilat.com and through this link: https://veidan.activetrail.biz/gilatq3-2021

The webcast will also be archived for a period of 30 days on the Company’s website and through the link above.

Non-GAAP Measures

The attached summary unaudited financial statements were prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP). To supplement the consolidated financial statements presented in accordance with GAAP, the Company presents Non-GAAP presentations of net income, operating income, Adjusted EBITDA and earnings per share. The adjustments to the Company’s GAAP results are made with the intent of providing both management and investors a more complete understanding of the Company’s underlying operational results, trends and performance. Non-GAAP financial measures mainly exclude the effect of stock based compensation, amortization of purchased intangibles, lease incentive amortization, litigation expenses, income related to trade secrets claims, restructuring and reorganization costs, merger, acquisition and related litigation expense (income), net and initial recognition of deferred tax asset with respect to carry-forward losses.

Adjusted EBITDA is presented to compare the Company’s performance to that of prior periods and evaluate the Company’s financial and operating results on a consistent basis from period to period. The Company also believes this measure, when viewed in combination with the Company’s financial results prepared in accordance with GAAP, provides useful information to investors to evaluate ongoing operating results and trends. Adjusted EBITDA, however, should not be considered as an alternative to operating income or net income for the period and may not be indicative of the historic operating results of the Company; nor is it meant to be predictive of potential future results. Adjusted EBITDA is not a measure of financial performance under GAAP and may not be comparable to other similarly titled measures for other companies. Reconciliation between the Company’s Operating income and Adjusted EBITDA is presented in the attached summary financial statements.

Non-GAAP presentations of net income, operating income, Adjusted EBITDA and earnings per share should not be considered in isolation or as a substitute for any of the consolidated statements of operations prepared in accordance with GAAP, or as an indication of Gilat’s operating performance or liquidity.

About Gilat

Gilat Satellite Networks Ltd. (NASDAQ: GILT, TASE: GILT) is a leading global provider of satellite-based broadband communications. With 30 years of experience, we design and manufacture cutting-edge ground segment equipment, and provide comprehensive solutions and end-to-end services, powered by our innovative technology. Delivering high value competitive solutions, our portfolio comprises of a cloud based VSAT network platform, high-speed modems, high performance on-the-move antennas and high efficiency, high power Solid-State Amplifiers (SSPA) and Block Upconverters (BUC).

Gilat’s comprehensive solutions support multiple applications with a full portfolio of products to address key applications including broadband access, Cellular Backhaul, enterprise, in-flight connectivity, maritime, trains, defense and public safety, all while meeting the most stringent service level requirements. Gilat controlling shareholders are the FIMI Private Equity Funds. For more information, please visit: www.gilat.com

Certain statements made herein that are not historical are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. The words “estimate”, “project”, “intend”, “expect”, “believe” and similar expressions are intended to identify forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties. Many factors could cause the actual results, performance or achievements of Gilat to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, risks associated with the outbreak and global spread of the coronavirus (COVID-19) pandemic; changes in general economic and business conditions, inability to maintain market acceptance to Gilat’s products, inability to timely develop and introduce new technologies, products and applications, rapid changes in the market for Gilat’s products, loss of market share and pressure on prices resulting from competition, introduction of competing products by other companies, inability to manage growth and expansion, loss of key OEM partners, inability to attract and retain qualified personnel, inability to protect the Company’s proprietary technology and risks associated with Gilat’s international operations and its location in Israel. For additional information regarding these and other risks and uncertainties associated with Gilat’s business, reference is made to Gilat’s reports filed from time to time with the Securities and Exchange Commission. We undertake no obligation to update or revise any forward-looking statements for any reason.

Contact:

Gilat Satellite Networks

Doreet Oren, Senior Director Corporate Communications

DoreetO@gilat.com

Ehud Helft

GK Investor & Public Relations

gilat@gkir.com

+1 212 378 8040

GILAT SATELLITE NETWORKS LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS

U.S. dollars in thousands (except share and per share data)

	Three months ended						Nine months ended
	September, 30						September, 30
	2021			2020			2021			2020
	Unaudited						Unaudited

Revenues	$	49,911		$	37,270		$	151,547		$	123,258
Cost of revenues		32,306			27,827			104,870			95,341

Gross profit		17,605			9,443			46,677			27,917

Research and development expenses		7,640			6,442			23,674			20,215
Less - grants		416			460			790			932
Research and development expenses, net		7,224			5,982			22,884			19,283
Selling and marketing expenses		5,359			3,687			15,827			12,337
General and administrative expenses		4,104			2,478			11,042			10,269
Merger, acquisition and related litigation expense, net		-			8,198			-			11,149

Total operating expenses		16,687			20,345			49,753			53,038

Operating income (loss)		918			(10,902	)		(3,076	)		(25,121	)

