- Quarterly Revenue of $149.2 million, Essentially Flat Compared to
the Prior Year Quarter
- Second Quarter Diluted EPS of $0.32; Adjusted Diluted EPS of $0.43
- Reiterates Guidance for Full Year 2018 and Provides Update on
Expected Currency Impact
- Declared a Second Quarter Dividend of $0.15 Per Share
- Recently Appointed CEO, Yuval Dagim, to Assume Position on August
12, 2018
MP MENASHE, Israel--(BUSINESS WIRE)--Aug. 8, 2018--
Caesarstone Ltd. (NASDAQ:CSTE), a global leading developer and
manufacturer of high quality engineered quartz surfaces, today reported
financial results for its second quarter ended June 30, 2018.
Yair Averbuch, Interim Chief Executive Officer, commented, “Our second
quarter results show considerable operational improvement compared to
our performance in the first quarter of 2018, highlighted by a
significant increase in gross margin. At the same time, we recognize the
need to better capitalize on the strong market opportunity for quartz,
mainly in North America, and to continue improving our operations. In
the second half of 2018, we are taking steps to leverage our global
platform, powerful brand, leading products and financial strength to
generate stronger returns. While manufacturing challenges in Israel, raw
material cost inflation and currency exchange rates are likely to remain
headwinds, we are improving our manufacturing operations and our U.S.
sales and distribution capabilities to position the company for
additional improvement opportunities in 2019.”
Revenue in the second quarter of 2018 was $149.2 million, essentially
flat compared to $148.9 million in the same period in the prior year. On
a constant currency basis, second quarter 2018 revenue decreased by 1.5%
year-over-year, with sales improvement in Canada, Europe and Rest of the
World offsetting softer performance in the U.S. and Israel.
Gross margin in the second quarter was 32.4% compared to 34.9% in the
same period in the prior year. The decrease in margin primarily reflects
increased product complexity and other manufacturing challenges in
Israel along with inventory and logistics inefficiencies and higher raw
material costs. These factors were partly offset by a significant
improvement in manufacturing performance at our U.S. manufacturing
facility. On a sequential basis, gross margin increased from the first
quarter of 2018, mainly due to higher sales volumes and higher average
selling prices, improvements in our manufacturing in Israel and the
U.S., and reduced inefficiencies related to inventory and logistics.
Operating expenses in the second quarter were $35.1 million, or 23.5% of
revenue, compared to $32.6 million, or 21.9% of revenue, in the same
quarter last year. Excluding legal settlements and loss contingencies,
operating expenses increased to 21.7% of revenue, compared to 20.9% in
the prior year second quarter mainly due to higher marketing and sales
expenses in addition to non-recurring expenses of approximately $1.2
million, mainly related to the relocation of the Company’s U.S.
headquarter.
Operating income in the second quarter was $13.3 million, a margin of
8.9%, compared to $19.3 million, a margin of 13.0%, in the second
quarter of 2017.
Adjusted EBITDA, which excludes expenses for share-based compensation,
legal settlements and loss contingencies and for non-recurring items,
was $24.6 million in the second quarter of 2018, representing a margin
of 16.5%. This compares to adjusted EBITDA of $29.6 million in the prior
year’s second quarter, representing a margin of 19.9%. This
year-over-year margin comparison primarily reflects the lower gross
margin described above.
Finance expenses in the second quarter were $0.5 million compared to
$1.4 million during the same period in the prior year. The change
primarily reflects the favorable impact of currency fluctuations on
certain financial instruments.
The Company reported net income attributable to controlling interest for
the second quarter of 2018 of $11.0 million compared to income of $14.5
million in the same quarter in the prior year. Diluted net income per
share for the second quarter was $0.32 compared to $0.42 in the prior
year's second quarter. Adjusted diluted net income per share for the
second quarter was $0.43 on 34.4 million shares compared to $0.49 on
34.6 million shares in prior year second quarter.
The Company's balance sheet as of June 30, 2018 remained strong,
including cash, cash equivalents and short-term bank deposits of $104.6
million.
Dividend
In accordance with the Company's dividend policy initiated in February
2018, the Company declared a dividend of $0.15 per share to be paid on
September 12, 2018 to shareholders of record as of August 22, 2018. The
dividend payment is subject to withholding tax of 20%.
Guidance
The Company reiterates its full year 2018 adjusted EBITDA outlook, which
is expected to be in the range of $74 million to $82 million. Given
current currency exchange rates, the Company expects an adverse currency
exchange impact of approximately $10 million for the year and therefore
now anticipates 2018 revenue to be at the low end to mid-point of the
previously announced range of $590 million to $610 million.
