Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2023 shares | |
Entity Addresses [Line Items] | |
Document Type | 20-F |
Document Registration Statement | false |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Amendment Flag | false |
Document Period End Date | Dec. 31, 2023 |
Entity Registrant Name | SENSTAR TECHNOLOGIES CORPORATION |
Trading Symbol | SNT |
Entity Central Index Key | 0001993727 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2023 |
Document Fiscal Period Focus | FY |
Entity Filer Category | Non-accelerated Filer |
Entity Shell Company | false |
Entity Emerging Growth Company | false |
Entity Voluntary Filers | No |
Entity Common Stock, Shares Outstanding | 23,309,987 |
Entity Well-known Seasoned Issuer | No |
Entity File Number | 001-41980 |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Address, Address Line One | 119 John Cavanaugh Drive |
Entity Address, City or Town | Ottawa |
Entity Address, Postal Zip Code | K0A 1L0 |
Entity Address, Country | CA |
Entity Incorporation State Country Code | A6 |
Title of 12(b) Security | Common Shares |
Security Exchange Name | NASDAQ |
ICFR Auditor Attestation Flag | false |
Document Accounting Standard | U.S. GAAP |
Auditor Name | Kost Forer Gabbay & Kasierer |
Auditor Location | Tel-Aviv, Israel |
Auditor Firm ID | 1281 |
Document Financial Statement Error Correction [Flag] | false |
Business Contact [Member] | |
Entity Addresses [Line Items] | |
Contact Personnel Name | Alicia Kelly |
Entity Address, Address Line One | 119 John Cavanaugh Drive |
Entity Address, City or Town | Ottawa |
Entity Address, Postal Zip Code | K0A 1L0 |
Entity Address, Country | CA |
City Area Code | 1 |
Local Phone Number | 613-839-5572 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 14,806 | $ 14,937 |
Short-term bank deposits | 116 | 110 |
Restricted cash and deposits | 6 | 5 |
Trade receivables, net | 9,545 | 9,973 |
Unbilled accounts receivable | 240 | 350 |
Other accounts receivable and prepaid expenses | 2,448 | 1,441 |
Inventories | 7,178 | 8,443 |
Total current assets | 34,339 | 35,259 |
LONG-TERM ASSETS: | ||
Deferred tax assets | 1,525 | 1,981 |
Operating lease right-of-use assets | 842 | 987 |
Total long-term assets | 2,367 | 2,968 |
PROPERTY AND EQUIPMENT, NET | 1,589 | 1,651 |
INTANGIBLE ASSETS, NET | 881 | 1,142 |
GOODWILL | 11,090 | 10,866 |
Total assets | 50,266 | 51,886 |
CURRENT LIABILITIES: | ||
Trade payables | 1,650 | 2,408 |
Customer advances | 187 | 239 |
Deferred revenues | 2,878 | 2,866 |
Other accounts payable and accrued expenses | 5,052 | 4,877 |
Short-term operating lease liabilities | 297 | 248 |
Total current liabilities | 10,064 | 10,638 |
LONG-TERM LIABILITIES: | ||
Deferred revenues | 1,415 | 1,463 |
Deferred tax liabilities | 606 | 865 |
Accrued severance pay | 296 | 330 |
Long-term operating lease liabilities | 580 | 757 |
Other long-term liabilities | 113 | 146 |
Total long-term liabilities | 3,010 | 3,561 |
COMMITMENTS AND CONTINGENT LIABILITIES | ||
SHAREHOLDERS' EQUITY: | ||
Share capital - Ordinary shares of NIS 1 par value - Authorized: 39,748,000 shares at December 31, 2023 and 2022; Issued and outstanding: 23,309,987 and 23,309,987 shares at December 31, 2023 and 2022, respectively | 6,799 | 6,799 |
Additional paid-in capital | 30,521 | 30,503 |
Accumulated other comprehensive income | 24 | (758) |
Foreign currency translation adjustments (Company's standalone financial statements) | 9,648 | 9,654 |
Accumulated deficit | (9,800) | (8,511) |
Total shareholders' equity | 37,192 | 37,687 |
Total liabilities and shareholders' equity | $ 50,266 | $ 51,886 |
CONSOLIDATED BALANCE SHEETS (pa
CONSOLIDATED BALANCE SHEETS (parenthetical) - ₪ / shares | Dec. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Ordinary shares, par value per share | ₪ 1 | ₪ 1 |
Ordinary shares, shares authorized | 39,748,000 | 39,748,000 |
Ordinary shares, shares issued | 23,309,987 | 23,309,987 |
Ordinary shares, shares outstanding | 23,309,987 | 23,309,987 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement [Abstract] | |||
Revenues | $ 32,792 | $ 35,558 | $ 34,916 |
Cost of revenues | 13,944 | 14,056 | 12,935 |
Gross profit | 18,848 | 21,502 | 21,981 |
Operating expenses: | |||
Research and development, net | 4,005 | 4,032 | 3,933 |
Selling and marketing | 9,954 | 9,008 | 9,998 |
General and administrative | 6,154 | 6,978 | 6,969 |
Total operating expenses | 20,113 | 20,018 | 20,900 |
Operating income (loss) | (1,265) | 1,484 | 1,081 |
Financial income (expenses), net | (64) | 141 | (1,011) |
Income (loss) before income taxes | (1,329) | 1,625 | 70 |
Taxes on income (tax benefit) | (40) | (2,404) | 2,261 |
Net income (loss) from continuing operations | (1,289) | 4,029 | (2,191) |
Net income (loss) from discontinued operations | 0 | (198) | 8,607 |
Net income (loss) | (1,289) | 3,831 | 6,416 |
Net income (loss) attributable to: | |||
Non-controlling interests from continuing operations | 0 | 0 | (1) |
Senstar shareholders | (1,289) | 3,831 | 6,417 |
Net income (loss) | $ (1,289) | $ 3,831 | $ 6,416 |
Basic net income (loss) per share: | |||
Continuing operations | $ (0.06) | $ 0.17 | $ (0.09) |
Discontinued operations | 0 | (0.01) | 0.37 |
Basic net income (loss) per share | (0.06) | 0.16 | 0.28 |
Diluted net income (loss) per share: | |||
Continuing operations | (0.06) | 0.17 | (0.09) |
Discontinued operations | 0 | (0.01) | 0.37 |
Diluted net income (loss) per share | $ (0.06) | $ 0.16 | $ 0.28 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ (1,289) | $ 3,831 | $ 6,416 |
Realized foreign currency translation adjustments from subsidiaries | 0 | 0 | 1,442 |
Foreign currency translation adjustments | 782 | (1,980) | (254) |
Total other comprehensive income (loss) | 782 | (1,980) | 1,188 |
Total comprehensive income (loss) | (507) | 1,851 | 7,604 |
Total comprehensive income (loss) attributable to: | |||
Senstar shareholders | (507) | 1,851 | 7,604 |
Total comprehensive income (loss) | $ (507) | $ 1,851 | $ 7,604 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Ordinary shares [Member] | Additional paid-in capital [Member] | Accumulated other comprehensive income (loss) [Member] | Foreign currency translation adjustment - the Company [Member] | Retained earnings (accumulated deficit) [Member] | Non-controlling interests [Member] | Total |
Balance at Dec. 31, 2020 | $ 6,753 | $ 69,965 | $ 34 | $ 9,104 | $ (18,759) | $ 1 | $ 67,098 |
Balance, shares at Dec. 31, 2020 | 23,163,985 | ||||||
Issuance of shares upon exercise of employee stock options | $ 43 | 391 | 0 | 0 | 0 | 0 | 434 |
Issuance of shares upon exercise of employee stock options, shares | 137,668 | ||||||
Stock-based compensation | $ 0 | 155 | 0 | 0 | 0 | 0 | 155 |
Cash distribution paid to Company’s shareholders | 0 | (40,117) | 0 | 0 | 0 | 0 | (40,117) |
Foreign currency translation adjustments- the Company | 0 | 0 | 0 | 583 | 0 | 0 | 583 |
Comprehensive income (loss): | |||||||
Net income (loss) | 0 | 0 | 0 | 0 | 6,417 | (1) | 6,416 |
Realized foreign currency translation adjustments | 0 | 0 | 1,442 | 0 | 0 | 0 | 1,442 |
Foreign currency translation adjustments | 0 | 0 | (254) | 0 | 0 | 0 | (254) |
Balance at Dec. 31, 2021 | $ 6,796 | 30,394 | 1,222 | 9,687 | (12,342) | 0 | 35,757 |
Balance, shares at Dec. 31, 2021 | 23,301,653 | ||||||
Issuance of shares upon exercise of employee stock options | $ 3 | 16 | 0 | 0 | 0 | 0 | 19 |
Issuance of shares upon exercise of employee stock options, shares | 8,334 | ||||||
Stock-based compensation | $ 0 | 93 | 0 | 0 | 0 | 0 | 93 |
Foreign currency translation adjustments- the Company | 0 | 0 | 0 | (33) | 0 | 0 | (33) |
Comprehensive income (loss): | |||||||
Net income (loss) | 0 | 0 | 0 | 0 | 3,831 | 0 | 3,831 |
Foreign currency translation adjustments | 0 | 0 | (1,980) | 0 | 0 | 0 | (1,980) |
Balance at Dec. 31, 2022 | $ 6,799 | 30,503 | (758) | 9,654 | (8,511) | $ 0 | $ 37,687 |
Balance, shares at Dec. 31, 2022 | 23,309,987 | 23,309,987 | |||||
Stock-based compensation | $ 0 | 18 | 0 | 0 | 0 | $ 18 | |
Foreign currency translation adjustments- the Company | 0 | 0 | 0 | (6) | 0 | (6) | |
Comprehensive income (loss): | |||||||
Net income (loss) | 0 | 0 | 0 | 0 | (1,289) | (1,289) | |
Foreign currency translation adjustments | 0 | 0 | 782 | 0 | 0 | 782 | |
Balance at Dec. 31, 2023 | $ 6,799 | $ 30,521 | $ 24 | $ 9,648 | $ (9,800) | $ 37,192 | |
Balance, shares at Dec. 31, 2023 | 23,309,987 | 23,309,987 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities: | |||
Net income (loss) | $ (1,289) | $ 3,831 | $ 6,416 |
Adjustments required to reconcile net income to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 917 | 1,430 | 1,869 |
Loss on sale of property and equipment | 8 | 0 | 0 |
Stock based compensation | 18 | 93 | 155 |
Decrease (increase) in trade receivables, net | 613 | (2,539) | 11,097 |
Decrease (increase) in unbilled accounts receivable | 116 | (339) | 2,593 |
Decrease (increase) in other accounts receivable and prepaid expenses | (967) | 455 | (10) |
Decrease (increase) in inventories | 1,479 | (3,152) | (683) |
Decrease in long-term trade receivables | 0 | 0 | 7 |
Decrease (increase) in deferred income taxes, net | 218 | (1,420) | 1,350 |
Decrease in operating lease right-of-use assets | 245 | 261 | 917 |
Increase in operating lease liabilities | (229) | (257) | (977) |
Decrease in trade payables | (799) | (161) | (771) |
Increase (decrease) in other accounts payable and accrued expenses and deferred revenues | 7 | (7,435) | (229) |
Decrease in customer advances | (54) | (143) | (540) |
Accrued severance pay, net | (23) | (139) | (277) |
Gain on divestiture of the Integrated Solutions Division | 0 | 0 | (14,888) |
Net cash provided by (used in) operating activities | 260 | (9,515) | 6,029 |
Cash flows from investing activities: | |||
Release (investment) of short-term and long-term bank deposits | (1) | (108) | 65 |
Proceeds from sale of property and equipment | 47 | 29 | 0 |
Purchase of property and equipment | (380) | (158) | (792) |
Asset acquisition of technology | 0 | 0 | (169) |
Proceeds from divestiture of the Integrated Solutions Division | 0 | 0 | 32,621 |
Net cash provided by (used in) investing activities | (334) | (237) | 31,725 |
Cash flows from financing activities: | |||
Cash distribution to Company’s shareholders | 0 | 0 | (40,117) |
Proceeds from issuance of shares upon exercise of options to employees | 0 | 19 | 434 |
Deferred payment with respect to asset acquisition | (213) | 0 | 0 |
Net cash provided by (used in) financing activities | (213) | 19 | (39,683) |
Effect of exchange rate changes on cash and cash equivalents | 156 | (1,727) | 981 |
Decrease in cash and cash equivalents | (131) | (11,460) | (948) |
Cash and cash equivalents at the beginning of the year, including cash attributable to discontinued operations | 14,937 | 26,397 | 27,345 |
Cash and cash equivalents at the end of the year | 14,806 | 14,937 | 26,397 |
Cash paid during the year for: | |||
Interest | 0 | 110 | 0 |
Income taxes | 447 | 1,412 | 1,971 |
Significant non-cash transactions: | |||
Right-of-use asset recognized with corresponding lease liability | $ 134 | $ 151 | $ 444 |
GENERAL
GENERAL | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GENERAL | NOTE 1:- GENERAL a. General: Senstar Technologies corporation (as a successor of Senstar Technologies Ltd.) ("the Parent Company" or "Senstar") and its subsidiaries (together - "the Company") is a leading international provider of comprehensive physical, video, and access control security products and solutions. The Company offers comprehensive solutions for critical sites, which leverage its broad portfolio of homegrown PIDS (Perimeter Intrusion Detection Systems), advanced VMS (Video Management Software) with native IVA (Intelligent Video Analytics) security solutions, as well as access control products and technologies. Effective March 18, 2024, Senstar Technologies Ltd. redomiciled as an Ontario organized company (See Note 17: Subsequent Events). In this Annual Report, because Senstar Technologies Corporation is the successor company to Senstar Technologies Ltd. in the Merger which closed on March 18, 2024, we are presenting the results of Senstar Technologies Ltd.’s operations for the years ended December 31, 2023, 2022 and 2021 and as of December 31, 2023 and 2022. Refer to Note 17 for further information related to the Merger. b. On February 7, 2021, the Company entered into an agreement (the “Purchase Agreement”) with Aeronautics Ltd., a subsidiary of RAFAEL Advanced Defense Systems Ltd., to sell the Company’s Integrated Solutions Division (the “Projects Division”), representing substantially all of the Company’s Integrated Solutions segment for total consideration of $35 million in cash at closing. On June 30, 2021, the Company completed the sale. The divestiture of the Company’s Integrated Solutions Division represented a strategic shift in the Company's operations. Discontinued operation: Under ASC 205-20, "Discontinued Operation" when a component of an entity, as defined in ASC 205-20, has been disposed of or is classified as held for sale, the results of its operations, including the gain or loss on its component are classified as discontinued operations and the assets and liabilities of such component are classified as assets and liabilities attributed to discontinued operations; that is, provided that the operations, assets and liabilities and cash flows of the component have been eliminated from the Company’s consolidated operations and the Company will have no significant continuing involvement in the operations of the component. Following the sale of the Projects Division, the Projects Division's results of operations and statement of financial position balances are disclosed as a discontinued operation, including the resulting income from the sale. All prior periods comparable results of operation have been retroactively included in discontinued operations. Starting in the third quarter of fiscal year 2021, the Company began to operate in one reportable segment as the discontinued Projects Division comprised substantially all of the Company’s Integrated Solutions segment. Results of discontinued operations includes all revenues and expenses directly derived from the Integrated Solutions Division, with the exception of general corporate overhead and other costs that were previously allocated to the Integrated Solutions segment but have not been allocated to discontinued operations. The following table presents the gain associated with the sale, presented in the results of our discontinued operations below, for the year ended December 31, 2021: Gross purchase price $ 35,000 Provision (1) (4,049 ) Net assets sold (14,621 ) Realized foreign currency translation adjustments (1,442 ) Total net gain on divestiture of the Projects Division $ 14,888 The carrying value of the net assets sold as follows: Cash and cash equivalents $ 2,008 Restricted cash and deposits 371 Trade receivables and unbilled accounts receivable 11,323 Other accounts receivable and prepaid expenses 3,140 Inventories 7,120 Deferred tax assets 2,083 Operating lease right-of-use assets, net of operating lease liabilities 46 Other long-term assets 42 Property and equipment, net 3,926 Goodwill and intangible assets, net 302 Trade payables (4,156 ) Customer advances (3,420 ) Other accounts payable and accrued expenses and deferred revenues (8,123 ) Severance pay, net (41 ) Total net assets sold $ 14,621 (1) According to the Purchase Agreement of the Projects division dated February 7, 2021, the Company was financially liable for the outcome of Magal Mexico's dispute with the Mexican tax authorities and had to indemnify Aeronautics Ltd. For further information and final resolution of the dispute refer to Note 10b. The following table presents the results of the discontinued operations for the years ended December 31, 2023, 2022 and 2021, are presented below: Year ended December 31, 2023 2022 2021 Revenues $ - $ - $ 17,177 Cost of revenues - - 14,906 Gross profit - - 2,271 Operating expenses: Research and development, net - - 828 Selling and marketing - - 2,223 General and administrative - - 3,814 Total - - 6,865 Operating loss - - (4,594 ) Financial expenses, net - - (76 ) Loss before income taxes - - (4,670 ) Taxes on income - - 1,611 Loss after income taxes - - (6,281 ) Capital gain (loss) from discontinued operation - (198 ) 14,888 Net income (loss) from discontinued operation $ - $ (198 ) $ 8,607 The following table presents cash flows for discontinued operations: Year ended December 31, 2023 2022 2021 Net cash provided by (used in) discontinued operating activities $ 22 $ (4,180 ) $ 1,392 Net cash provided by (used in) discontinued investing activities $ - $ - $ 32,447 |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("U.S. GAAP"), followed on a consistent basis. a. Use of estimates: The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the financial statements and accompanying notes. Such management estimates and assumptions are related, but not limited to estimates used in determining values of goodwill and identifiable intangible assets, revenue recognition, allowances for credit losses, inventory write-offs, warranty provision, tax assets and tax positions, legal contingencies, amounts classified as discontinued operations and stock-based compensation costs. Actual results could differ from those estimates. b. Financial statements in U.S. dollars: The Company's management believes that the NIS is the primary currency of the economic environment in which Senstar Technologies Ltd. operates. The Company's reporting currency is the U.S. dollar. The functional currency of Senstar Technologies Ltd. is the NIS. The functional currency of the foreign subsidiaries is the