Financial expenses, net		(701	)		(286	)		(1,458	)		(1,715	)

Income (loss) before taxes on income		217			(11,188	)		(4,534	)		(26,836	)

Taxes on income		49			363			523			695

Net income (loss)	$	168		$	(11,551	)	$	(5,057	)	$	(27,531	)

Basic and Diluted earnings (loss) per share	$	0.00		$	(0.21	)	$	(0.09	)	$	(0.50	)

Weighted average number of shares used in
computing earnings (loss) per share
Basic		56,525,177			55,520,197			56,355,020			55,506,266
Diluted		56,958,250			55,520,197			56,355,020			55,506,266

GILAT SATELLITE NETWORKS LTD.

RECONCILIATION BETWEEN GAAP AND NON-GAAP STATEMENTS OF OPERATIONS

FOR COMPARATIVE PURPOSES

U.S. dollars in thousands (except share and per share data)

	Three months ended							Three months ended
	September 30, 2021							September 30, 2020
	GAAP		Adjustments (1)			Non-GAAP		GAAP			Adjustments (1)			Non-GAAP
	Unaudited							Unaudited

Gross profit	$	17,605		96		$	17,701	$	9,443			28		$	9,471
Operating expenses (income)		16,687		(448	)		16,239		20,345			(8,950	)		11,395
Operating income (loss)		918		544			1,462		(10,902	)		8,978			(1,924	)
Income (loss) before taxes on income		217		544			761		(11,188	)		8,978			(2,210	)
Net income (loss)		168		544			712		(11,551	)		8,978			(2,573	)

Earnings (loss) per share (basic and diluted)	$	0.00	$	0.01		$	0.01	$	(0.21	)	$	0.16		$	(0.05	)

Weighted average number of shares used in
computing earnings per share
Basic		56,525,177					56,525,177		55,520,197						55,520,197
Diluted		56,958,250					57,227,810		55,520,197						55,520,197

(1) Adjustments reflect the effect of non-cash stock-based compensation as per ASC 718, amortization of intangible assets related to shares acquisition transactions, merger and acquisition and related litigation, net. and restructuring and re-organization costs

			Three months ended September 30, 2021								Three months ended September 30, 2020
			Unaudited								Unaudited

GAAP net income (loss)			$	168							$	(11,551	)

Gross profit
Non-cash stock-based compensation expenses				91								21
Amortization of intangible assets related to acquisition transactions				5								7
				96								28
Operating expenses
Non-cash stock-based compensation expenses				398								259
Amortization of intangible assets related to acquisition transactions				50								49
Merger and acquisition and related litigation, net				-								8,198
Restructuring and re-organization costs				-								444
				448								8,950

Non-GAAP net income (loss)			$	712							$	(2,573	)

GILAT SATELLITE NETWORKS LTD.

RECONCILIATION BETWEEN GAAP AND NON-GAAP STATEMENTS OF OPERATIONS

FOR COMPARATIVE PURPOSES

U.S. dollars in thousands (except share and per share data)

	Nine months ended									Nine months ended
	September 30, 2021									September 30, 2020
	GAAP			Adjustments (1)			Non-GAAP			GAAP			Adjustments (1)			Non-GAAP
	Unaudited									Unaudited

Gross profit	$	46,677			226		$	46,903		$	27,917			144		$	28,061
Operating expenses (income)		49,753			(735	)		49,018			53,038			(12,887	)		40,151
Operating income (loss)		(3,076	)		961			(2,115	)		(25,121	)		13,031			(12,090	)
Income (loss) before taxes on income		(4,534	)		961			(3,573	)		(26,836	)		13,031			(13,805	)
Net income (loss)		(5,057	)		961			(4,096	)		(27,531	)		13,031			(14,500	)

Earnings (loss) per share (basic and diluted)	$	(0.09	)	$	0.02		$	(0.07	)	$	(0.50	)	$	0.24		$	(0.26	)

Weighted average number of shares used in
computing earnings per share
Basic and Diluted		56,355,020						56,355,020			55,506,266						55,506,266

(1) Adjustments reflect the effect of non-cash stock-based compensation as per ASC 718, amortization of intangible assets related to shares acquisition transactions, merger and acquisition and related litigation, net, trade secrets and other litigation expenses and restructuring and re-organization costs .

				Nine months ended September 30, 2021									Nine months ended September 30, 2020
				Unaudited									Unaudited

GAAP net loss				$	(5,057	)							$	(27,531	)

Gross profit
Non-cash stock-based compensation expenses					211									127
Amortization of intangible assets related to acquisition transactions					15									17
					226									144
Operating expenses
Non-cash stock-based compensation expenses					584									860
Amortization of intangible assets related to acquisition transactions					151									150
Trade secrets and other litigation expenses					-									11
Merger, acquisition and related litigation expense, net					-									11,149
Restructuring and re-organization costs					-									717
					735									12,887

Non-GAAP net loss				$	(4,096	)							$	(14,500	)

GILAT SATELLITE NETWORKS LTD.