Conference Call Details
The company will host a conference call today at 8:30 a.m. ET to discuss
the results, followed by a question and answer session for the
investment community. A live webcast of the call can be accessed at
ir.caesarstone.com. To access the call, dial toll-free 1-877-407-4018 or
+1-201-689-8471 (international). The toll-free Israeli number is 1 80
940 6247. Upon dialing in, please request to join the Caesarstone Second
Quarter Earnings Call.
To listen to a telephonic replay of the conference call, dial toll-free
1-844-512-2921 or +1-412-317-6671 (international) and enter pass code
13681791. The replay will be available beginning at 11:30 a.m. ET on
Wednesday, August 8, 2018 and will last through 11:59 p.m. ET on
Wednesday, August 15, 2018.
About Caesarstone
Caesarstone designs, develops and manufactures high quality engineered
quartz surfaces, which are used in both residential and commercial
buildings as countertops, vanities, wall cladding, floors and other
interior surfaces. The wide variety of colors, styles, designs and
textures of Caesarstone® products, along with Caesarstone's inherent
characteristics such as hardness, non-porous, scratch and stain
resistance and durability, provide consumers with excellent surfaces for
their internal spaces which are highly competitive to granite,
manufactured solid surfaces and laminate, as well as to other engineered
quartz surfaces. Caesarstone's four collections of products — Classico,
Supernatural, Metropolitan and Concetto — are available in over 50
countries around the world. For more information about the Company,
please visit our website www.caesarstone.com.
(CSTE-E)
Non-GAAP Financial Measures
The non-GAAP measures presented by the Company should be considered in
addition to, and not as a substitute for, comparable GAAP measures. A
reconciliation of GAAP net income attributable to controlling interest
to adjusted net income attributable to controlling interest and net
income to Adjusted EBITDA are provided in the schedules within this
release. The Company provides these non-GAAP financial measures because
it believes that they present a better measure of the Company's core
business and management uses the non-GAAP measures internally to
evaluate the Company's ongoing performance. Accordingly, the Company
believes that they are useful to investors in enhancing an understanding
of the Company's operating performance.
Forward-Looking Statements
Information provided in this press release may contain statements
relating to current expectations, estimates, forecasts and projections
about future events that are "forward-looking statements" as defined in
the Private Securities Litigation Reform Act of 1995. These
forward-looking statements generally relate to the Company's plans,
objectives and expectations for future operations, including its
projected results of operations and the expected timing of expanding its
manufacturing facilities. These forward-looking statements are based
upon management's current estimates and projections of future results or
trends. Actual results may differ materially from those projected as a
result of certain risks and uncertainties. These factors include, but
are not limited to: the strength of the home renovation and construction
sectors; economic conditions within any of our key existing markets;
actions by our competitors; changes in raw material prices, particularly
polymer resins and pigments; fluctuations in currency exchange rates;
the success of our expansion efforts in the United States; the outcome
of silicosis claims and other claims; unpredictability of seasonal
fluctuations in revenues; delays in manufacturing and other factors
discussed under the heading "Risk Factors" in our most recent annual
report on Form 20-F and other documents filed with the Securities and
Exchange Commission. These forward-looking statements are made only as
of the date hereof, and the Company undertakes no obligation to update
or revise the forward-looking statements, whether as a result of new
information, future events or otherwise.