local currency in which each subsidiary operates. ASC 830, "Foreign Currency Matters" sets the standards for translating foreign currency financial statements of consolidated subsidiaries. The first step in the translation process is to identify the functional currency for each entity included in the financial statements. The accounts of each entity are then measured in its functional currency. All transaction gains and losses from the measurement of monetary balance sheet items are reflected in the statement of operations as financial income or expenses, as appropriate. After the measurement process is complete the financial statements are translated into the reporting currency, which is the U.S. dollar, using the current rate method. Equity accounts are translated using historical exchange rates. All other balance sheet accounts are translated using the exchange rates in effect at the balance sheet date. Statement of operations amounts have been translated using the average exchange rate for the year. The resulting translation adjustments are reported as a component of shareholders' equity in accumulated other comprehensive income (loss). c. Principles of consolidation: The consolidated financial statements include the accounts of the Parent Company and its subsidiaries. Intercompany transactions and balances including profits from intercompany sales not yet realized outside the Company, have been eliminated upon consolidation. Changes in the Parent Company's ownership interest with no change of control are treated as equity transactions. Non-controlling interests in subsidiaries represent the equity in subsidiaries not attributable, directly or indirectly, to a parent. Non-controlling interests are presented in equity separately from the equity attributable to the equity holders of the Company. Profit or loss and components of other comprehensive income are attributed to the Company and to non-controlling interests. Losses are attributed to non-controlling interests even if they result in a negative balance of non-controlling interests in the consolidated statement of financial position. When the purchase price of a non-controlling interest exceeds the book value at the time of purchase, any excess or shortfall is recognized as an adjustment to additional paid-in capital. d. Cash equivalents: Cash equivalents are short-term highly liquid investments that are readily convertible into cash with original maturities of three months or less at the date acquired. e. Short-term and long-term restricted cash and deposits: Short-term restricted cash and deposits are primarily invested in certificates of deposit that are restricted to withdrawals or use up to one year. Such certificates of deposit are used primarily as collateral for performance and advance payment guarantees to customers. Long-term restricted cash and deposits are primarily invested in certificates of deposit that are restricted to withdrawals or use for a period for more than one year. Such certificates of deposit are used primarily as collateral for performance guarantees to customers. f. Short-term and long-term bank deposits: Short-term bank deposits are deposits with maturities of more than three months and less than one year and are presented at their cost. A bank deposit with a maturity of more than one year is included in long-term bank deposits and presented at cost. g. Inventories: Inventories are stated at the lower of cost or net realizable value. The Company periodically evaluates the inventory quantities on hand relative to historical and projected sales volumes, current and historical selling prices and contractual obligations to maintain certain levels of parts. Based on these evaluations, inventory write-offs are provided to cover risks arising from slow-moving items, discontinued products, excess inventories, market prices lower than cost and adjusted revenue forecasts. Cost is determined as follows: Raw materials, parts and supplies: using the "first-in, first-out" method. Work in progress and finished products: on the basis of direct manufacturing costs with the addition of allocable indirect cost, representing allocable operating overhead expenses and manufacturing costs. During the years ended December 31, 2023, 2022 and 2021, the Company recorded inventory write-offs in the amounts of $321, $47 and $95, respectively. Such write-offs were included in cost of revenues. h. Property and equipment: Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated by the straight-line method over the estimated useful lives of the assets at the following annual rates: % Buildings 3 - 4 Machinery and equipment 10 - 33 (mainly 10%) Motor vehicles 15 - 20 Promotional displays 10 - 25 Office furniture and equipment 20 - 33 Leasehold improvements By the shorter of the term of the lease or the useful life of the assets i. Intangible assets: Intangible assets are comprised of patents, capitalized and acquired technology and customer relations. Intangible assets are amortized over their useful lives using a method of amortization that reflects the pattern in which the economic benefits of the intangible assets are consumed or otherwise used up, in accordance with ASC 350, "Intangibles - Goodwill and Other." Intangible assets were amortized based on the straight-line method or acceleration method, at the following weighted average annual rates: % Patents 10 Technology 12.5 - 26.7 Customer relationships 10.3 - 36.4 j. Impairment of long-lived assets: The Company's long-lived assets (assets group) to be held or used, including right of use assets and intangible assets that are subject to amortization, are reviewed for impairment in accordance with ASC 360, "Property, Plant, and Equipment" whenever events or changes in circumstances indicate that the carrying amount of a group of assets may not be recoverable. Recoverability of a group of assets to be held and used is measured by a comparison of the carrying amount of the group to the future undiscounted cash flows expected to be generated by the group. If such group of assets is considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds their fair value. During the years ended December 2023, 2022 and 2021, the Company did not record any impairment charges attributable to long-lived assets. k. Goodwill: Goodwill and certain other purchased intangible assets have been recorded as a result of acquisitions. Goodwill represents the excess of the purchase price in a business combination over the fair value of net tangible and intangible assets acquired. Goodwill is not amortized, but rather is subject to an impairment test. ASC No. 350, "Intangible-Goodwill and other" requires goodwill to be tested for impairment at least annually and, in certain circumstances, between annual tests. The accounting guidance gives the option to perform a qualitative assessment to determine whether further impairment testing is necessary. The qualitative assessment considers events and circumstances that might indicate that a reporting unit's fair value is less than its carrying amount. If it is determined, as a result of the qualitative assessment, that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, a quantitative test is performed. Alternatively, ASC No. 350 permits an entity to bypass the qualitative assessment for any reporting unit and proceed directly to performing the quantitative goodwill impairment test. If the carrying value of a reporting unit exceeds its fair value, the Company recognizes an impairment of goodwill for the amount of this excess. The Company performs an annual impairment test during the fourth quarter of each fiscal year, or more frequently if impairment indicators are present. Starting June 30, 2021, as a result of the sale of the Projects segment (see Note 1b), the Company began operating as one operating segment with a single reporting unit. For the years ended December 31, 2023, 2022 and 2021, no impairment losses were recorded. l. Business combinations: The Company accounts for business combinations in accordance with ASC No. 805, "Business Combinations". ASC No. 805 requires recognition of assets acquired, liabilities assumed, and any non-controlling interest at the acquisition date, measured at their fair values as of that date. Any excess of the fair value of net assets acquired over purchase price and any subsequent changes in estimated contingencies are to be recorded in consolidated statements of operations. Acquisition related costs are expensed in the statement of operations in the period incurred. m. Revenue recognition: The Company recognizes revenues in accordance with ASC No. 606, "Revenue from Contracts with Customers" ("ASC No. 606"). As such, the Company identifies a contract with a customer, identifies the performance obligations in the contract, determines the transaction price, allocates the transaction price to each performance obligation in the contract and recognizes revenues when (or as) the Company satisfies a performance obligation. Following the sale of the Integrated Solution Division, the Company generates its revenues mainly from: (1) sales of security products; (2) services and maintenance, which are performed either on a fixed-price basis or as time-and-materials based contracts; and (3) software license fees and related services. The Company enters into contracts that can include combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations. The perpetual license is distinct as the customer can derive the economic benefit of the software without any professional services, updates or technical support. The transaction price is determined based on the consideration to which the Company will be entitled in exchange for transferring goods or services to the customer. The Company usually does not grant a right of return to its customers. In instances of contracts where revenue recognition differs from the timing of invoicing, the Company generally determined that those contracts do not include a significant financing component. The Company uses the practical expedient and does not assess the existence of a significant financing component when the difference between payment and revenue recognition is a year or less. As required by ASC 606, following the determination of the performance obligations in the contract, the Company allocates the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised license fees or services underlying each performance obligation. Standalone selling price is the price at which the Company would sell a promised license or service separately to a customer. Software related services provide customers with rights to unspecified software product updates, if and when available. These services grant the customers online and telephone access to technical support personnel during the term of the service. The Company recognizes software related services revenues ratably over the term of the agreement, usually one year. The Company provides customers with services and maintenance. The Company's service contracts included contracts in which the customer simultaneously receives and consumes the benefits provided as the performance obligations are satisfied, accordingly, related revenues are recognized, as those services are performed or over the term of the related agreements. During the years ended December 31, 2023, 2022 and 2021, the Company derived approximately 16.2%, 17.7% and 17.9% of total revenues, respectively, from services and maintenance (see Note 15). Revenues for performance obligations that are not recognized over time are recognized at the point in time when control is transferred to the customer (which is generally upon delivery) and included mainly revenues from the sales of software license and security products without significant installation work. For performance obligations that are satisfied at a point in time, the Company evaluated the point in time when the customer can direct the use of, and obtain the benefits from, the products, usually upon delivery. Shipping and handling costs are not considered performance obligations and are included in cost of sales as incurred. Remaining performance obligations: Remaining performance obligations represent the future revenues expected to be recognized on firm orders received by the Company and are equivalent to the Company’s remaining performance obligations at the end of each period for a remaining period of more than a year. The Company's remaining performance obligations as of December 31, 2023 was $3.5 million, out of which the Company expects to recognize approximately 47% as revenue in 2024, with the remainder to be recognized thereafter. Deferred revenues and customer advances: Deferred revenues and customer advances decreased by $0.1 million compared to the beginning balance of $4.6 million as of January 1, 2023. The decrease was primarily as a result of $4 million of recognized revenues from deferred revenues and customer advances. This was offset by $3.8 million of new unearned amounts under contracts as well as the exchange rate impact of $0.1 million. The above resulted in an ending balance of $4.5 million as of December 31, 2023. Unbilled accounts receivable: Unbilled accounts receivable decreased by $0.1 million compared to the beginning balance as of January 1, 2023. The above resulted in an ending balance of $0.2 million as of December 31, 2023. n. Accounting for stock-based compensation: The Company accounts for stock-based compensation in accordance with ASC 718, "Compensation-Stock Compensation". ASC 718 requires companies to estimate the fair value of equity-based payment awards on the date of grant using an option-pricing model. The value of the award is recognized as an expense over the requisite service periods in the Company's consolidated income statement. The Company recognizes compensation expenses for the value of its awards, which have graded vesting, based on the accelerated attribution method over the vesting period. The Company accounts for forfeitures as they occur. During the years ended December 31, 2023, 2022 and 2021, the Company recognized stock-based compensation expenses related to employee stock options in the amounts of $18, $93 and $155, respectively. The Company estimates the fair value of stock options granted under ASC 718 using the Binomial model. The Binomial model for option pricing requires a number of assumptions, of which the most significant are the suboptimal exercise factor and expected stock price volatility. The suboptimal exercise factor is estimated using historical option exercise information. The suboptimal exercise factor is the ratio by which the stock price must increase over the exercise price before employees are expected to exercise their stock options. Expected volatility is based upon actual historical stock price movements and was calculated as of the grant dates for different periods, since the Binomial model can be used for different expected volatilities for different periods. The risk-free interest rate is based on the yield from U.S. Treasury zero-coupon bonds with an equivalent term to the contractual term of the options. The expected term of options granted is derived from the output of the option valuation model and represents the period that options granted are expected to be outstanding. During the year ended December 31, 2023 and 2022 no options were granted. The following assumptions were used in the Binomial option pricing model for the year ended December 31, 2021 (no options were granted in 2023 and 2022): 2021 Dividend yield 0% Expected volatility 38.96%-42.17% Risk-free interest 0.67%-1.19% Contractual term 5-7 years Forfeiture rate 13% Suboptimal exercise multiple 1.29 o. Research and development costs: Research and development costs incurred in the process of developing product improvements or new products, are charged to expenses as incurred. ASC 985, "Software", requires capitalization of certain software development costs subsequent to the establishment of technological feasibility. Based on the Company's product development process, technological feasibility is established upon completion of a working model. Costs incurred by the Company between completion of the working models and the point at which the products are ready for general release are capitalized. Capitalized technology is included in intangible assets on the balance sheet and is amortized on a straight-line basis over its estimated useful life, which is generally five years. Amortization expenses are recognized under cost of revenues. Management evaluates the useful lives of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. The Company participates in programs sponsored by the Industrial Research Assistance Program (IRAP) in Canada. In the years ended December 31, 2023 and 2022 the Company recognized IRAP funding in the amount of $266 and $89, respectively. In the year ended December 31, 2021 the Company did not receive any grants with respect to such programs. In the year ended December 31, 2021, the Company capitalized amounts of $13. In the years ended December 31, 2023 and 2022, the Company did not capitalize research and development costs. p. Warranty costs: The Company provides various warranty periods up to 36 months at no extra charge. The Company estimates the costs that may be incurred under its warranty and records a liability in the amount of such costs at the time product revenue is recognized in accordance with ASC 450, "Contingencies." Factors that affect the Company's warranty liability include the number of units, historical and anticipated rates of warranty claims and cost per claim. The Company periodically assesses the adequacy of its recorded warranty liabilities and adjusts the amounts as necessary. The