SUPPLEMENTAL INFORMATION

U.S. dollars in thousands

ADJUSTED EBITDA:

	Three months ended					Nine months ended
	September 30,					September 30,
	2021		2020			2021			2020
	Unaudited					Unaudited

GAAP operating profit (loss)	$	918	$	(10,902	)	$	(3,076	)	$	(25,121	)
Add:
Non-cash stock-based compensation expenses		489		280			795			987
Trade secrets and other litigation expenses		-		-			-			11
Restructuring and re-organization costs		-		444			-			717
Merger, acquisition and related litigation expense, net		-		8,198			-			11,149
Depreciation and amortization (*)		2,608		2,542			7,365			7,924

Adjusted EBITDA	$	4,015	$	562		$	5,084		$	(4,333	)

(*) Including amortization of lease incentive

SEGMENT REVENUE:

	Three months ended				Nine months ended
	September 30,				September 30,
	2021		2020		2021		2020
	Unaudited				Unaudited

Fixed Networks	$	22,328	$	22,797	$	78,455	$	67,587
Mobility Solutions		21,624		9,210		52,626		42,417
Terrestrial Infrastructure Projects		5,959		5,263		20,466		13,254

Total revenue	$	49,911	$	37,270	$	151,547	$	123,258

GILAT SATELLITE NETWORKS LTD.

CONSOLIDATED BALANCE SHEETS

U.S. dollars in thousands

	September 30,		December 31,
	2021		2020
	Unaudited		Audited

ASSETS

CURRENT ASSETS:
Cash and cash equivalents	$	63,774	$	88,754
Restricted cash		21,624		27,162
Trade receivables, net		29,705		27,976
Contract assets		24,469		41,573
Inventories		31,577		31,304
Other current assets		24,189		16,637

Total current assets		195,338		233,406

LONG-TERM ASSETS:
Restricted cash		12		42
Severance pay funds		6,524		6,665
Deferred taxes		19,343		19,295
Operating lease right-of-use assets		4,129		4,879
Other long term receivables		6,474		7,797

Total long-term assets		36,482		38,678

PROPERTY AND EQUIPMENT, NET		75,631		77,172

INTANGIBLE ASSETS, NET		750		1,082

GOODWILL		43,468		43,468

TOTAL ASSETS	$	351,669	$	393,806

GILAT SATELLITE NETWORKS LTD.

CONSOLIDATED BALANCE SHEETS (Cont.)

U.S. dollars in thousands

	September 30,			December 31,
	2021			2020
	Unaudited			Audited

LIABILITIES AND SHAREHOLDERS’ EQUITY

CURRENT LIABILITIES:
Current maturities of long-term loans	$	-		$	4,000
Trade payables		17,767			20,487
Accrued expenses		47,722			46,387
Advances from customers and deferred revenues		29,550			26,244
Operating lease liabilities		1,804			1,911
Dividend payable		-			35,003
Other current liabilities		13,342			13,322

Total current liabilities		110,185			147,354

LONG-TERM LIABILITIES:
Accrued severance pay		6,819			7,136
Long-term advances from customers		3,022			1,890
Operating lease liabilities		2,325			2,985
Other long-term liabilities		120			631

Total long-term liabilities		12,286			12,642

SHAREHOLDERS’ EQUITY:
Share capital - ordinary shares of NIS 0.2 par value		2,706			2,647
Additional paid-in capital		929,359			928,626
Accumulated other comprehensive loss		(6,364	)		(6,017	)
Accumulated deficit		(696,503	)		(691,446	)