Caesarstone Ltd. and its subsidiaries Condensed consolidated balance sheets
|
|
|
|
|
|
|
|
|
|
As of |
U.S. dollars in thousands |
|
|
June 30, 2018 |
|
December 31, 2017 |
|
|
|
(Unaudited) |
|
(Audited) |
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT ASSETS:
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents and short-term bank deposits
|
|
|
$
|
104,641
|
|
|
$
|
138,707
|
|
Trade receivables, net
|
|
|
|
80,161
|
|
|
|
73,267
|
|
Other accounts receivable and prepaid expenses
|
|
|
|
41,230
|
|
|
|
33,053
|
|
Inventories
|
|
|
|
153,780
|
|
|
|
132,940
|
|
|
|
|
|
|
|
Total current assets
|
|
|
|
379,812
|
|
|
|
377,967
|
|
|
|
|
|
|
|
LONG-TERM ASSETS:
|
|
|
|
|
|
|
|
|
|
|
|
Severance pay fund
|
|
|
|
3,773
|
|
|
|
3,887
|
|
Other long-term receivables
|
|
|
|
4,790
|
|
|
|
8,502
|
|
Deferred tax assets, net
|
|
|
|
7,409
|
|
|
|
3,965
|
|
Long-term deposits and prepaid expenses
|
|
|
|
2,710
|
|
|
|
2,743
|
|
Property, plant and equipment, net
|
|
|
|
211,160
|
|
|
|
216,653
|
|
Other intangibles assets
|
|
|
|
1,092
|
|
|
|
2,241
|
|
Goodwill
|
|
|
|
36,057
|
|
|
|
37,029
|
|
|
|
|
|
|
|
Total long-term assets
|
|
|
|
266,991
|
|
|
|
275,020
|
|
|
|
|
|
|
|
Total assets
|
|
|
$
|
646,803
|
|
|
$
|
652,987
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES:
|
|
|
|
|
|
|
|
|
|
|
|
Short-term bank credit
|
|
|
$
|
9,021
|
|
|
$
|
4,191
|
|
Trade payables
|
|
|
|
59,610
|
|
|
|
64,021
|
|
Related party and other loan
|
|
|
|
3,103
|
|
|
|
3,463
|
|
Short term legal settlements and loss contingencies
|
|
|
|
13,776
|
|
|
|
25,782
|
|
Accrued expenses and other liabilities
|
|
|
|
36,676
|
|
|
|
30,000
|
|
|
|
|
|
|
|
Total current liabilities
|
|
|
|
122,186
|
|
|
|
127,457
|
|
|
|
|
|
|
|
LONG-TERM LIABILITIES:
|
|
|
|
|
|
|
|
|
|
|
|
Long-term loan and financing leaseback from a related party
|
|
|
|
7,602
|
|
|
|
8,336
|
|
Legal settlements and loss contingencies long-term
|
|
|
|
24,892
|
|
|
|
23,454
|
|
Accrued severance pay
|
|
|
|
4,847
|
|
|
|
5,556
|
|
Long-term warranty provision
|
|
|
|
1,203
|
|
|
|
1,151
|
|
Deferred tax liabilities, net
|
|
|
|
-
|
|
|
|
657
|
|
|
|
|
|
|
|
Total long-term liabilities
|
|
|
|
38,544
|
|
|
|
39,154
|
|
|
|
|
|
|
|
REDEEMABLE NON-CONTROLLING INTEREST
|
|
|
|
14,959
|
|
|
|
16,481
|
|
|
|
|
|
|
|
EQUITY:
|
|
|
|
|
|
|
|
|
|
|
|
Ordinary shares
|
|
|
|
371
|
|
|
|
371
|
|
Treasury shares - at cost
|
|
|
|
(39,430
|
)
|
|
|
(39,430
|
)
|
Additional paid-in capital
|
|
|
|
152,293
|
|
|
|
151,880
|
|
Accumulated other comprehensive (loss) income
|
|
|
|
(1,184
|
)
|
|
|
683
|
|
Retained earnings
|
|
|
|
359,064
|
|
|
|
356,391
|
|
|
|
|
|
|
|
Total equity
|
|
|
|
471,114
|
|
|
|
469,895
|
|
|
|
|
|
|
|
Total liabilities and equity
|
|
|
$
|
646,803
|
|
|
$
|
652,987
|
|
|
|
|
|
|
|
|
|
|
|
|
Caesarstone Ltd. and its subsidiaries Condensed consolidated statements of income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, |
|
|
Six months ended June 30, |
U.S. dollars in thousands (except per share data) |
|
|
|
2018 |
|
|
|
|
2017 |
|
|
|
|
|
2018 |
|
|
|
|
2017 |
|
|
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
$
|
149,243
|
|
|
|
$
|
148,914
|
|
|
|
|
$
|
285,301
|
|
|
|
$
|
285,325
|
|
Cost of revenues
|
|
|
|
100,914
|
|
|
|
|
96,993
|
|
|
|
|
|
202,728
|
|
|
|
|
184,163
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
|
|
|
48,329
|
|
|
|
|
51,921
|
|
|
|
|
|
82,573
|
|
|
|
|
101,162
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development
|
|
|
|
885
|
|
|
|
|
866
|
|
|
|
|
|
1,641
|
|
|