following table provides the detail of the change in the Company's warranty accrual, which is a component of other accrued liabilities in the consolidated balance sheets as of December 31, 2023 and 2022: December 31, 2023 2022 Warranty provision, beginning of year $ 226 $ 157 Charged to costs and expenses relating to new sales 149 235 Utilization or expiration of warranty (225 ) (155 ) Foreign currency translation adjustments - (11 ) Warranty provision, year end $ 150 $ 226 q. Net earnings per share: Basic net earnings per share are computed based on the weighted average number of Ordinary shares outstanding during each year. Diluted net earnings per share is computed based on the weighted average number of ordinary shares outstanding during each year, plus dilutive potential ordinary shares considered outstanding during the year, in accordance with ASC 260, "Earnings Per Share." Certain of the Company's outstanding stock options have been excluded from the calculation of the diluted earnings per share because such options are anti-dilutive. The total weighted average number of the Company's ordinary shares related to the outstanding options excluded from the calculations of diluted earnings per share was 363,499 shares, 554,916 shares and 610,083 shares for the years ended December 31, 2023, 2022 and 2021, respectively. r. Concentrations of credit risk: Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents, short-term and long-term bank deposits, trade receivables, unbilled accounts receivable and long-term trade receivables. As of December 31, 2023, $7,203 of the Company's cash and cash equivalents and restricted cash and short-term deposits were invested in major Israeli and U.S. banks, and approximately $7,725 were invested in other banks, mainly with the Royal Bank of Canada, Deutsche Bank and Natwest Bank. The Company is exposed to credit risk in the event of default by the financial institutions to the extent of the amounts recorded on the accompanying consolidated balance sheets exceed insured limits. Generally, these deposits may be redeemed upon demand and therefore, bear low risk. Trade receivables of the Company, as well as the unbilled accounts receivable, are primarily derived from sales to large and solid organizations and governmental authorities located mainly in the U.S., Canada, Europe and APAC. The Company performs ongoing credit evaluations of its customers. An allowance for credit losses is recognized with respect to those amounts that the Company has determined to be doubtful of collection. In certain circumstances, the Company may require letters of credit, other collateral or additional guarantees. Changes in the Company's allowance for credit losses related to accounts receivables during the two years ended December 31, 2023 and 2022 are as follows: Year ended December 31, 2023 2022 Balance at the beginning of the year $ 103 $ 125 Credit losses expenses during the year 18 30 Customer write-offs or collections during the year (64 ) (46 ) Exchange rate 1 (6 ) $ 58 $ 103 As of December 31, 2023, the Company has no significant off-balance sheet concentrations of credit risk, such as foreign exchange contracts or foreign hedging arrangements. s. Income taxes: The Company accounts for income taxes in accordance with ASC 740, "Income Taxes." This ASC prescribes the use of the liability method whereby deferred tax assets and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value. The Company establishes reserves for uncertain tax positions based on an evaluation of whether the tax position is “more likely than not” to be sustained upon examination. The Company records interest and penalties pertaining to its uncertain tax positions in the financial statements as income tax expense. In the years ended December 31, 2023 and 2021, the Company recorded tax expenses in connection with uncertainties in income taxes of $140 and $126, respectively. In the year ended December 31, 2022, the Company recorded a tax benefit in connection with uncertainties in income taxes of $993. t. Severance pay: The Company has entered into an agreement with its employees implementing Section 14 of the Severance Pay Law and the General Approval of the Labor Minister dated June 30, 1998, issued in accordance with the said Section 14, mandating that upon termination of such employees' employment, all the amounts accrued in their insurance policies will be released to them. The severance pay liabilities and deposits covered by these plans are not reflected in the balance sheet as the severance pay risks have been irrevocably transferred to the severance funds. On December 31, 2007, the then Chairman of the Company's Board of Directors, retired from his position. His retirement agreement included certain perquisites from the Company for the rest of his life. As of December 31, 2023, the actuarial value of these perquisites is estimated at approximately $296. This provision was included as part of accrued severance pay. u. Fair value measurements: ASC 820, "Fair Value Measurement and Disclosure" clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering such assumptions, ASC 820 establishes a three tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 - Significant other observable inputs based on market data obtained from sources independent of the reporting entity. Level 3 - Unobservable inputs which are supported by little or no market activity. The carrying amounts of cash and cash equivalents, trade receivables, unbilled accounts receivable and trade payables approximate their fair value due to the short-term maturity of such instruments. The fair value of the Company's reporting unit was estimated using a discounted cash flow valuation methodology which utilize unobservable, level 3, inputs. v. Advertising expenses: Advertising costs are expensed as incurred. Advertising expenses for the years ended December 31, 2023, 2022 and 2021 were $161, $152 and $107, respectively. w. Comprehensive income (loss): The Company accounts for comprehensive income (loss) in accordance with ASC 220, "Comprehensive Income". ASC 220 establishes standards for the reporting and display of comprehensive income and its components in a full set of general purpose financial statements. Comprehensive income generally represents all changes in shareholders' equity (deficiency) during the period except those resulting from investments by, or distributions to, shareholders. The Company has determined that its items of comprehensive income (loss) relate to unrealized gain (loss) from foreign currency translation adjustments. Changes in the Company's accumulated other comprehensive income (loss), net for the years ended December 31, 2023, 2022 and 2021 are as follows: Year ended December 31, 2023 2022 2021 Balance at the beginning of the year $ (758 ) $ 1,222 $ 34 Foreign currency translation adjustments 782 (1,980 ) (254 ) Realized foreign currency translation adjustments - - 1,442 Total accumulated other comprehensive income (loss) $ 24 $ (758 ) $ 1,222 x. Non-controlling interest: In 2018, the Company established a company in Kenya, which was 51% owned by the Company and 49% owned by a local partner. The non-controlling interest relating to the subsidiary was not material in 2021 and 2020. The subsidiary was sold as part of the Integrated Solutions Division sale (see Note 1b). y. Leases: In accordance with ASC 842, the Company determines if an arrangement is a lease and the classification of that lease at inception based on: (1) whether the contract involves the use of a distinct identified asset, (2) whether the Company obtains the right to substantially all the economic benefits from the use of the asset throughout the period, and (3) whether the Company has a right to direct the use of the asset. The Company elected to not recognize a lease liability and a right-of-use (“ROU”) asset for leases with a term of twelve months or less. ROU assets and lease liabilities are recognized at commencement date based on the present value of remaining lease payments over the lease term. ROU assets are initially measured at amounts, which represents the discounted present value of the lease payments over the lease, plus any initial direct costs incurred. The lease liability is initially measured based on the discounted present value of remaining lease payments over the lease term. For this purpose, the Company considers only payments that are fixed and determinable at the time of commencement. The implicit rate within the operating leases is generally not determinable, therefore the Company uses the Incremental Borrowing Rate (“IBR”) based on the information available at commencement date in determining the present value of lease payments. The Company’s IBR is estimated to approximate the interest rate for collateralized borrowing with similar terms and payments and in economic environments where the leased asset is located. Certain leases include options to extend or terminate the lease. An option to extend the lease is considered in connection with determining the ROU asset and lease liability when it is reasonably certain that the Company will exercise that option. An option to terminate is considered unless it is reasonably certain that the Company will not exercise the option. z. Impact of recently issued and adopted accounting standards: Recently issued accounting standards adopted by the Company: In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (ASU 2021-08), which clarifies that an acquirer of a business should recognize and measure contract assets and contract liabilities in a business combination in accordance with Accounting Standards Codification (ASC) Topic 606, Revenue from Contracts with Customers (Topic 606). This guidance is effective for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. The adoption of the standards did not have a material impact on the Company’s consolidated financial statements. Recently issued accounting standards not yet adopted by the Company: In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires public entities to disclose information about their reportable segments’ significant expenses and other segment items on an interim and annual basis. Public entities with a single reportable segment are required to apply the disclosure requirements in ASU 2023-07, as well as all existing segment disclosures and reconciliation requirements in ASC 280 on an interim and annual basis. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2023-07. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires public entities, on an annual basis, to provide disclosure of specific categories in the rate reconciliation, as well as disclosure of income taxes paid disaggregated by jurisdiction. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2023-09. |
OTHER ACCOUNTS RECEIVABLE AND P
OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES | 12 Months Ended |
Dec. 31, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES | NOTE 3:- OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES December 31, 2023 2022 Prepaid expenses $ 681 $ 696 Government authorities 1,512 570 Others 255 175 $ 2,448 $ 1,441 |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2023 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | NOTE 4:- INVENTORIES December 31, 2023 2022 Raw materials $ 1,915 $ 2,105 Work in progress 457 911 Finished products 4,806 5,427 $ 7,178 $ 8,443 |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2023 | |
Lessee Disclosure [Abstract] | |
LEASES | NOTE 5:- LEASES The Company entered into operating leases primarily for offices and cars. The leases have remaining lease terms of up to 4.4 years. The Company also elected the practical expedient (by class of underlying asset) to not separate lease and non-lease components and instead to account for each separate lease component and the non-lease components associated with that lease component as a single lease component for its leased cars. a. Supplemental balance sheet information related to operating leases is as follows: December 31, 2023 2022 Operating lease ROU assets $ 842 $ 987 Operating lease liabilities, current $ 297 $ 248 Operating lease liabilities, long-term $ 580 $ 757 Weighted average remaining lease term (in years) 2.61 3.32 Weighted average discount rate 3.12 % 3.46 % b. Future lease payments under operating leases as of December 31, 2023, are as follows: December 31, 2024 $ 316 2025 276 2026 184 2027 138 2028 and thereafter 11 Total future lease payments 925 Less - imputed interest (48 ) Total lease liability balance $ 877 c. Operating lease expenses amounted to $339, $360 and $421 for the years ended December 31, 2023, 2022 and 2021, respectively. Operating lease expenses with a term of twelve months or less were immaterial. |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | NOTE 6:- PROPERTY AND EQUIPMENT, NET a. Composition: December 31, 2023 2022 Cost: Land and buildings $ 2,683 $ 2,767 Machinery and equipment 3,017 2,636 Motor vehicles 151 289 Promotional displays 270 257 Office furniture and equipment 2,321 2,289 8,442 8,238 Accumulated depreciation: Buildings 1,829 1,846 Machinery and equipment 2,568 2,322 Motor vehicles 93 179 Promotional displays 245 219 Office furniture and equipment 2,118 2,021 6,853 6,587 Property and equipment, net $ 1,589 $ 1,651 b. Depreciation expenses amounted to $420, $482 and $519 for the years ended December 31, 2023, 2022 and 2021, respectively. |
INTANGIBLE ASSETS, NET
INTANGIBLE ASSETS, NET | 12 Months Ended |
Dec. 31, 2023 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
INTANGIBLE ASSETS, NET | NOTE 7:- INTANGIBLE ASSETS, NET a. Composition: December 31, 2023 2022 Cost: Know-how and patents $ 3,291 $ 3,230 Technology 6,673 6,337 Customer relationships 1,063 1,046 11,027 10,613 Accumulated amortization: Know-how and patents 3,276 3,211 Technology 5,859 5,307 Customer relationships 1,011 953 10,146 9,471 Intangible assets, net $ 881 $ 1,142 b. Amortization expenses related to intangible assets amounted to $497, $948 and $973 for the years ended December 31, 2023, 2022 and 2021, respectively. c. Estimated amortization of intangible assets for the years ended: December 31, 2024 $ 362 2025 354 2026 160 2027 5 $ 881 |
GOODWILL
GOODWILL | 12 Months Ended |
Dec. 31, 2023 | |
GOODWILL [Abstract] | |
GOODWILL | NOTE 8:- GOODWILL With effect from June 30, 2021, as a result of the sale of the Integrated Solutions segment (see Note 1b), the Company operates in one operating segment, and this segment comprises from only one reporting unit. During the fourth quarter of 2023, the Company performed the annual impairment test for goodwill for its reporting unit using a quantitative testing approach. The Company compared the carrying amount of the reporting unit to the estimated fair value using discounted cash flow calculations. Based on the evaluation performed, the Company determined that the fair value of the reporting unit exceeded its carrying amount, and therefore, the Company determined that goodwill was not impaired. The changes in the carrying amount of goodwill associated with continuing operations and appearing in the accompanying consolidated balance sheets as of December 31, 2023 and 2022 are as follows: Total As of January 1, 2022 $ 11,449 Foreign currency translation adjustments (583 ) As of December 31, 2022 10,866 Foreign currency translation adjustments 224 As of December 31, 2023 $ 11,090 |
OTHER ACCOUNTS PAYABLE AND ACCR
OTHER ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 12 Months Ended |
Dec. 31, 2023 | |
Payables and Accruals [Abstract] | |
OTHER ACCOUNTS PAYABLE AND ACCRUED EXPENSES | NOTE 9:- OTHER ACCOUNTS PAYABLE AND ACCRUED EXPENSES December 31, 2023 2022 Employees and payroll accruals $ 1,381 $ 1,696 Accrued expenses 1,747 1,493 Government authorities 697 529 Uncertain tax positions 1,113 1,053 Others 114 106 $ 5,052 $ 4,877 |
COMMITMENTS AND CONTINGENT LIAB