Total shareholders’ equity		229,198			233,810

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	351,669		$	393,806

GILAT SATELLITE NETWORKS LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS

U.S. dollars in thousands

	Three months ended						Nine months ended
	September 30,						September 30,
	2021			2020			2021			2020
	Unaudited						Unaudited
Cash flows from operating activities:
Net income (loss)	$	168		$	(11,551	)	$	(5,057	)	$	(27,531	)
Adjustments required to reconcile net income
to net cash provided by operating activities:
Depreciation and amortization		2,556			2,486			7,202			7,757
Capital loss from disposal of property and equipment		-			11			-			34
Stock-based compensation of options		489			280			795			987
Accrued severance pay, net		(49	)		11			(177	)		37
Deferred taxes, net		(232	)		(39	)		(47	)		101
Decrease (increase) in trade receivables, net		5,311			2,488			(1,757	)		20,852
Decrease (increase) in contract assets		(639	)		(6,042	)		17,104			(14,404	)
Decrease (increase) in other assets (including short-term, long-term
and deferred charges)		(1,476	)		1,209			(5,485	)		7,919
Decrease (increase) in inventories		(2,121	)		548			(347	)		(5,150	)
Decrease in trade payables		(1,929	)		(2,825	)		(2,719	)		(3,335	)
Increase (decrease) in accrued expenses		(542	)		5,616			1,151			(193	)
Increase (decrease) in advance from customers and deferred revenue		4,560			1,609			4,369			(4,116	)
Decrease in current and non current liabilities		(1,107	)		(904	)		(1,301	)		(219	)
Net cash provided by (used in) operating activities		4,989			(7,103	)		13,731			(17,261	)

Cash flows from investing activities:
Purchase of property and equipment		(1,452	)		(861	)		(5,024	)		(2,740	)
Proceeds from short term deposits		2,159			-			-			-
Net cash used in investing activities		707			(861	)		(5,024	)		(2,740	)

Cash flows from financing activities:
Dividend payment		-			-			(35,003	)		-
Repayment of long-term loans		-			-			(4,000	)		(4,096	)
Net cash used in financing activities		-			-			(39,003	)		(4,096	)

Effect of exchange rate changes on cash, cash equivalents and restricted cash		(91	)		(91	)		(252	)		(630	)

Increase (decrease) in cash, cash equivalents and restricted cash		5,605			(8,055	)		(30,548	)		(24,727	)

Cash, cash equivalents and restricted cash at the beginning of the period		79,805			85,297			115,958			101,969

Cash, cash equivalents and restricted cash at the end of the period	$	85,410		$	77,242		$	85,410		$	77,242

Enhanced Investments, Inc.
329 South Oyster Bay Road #2085
Plainview, NY 11803
team@eninvs.com

Important disclosures

Performance results were prepared by Enhanced Investments, and have not been compiled, reviewed or audited by an independent accountant. Performance estimates are subject to future adjustment and revision. Investors should be aware that a loss of investment is possible. Account holdings are for illustrative purposes only and are not investment recommendations. Additional information, including (i) the calculation methodology; and (ii) a list showing the contribution of each holding to the portfolio’s performance during the time period will be provided upon request.
All statements made via social media sites sponsored or maintained by Enhanced Investments and its affiliates are for informational purposes only and do not constitute a comprehensive description of Enhanced Investments' investment advisory services.
Certain investments are not suitable for all investors. Before investing, consider your investment objectives and applicable fees. The rate of return on investments can vary widely over time, especially for long term investments. Investment losses are possible, including the potential loss of all amounts invested. Information provided by Enhanced Investments is for informational and general educational purposes only and is not investment or financial advice.

Nothing on this website should be considered an offer, solicitation of an offer, or advice to buy or sell securities.
Past performance is no guarantee of future results. Any historical returns, expected returns [or probability projections] are hypothetical in nature and may not reflect actual future performance.
All the strategies assume investments in equity invstrumenta only and are more relevant for "agressive investment profile". Eastern European flagship strategy assumes using up to 20% leverage of total portfolio. GlobalCommodities and US Growth strategy currently assume no leverage.
Results for the Enhanced Investments strategies as compared to the performance of Illustrative Benchmarks is for informational purposes only. Our investment program does not mirror that of the Illustrative Benchmarks and the volatility may be materially different from the volatility of Illustrative Benchmarks. Reference or comparison to an Illustrative Benchmark does not imply that strategies of Enhanced Investments will be constructed in the same way as the Illustrative Benchmark or achieve returns, volatility, or other results similar to those of the Illustrative Benchmark. The S&P 500 is an unmanaged market capitalization-weighted index of 500 common stocks chosen for market size, liquidity, and industry group representation to represent U.S. equity performance.
Performance results were prepared by Enhanced Investments, and have not been compiled, reviewed or audited by an independent accountant. Performance estimates are subject to future adjustment and revision. Investors should be aware that a loss of investment is possible. Account holdings are for illustrative purposes only and are not investment recommendations. Additional information, including (i) the calculation methodology; and (ii) a list showing the contribution of each holding to the portfolio’s performance during the time period will be provided upon request.
All statements made via social media sites sponsored or maintained by Enhanced Investments and its affiliates are for informational purposes only and do not constitute a comprehensive description of Enhanced Investments' investment advisory services.
Certain investments are not suitable for all investors. Before investing, consider your investment objectives and applicable fees. The rate of return on investments can vary widely over time, especially for long term investments. Investment losses are possible, including the potential loss of all amounts invested. Information provided by Enhanced Investments is for informational and general educational purposes only and is not investment or financial advice.