|
|
1,814
|
|
Marketing and selling
|
|
|
|
20,249
|
|
|
|
|
19,615
|
|
|
|
|
|
38,609
|
|
|
|
|
40,774
|
|
General and administrative
|
|
|
|
11,244
|
|
|
|
|
10,706
|
|
|
|
|
|
22,448
|
|
|
|
|
22,032
|
|
Legal settlements and loss contingencies, net
|
|
|
|
2,676
|
|
|
|
|
1,420
|
|
|
|
|
|
5,173
|
|
|
|
|
2,091
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses
|
|
|
|
35,054
|
|
|
|
|
32,607
|
|
|
|
|
|
67,871
|
|
|
|
|
66,711
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
|
13,275
|
|
|
|
|
19,314
|
|
|
|
|
|
14,702
|
|
|
|
|
34,451
|
|
Finance expenses (income), net
|
|
|
|
531
|
|
|
|
|
1,391
|
|
|
|
|
|
(9
|
)
|
|
|
|
2,915
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before taxes on income
|
|
|
|
12,744
|
|
|
|
|
17,923
|
|
|
|
|
|
14,711
|
|
|
|
|
31,536
|
|
Taxes on income
|
|
|
|
1,703
|
|
|
|
|
3,051
|
|
|
|
|
|
2,214
|
|
|
|
|
5,399
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
$
|
11,041
|
|
|
|
$
|
14,872
|
|
|
|
|
$
|
12,497
|
|
|
|
$
|
26,137
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (loss) attributable to non-controlling interest
|
|
|
|
(31
|
)
|
|
|
|
(324
|
)
|
|
|
|
|
6
|
|
|
|
|
(493
|
)
|
Net income attributable to controlling interest
|
|
|
$
|
11,010
|
|
|
|
$
|
14,548
|
|
|
|
|
$
|
12,503
|
|
|
|
$
|
25,644
|
|
Basic net income per ordinary share (*)
|
|
|
$
|
0.32
|
|
|
|
$
|
0.42
|
|
|
|
|
$
|
0.37
|
|
|
|
$
|
0.73
|
|
Diluted net income per ordinary share (*)
|
|
|
$
|
0.32
|
|
|
|
$
|
0.42
|
|
|
|
|
$
|
0.37
|
|
|
|
$
|
0.73
|
|
Weighted average number of ordinary shares used in computing basic
income per ordinary share
|
|
|
|
34,360,872
|
|
|
|
|
34,337,060
|
|
|
|
|
|
34,352,449
|
|
|
|
|
34,329,403
|
|
Weighted average number of ordinary shares used in computing diluted
income per ordinary share
|
|
|
|
34,379,948
|
|
|
|
|
34,412,160
|
|
|
|
|
|
34,387,420
|
|
|
|
|
34,390,118
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*) The numerator for the calculation of net income per share for the
three and six months ended June 30, 2018 and 2017 has been increased by
approximately $0.1 million and $0.1 million and reduced by approximately
$0.3 million and $0.5 million, respectively, to reflect the adjustment
to redemption value associated with the redeemable non-controlling
interest.
Caesarstone Ltd. and its subsidiaries Selected Condensed consolidated statements of cash flows
|
|
|
|
|
|
|
|
|
|
|
Six months ended June 30, |
U.S. dollars in thousands |
|
|
|
2018 |
|
|
|
|
2017 |
|
|
|
|
(Unaudited) |
|
|
(Unaudited) |
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
$
|
12,497
|
|
|
|
$
|
26,137
|
|
Adjustments required to reconcile net income to net cash provided by
operating activities:
|
|
|
|
Depreciation and amortization
|
|
|
|
14,382
|
|
|
|
|
14,941
|
|
Share-based compensation expense
|
|
|
|
392
|
|
|
|
|
2,521
|
|
Accrued severance pay, net
|
|
|
|
(583
|
)
|
|
|
|
509
|
|
Changes in deferred tax, net
|
|
|
|
(3,868
|
)
|
|
|
|
(1,134
|
)
|
Capital loss
|
|
|
|
75
|
|
|
|
|
-
|
|
Legal settlemnets and loss contingencies, net
|
|
|
|
5,173
|
|
|
|
|
2,091
|
|
Increase in trade receivables
|
|
|
|
(7,382
|
)
|
|
|
|
(9,106
|
)
|
Increase in other accounts receivable and prepaid expenses
|
|
|
|
(5,970
|
)
|
|
|
|
(4,229
|
)
|
Increase in inventories
|
|
|
|
(23,280
|
)
|
|
|
|
(16,331
|
)
|
Increase (decrease) in trade payables
|
|
|
|
(3,744
|
)
|
|
|
|
14,982
|
|
Increase in warranty provision
|
|
|
|
154
|
|
|
|
|
102
|
|
Increase (decrease) in accrued expenses and other liabilities