COMMITMENTS AND CONTINGENT LIABILITIES | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENT LIABILITIES | NOTE 10:- COMMITMENTS AND CONTINGENT LIABILITIES a. Guarantees: As of December 31, 2023 and 2022, the Company had credit lines of approximately $2,025 and $2,117, out of which $1,636 and $1,595 were utilized for bank performance guarantees, advance payment guarantees and bid bond guarantees from several banks, respectively, mainly in Israel and Canada. b. Legal proceedings: 1) The Company is subject to legal proceedings arising in the normal course of business. Based on the advice of legal counsel, management believes that these proceedings will not have a material adverse effect on the Company's financial position or results of operations. 2) In February 2019, Magal Mexico (the Company’s former subsidiary whose shares were sold as part of the Integrated Solutions Division sale (see Note 1b)) initiated a dispute procedure with the Mexican tax authorities requesting the recognition of deduction of certain expenses as claimed by the former Mexican subsidiary’s in its annual tax filings. In July 2019, the tax authorities denied the former Mexican subsidiary position. On September 11, 2019, Magal Mexico filed a nullity claim (administrative trial) against the resolution of the Mexican Internal Revenue Service (Servicio de Administración Tributaria) that had requested the former subsidiary to correct its tax situation by virtue that certain invoices did not produce any legal effect. The claim was admitted and resolved in favor of the former subsidiary on August 5, 2020. This resolution was then challenged by the tax authority, through a motion of review before the Collegiate Courts of Circuit; which resolved the appeal by the tax authority unfavorably to the former Mexican subsidiary, on June 4, 2021. The Collegiate Court had confirmed the legality of the tax resolution and had directed the lower court to issue a similar resolution which was issued on July 2, 2021, whereby the lower court had ruled in favor of the Tax Authority. On September 21, 2021, the former Mexican subsidiary appealed the resolution by the lower court before the Collegiate Courts of Circuit. In October 2021, the Collegiate Court admitted the appeal, however, on March 14, 2022, the Court notified the resolution whereby it ruled in favor of the Tax Authority, deciding to confirm the challenged resolution. On March 25, 2022, the former Mexican subsidiary appealed the Collegiate Court's decision before the Mexican Supreme Court of Justice. On May 17, 2022, the Mexican Court rejected the former Mexican subsidiary's annulment claim regarding the Mexican Tax authority’s decision not to allow the deduction of expenses and credit of VAT in respect of the engagement of Cuceju by the former Mexican subsidiary. According to the Purchase Agreement of the Integrated Solutions division dated February 7, 2021, the Company was financially liable for the outcome of this dispute and so has to indemnify Aeronautics Ltd. according to the final tax resolution in this matter. On July 19, 2022, Aeronautics Ltd. and Magal Security Systems Ltd. (collectively for this section the "Buyer"), and the Company agreed that the Company will reimbursed the Buyer in the amount of $4,250 (approximately 86,855 thousands Mexican Peso, in accordance with the then USD-Mexican Peso exchange rate) (the "Tax Payment Amount"), as set forth in the closing protocol dated June 30, 2021 to the Purchase Agreement. The Buyer committed to pay the Tax Payment Amount to the relevant Mexican tax authorities. c. Royalty commitments to the Innovation Authority (formerly the Office of the Chief Scientist) of the Israeli Ministry of Economy, or Innovation Authority: Under the research and development agreements between the Company and the Innovation Authority, the Company is required to pay royalties at the rate of 3.5% of revenues derived from sales of products developed with funds provided by the Innovation Authority and ancillary services, up to an amount equal to 100% of the Innovation Authority research and development grants received, linked to the U.S. dollars plus interest on the unpaid amount received based on the 12-month LIBOR rate applicable to U.S. dollar deposits. The obligation to pay these royalties is contingent on actual sales of the products and in the absence of such sales no payment is required. On June 30, 2021, upon closing of the Company's Projects Division sale to Aeronautics Ltd., the Company's rights and obligations concerning some of its Innovation Authority grants were assumed by Aeronautics Ltd. As of December 31, 2023, the Company had remaining contingent obligations to pay approximately $600 in royalties not assumed by Aeronautics Ltd. The Company's obligations are contingent upon the unlikely event of future revenues associated with the technologies developed under the said grants. As an alternative, the Company may be required to pay royalties over the portion of the consideration attributed to the operation derived from the funds provided by the Innovation Authority, up to the maximum amount of the related funds received. Company's management estimated it to be in an immaterial amount. |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2023 | |
Stockholders' Equity Note [Abstract] | |
SHAREHOLDERS' EQUITY | NOTE 11:- SHAREHOLDERS' EQUITY a. Pertinent rights and privileges conferred by Ordinary shares: The Ordinary shares confer upon their holders the right to receive notice to participate and vote in the general meetings of the Company and the right to receive dividends, if declared. b. Issued and outstanding share capital: 23,309,987 Ordinary shares as of December 31, 2023 and 2022. c. Stock Option Plan: On October 27, 2003, the Company’s Board of Directors approved the Company’s 2003 Israeli Share Option Plan (“the 2003 Plan”). Under the 2003 Plan, stock options may be periodically granted to employees, directors, officers and consultants of the Company or its subsidiaries in accordance with the decision of the Board of Directors of the Company (or a committee appointed by it). The Board of Directors also has the authority to determine the vesting schedule and exercise price of options granted under the 2003 Plan. In May 2008, the Board of Directors approved an amendment to the 2003 Plan, which was approved by the Company’s shareholders in August 2008, which increased the number of Ordinary shares available for issuance under the 2003 Plan by an additional 1,000,000 shares and the termination of the 2003 Plan was extended from October 2013 to October 2018. Any options that are cancelled or forfeited before expiration become available for future grant. On June 23, 2010, the Company’s Annual General Meeting approved the Company’s 2010 Israeli Share Option Plan, or the 2010 Plan, which authorizes the grant of options to employees, officers, directors and consultants of the Company and its subsidiaries. The Ordinary shares that remained available for future option grants under the 2003 Plan as of the date of the adoption of the 2010 Plan and any Ordinary shares that became available in the future under the 2003 Plan as a result of expiration, cancellation or relinquishment of any option outstanding under the 2003 Plan were rolled over to the 2010 Plan. No additional options will be granted under the 2003 Plan. In June 2013, the Company’s shareholders approved an increase to the number of Ordinary shares available for issuance under the 2010 Plan by an additional 500,000 shares. The 2010 Plan has an original term of ten years, which was extended in August 2020 for an additional 5 years, on which date our Board of Directors had also increased and set the number of Ordinary shares available for issuance under the 2010 to 1,200,000. As of December 31, 2023, 906,332 Ordinary shares were available for future option grants. A summary of employee option activity under the Company’s stock option plans as of December 31, 2023 and changes during the year ended December 31, 2023 are as follows: Number of options Weighted-average exercise price Weighted- average remaining contractual life (in months) Aggregate intrinsic value (in thousands) Outstanding at January 1, 2023 552,332 2.826 26.38 - Forfeited (414,666 ) 2.725 Outstanding as of December 31, 2023 137,666 3.130 33.07 - Exercisable as of December 31, 2023 67,667 2.995 26.50 - The weighted-average grant-date fair value of options granted during the year ended December 31, 2021 were $1.56. No options were granted in 2023 and 2022. The aggregate intrinsic value in the table above represents the total intrinsic value (the difference between the Company’s closing stock price on the last trading day of the fourth quarter of fiscal 2023 and the exercise price, multiplied by the number of in-the-money options). This amount changes, based on the fair market value of the Company’s stock. As of December 31, 2023 and 2022, there is no intrinsic value. The total intrinsic value of options exercised for the years ended December 31, 2021 were approximately $232. As of December 31, 2023, there was approximately $24 of unrecognized compensation costs related to non-vested share-based compensation arrangements granted under the Company’s stock option plan. This cost is expected to be recognized over a period of up to 1.75 years. The options outstanding as of December 31, 2023 are follows: Number of options outstanding as of December 31, 2023 Exercise price Weighted average remaining contractual life Number of options exercisable as of December 31, 2023 (In months) 16,666 2.36 17.90 16,666 16,000 3.07 7.20 16,000 35,000 3.23 42.16 11,667 70,000 3.28 38.05 23,334 137,666 33.07 67,667 d. Dividends: Dividends, will be declared and paid in U.S. dollars. On August 16, 2021, the Company announced a cash distribution of $1.725 per share. The cash distribution, in the aggregate amount of $40.1 million, was paid on September 22, 2021 on all of the Company's shares of record on August 31, 2021. |
BASIC AND DILUTED NET EARNINGS
BASIC AND DILUTED NET EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
BASIC AND DILUTED NET EARNINGS PER SHARE | NOTE 12:- BASIC AND DILUTED NET EARNINGS PER SHARE Year ended December 31, 2023 2022 2021 Numerator - continuing operations: Income (loss) from continuing operations attributable to Senstar shareholders $ (1,289 ) $ 4,029 $ (2,191 ) Numerator - discontinued operations: Net income (loss) from discontinued operations, less income (loss) attributed to redeemable non-controlling interests and non-controlling interests, including accretion of redeemable non-controlling interests to redemption value $ - $ (198 ) $ 8,607 Denominator: Denominator for basic net earnings per share weighted-average number of shares outstanding 23,309,987 23,308,001 23,208,589 Effect of diluting securities: Employee stock options - 1,975 - Denominator for diluted net earnings per share - adjusted weighted average shares and assumed exercises 23,309,987 23,309,976 23,208,589 |
TAXES ON INCOME
TAXES ON INCOME | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
TAXES ON INCOME | NOTE 13:- TAXES ON INCOME a. Tax laws and tax rates applicable to the Group companies: The Company and its Israeli subsidiary taxation: Until the sale of the Integrated Solution Division in June 30, 2021, the Company believed that it and its Israeli subsidiary qualified as a Preferred Enterprise, under Law for the Encouragement of Capital Investments, 1959 ("the Law") and accordingly were eligible for a reduced corporate tax rate of 16% on their preferred income, as defined in the Law. In addition, any dividends distributed to individuals or foreign residents from the preferred enterprise's earnings as above will be subject to tax at a rate of 20%. Following the sale of the Integrated Solution Division, the Company’s income is not eligible for Preferred Enterprise benefits and is taxed at the regular corporate tax rate for Israeli companies at 23%. Non-Israeli subsidiaries taxation: Non-Israeli subsidiaries are taxed according to the tax laws in their respective country of domicile. The tax rates of the Company's non-Israeli subsidiaries range between 19%-30%. Tax Reform in U.S.: On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act (the "Act"), which among other provisions, reduced the U.S. corporate tax rate from 35% to 21%, effective January 1, 2018. b. Tax assessments: Senstar Technologies Ltd. received final tax assessments in Israel through the 2020 tax year. The remaining subsidiaries have not received final tax assessments since their incorporation however, the assessments of these subsidiaries are deemed final through the range between the 2015-2020 tax years. c. Reconciliation between the theoretical tax expense, assuming all income is taxed at the Israeli statutory rate, and the actual tax expense, is as follows: Year ended December 31, 2023 2022 2021 Income (loss) before taxes as reported in the statements of operations $ (1,329 ) $ 1,625 $ 70 Tax rate 23 % 23 % 23 % Theoretical tax $ (306 ) $ 374 $ 16 Increase (decrease) in taxes: Non-deductible items 202 177 77 Losses and other items for which a valuation allowance was provided 286 230 599 Repatriation of undistributed earnings (260 ) - 516 Realization of carryforward tax losses for which valuation allowance was provided - (175 ) - Changes in valuation allowance - (1,362 ) (113 ) Tax rate differences in subsidiaries and benefit from reduced tax rates (7 ) 110 43 Provision for uncertain tax positions 140 (993 ) 126 Taxes in respect of prior years (80 ) (562 ) 1 Investment tax credit (68 ) (204 ) (141 ) Other 53 1 1,137 Taxes on income (tax benefit) in the statements of operations $ (40 ) $ (2,404 ) $ 2,261 d. Taxes on income (tax benefit) included in the statements of operations: Year ended December 31, 2023 2022 2021 Current $ (239 ) $ (899 ) $ 1,846 Deferred 199 (1,505 ) 415 $ (40 ) $ (2,404 ) $ 2,261 Domestic $ (28 ) $ (1,583 ) $ 1,707 Foreign (12 ) (821 ) 554 $ (40 ) $ (2,404 ) $ 2,261 e. Deferred income taxes: Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company's deferred tax assets are as follows: December 31, 2023 2022 Deferred tax assets: Operating losses carry forwards $ 2,288 $ 3,548 Reserves, tax allowances, capital losses carry forwards, operating lease and others 4,840 4,029 Total deferred taxes before valuation allowance 7,128 7,577 Valuation allowance (5,184 ) (5,045 ) Deferred tax assets, net: 1,944 2,532 Deferred tax liabilities: Property and equipment, intangible assets, operating lease and others (595 ) (721 ) Undistributed earnings of subsidiaries (430 ) (695 ) Deferred tax liabilities: (1,025 ) (1,416 ) Net deferred tax assets (liability) $ 919 $ 1,116 Domestic $ (430 ) $ (695 ) Foreign $ 1,349 $ 1,811 Prior to 2021, the Company considered the undistributed earnings of all its non-Israeli subsidiaries to be indefinitely reinvested since the Company's Board of Directors had determined that the Company would not distribute any amounts of its undistributed earnings as dividends. Accordingly, the Company recorded no deferred income taxes associated with such undistributed earnings. If these earnings were distributed in the form of dividends or otherwise, the Company would be subject to additional income taxes (subject to an adjustment for foreign tax credits) and foreign withholding taxes. Following the sale of the Projects segment on June 30, 2021 (see Note 1b), the Company reevaluated its historic assertion and no longer consider the earnings of certain of its subsidiaries to be indefinitely reinvested since the cash generated from some of the subsidiaries will be distributed. As a result of the change in assertion, the impact of a repatriation of the undistributed earnings resulted in recording a deferred tax liability consisting of potential withholding and distribution taxes of $0.4 million as of December 31, 2023. During the year ended December 31, 2023, the Company released valuation allowance against the deferred tax assets primarily related to carryforward tax losses and other temporary differences in USA. The Company provided valuation allowance for a portion of the deferred tax regarding the carryforwards losses and other temporary differences that management believes are not expected to be realized in the foreseeable future (see Note 13g). f. The domestic and foreign components of income (loss) before taxes are as follows: Year ended December 31, 2023 2022 2021 Domestic $ (992 ) $ (2,182 ) $ (2,608 ) Foreign (337 ) 3,807 2,678 $ (1,329 ) $ 1,625 $ 70 g. Net operating carryforward tax losses: Senstar Technologies Ltd. has estimated total available carryforward operating tax losses of $4,757 to offset against future taxable income. As of December 31, 2023, Senstar Technologies Ltd. recorded a full valuation allowance on these carry forward tax losses due to the uncertainty of their future realization. There is no time limitation for the realization of such tax losses. The Company's subsidiaries have estimated total available carryforward operating tax losses of $4,555, which may be used to offset against future taxable income, for periods ranging between 1 to 14 years. As of December 31, 2023, the Company recorded a net deferred tax asset after valuation allowance in the amount of $1,304 for its subsidiaries' carryforward tax losses. Utilization of U.S. net operating losses (federal and state net operating losses) may be subject to a substantial annual limitation due to the "change in ownership" provisions of the Internal Revenue Code of 1986 and similar state provisions. The annual limitation may result in the expiration of net operating losses before utilization. h. Uncertain tax positions: As of December 31, 2023 and 2022, balances in respect to ASC 740, "Income Taxes" amounted to $1,113 and $1,053, respectively. A reconciliation of the beginning and ending amount of unrecognized tax positions is as follows: December 31, 2023 2022 Balance at the beginning of the year $ 1,053 $ 2,003 Additions based on tax positions taken related to the current year 148 94 Reduction related to expirations of statute of limitations or settlements of tax matters (92 ) (1,087 ) Foreign currency translation adjustments 4 43 Balance at the end of the year $ 1,113 $ 1,053 Substantially all the balance of unrecognized tax benefits, if recognized, would reduce the Company's annual effective tax rate. |
BALANCES AND TRANSACTIONS WITH
BALANCES AND TRANSACTIONS WITH RELATED PARTIES | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
BALANCES AND TRANSACTIONS WITH RELATED PARTIES | NOTE 14:- BALANCES AND TRANSACTIONS WITH RELATED PARTIES The Company compensates its Executive Chairman of the Board for services provided to the Company commencing October 1, 2014. In addition to the directors' fees paid by the Company to all of its directors, the Company pays for his services: (i) a monthly payment of approximately $4 for time devoted to such position; and (ii) an annual cash bonus of $30 that is payable only if the Company's net profit pursuant to its annual audited and consolidated financial statement exceeds $5,000. The annual cash bonus is payable commencing as of the fiscal year 2015 and will be paid, if earned, as set forth in the Compensation Policy. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | NOTE 15:- SEGMENT INFORMATION Historically, the Company had two operating segments, which also represented its reportable segments. The Integrated Solutions Division (“Projects” segment) and Senstar Product division (“Products” segment). On June 30, 2021, the Projects segment was sold (see note 1b). Therefore, the results of the Company’s Projects segment were classified as discontinued operations in the Company’s consolidated statements of operations and thus excluded from both continuing operations and segment results for all periods presented. Accordingly, the Company now have one reportable segment with the change reflected in all periods presented. Geographical information: The following is a summary of revenues within geographic areas based on end customers’ location and long-lived assets: 1. Revenues: Year ended December 31, 2023 2022 2021 North America $ 14,835 $ 16,042 $ 15,902 Europe 11,393 10,396 8,913 APAC 3,863 6,571 8,387 South and Latin America 2,197 1,334 1,296 Israel 302 1,195 317 Others 202 20 101 $ 32,792 $ 35,558 $ 34,916 2. Long-lived assets: December 31, 2023 2022 Israel $ 65 $ 170 Europe 1,382 1,268 USA 1,791 1,764 Canada 11,164 11,375 Others - 69 $ 14,402 $ 14,646 Long-lived assets include operating lease right-of-use assets, property and equipment, net, intangible assets, net and goodwill. |
