Things look good. Expect GICOF to come back strong as well.
Thursday November 5, 8:12 am Eastern Time
Company Press Release
Gilat Reports Record Sales and Record Earnings for the Third Quarter Of 1998
PETAH TIKVA, Israel--(BUSINESS WIRE)--Nov. 5, 1998--Gilat Satellite Networks Ltd. (NASDAQ:GILTF - news) announced today revenues of US$40.0 million for the third quarter ended September 30, 1998, a 47 percent increase over the same period in 1997, when the Company had sales of US$27.3 million. Net income was US$6.3 million ($0.55 per share), a 43 percent increase over the US$4.4 million ($0.39 per share) posted for the same period last year.
Revenues for the nine months ended September 30, 1998, were US$105.7 million, a 43 percent increase over the same period last year, when Gilat had sales of US$73.7 million. Net income was $15.6 million ($1.36 per share), a 39 percent increase over the $11.2 million ($1.00 per share) recorded for the first nine months of 1997. Orders from July 28, 1998 until today totaled approximately US$54.5 million.
SkySurfer(TM) to China
Under a cooperative agreement among Gilat, China-based KSAT Satellite Networks Inc. (KSAT), an affiliated company, and the Tontru Information Industry Group (Tontru), KSAT has agreed to order two hub stations and 5,000 SkySurfer VSATs. The units are intended for a new joint venture between KSAT and Tontru, currently being formed under the terms of the cooperative agreement, with most of the delivery expected during 1999.
Established in 1995, Tontru is supported by the China Ministry of Electronic Industry as well as by the Municipal Governments of Jiangsu and Nanjing. Tontru is one of the largest domestic manufacturers of personal computers in China with facilities in Nanjing, Beijing and Hong Kong. Through the planned joint venture, Tontru intends to provide satellite-based remote training and E-commerce services throughout China.
Wang Rong Zhi, President of Tontru, stated, ''Satellite communications is essentially the only solution for quick, widespread interactive E-commerce communications in China, due to the great distances that must be covered, sometimes difficult terrain and insufficient telephony infrastructure. We chose Gilat's SkySurfer VSAT for its particular suitability to the corporate environment, its affordability and its availability.'' The order to be placed by KSAT is contingent upon the receipt of a Letter of Credit (LC) from Tontru. There can be no assurance that the order will be placed, the LC will be received or that the new joint venture will be finalized.
Skystar Advantage(TM) to BP in US
GE Capital Spacenet Services, Inc. (GE Spacenet) announced today that it has been selected by BP Oil Company to provide a Skystar Advantage VSAT network to more than 1,500 BP service station/convenience stores nationwide for credit/debit card authorization and pay-at-the-pump services. BP's US retail marketing operations, headquartered in Cleveland, Ohio, operate a network of more than 7,500 locations, including BP Express(R) sites, in more than 30 states.
Rapid installation time in South Africa
Gilat installed more than 1,000 solar-powered DialAway(TM) VSATs during the past two months for Telkom SA Ltd., as part of the 3,000-site contract announced on September 14, 1998. Breaking all previous Company records, 75 sites were installed in a single day.
All of the installed sites have been connected to the hub station.
Gilat Chairman and Chief Executive Officer Yoel Gat remarked, ''There continues to be excellent momentum in all our product lines. Our merger with GE Spacenet should facilitate further growth in our data communication VSATs. We expect satellite telephony to account for more than 30 percent of our revenues in 1998. We also expect our Internet products to account for a significant proportion of our revenues in 1999.''
Gilat's teleconference to the financial community, scheduled today at 10:30 AM Eastern in the United States (in the US: 1-800-289-0493, outside the US: 1-913-981-5510), will also be broadcast live over the Internet. The event can be accessed at gilat.com where there will also be a link for downloading the necessary software (Real Player 5).
Gilat Satellite Networks Ltd. designs, develops, manufactures, markets and supports Very Small Aperture Terminal (VSAT) satellite earth stations and related hub equipment and software. Gilat products are incorporated into telecommunications networks that provide satellite-based communications between a central location and a large number of geographically dispersed sites. The Company offers a range of products: Skystar Advantage(TM), a joint development of GE Spacenet and Gilat, enables interactive, transaction-oriented applications. ISAT(R) facilitates frame-relay delivery of voice and data. FaraWay(TM) VSAT offers multi-channel, toll-quality telephone, fax and data services. DialAway(R) VSAT allows for one- to three-channel, telephone and fax service to rural communities. SkySurfer(TM) VSAT delivers interactive corporate communications; SkyBlaster(TM), when incorporated into the SkySurfer system, provides a satellite return path. OneWay(TM) VSAT provides unidirectional data broadcasts.
In December 1996, Gilat acquired Skydata Inc., a Florida-based VSAT company specializing in the paging and data broadcast markets. As of May 1998, Gilat holds a minority share in Global Village Telecom (GVT), which specializes in the operation of satellite-based rural telephony networks, and in KSAT, a joint venture with Singapore-based Keppel Communications, which is dedicated to providing satellite-based telecommunication services in China.
Skystar Advantage(TM) is a trademark of GE Capital Spacenet Services, Inc. ISAT(R), FaraWay(TM), DialAway(R), SkySurfer(TM), SkyBlaster(TM) and OneWay(TM) are trademarks of Gilat Satellite Networks Ltd.
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 the Company 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, changes in general economic and business conditions, inability to maintain market acceptance to the Company's products, inability to timely develop and introduce new technologies, products and applications, rapid changes in the market for the Company'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 the Company's international operations and its location in Israel. For additional information regarding these and other risks and uncertainties associated with the Company's business, reference is made to the Company's reports filed from time to time with the Securities and Exchange Commission. |