including related party
|
|
|
|
(8,155
|
)
|
|
|
|
3,175
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) operating activities
|
|
|
|
(20,309
|
)
|
|
|
|
33,658
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase of property, plant and equipment
|
|
|
|
(7,831
|
)
|
|
|
|
(11,352
|
)
|
Proceeds from sale of property, plant and equipment
|
|
|
|
2
|
|
|
|
|
-
|
|
Decrease (increase) in long term deposits
|
|
|
|
(53
|
)
|
|
|
|
(1
|
)
|
|
|
|
|
|
|
|
Net cash used in investing activities (*)
|
|
|
|
(7,882
|
)
|
|
|
|
(11,353
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividend paid
|
|
|
|
(9,960
|
)
|
|
|
|
-
|
|
Dividend paid by subsidiary to non-controlling interest
|
|
|
|
(559
|
)
|
|
|
|
-
|
|
Changes in short-term bank credit and loans, net
|
|
|
|
5,369
|
|
|
|
|
1,059
|
|
Repayment of a financing leaseback related to Bar-Lev transaction
|
|
|
|
(587
|
)
|
|
|
|
(579
|
)
|
|
|
|
|
|
|
|
Net cash provided by (used in) financing activities
|
|
|
|
(5,737
|
)
|
|
|
|
480
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate differences on cash and cash equivalents
|
|
|
|
(139
|
)
|
|
|
|
344
|
|
|
|
|
|
|
|
|
Increase (decrease) in cash and cash equivalents and short-term bank
deposits
|
|
|
|
(34,066
|
)
|
|
|
|
23,129
|
|
Cash and cash equivalents and short-term bank deposits at beginning
of the period
|
|
|
|
138,707
|
|
|
|
|
106,270
|
|
|
|
|
|
|
|
|
Cash and cash equivalents and short-term bank deposits at end of the
period
|
|
|
$
|
104,641
|
|
|
|
$
|
129,399
|
|
|
|
|
|
|
|
|
Non - cash investing:
|
|
|
|
|
|
|
Changes in trade payables balances related to purchase of fixed
assets
|
|
|
|
186
|
|
|
|
|
(743
|
)
|
|
|
|
|
(*) Cash used in investing activities does not include changes in bank
deposits as such balance is included in the “cash and cash equivalents
and short term bank deposits” line at the beginning and end of the
period.
|
|
|
Caesarstone Ltd. and its subsidiaries |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, |
|
|
Six months ended June 30, |
U.S. dollars in thousands |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
|
|
(Unaudited) |
|
|
(Unaudited) |
Reconciliation of Net Income to Adjusted EBITDA: |
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
$
|
11,041
|
|
|
$
|
14,872
|
|
|
$
|
12,497
|
|
|
|
$
|
26,137
|
|
Finance expenses (income), net
|
|
|
|
531
|
|
|
|
1,391
|
|
|
|
(9
|
)
|
|
|
|
2,915
|
|
Taxes on income
|
|
|
|
1,703
|
|
|
|
3,051
|
|
|
|
2,214
|
|
|
|
|
5,399
|
|
Depreciation and amortization
|
|
|
|
7,132
|
|
|
|
7,512
|
|
|
|
14,382
|
|
|
|
|
14,941
|
|
Legal settlements and loss contingencies, net (a)
|
|
|
|
2,676
|
|
|
|
1,420
|
|
|
|
5,173
|
|
|
|
|
2,091
|
|
Share-based compensation expense (b)
|
|
|
|
362
|
|
|
|
1,367
|
|
|
|
392
|
|
|
|
|
2,521
|
|
Provision for employees fringe benefits (c)
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
(114
|
)
|
Non-recurring items (d)
|
|
|
|
1,157
|
|
|
|
-
|
|
|
|
1,157
|
|
|
|
|
-
|
|
Adjusted EBITDA (Non-GAAP)
|
|
|
$
|
24,602
|
|
|
$
|
29,613
|
|
|
$
|
35,806
|
|
|
|
$
|
53,890
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
|
Consists of legal settlements expenses and loss contingencies,
net, related to product liability claims and other adjustments to
on-going legal claims.
|
(b)
|
|
Share-based compensation includes expenses related to stock
options and restricted stock units granted to employees and
directors of the Company. In addition, includes expenses for
phantom awards granted and related payroll expenses as a result of
exercises.