SELECTED STATEMENTS OF INCOME D
SELECTED STATEMENTS OF INCOME DATA | 12 Months Ended |
Dec. 31, 2023 | |
Other Income and Expenses [Abstract] | |
SELECTED STATEMENTS OF INCOME DATA | NOTE 16:- SELECTED STATEMENTS OF INCOME DATA Financial expenses: Year ended December 31, 2023 2022 2021 Financial expenses: Interest on short-term and long-term bank credit and bank charges and others $ (157 ) $ (273 ) $ (52 ) Foreign exchange loss, net (58 ) - (985 ) (215 ) (273 ) (1,037 ) Financial income: Interest on short-term and long-term bank deposits 151 48 26 Foreign exchange income, net - 366 - 151 414 26 Financial income (expenses), net $ (64 ) $ 141 $ (1,011 ) |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2023 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 17:- SUBSEQUENT EVENTS On September 26, 2023, Senstar Technologies Ltd., Senstar Technologies Corporation, a newly established Ontario corporation, and Can Co Sub Ltd., a Company organized under the laws of the State of Israel and a wholly-owned subsidiary of Senstar Technologies Corporation (“Merger Sub”) entered into a merger agreement (the “Merger Agreement”), pursuant to which Senstar Technologies Corporation would become the Parent Company of Senstar Technologies Ltd. as a result of a merger of Merger Sub with and into Senstar Technologies Ltd., with Senstar Technologies Ltd. surviving the Merger as a wholly-owned subsidiary of Senstar Technologies Corporation (the “Merger”). Pursuant to the Merger Agreement, Senstar Technologies Ltd. agreed to become domiciled in Ontario and become Senstar Technologies Corporation, an Ontario organized Company (the “Redomiciliation”). Effective March 18, 2024 (the “Effective Time”), Merger Sub was merged with and into Senstar Technologies Ltd.. As a result of the Merger, (a) the separate corporate existence of Merger Sub ceased and Senstar Technologies Ltd. continued as the surviving company; (b) all the properties, rights, privileges, powers and franchises of Senstar Technologies Ltd. and Merger Sub vested in Senstar Technologies Ltd. (as the surviving company); (c) all debts, liabilities and duties of Senstar Technologies Ltd. and Merger Sub became the debts, liabilities and duties of Senstar Technologies Ltd. (as the surviving company); and (d) all the rights, privileges, immunities, powers and franchises of Senstar Technologies Ltd. continued unaffected by the Merger in accordance with the Israeli Companies Law, 5759-1999. Each Senstar Technologies Ltd. ordinary share issued and outstanding immediately prior to the consummation of the Merger represented the right to receive, less any applicable withholding taxes, one (1) validly issued, fully paid and nonassessable common share of Senstar Technologies Corporation, representing the same proportional equity interest in Senstar Technologies Corporation as that shareholder held in Senstar Technologies Ltd.. The number of common shares of Senstar Technologies Corporation outstanding immediately after the Redomiciliation continued to be the same as the number of ordinary shares of Senstar Technologies Ltd. outstanding immediately prior to the Redomiciliation. Upon effectiveness of the Redomiciliation, the name of the Company became Senstar Technologies Corporation. The rights of shareholders of Senstar Technologies Corporation are governed under Ontario law and the Articles and By-Laws of Senstar Technologies Corporation. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Use of estimates | a. Use of estimates: The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the financial statements and accompanying notes. Such management estimates and assumptions are related, but not limited to estimates used in determining values of goodwill and identifiable intangible assets, revenue recognition, allowances for credit losses, inventory write-offs, warranty provision, tax assets and tax positions, legal contingencies, amounts classified as discontinued operations and stock-based compensation costs. Actual results could differ from those estimates. |
Financial statements in U.S. dollars | b. Financial statements in U.S. dollars: The Company's management believes that the NIS is the primary currency of the economic environment in which Senstar Technologies Ltd. operates. The Company's reporting currency is the U.S. dollar. The functional currency of Senstar Technologies Ltd. is the NIS. The functional currency of the foreign subsidiaries is the local currency in which each subsidiary operates. ASC 830, "Foreign Currency Matters" sets the standards for translating foreign currency financial statements of consolidated subsidiaries. The first step in the translation process is to identify the functional currency for each entity included in the financial statements. The accounts of each entity are then measured in its functional currency. All transaction gains and losses from the measurement of monetary balance sheet items are reflected in the statement of operations as financial income or expenses, as appropriate. After the measurement process is complete the financial statements are translated into the reporting currency, which is the U.S. dollar, using the current rate method. Equity accounts are translated using historical exchange rates. All other balance sheet accounts are translated using the exchange rates in effect at the balance sheet date. Statement of operations amounts have been translated using the average exchange rate for the year. The resulting translation adjustments are reported as a component of shareholders' equity in accumulated other comprehensive income (loss). |
Principles of consolidation | c. Principles of consolidation: The consolidated financial statements include the accounts of the Parent Company and its subsidiaries. Intercompany transactions and balances including profits from intercompany sales not yet realized outside the Company, have been eliminated upon consolidation. Changes in the Parent Company's ownership interest with no change of control are treated as equity transactions. Non-controlling interests in subsidiaries represent the equity in subsidiaries not attributable, directly or indirectly, to a parent. Non-controlling interests are presented in equity separately from the equity attributable to the equity holders of the Company. Profit or loss and components of other comprehensive income are attributed to the Company and to non-controlling interests. Losses are attributed to non-controlling interests even if they result in a negative balance of non-controlling interests in the consolidated statement of financial position. When the purchase price of a non-controlling interest exceeds the book value at the time of purchase, any excess or shortfall is recognized as an adjustment to additional paid-in capital. |
Cash equivalents | d. Cash equivalents: Cash equivalents are short-term highly liquid investments that are readily convertible into cash with original maturities of three months or less at the date acquired. |
Short-term and long-term restricted cash and deposits | e. Short-term and long-term restricted cash and deposits: Short-term restricted cash and deposits are primarily invested in certificates of deposit that are restricted to withdrawals or use up to one year. Such certificates of deposit are used primarily as collateral for performance and advance payment guarantees to customers. Long-term restricted cash and deposits are primarily invested in certificates of deposit that are restricted to withdrawals or use for a period for more than one year. Such certificates of deposit are used primarily as collateral for performance guarantees to customers. |
Short-term and long-term bank deposits | f. Short-term and long-term bank deposits: Short-term bank deposits are deposits with maturities of more than three months and less than one year and are presented at their cost. A bank deposit with a maturity of more than one year is included in long-term bank deposits and presented at cost. |
Inventories | g. Inventories: Inventories are stated at the lower of cost or net realizable value. The Company periodically evaluates the inventory quantities on hand relative to historical and projected sales volumes, current and historical selling prices and contractual obligations to maintain certain levels of parts. Based on these evaluations, inventory write-offs are provided to cover risks arising from slow-moving items, discontinued products, excess inventories, market prices lower than cost and adjusted revenue forecasts. Cost is determined as follows: Raw materials, parts and supplies: using the "first-in, first-out" method. Work in progress and finished products: on the basis of direct manufacturing costs with the addition of allocable indirect cost, representing allocable operating overhead expenses and manufacturing costs. During the years ended December 31, 2023, 2022 and 2021, the Company recorded inventory write-offs in the amounts of $321, $47 and $95, respectively. Such write-offs were included in cost of revenues. |
Property and equipment | h. Property and equipment: Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated by the straight-line method over the estimated useful lives of the assets at the following annual rates: % Buildings 3 - 4 Machinery and equipment 10 - 33 (mainly 10%) Motor vehicles 15 - 20 Promotional displays 10 - 25 Office furniture and equipment 20 - 33 Leasehold improvements By the shorter of the term of the lease or the useful life of the assets |
Intangible assets | i. Intangible assets: Intangible assets are comprised of patents, capitalized and acquired technology and customer relations. Intangible assets are amortized over their useful lives using a method of amortization that reflects the pattern in which the economic benefits of the intangible assets are consumed or otherwise used up, in accordance with ASC 350, "Intangibles - Goodwill and Other." Intangible assets were amortized based on the straight-line method or acceleration method, at the following weighted average annual rates: % Patents 10 Technology 12.5 - 26.7 Customer relationships 10.3 - 36.4 |
Impairment of long-lived assets | j. Impairment of long-lived assets: The Company's long-lived assets (assets group) to be held or used, including right of use assets and intangible assets that are subject to amortization, are reviewed for impairment in accordance with ASC 360, "Property, Plant, and Equipment" whenever events or changes in circumstances indicate that the carrying amount of a group of assets may not be recoverable. Recoverability of a group of assets to be held and used is measured by a comparison of the carrying amount of the group to the future undiscounted cash flows expected to be generated by the group. If such group of assets is considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds their fair value. During the years ended December 2023, 2022 and 2021, the Company did not record any impairment charges attributable to long-lived assets. |
Goodwill | k. Goodwill: Goodwill and certain other purchased intangible assets have been recorded as a result of acquisitions. Goodwill represents the excess of the purchase price in a business combination over the fair value of net tangible and intangible assets acquired. Goodwill is not amortized, but rather is subject to an impairment test. ASC No. 350, "Intangible-Goodwill and other" requires goodwill to be tested for impairment at least annually and, in certain circumstances, between annual tests. The accounting guidance gives the option to perform a qualitative assessment to determine whether further impairment testing is necessary. The qualitative assessment considers events and circumstances that might indicate that a reporting unit's fair value is less than its carrying amount. If it is determined, as a result of the qualitative assessment, that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, a quantitative test is performed. Alternatively, ASC No. 350 permits an entity to bypass the qualitative assessment for any reporting unit and proceed directly to performing the quantitative goodwill impairment test. If the carrying value of a reporting unit exceeds its fair value, the Company recognizes an impairment of goodwill for the amount of this excess. The Company performs an annual impairment test during the fourth quarter of each fiscal year, or more frequently if impairment indicators are present. Starting June 30, 2021, as a result of the sale of the Projects segment (see Note 1b), the Company began operating as one operating segment with a single reporting unit. For the years ended December 31, 2023, 2022 and 2021, no impairment losses were recorded. |
Business combinations | l. Business combinations: The Company accounts for business combinations in accordance with ASC No. 805, "Business Combinations". ASC No. 805 requires recognition of assets acquired, liabilities assumed, and any non-controlling interest at the acquisition date, measured at their fair values as of that date. Any excess of the fair value of net assets acquired over purchase price and any subsequent changes in estimated contingencies are to be recorded in consolidated statements of operations. Acquisition related costs are expensed in the statement of operations in the period incurred. |
Revenue recognition | m. Revenue recognition: The Company recognizes revenues in accordance with ASC No. 606, "Revenue from Contracts with Customers" ("ASC No. 606"). As such, the Company identifies a contract with a customer, identifies the performance obligations in the contract, determines the transaction price, allocates the transaction price to each performance obligation in the contract and recognizes revenues when (or as) the Company satisfies a performance obligation. Following the sale of the Integrated Solution Division, the Company generates its revenues mainly from: (1) sales of security products; (2) services and maintenance, which are performed either on a fixed-price basis or as time-and-materials based contracts; and (3) software license fees and related services. The Company enters into contracts that can include combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations. The perpetual license is distinct as the customer can derive the economic benefit of the software without any professional services, updates or technical support. The transaction price is determined based on the consideration to which the Company will be entitled in exchange for transferring goods or services to the customer. The Company usually does not grant a right of return to its customers. In instances of contracts where revenue recognition differs from the timing of invoicing, the Company generally determined that those contracts do not include a significant financing component. The Company uses the practical expedient and does not assess the existence of a significant financing component when the difference between payment and revenue recognition is a year or less. As required by ASC 606, following the determination of the performance obligations in the contract, the Company allocates the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised license fees or services underlying each performance obligation. Standalone selling price is the price at which the Company would sell a promised license or service separately to a customer. Software related services provide customers with rights to unspecified software product updates, if and when available. These services grant the customers online and telephone access to technical support personnel during the term of the service. The Company recognizes software related services revenues ratably over the term of the agreement, usually one year. The Company provides customers with services and maintenance. The Company's service contracts included contracts in which the customer simultaneously receives and consumes the benefits provided as the performance obligations are satisfied, accordingly, related revenues are recognized, as those services are performed or over the term of the related agreements. During the years ended December 31, 2023, 2022 and 2021, the Company derived approximately 16.2%, 17.7% and 17.9% of total revenues, respectively, from services and maintenance (see Note 15). Revenues for performance obligations that are not recognized over time are recognized at the point in time when control is transferred to the customer (which is generally upon delivery) and included mainly revenues from the sales of software license and security products without significant installation work. For performance obligations that are satisfied at a point in time, the Company evaluated the point in time when the customer can direct the use of, and obtain the benefits from, the products, usually upon delivery. Shipping and handling costs are not considered performance obligations and are included in cost of sales as incurred. Remaining performance obligations: Remaining performance obligations represent the future revenues expected to be recognized on firm orders received by the Company and are equivalent to the Company’s remaining performance obligations at the end of each period for a remaining period of more than a year. The Company's remaining performance obligations as of December 31, 2023 was $3.5 million, out of which the Company expects to recognize approximately 47% as revenue in 2024, with the remainder to be recognized thereafter. Deferred revenues and customer advances: Deferred revenues and customer advances decreased by $0.1 million compared to the beginning balance of $4.6 million as of January 1, 2023. The decrease was primarily as a result of $4 million of recognized revenues from deferred revenues and customer advances. This was offset by $3.8 million of new unearned amounts under contracts as well as the exchange rate impact of $0.1 million. The above resulted in an ending balance of $4.5 million as of December 31, 2023. Unbilled accounts receivable: Unbilled accounts receivable decreased by $0.1 million compared to the beginning balance as of January 1, 2023. The above resulted in an ending balance of $0.2 million as of December 31, 2023. |
Accounting for stock-based compensation | n. Accounting for stock-based compensation: The Company accounts for stock-based compensation in accordance with ASC 718, "Compensation-Stock Compensation". ASC 718 requires companies to estimate the fair value of equity-based payment awards on the date of grant using an option-pricing model. The value of the award is recognized as an expense over the requisite service periods in the Company's consolidated income statement. The Company recognizes compensation expenses for the value of its awards, which have graded vesting, based on the accelerated attribution method over the vesting period. The Company accounts for forfeitures as they occur. During the years ended December 31, 2023, 2022 and 2021, the Company recognized stock-based compensation expenses related to employee stock options in the amounts of $18, $93 and $155, respectively. The Company estimates the fair value of stock options granted under ASC 718 using the Binomial model. The Binomial model for option pricing requires a number of assumptions, of which the most significant are the suboptimal exercise factor and expected stock price volatility. The suboptimal exercise factor is estimated using historical option exercise information. The suboptimal exercise factor is the ratio by which the stock price must increase over the exercise price before employees are expected to exercise their stock options. Expected volatility is based upon actual historical stock price movements and was calculated as of the grant dates for different periods, since the Binomial model can be used for different expected volatilities for different periods. The risk-free interest rate is based on the yield from U.S. Treasury zero-coupon bonds with an equivalent term to the contractual term of the options. The expected term of options granted is derived from the output of the option valuation model and represents the period that options granted are expected to be outstanding. During the year ended December 31, 2023 and 2022 no options were granted. The following assumptions were used in the Binomial option pricing model for the year ended December 31, 2021 (no options were granted in 2023 and 2022): 2021 Dividend yield 0% Expected volatility 38.96%-42.17% Risk-free interest 0.67%-1.19% Contractual term 5-7 years Forfeiture rate 13% Suboptimal exercise multiple 1.29 |
Research and development costs | o. Research and development costs: Research and development costs incurred in the process of developing product improvements or new products, are charged to expenses as incurred. ASC 985, "Software", requires capitalization of certain software development costs subsequent to the establishment of technological feasibility. Based on the Company's product development process, technological feasibility is established upon completion of a working model. Costs incurred by the Company between completion of the working models and the point at which the products are ready for general release are capitalized. Capitalized technology is included in intangible assets on the balance sheet and is amortized on a straight-line basis over its estimated useful life, which is generally five years. Amortization expenses are recognized under cost of revenues. Management evaluates the useful lives of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. The Company participates in programs sponsored by the Industrial Research Assistance Program (IRAP) in Canada. In the years ended December 31, 2023 and 2022 the Company recognized IRAP funding in the amount of $266 and $89, respectively. In the year ended December 31, 2021 the Company did not receive any grants with respect to such programs. In the year ended December 31, 2021, the Company capitalized amounts of $13. In the years ended December 31, 2023 and 2022, the Company did not capitalize research and development costs. |
Warranty costs | p. Warranty costs: The Company provides various warranty periods up to 36 months at no extra charge. The Company estimates the costs that may be incurred under its warranty and records a liability in the amount of such costs at the time product revenue is recognized in accordance with ASC 450, "Contingencies." Factors that affect the Company's warranty liability include the number of units, historical and anticipated rates of warranty claims and cost per claim. The Company periodically assesses the adequacy of its recorded warranty liabilities and adjusts the amounts as necessary. The following table provides the detail of the change in the Company's warranty accrual, which is a component of other accrued liabilities in the consolidated balance sheets as of December 31, 2023 and 2022: December 31, 2023 2022 Warranty provision, beginning of year $ 226 $ 157 Charged to costs and expenses relating to new sales 149 235 Utilization or expiration of warranty (225 ) (155 ) Foreign currency translation adjustments - (11 ) Warranty provision, year end $ 150 $ 226 |
Net earnings per share | q. Net earnings per share: Basic net earnings per share are computed based on the weighted average number of Ordinary shares outstanding during each year. Diluted net earnings per share is computed based on the weighted average number of ordinary shares outstanding during each year, plus dilutive potential ordinary shares considered outstanding during the year, in accordance with ASC 260, "Earnings Per Share." Certain of the Company's outstanding stock options have been excluded from the calculation of the diluted earnings per share because such options are anti-dilutive. The total weighted average number of the Company's ordinary shares related to the outstanding options excluded from the calculations of diluted earnings per share was 363,499 shares, 554,916 shares and 610,083 shares for the years ended December 31, 2023, 2022 and 2021, respectively. |
Concentrations of credit risk | r. Concentrations of credit risk: Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents, short-term and long-term bank deposits, trade receivables, unbilled accounts receivable and long-term trade receivables. As of December 31, 2023, $7,203 of the Company's cash and cash equivalents and restricted cash and short-term deposits were invested in major Israeli and U.S. banks, and approximately $7,725 were invested in other banks, mainly with the Royal Bank of Canada, Deutsche Bank and Natwest Bank. The Company is exposed to credit risk in the event of default by the financial institutions to the extent of the amounts recorded on the accompanying consolidated balance sheets exceed insured limits. Generally, these deposits may be redeemed upon demand and therefore, bear low risk. Trade receivables of the Company, as well as the unbilled accounts receivable, are primarily derived from sales to large and solid organizations and governmental authorities located mainly in the U.S., Canada, Europe and APAC. The Company performs ongoing credit evaluations of its customers. An allowance for credit losses is recognized with respect to those amounts that the Company has determined to be doubtful of collection. In certain circumstances, the Company may require letters of credit, other collateral or additional guarantees. Changes in the Company's allowance for credit losses related to accounts receivables during the two years ended December 31, 2023 and 2022 are as follows: Year ended December 31, 2023 2022 Balance at the beginning of the year $ 103 $ 125 Credit losses expenses during the year 18 30 Customer write-offs or collections during the year (64 ) (46 ) Exchange rate 1 (6 ) $ 58 $ 103 As of December 31, 2023, the Company has no significant off-balance sheet concentrations of credit risk, such as foreign exchange contracts or foreign hedging arrangements. |
Income taxes | s. Income taxes: The Company accounts for income taxes in accordance with ASC 740, "Income Taxes." This ASC prescribes the use of the liability method whereby deferred tax assets and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value. The Company establishes reserves for uncertain tax positions based on an evaluation of whether the tax position is “more likely than not” to be sustained upon examination. The Company records interest and penalties pertaining to its uncertain tax positions in the financial statements as income tax expense. In the years ended December 31, 2023 and 2021, the Company recorded tax expenses in connection with uncertainties in income taxes of $140 and $126, respectively. In the year ended December 31, 2022, the Company recorded a tax benefit in connection with uncertainties in income taxes of $993. |
Severance pay | t. Severance pay: The Company has entered into an agreement with its employees implementing Section 14 of the Severance Pay Law and the General Approval of the Labor Minister dated June 30, 1998, issued in accordance with the said Section 14, mandating that upon termination of such employees' employment, all the amounts accrued in their insurance policies will be released to them. The severance pay liabilities and deposits covered by these plans are not reflected in the balance sheet as the severance pay risks have been irrevocably transferred to the severance funds. On December 31, 2007, the then Chairman of the Company's Board of Directors, retired from his position. His retirement agreement included certain perquisites from the Company for the rest of his life. As of December 31, 2023, the actuarial value of these perquisites is estimated at approximately $296. This provision was included as part of accrued severance pay. |
Fair value measurements | u. Fair value measurements: ASC 820, "Fair Value Measurement and Disclosure" clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering such assumptions, ASC 820 establishes a three tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 - Significant other observable inputs based on market data obtained from sources independent of the reporting entity. Level 3 - Unobservable inputs which are supported by little or no market activity. The carrying amounts of cash and cash equivalents, trade receivables, unbilled accounts receivable and trade payables approximate their fair value due to the short-term maturity of such instruments. The fair value of the Company's reporting unit was estimated using a discounted cash flow valuation methodology which utilize unobservable, level 3, inputs. |
Advertising expenses | v. Advertising expenses: Advertising costs are expensed as incurred. Advertising expenses for the years ended December 31, 2023, 2022 and 2021 were $161, $152 and $107, respectively. |
Comprehensive income (loss) | w. Comprehensive income (loss): The Company accounts for comprehensive income (loss) in accordance with ASC 220, "Comprehensive Income". ASC 220 establishes standards for the reporting and display of comprehensive income and its components in a full set of general purpose financial statements. Comprehensive income generally represents all changes in shareholders' equity (deficiency) during the period except those resulting from investments by, or distributions to, shareholders. The Company has determined that its items of comprehensive income (loss) relate to unrealized gain (loss) from foreign currency translation adjustments. Changes in the Company's accumulated other comprehensive income (loss), net for the years ended December 31, 2023, 2022 and 2021 are as follows: Year ended December 31, 2023 2022 2021 Balance at the beginning of the year $ (758 ) $ 1,222 $ 34 Foreign currency translation adjustments 782 (1,980 ) (254 ) Realized foreign currency translation adjustments - - 1,442 Total accumulated other comprehensive income (loss) $ 24 $ (758 ) $ 1,222 |
Non-controlling interest | x. Non-controlling interest: In 2018, the Company established a company in Kenya, which was 51% owned by the Company and 49% owned by a local partner. The non-controlling interest relating to the subsidiary was not material in 2021 and 2020. The subsidiary was sold as part of the Integrated Solutions Division sale (see Note 1b). |
Leases | y. Leases: In accordance with ASC 842, the Company determines if an arrangement is a lease and the classification of that lease at inception based on: (1) whether the contract involves the use of a distinct identified asset, (2) whether the Company obtains the right to substantially all the economic benefits from the use of the asset throughout the period, and (3) whether the Company has a right to direct the use of the asset. The Company elected to not recognize a lease liability and a right-of-use (“ROU”) asset for leases with a term of twelve months or less. ROU assets and lease liabilities are recognized at commencement date based on the present value of remaining lease payments over the lease term. ROU assets are initially measured at amounts, which represents the discounted present value of the lease payments over the lease, plus any initial direct costs incurred. The lease liability is initially measured based on the discounted present value of remaining lease payments over the lease term. For this purpose, the Company considers only payments that are fixed and determinable at the time of commencement. The implicit rate within the operating leases is generally not determinable, therefore the Company uses the Incremental Borrowing Rate (“IBR”) based on the information available at commencement date in determining the present value of lease payments. The Company’s IBR is estimated to approximate the interest rate for collateralized borrowing with similar terms and payments and in economic environments where the leased asset is located. Certain leases include options to extend or terminate the lease. An option to extend the lease is considered in connection with determining the ROU asset and lease liability when it is reasonably certain that the Company will exercise that option. An option to terminate is considered unless it is reasonably certain that the Company will not exercise the option. |
Impact of recently issued and adopted accounting standards | z. Impact of recently issued and adopted accounting standards: Recently issued accounting standards adopted by the Company: In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (ASU 2021-08), which clarifies that an acquirer of a business should recognize and measure contract assets and contract liabilities in a business combination in accordance with Accounting Standards Codification (ASC) Topic 606, Revenue from Contracts with Customers (Topic 606). This guidance is effective for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. The adoption of the standards did not have a material impact on the Company’s consolidated financial statements. Recently issued accounting standards not yet adopted by the Company: In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires public entities to disclose information about their reportable segments’ significant expenses and other segment items on an interim and annual basis. Public entities with a single reportable segment are required to apply the disclosure requirements in ASU 2023-07, as well as all existing segment disclosures and reconciliation requirements in ASC 280 on an interim and annual basis. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2023-07. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires public entities, on an annual basis, to provide disclosure of specific categories in the rate reconciliation, as well as disclosure of income taxes paid disaggregated by jurisdiction. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2023-09. |
GENERAL (Tables)
GENERAL (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Schedule of Gain Associated with Sale, Presented in Results of Discontinued Operations | Gross purchase price $ 35,000 Provision (1) (4,049 ) Net assets sold (14,621 ) Realized foreign currency translation adjustments (1,442 ) Total net gain on divestiture of the Projects Division $ 14,888 |
Schedule of Carrying Value of Net Assets Sold | Cash and cash equivalents $ 2,008 Restricted cash and deposits 371 Trade receivables and unbilled accounts receivable 11,323 Other accounts receivable and prepaid expenses 3,140 Inventories 7,120 Deferred tax assets 2,083 Operating lease right-of-use assets, net of operating lease liabilities 46 Other long-term assets 42 Property and equipment, net 3,926 Goodwill and intangible assets, net 302 Trade payables (4,156 ) Customer advances (3,420 ) Other accounts payable and accrued expenses and deferred revenues (8,123 ) Severance pay, net (41 ) Total net assets sold $ 14,621 |