|
(c)
|
|
Relates to an adjustment of provision for taxable employee fringe
benefits as a result of a settlement with the Israeli Tax
Authority and with the National Insurance Institute of Israel.
|
(d)
|
|
Relates mainly to relocation expenses of Caesarstone USA
headquarters (Company's subsidiary).
|
|
|
|
|
|
|
Caesarstone Ltd. and its subsidiaries |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, |
|
|
Six months ended June 30, |
U.S. dollars in thousands (except per share data) |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
|
|
(Unaudited) |
|
|
(Unaudited) |
Reconciliation of net income attributable to controlling interest
to adjusted net income attributable to controlling interest: |
|
|
|
|
|
Net income attributable to controlling interest
|
|
|
$
|
11,010
|
|
|
$
|
14,548
|
|
|
$
|
12,503
|
|
|
$
|
25,644
|
|
Legal settlements and loss contingencies, net (a)
|
|
|
|
2,676
|
|
|
|
1,420
|
|
|
|
5,173
|
|
|
|
2,091
|
|
Share-based compensation expense (b)
|
|
|
|
362
|
|
|
|
1,367
|
|
|
|
392
|
|
|
|
2,521
|
|
Provision for employees fringe benefits (c)
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(114
|
)
|
Non-recurring items (d)
|
|
|
|
1,157
|
|
|
|
-
|
|
|
|
1,157
|
|
|
|
-
|
|
Total adjustments
|
|
|
|
4,195
|
|
|
|
2,787
|
|
|
|
6,722
|
|
|
|
4,498
|
|
Less tax on non-tax adjustments (e)
|
|
|
|
355
|
|
|
|
475
|
|
|
|
1,012
|
|
|
|
770
|
|
Total adjustments after tax
|
|
|
|
3,840
|
|
|
|
2,312
|
|
|
|
5,710
|
|
|
|
3,728
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income attributable to controlling interest (Non-GAAP)
|
|
|
$
|
14,850
|
|
|
$
|
16,860
|
|
|
$
|
18,213
|
|
|
$
|
29,372
|
|
Adjusted diluted EPS (f)
|
|
|
$
|
0.43
|
|
|
$
|
0.49
|
|
|
$
|
0.53
|
|
|
$
|
0.85
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
|
Consists of legal settlements expenses and loss contingencies, net,
related to product liability claims and other
|
(b)
|
|
Share-based compensation includes expenses related to stock
options and restricted stock units granted to employees and
directors of the Company. In addition, includes expenses for
phantom awards granted and the related payroll expenses as a
result of exercises.
|
(c)
|
|
Relates to an adjustment of provision for taxable employee fringe
benefits as a result of a settlement with the Israeli Tax
Authority and with the National Insurance Institute of Israel.
|
(d)
|
|
Relates mainly to relocation expenses of Caesarstone USA
headquarters (Company's subsidiary).
|
(e)
|
|
Tax adjustments for the three and six months ended June 30, 2018
and 2017 were based on the effective tax rates for these periods,
respectively.
|
(f)
|
|
In calculating adjusted diluted (Non-GAAP) EPS, the diluted
weighted average number of shares outstanding excludes the effects
of share-based compensation expense in accordance with FASB ASC
718.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Caesarstone Ltd. and its subsidiaries |
Geographic breakdown of revenues by region |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, |
|
|
Six months ended June 30, |
U.S. dollars in thousands |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
USA
|
|
|
$
|
60,358
|
|
|
$
|
64,828
|
|
|
$
|
117,108
|
|
|
$
|
122,852
|
Australia (incl. New Zealand)
|
|
|
|
34,731
|
|
|
|
34,265
|
|
|
|
63,635
|
|
|
|
63,786
|
Canada
|
|
|
|
27,349
|
|
|
|
25,289
|
|
|
|
50,704
|
|
|
|
47,593
|
Israel
|
|
|
|
9,125
|
|
|
|
10,845
|
|
|
|
20,916
|
|
|
|
22,545
|
Europe
|
|
|
|
9,133
|
|
|
|
6,967
|
|
|
|
16,565
|
|
|
|
13,344
|
Rest of World
|
|
|
|
8,547
|
|
|
|
6,720
|
|
|
|
16,373
|
|
|
|
15,205
|
|
|
|
$
|
149,243
|
|
|
$
|
148,914
|
|
|
$
|
285,301
|
|
|
$
|
285,325
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20180808005275/en/
Source: Caesarstone Ltd.
Investor Relations
ICR, Inc.
Rodny Nacier, +1
646-277-1237
Managing Director
[email protected]