Schedule of Results of Discontinued Operations | Year ended December 31, 2023 2022 2021 Revenues $ - $ - $ 17,177 Cost of revenues - - 14,906 Gross profit - - 2,271 Operating expenses: Research and development, net - - 828 Selling and marketing - - 2,223 General and administrative - - 3,814 Total - - 6,865 Operating loss - - (4,594 ) Financial expenses, net - - (76 ) Loss before income taxes - - (4,670 ) Taxes on income - - 1,611 Loss after income taxes - - (6,281 ) Capital gain (loss) from discontinued operation - (198 ) 14,888 Net income (loss) from discontinued operation $ - $ (198 ) $ 8,607 The following table presents cash flows for discontinued operations: Year ended December 31, 2023 2022 2021 Net cash provided by (used in) discontinued operating activities $ 22 $ (4,180 ) $ 1,392 Net cash provided by (used in) discontinued investing activities $ - $ - $ 32,447 |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Annual Depreciation Rates | % Buildings 3 - 4 Machinery and equipment 10 - 33 (mainly 10%) Motor vehicles 15 - 20 Promotional displays 10 - 25 Office furniture and equipment 20 - 33 Leasehold improvements By the shorter of the term of the lease or the useful life of the assets |
Schedule of Intangible Assets Amortization Rates | % Patents 10 Technology 12.5 - 26.7 Customer relationships 10.3 - 36.4 |
Schedule of Fair Value Assumptions for Stock Options | 2021 Dividend yield 0% Expected volatility 38.96%-42.17% Risk-free interest 0.67%-1.19% Contractual term 5-7 years Forfeiture rate 13% Suboptimal exercise multiple 1.29 |
Schedule of Product Warranty Accrual | December 31, 2023 2022 Warranty provision, beginning of year $ 226 $ 157 Charged to costs and expenses relating to new sales 149 235 Utilization or expiration of warranty (225 ) (155 ) Foreign currency translation adjustments - (11 ) Warranty provision, year end $ 150 $ 226 |
Schedule of Changes in Allowance for Credit Losses Related to Accounts | Year ended December 31, 2023 2022 Balance at the beginning of the year $ 103 $ 125 Credit losses expenses during the year 18 30 Customer write-offs or collections during the year (64 ) (46 ) Exchange rate 1 (6 ) $ 58 $ 103 |
Schedule of Accumulated Other Comprehensive Income | Year ended December 31, 2023 2022 2021 Balance at the beginning of the year $ (758 ) $ 1,222 $ 34 Foreign currency translation adjustments 782 (1,980 ) (254 ) Realized foreign currency translation adjustments - - 1,442 Total accumulated other comprehensive income (loss) $ 24 $ (758 ) $ 1,222 |
OTHER ACCOUNTS RECEIVABLE AND_2
OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Other Accounts Receivable and Prepaid Expenses | December 31, 2023 2022 Prepaid expenses $ 681 $ 696 Government authorities 1,512 570 Others 255 175 $ 2,448 $ 1,441 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | December 31, 2023 2022 Raw materials $ 1,915 $ 2,105 Work in progress 457 911 Finished products 4,806 5,427 $ 7,178 $ 8,443 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Lessee Disclosure [Abstract] | |
Schedule of Supplemental Balance Sheet Information Related Operating Leases | December 31, 2023 2022 Operating lease ROU assets $ 842 $ 987 Operating lease liabilities, current $ 297 $ 248 Operating lease liabilities, long-term $ 580 $ 757 Weighted average remaining lease term (in years) 2.61 3.32 Weighted average discount rate 3.12 % 3.46 % |
Schedule of Maturities of Operating Lease Liabilities | December 31, 2024 $ 316 2025 276 2026 184 2027 138 2028 and thereafter 11 Total future lease payments 925 Less - imputed interest (48 ) Total lease liability balance $ 877 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | December 31, 2023 2022 Cost: Land and buildings $ 2,683 $ 2,767 Machinery and equipment 3,017 2,636 Motor vehicles 151 289 Promotional displays 270 257 Office furniture and equipment 2,321 2,289 8,442 8,238 Accumulated depreciation: Buildings 1,829 1,846 Machinery and equipment 2,568 2,322 Motor vehicles 93 179 Promotional displays 245 219 Office furniture and equipment 2,118 2,021 6,853 6,587 Property and equipment, net $ 1,589 $ 1,651 |
INTANGIBLE ASSETS, NET (Tables)
INTANGIBLE ASSETS, NET (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Schedule of Intangible Assets | a. Composition: December 31, 2023 2022 Cost: Know-how and patents $ 3,291 $ 3,230 Technology 6,673 6,337 Customer relationships 1,063 1,046 11,027 10,613 Accumulated amortization: Know-how and patents 3,276 3,211 Technology 5,859 5,307 Customer relationships 1,011 953 10,146 9,471 Intangible assets, net $ 881 $ 1,142 |
Schedule of Amortization of Intangible Assets | c. Estimated amortization of intangible assets for the years ended: December 31, 2024 $ 362 2025 354 2026 160 2027 5 $ 881 |
GOODWILL (Tables)
GOODWILL (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
GOODWILL [Abstract] | |
Schedule of Goodwill | Total As of January 1, 2022 $ 11,449 Foreign currency translation adjustments (583 ) As of December 31, 2022 10,866 Foreign currency translation adjustments 224 As of December 31, 2023 $ 11,090 |
OTHER ACCOUNTS PAYABLE AND AC_2
OTHER ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Payables and Accruals [Abstract] | |
Schedule of Other Accounts Payable and Accrued Expenses | December 31, 2023 2022 Employees and payroll accruals $ 1,381 $ 1,696 Accrued expenses 1,747 1,493 Government authorities 697 529 Uncertain tax positions 1,113 1,053 Others 114 106 $ 5,052 $ 4,877 |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Changes in Stock Option Activity | Number of options Weighted-average exercise price Weighted- average remaining contractual life (in months) Aggregate intrinsic value (in thousands) Outstanding at January 1, 2023 552,332 2.826 26.38 - Forfeited (414,666 ) 2.725 Outstanding as of December 31, 2023 137,666 3.130 33.07 - Exercisable as of December 31, 2023 67,667 2.995 26.50 - |
Schedule of Stock Options Outstanding | Number of options outstanding as of December 31, 2023 Exercise price Weighted average remaining contractual life Number of options exercisable as of December 31, 2023 (In months) 16,666 2.36 17.90 16,666 16,000 3.07 7.20 16,000 35,000 3.23 42.16 11,667 70,000 3.28 38.05 23,334 137,666 33.07 67,667 |
BASIC AND DILUTED NET EARNING_2
BASIC AND DILUTED NET EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Net Earnings Per Share | Year ended December 31, 2023 2022 2021 Numerator - continuing operations: Income (loss) from continuing operations attributable to Senstar shareholders $ (1,289 ) $ 4,029 $ (2,191 ) Numerator - discontinued operations: Net income (loss) from discontinued operations, less income (loss) attributed to redeemable non-controlling interests and non-controlling interests, including accretion of redeemable non-controlling interests to redemption value $ - $ (198 ) $ 8,607 Denominator: Denominator for basic net earnings per share weighted-average number of shares outstanding 23,309,987 23,308,001 23,208,589 Effect of diluting securities: Employee stock options - 1,975 - Denominator for diluted net earnings per share - adjusted weighted average shares and assumed exercises 23,309,987 23,309,976 23,208,589 |
TAXES ON INCOME (Tables)
TAXES ON INCOME (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Reconciliation of Income Tax Rate | Year ended December 31, 2023 2022 2021 Income (loss) before taxes as reported in the statements of operations $ (1,329 ) $ 1,625 $ 70 Tax rate 23 % 23 % 23 % Theoretical tax $ (306 ) $ 374 $ 16 Increase (decrease) in taxes: Non-deductible items 202 177 77 Losses and other items for which a valuation allowance was provided 286 230 599 Repatriation of undistributed earnings (260 ) - 516 Realization of carryforward tax losses for which valuation allowance was provided - (175 ) - Changes in valuation allowance - (1,362 ) (113 ) Tax rate differences in subsidiaries and benefit from reduced tax rates (7 ) 110 43 Provision for uncertain tax positions 140 (993 ) 126 Taxes in respect of prior years (80 ) (562 ) 1 Investment tax credit (68 ) (204 ) (141 ) Other 53 1 1,137 Taxes on income (tax benefit) in the statements of operations $ (40 ) $ (2,404 ) $ 2,261 |
Schedule of Income Taxes | Year ended December 31, 2023 2022 2021 Current $ (239 ) $ (899 ) $ 1,846 Deferred 199 (1,505 ) 415 $ (40 ) $ (2,404 ) $ 2,261 Domestic $ (28 ) $ (1,583 ) $ 1,707 Foreign (12 ) (821 ) 554 $ (40 ) $ (2,404 ) $ 2,261 |
Schedule of Deferred Tax Assets and Liabilities | December 31, 2023 2022 Deferred tax assets: Operating losses carry forwards $ 2,288 $ 3,548 Reserves, tax allowances, capital losses carry forwards, operating lease and others 4,840 4,029 Total deferred taxes before valuation allowance 7,128 7,577 Valuation allowance (5,184 ) (5,045 ) Deferred tax assets, net: 1,944 2,532 Deferred tax liabilities: Property and equipment, intangible assets, operating lease and others (595 ) (721 ) Undistributed earnings of subsidiaries (430 ) (695 ) Deferred tax liabilities: (1,025 ) (1,416 ) Net deferred tax assets (liability) $ 919 $ 1,116 Domestic $ (430 ) $ (695 ) Foreign $ 1,349 $ 1,811 |
Schedule of Domestic and Foreign Components of Income (Loss) Before Income Taxes | Year ended December 31, 2023 2022 2021 Domestic $ (992 ) $ (2,182 ) $ (2,608 ) Foreign (337 ) 3,807 2,678 $ (1,329 ) $ 1,625 $ 70 |
Schedule of Reconciliation of Unrecognized Tax Benefits | December 31, 2023 2022 Balance at the beginning of the year $ 1,053 $ 2,003 Additions based on tax positions taken related to the current year 148 94 Reduction related to expirations of statute of limitations or settlements of tax matters (92 ) (1,087 ) Foreign currency translation adjustments 4 43 Balance at the end of the year $ 1,113 $ 1,053 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Revenues and Long-Lived Assets With in Geographic Areas | 1. Revenues: Year ended December 31, 2023 2022 2021 North America $ 14,835 $ 16,042 $ 15,902 Europe 11,393 10,396 8,913 APAC 3,863 6,571 8,387 South and Latin America 2,197 1,334 1,296 Israel 302 1,195 317 Others 202 20 101 $ 32,792 $ 35,558 $ 34,916 2. Long-lived assets: December 31, 2023 2022 Israel $ 65 $ 170 Europe 1,382 1,268 USA 1,791 1,764 Canada 11,164 11,375 Others - 69 $ 14,402 $ 14,646 |
SELECTED STATEMENTS OF INCOME_2
SELECTED STATEMENTS OF INCOME DATA (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Other Income and Expenses [Abstract] | |
Schedule of Selected Statements of Income Data | Year ended December 31, 2023 2022 2021 Financial expenses: Interest on short-term and long-term bank credit and bank charges and others $ (157 ) $ (273 ) $ (52 ) Foreign exchange loss, net (58 ) - (985 ) (215 ) (273 ) (1,037 ) Financial income: Interest on short-term and long-term bank deposits 151 48 26 Foreign exchange income, net - 366 - 151 414 26 Financial income (expenses), net $ (64 ) $ 141 $ (1,011 ) |
GENERAL (Narrative) (Details)
GENERAL (Narrative) (Details) $ in Millions | Feb. 07, 2021 USD ($) |
Business Acquisition [Line Items] | |
Cash consideration for division purchase | $ 35 |
GENERAL (Schedule of gain assoc
GENERAL (Schedule of gain associated with sale, presented in the results of discontinued operations) (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Realized foreign currency translation adjustments | $ 14,888 |
Discontinued Operations [Member] | Integrated Solutions Division Member | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Gross purchase price | 35,000 |
Provision | (4,049) |
Net assets sold | (14,621) |
Realized foreign currency translation adjustments | $ (1,442) |
GENERAL (Schedule of carrying v
GENERAL (Schedule of carrying value of the net assets sold) (Details) - USD ($) $ in Thousands | 1 Months Ended | |
Jun. 30, 2021 | Dec. 31, 2022 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Total net assets sold | $ 14,621 | |
Discontinued Operations [Member] | Integrated Solutions Division Member | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Cash and cash equivalents | 2,008 | |
Restricted cash and deposits | 371 | |
Trade receivables and Unbilled accounts receivable | 11,323 | |
Other accounts receivable and prepaid expenses | 3,140 | |
Inventories | 7,120 | |
Deferred tax assets | 2,083 | |
Operating lease right-of-use assets, net of operating lease liabilities | $ 46 | |
Other long-term assets | 42 | |
Property and equipment, net | 3,926 | |
Goodwill and intangible assets, net | 302 | |
Trade payables | (4,156) | |
Customer advances | (3,420) | |
Other accounts payable and accrued expenses and deferred revenues | (8,123) | |
Severance pay, net | $ (41) |
GENERAL (Schedule of results of
GENERAL (Schedule of results of the discontinued operations) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Operating expenses: | |||
Net income (loss) from discontinued operation | $ 0 | $ (198) | $ 8,607 |
Discontinued Operations [Member] | Integrated Solutions Division Member | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Revenues | 0 | 0 | 17,177 |
Cost of revenues | 0 | 0 | 14,906 |
Gross profit | 0 | 0 | 2,271 |
Operating expenses: | |||
Research and development, net | 0 | 0 | 828 |
Selling and marketing | 0 | 0 | 2,223 |
General and administrative | 0 | 0 | 3,814 |
Total operating expenses | 0 | 0 | 6,865 |
Operating loss | 0 | 0 | (4,594) |
Financial expenses, net | 0 | 0 | (76) |
Loss before income taxes | 0 | 0 | (4,670) |
Taxes on income | 0 | 1,611 | |
Loss after income taxes | 0 | 0 | (6,281) |
Capital gain (loss) from discontinued operation | 0 | (198) | 14,888 |
Net income (loss) from discontinued operation | $ 0 | $ (198) | $ 8,607 |
GENERAL (Schedule of cash flows
GENERAL (Schedule of cash flows for discontinued operations) (Details) - Discontinued Operations [Member] - Integrated Solutions Division Member - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |
Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Net cash provided by (used in) discontinued operating activities | $ 22 | $ (4,180) | $ 1,392 |
Net cash provided by (used in) discontinued investing activities | $ 0 | $ 0 | $ 32,447 |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2018 | |
Business Acquisition [Line Items] | ||||
Write-off of inventory | $ 321 | $ 47 | $ 95 | |
Number of shares excluded from calculation of diluted earnings (loss) per share | 363,499 | 554,916 | 610,083 | |
Stock-based compensation | $ 18 | $ 93 | $ 155 | |
Tax expenses related to uncertainties in income taxes | 993 | 140 | 126 | |
Accrued severance pay for former Chairman of Board | 296 | |||
Advertising expense | 161 | 152 | 107 | |
Remaining performance obligations | $ 3,500 | |||
Expected recognition in the upcoming year | 47% | |||
Increase decrease in unbilled accounts receivables | $ 200 | 100 | ||
Unbilled accounts receivable | 240 | 350 | ||
Increase decrease in customer advances and deferred revenues | 100 | |||
Customer Advances And Deferred Revenues | 4,500 | 4,600 | ||
Increase decrease in unearned amounts | 3,800 | |||
Amount of recognized revenues from customer advances and deferred revenues | 4,000 | |||
Research and development costs capitalized | $ 13 | |||
Value of Industrial Research Assistance Program | $ 266 | $ 89 | ||
Percentage of revenue from services and maintenance | 16.20% | 17.70% | 17.90% | |
Kenyan Company [Member] | ||||
Business Acquisition [Line Items] | ||||
Ownership percentage | 51% | |||
Major Israeli And U.S. Banks [Member] | ||||
Business Acquisition [Line Items] | ||||
Cash and cash equivalents, short-term and restricted deposits | $ 7,203 | |||
Other Banks [Member] | ||||
Business Acquisition [Line Items] | ||||
Cash and cash equivalents, short-term and restricted deposits | $ 7,725 | |||
Local partner [Member] | Kenyan Company [Member] | ||||
Business Acquisition [Line Items] | ||||
Ownership percentage | 49% |
SIGNIFICANT ACCOUNTING POLICI_5
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Annual Depreciation Rates) (Details) | Dec. 31, 2023 |
Buildings [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual depreciation rate, minimum | 3% |
Annual depreciation rate, maximum | 4% |
Machinery and Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual depreciation rate, minimum | 10% |
Annual depreciation rate, maximum | 33% |
Annual depreciation rate, mainly | 10% |
Motor Vehicles [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual depreciation rate, minimum | 15% |
Annual depreciation rate, maximum | 20% |
Promotional displays [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual depreciation rate, minimum | 10% |
Annual depreciation rate, maximum | 25% |
Office furniture and equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual depreciation rate, minimum | 20% |
Annual depreciation rate, maximum | 33% |
SIGNIFICANT ACCOUNTING POLICI_6
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Intangible Assets Amortization Rates) (Details) | Dec. 31, 2023 |
Patents [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Annual amortization rate | 10% |
Technology [Member] | Minimum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Annual amortization rate | 12.50% |
Technology [Member] | Maximum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Annual amortization rate | 26.70% |
Customer Relationships [Member] | Minimum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Annual amortization rate | 10.30% |
Customer Relationships [Member] | Maximum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Annual amortization rate | 36.40% |
SIGNIFICANT ACCOUNTING POLICI_7
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Fair Value Assumptions for Stock Options) (Details) - Employee Stock Option [Member] | 12 Months Ended |
Dec. 31, 2022 Multiple | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Dividend yield | 0% |
Forfeiture rate | 13% |
Suboptimal exercise multiple | 1.29 |
Minimum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected volatility | 38.96% |
Risk-free interest | 0.67% |
Contractual term | 5 years |
Maximum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected volatility | 42.17% |
Risk-free interest | 1.19% |
Contractual term | 7 years |
SIGNIFICANT ACCOUNTING POLICI_8
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Product Warranty Accrual) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Accounting Policies [Abstract] | ||
Warranty provision, beginning of year | $ 226 | $ 157 |
Charged to costs and expenses relating to new sales | 149 | 235 |
Utilization or expiration of warranty | (225) | (155) |
Foreign currency translation adjustments | 0 | 11 |
Warranty provision, end of year | $ 150 | $ 226 |
SIGNIFICANT ACCOUNTING POLICI_9
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Changes in Allowance for Credit Losses Related to Accounts) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Accounting Policies [Abstract] | ||
Balance at the beginning of the year | $ 103 | $ 125 |
Credit losses expenses during the year | 18 | 30 |
Customer write-offs or collections during the year | (64) | (46) |
Exchange rate | (1) | (6) |
Balance at the end of the year | $ 58 | $ 103 |
SIGNIFICANT ACCOUNTING POLIC_10
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Accounting Policies [Abstract] | |||
Balance at the beginning of the year | $ (758) | $ 1,222 | $ 34 |
Foreign currency translation adjustments | 782 | (1,980) | (254) |
Realized foreign currency translation adjustments | 0 | 0 | 1,442 |
Total accumulated other comprehensive income (loss) | $ 24 | $ (758) | $ 1,222 |
OTHER ACCOUNTS RECEIVABLE AND_3
OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid expenses | $ 681 | $ 696 |
Government authorities | 1,512 | 570 |
Others | 255 | 175 |
Total other accounts receivable and prepaid expenses | $ 2,448 | $ 1,441 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 1,915 | $ 2,105 |
Work in progress | 457 | 911 |
Finished products | 4,806 | 5,427 |
Total inventory | $ 7,178 | $ 8,443 |
LEASES (Narrative) (Details)
LEASES (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Lessee, Lease, Description [Line Items] | |||
Operating lease expenses | $ 339 | $ 360 | $ 421 |
Offices and Cars [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease term | 4 years 4 months 24 days |
LEASES (Schedule of Supplementa
LEASES (Schedule of Supplemental Balance Sheet Information Related Operating Leases) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
Operating lease ROU assets | $ 842 | $ 987 |
Operating lease liabilities, current | 297 | 248 |
Operating lease liabilities, long-term | $ 580 | $ 757 |
Weighted average remaining lease term (in years) | 2 years 7 months 9 days | 3 years 3 months 25 days |
Weighted average discount rate | 3.12% | 3.46% |
LEASES (Schedule of Maturities
LEASES (Schedule of Maturities of Operating Lease Liabilities) (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Accounting Policies [Abstract] | |
2024 | $ 316 |
2025 | 276 |
2026 | 184 |
2027 | 138 |
2028 and thereafter | 11 |
Total future lease payments | 925 |
Less - imputed interest | (48) |
Total lease liability balance | $ 877 |
PROPERTY AND EQUIPMENT, NET (Na
PROPERTY AND EQUIPMENT, NET (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation | $ 420 | $ 482 | $ 519 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 8,442 | $ 8,238 |
Property and equipment, accumulated depreciation | 6,853 | 6,587 |
Property and equipment, net | 1,589 | 1,651 |
Land and Buildings [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 2,683 | 2,767 |
Property and equipment, accumulated depreciation | 1,829 | 1,846 |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 3,017 | 2,636 |
Property and equipment, accumulated depreciation | 2,568 | 2,322 |
Motor Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 151 | 289 |
Property and equipment, accumulated depreciation | 93 | 179 |
Promotional Displays [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 270 | 257 |
Property and equipment, accumulated depreciation | 245 | 219 |
Office Furniture and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 2,321 | 2,289 |
Property and equipment, accumulated depreciation | $ 2,118 | $ 2,021 |
INTANGIBLE ASSETS, NET (Narrati
INTANGIBLE ASSETS, NET (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||
Amortization of Intangible Assets | $ 497 | $ 948 | $ 973 |
INTANGIBLE ASSETS, NET (Schedul
INTANGIBLE ASSETS, NET (Schedule of Intangible Assets) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 11,027 | $ 10,613 |
Accumulated amortization | 10,146 | 9,471 |
Intangible assets, net | 881 | 1,142 |
Know-how and patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 3,291 | 3,230 |
Accumulated amortization | 3,276 | 3,211 |
Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 6,673 | 6,337 |
Accumulated amortization | 5,859 | 5,307 |
Customer Relationships Member | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 1,063 | 1,046 |
Accumulated amortization | $ 1,011 | $ 953 |
INTANGIBLE ASSETS, NET (Sched_2
INTANGIBLE ASSETS, NET (Schedule of Amortization of Intangible Assets) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
2024 | $ 362 | |
2025 | 354 | |
2026 | 160 | |
2027 | 5 | |
Intangible assets, net | $ 881 | $ 1,142 |
GOODWILL (Schedule of Goodwill)
GOODWILL (Schedule of Goodwill) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Goodwill [Line Items] | ||
Goodwill, beginning balance | $ 10,866 | $ 11,449 |
Foreign currency translation adjustments | 224 | (583) |
Goodwill, ending balance | $ 11,090 | $ 10,866 |
OTHER ACCOUNTS PAYABLE AND AC_3
OTHER ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Payables and Accruals [Abstract] | ||
Employees and payroll accruals | $ 1,381 | $ 1,696 |
Accrued expenses | 1,747 | 1,493 |
Government authorities | 697 | 529 |
Uncertain tax positions | 1,113 | 1,053 |
Others | 114 | 106 |
Other accounts payable and accrued expenses | $ 5,052 | $ 4,877 |
COMMITMENTS AND CONTINGENT LI_2
COMMITMENTS AND CONTINGENT LIABILITIES (Narrative) (Details) $ in Thousands, $ in Thousands | 1 Months Ended | |||
Jul. 19, 2022 MXN ($) | Jul. 19, 2022 USD ($) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | |
Royalty rate | 3.50% | |||
Royalties, maximum percentage of grants received | 100% | |||
Remaining contingent obligations | $ 600 | |||
Line of Credit | 2,025 | $ 2,117 | ||
Credit lines - Used | $ 1,636 | $ 1,595 | ||
Buyer [Member] | ||||
Repayment amount for adjustment to purchase price | $ 86,855 | $ 4,250 |
SHAREHOLDERS' EQUITY (Narrative
SHAREHOLDERS' EQUITY (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||||
Sep. 22, 2021 | Aug. 16, 2021 | Aug. 31, 2020 | Jun. 30, 2013 | May 31, 2008 | Dec. 31, 2023 | Dec. 31, 2021 | Dec. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Ordinary shares, shares issued | 23,309,987 | 23,309,987 | ||||||
Ordinary shares, shares outstanding | 23,309,987 | 23,309,987 | ||||||
Weighted-average grant date fair value | $ 1.56 | |||||||
Total intrinsic value of options exercised | $ 232 | |||||||
Non-vested share-based compensation arrangements, unrecognized compensation costs | $ 24 | |||||||
Unrecognized compensation cost, weighted-average recognition period | 1 year 9 months | |||||||
Cash distribtion per share | $ 1.725 | |||||||
Cash distribution aggregate amount | $ 40,100 | |||||||
2010 Plan [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Total pool authorized | 500,000 | |||||||
Number of shares available for grant | 906,332 | |||||||
2010 Plan [Member] | Extended Term [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Plan term | 5 years | |||||||
Total pool authorized | 1,200,000 | |||||||
2003 Plan [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Total pool authorized | 1,000,000 |
SHAREHOLDERS' EQUITY (Summary o
SHAREHOLDERS' EQUITY (Summary of Changes in Stock Option Activity) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Number of options | ||
Outstanding at January 1, 2023 | 552,332 | |
Forfeited | (414,666) | |
Outstanding at December 31, 2023 | 137,666 | 552,332 |
Exercisable at December 31, 2023 | 67,667 | |
Weighted-average exercise price | ||
Outstanding at January 1, 2023 | $ 2.826 | |
Forfeited | 2.725 | |
Outstanding at December 31, 2023 | 3.13 | $ 2.826 |
Exercisable at December 31, 2023 | $ 2.995 | |
Weighted-average remaining contractual life (in months) | ||
Outstanding | 33 months 2 days | 26 months 11 days |
Exercisable at December 31, 2023 | 26 months 15 days | |
Aggregate intrinsic value (in thousands) | ||
Outstanding at January 1, 2023 | $ 0 | |
Outstanding at December 31, 2023 | 0 | $ 0 |
Exercisable at December 31, 2023 | $ 0 |
SHAREHOLDERS' EQUITY (Schedule
SHAREHOLDERS' EQUITY (Schedule of Stock Options Outstanding) (Details) | 12 Months Ended |
Dec. 31, 2023 $ / shares shares | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Number of options outstanding as of December 31, 2021 | 137,666 |
Weighted average remaining contractual life | 33 months 2 days |
Number of options exercisable as of December 31, 2021 | 67,667 |
$2.36 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Number of options outstanding as of December 31, 2021 | 16,666 |
Exercise price | $ / shares | $ 2.36 |
Weighted average remaining contractual life | 17 months 27 days |
Number of options exercisable as of December 31, 2021 | 16,666 |
$3.07 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Number of options outstanding as of December 31, 2021 | 16,000 |
Exercise price | $ / shares | $ 3.07 |
Weighted average remaining contractual life | 7 months 6 days |
Number of options exercisable as of December 31, 2021 | 16,000 |
$3.23 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Number of options outstanding as of December 31, 2021 | 35,000 |
Exercise price | $ / shares | $ 3.23 |
Weighted average remaining contractual life | 42 months 4 days |
Number of options exercisable as of December 31, 2021 | 11,667 |
$3.28 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Number of options outstanding as of December 31, 2021 | 70,000 |
Exercise price | $ / shares | $ 3.28 |
Weighted average remaining contractual life | 38 months 1 day |
Number of options exercisable as of December 31, 2021 | 23,334 |
BASIC AND DILUTED NET EARNING_3
BASIC AND DILUTED NET EARNINGS PER SHARE (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Numerator: | |||
Income (loss) from continuing operations attributable to Senstar shareholders | $ (1,289) | $ 4,029 | $ (2,191) |
Net income (loss) from discontinued operations, less income (loss) attributed to redeemable non-controlling interests and non-controlling interests, including accretion of redeemable non-controlling interests to redemption value | $ 0 | $ (198) | $ 8,607 |
Denominator: | |||
Denominator for basic net earnings per share weighted-average number of shares outstanding | 23,309,987 | 23,308,001 | 23,208,589 |
Effect of diluting securities - Employee stock options | 0 | 1,975 | 0 |
Denominator for diluted net earnings per share - adjusted weighted average shares and assumed exercises | 23,309,987 | 23,309,976 | 23,208,589 |
TAXES ON INCOME (Narrative) (De
TAXES ON INCOME (Narrative) (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Jun. 30, 2021 | Dec. 22, 2017 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Carry forward tax losses estimated by subsidiaries | $ 1,304 | ||||
Tax rate | 23% | 23% | 23% | ||
Unrecognized tax benefits | $ 1,113 | $ 1,053 | $ 2,003 | ||
Potential withholding and distribution taxes | $ 400 | ||||
Minimum [Member] | |||||
Carry forward tax losses for subsidiaries, term | 1 year | ||||
Tax rate | 21% | ||||
Maximum [Member] | |||||
Carry forward tax losses for subsidiaries, term | 14 years | ||||
Tax rate | 35% | ||||
Preferred enterprise in 2014 and thereafter [Member] | |||||
Tax rate | 16% | ||||
Preferred enterprise [Member] | |||||
Tax rate | 20% | ||||
Preferred Enterprise One [Member] | |||||
Tax rate | 23% | ||||
Non-Israeli subsidiaries [Member] | Minimum [Member] | |||||
Tax rate | 19% | ||||
Non-Israeli subsidiaries [Member] | Maximum [Member] | |||||
Tax rate | 30% | ||||
Subsidiary of Common Parent [Member] | |||||
Carry forward operating tax losses | $ 4,555 | ||||
Parent Company [Member] | |||||
Carry forward operating tax losses | $ 4,757 |
TAXES ON INCOME (Schedule of Re
TAXES ON INCOME (Schedule of Reconciliation of Income Tax Rate) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Income (loss) before taxes as reported in the statements of operations | $ (1,329) | $ 1,625 | $ 70 |
Tax rate | 23% | 23% | 23% |
Theoretical tax | $ (306) | $ 374 | $ 16 |
Increase (decrease) in taxes: | |||
Non-deductible items | 202 | 177 | 77 |
Losses and other items for which a valuation allowance was provided | 286 | 230 | 599 |
Repatriation of undistributed earnings | (260) | 0 | 516 |
Realization of carryforward tax losses for which valuation allowance was provided | 0 | (175) | 0 |
Changes in valuation allowance | 0 | (1,362) | (113) |
Tax rate differences in subsidiaries and benefit from reduced tax rates | (7) | 110 | 43 |
Provision for uncertain tax positions | 140 | (993) | 126 |
Taxes in respect of prior years | (80) | (562) | 1 |
Investment tax credit | (68) | (204) | (141) |
Other | 53 | 1 | 1,137 |
Taxes on income (tax benefit) in the statements of operations | $ (40) | $ (2,404) | $ 2,261 |
TAXES ON INCOME (Schedule of In
TAXES ON INCOME (Schedule of Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Taxes on income (tax benefit): | |||
Current | $ (239) | $ (899) | $ 1,846 |
Deferred | (199) | (1,505) | 415 |
Taxes on income (tax benefit) | (40) | (2,404) | 2,261 |
Taxes on income (tax benefit): | |||
Domestic | (28) | (1,583) | 1,707 |
Foreign | (12) | (821) | 554 |
Taxes on income (tax benefit) | $ (40) | $ (2,404) | $ 2,261 |
TAXES ON INCOME (Schedule of De
TAXES ON INCOME (Schedule of Deferred Tax Assets and Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred tax assets: | ||
Operating losses carry forwards | $ 2,288 | $ 3,548 |
Reserves, tax allowances, capital losses carry forwards, operating lease and others | 4,840 | 4,029 |
Total deferred taxes before valuation allowance | 7,128 | 7,577 |
Valuation allowance | (5,184) | (5,045) |
Deferred tax assets, net: | 1,944 | 2,532 |
Deferred tax liabilities: | ||
Property and equipment, intangible assets, operating lease and others | (595) | (721) |
Undistributed earnings of subsidiaries | (430) | (695) |
Deferred tax liabilities | (1,025) | (1,416) |
Net deferred tax assets (liability) | 919 | 1,116 |
Domestic [Member] | ||
Deferred tax liabilities: | ||
Deferred tax assets, Domestic | (430) | (695) |
Foreign Tax Authority [Member] | ||
Deferred tax liabilities: | ||
Deferred tax assets, Foreign | $ 1,349 | $ 1,811 |
TAXES ON INCOME (Schedule of Do
TAXES ON INCOME (Schedule of Domestic and Foreign Components of Income (Loss) Before Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ (992) | $ (2,182) | $ (2,608) |
Foreign | (337) | 3,807 | 2,678 |
Income (loss) before income taxes | $ (1,329) | $ 1,625 | $ 70 |
TAXES ON INCOME (Schedule of _2
TAXES ON INCOME (Schedule of Reconciliation of Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
Balance at the beginning of the year | $ 1,053 | $ 2,003 |
Additions based on tax positions taken related to the current year | 148 | 94 |
Reduction related to expirations of statute of limitations or settlements of tax matters | (92) | (1,087) |
Foreign currency translation adjustments | 4 | 43 |
Balance at the end of the year | $ 1,113 | $ 1,053 |
BALANCES AND TRANSACTIONS WIT_2
BALANCES AND TRANSACTIONS WITH RELATED PARTIES (Narrative) (Details) - Board of Directors Chairman [Member] $ in Thousands | 12 Months Ended |
Dec. 31, 2023 USD ($) | |
Related Party Transaction [Line Items] | |
Minimum profit for bonus payment | $ 5,000 |
Monthly Payment [Member] | |
Related Party Transaction [Line Items] | |
Compensation | 4 |
Cash Bonus [Member] | |
Related Party Transaction [Line Items] | |
Compensation | $ 30 |
SEGMENT INFORMATION (Schedule o
SEGMENT INFORMATION (Schedule of Revenues and Long-Lived Assets Within Geographic Areas) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Revenues | $ 32,792 | $ 35,558 | $ 34,916 |
Long-lived assets | 14,402 | 14,646 | |
North America [Member] | |||
Revenues | 14,835 | 16,042 | 15,902 |
Europe [Member] | |||
Revenues | 11,393 | 10,396 | 8,913 |
Long-lived assets | 1,382 | 1,268 | |
APAC [Member] | |||
Revenues | 3,863 | 6,571 | 8,387 |
South And Latin America [Member] | |||
Revenues | 2,197 | 1,334 | 1,296 |
Israel [Member] | |||
Revenues | 302 | 1,195 | 317 |
Long-lived assets | 65 | 170 | |
Others [Member] | |||
Revenues | 202 | 20 | $ 101 |
Long-lived assets | 0 | 69 | |
USA [Member] | |||
Long-lived assets | 1,791 | 1,764 | |
Canada [Member] | |||
Long-lived assets | $ 11,164 | $ 11,375 |
SELECTED STATEMENTS OF INCOME_3
SELECTED STATEMENTS OF INCOME DATA (Schedule of Selected Statements of Income Data) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Financial expenses: | |||
Interest on short-term and long-term bank credit and bank charges and others | $ (157) | $ (273) | $ (52) |
Foreign exchange loss, net | (58) | 0 | (985) |
Total financial expenses | (215) | (273) | (1,037) |
Financial income: | |||
Interest on short-term and long-term bank deposits | 151 | 48 | 26 |
Foreign exchange income, net | 0 | 366 | 0 |
Total financial income | 151 | 414 | 26 |
Financial income (expenses), net | $ (64) | $ 141 | $ (1,011) |