Exhibit 99.1
ELSCINT LTD. REPORTS FOURTH QUARTER 2003 RESULTS
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Tel Aviv, Israel - April 5, 2004 - Elscint Ltd. (NYSE: ELT), a
subsidiary of Elbit Medical Imaging Ltd. (NASDAQ: EMITF), today announced its
results for the fourth quarter and year ended December 31, 2003.
Fourth Quarter Results
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Consolidated revenues for the fourth quarter of 2003 were NIS 77.3 million
($17.7 million) compared with NIS 55.1 million reported in the corresponding
quarter last year.
Revenues include NIS 3.8 million ($0.9 million) from the lease of the
Bernard Shaw Hotel to a third party for a period of twenty-five years and NIS
10.3 million ($2.4 million) from the operations of a commercial and
entertainment center in Herzlia, Israel, which was opened on a partial basis, in
June, 2003.
Revenues from operating and managing hotels increased to NIS 63.2 million
($14.4 million) compared to NIS 55.1 million in the corresponding quarter last
year. This growth is attributable mainly to increases in the revenue of hotels
in the UK and to devaluation of the NIS against the Euro and the British Pound
during the fourth quarter of 2003. These increases were offset, in part, by a
decrease in revenue from the transition of the Bernard Shaw Hotel from hotel
operation to lease of the property in early 2003.
Gross profit for the fourth quarter of 2003 was NIS 21.6 million ($4.9
million) compared with NIS 17.8 million in the corresponding quarter of 2002.
This increase is attributable to the improvement in the results of the hotel
segment.
Operating loss for the fourth quarter of 2003 was NIS 6.3 million ($1.4
million) compared to NIS 6.1 million in the corresponding quarter of 2002. The
increase in operating loss is mainly due to an increase in selling and marketing
expenses attributable to operations of the commercial and entertainment center,
which were offset by the aforementioned increases in gross profit in the hotel
segment and a decrease in hotel depreciation, amortization and operational
expenses (mainly due to the lease of the Bernard Shaw Hotel).
Loss from continuing operations for the fourth quarter of 2003 was NIS 27.0
million ($6.2 million), or NIS 1.62 ($0.37) basic loss per share, compared with
NIS 35.7 million, or NIS 2.14 basic loss per share, for the corresponding
quarter last year.
The decrease in the loss from continuing operations results primarily from
a decrease in finance expenses net, to NIS 3.8 million ($0.9 million), compared
with NIS 9.2 million for the corresponding quarter of last year. The decrease in
finance expenses net is attributable mainly to exchange rate and inflation
fluctuations.
Net Income from discontinuing operations for the fourth quarter of 2003 was
NIS 5.6 million ($1.3 million), or NIS 0.33 ($0.08) basic earnings per share,
compared to NIS 51.5 million or NIS 3.09 basic earnings per share, for the
corresponding quarter last year. The decrease in net income from
1
discontinued operations is attributable mainly to the results of the
subassemblies segment activities and to the gain derived from the sale of this
segment, which were reported in the fourth quarter of 2002.
Loss for the fourth quarter of 2003 was NIS 21.5 million ($4.9 million), or
NIS 1.29 ($0.29) basic loss per share, compared with net income of NIS 15.8
million, or NIS 0.94 basic earnings per share, for the corresponding quarter
last year.
Year -End Results
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Consolidated revenues for the year ended December 31, 2003, were NIS 222.8
million ($50.9 million) compared with NIS 208.2 million reported last year.
Revenues include NIS 13.5 million ($3.1 million) from the lease of the
Bernard Shaw Hotel to a third party for a period of twenty-five years and NIS
20.1 million ($4.6 million) from the operations of the commercial and
entertainment center in Herzlia, Israel, which was opened on a partial basis, in
June, 2003.
Revenues from operating and managing hotels decreased to NIS 189.2 million
($43.2 million) compared to NIS 206.7 million reported last year. This decrease
is attributable mainly to the transition of the Bernard Shaw Hotel from hotel
operation to lease of the property in early 2003, and to the closing of the
Bucuresti Hotel in Romania for renovation at the end of 2002. This decrease was
offset, in part, by increases in the revenue of the hotels in the UK.
Gross profit for the year ended December 31, 2003 was NIS 69.0 million
($15.8 million) compared with NIS 73.6 million reported last year. This decrease
is attributable mainly to the operating and managing hotel segment, which was
offset by the increase in gross profit derived from the lease of the Bernard
Shaw Hotel.
Operating loss for the year ended December 31, 2003, was NIS 24.0 million
($5.5 million) compared with NIS 21.3 million reported last year. The increase
in operating loss is mainly due to the aforementioned decrease in gross profit
and to an increase in selling and marketing expenses attributable to the
operation of the commercial and entertainment center. This was offset, in part,
by a decrease in hotel depreciation, amortization and operational expenses
(mainly due to the lease of the Bernard Shaw Hotel).
Loss from continuing operations for the year ended December 31, 2003, was
NIS 79.3 million ($18.1 million), or NIS 4.75 ($1.08) basic loss per share,
compared with NIS 26.7 million, or NIS 1.60 basic loss per share, reported last
year.
The increase in loss from continuing operations results primarily from an
increase in finance expenses net, to NIS 41.3 million ($9.4 million) for the
year ended December 31, 2003, from finance income net, of NIS 12.8 million
reported last year. This increase in finance expenses net is attributable mainly
to exchange rate and inflation fluctuations. In addition the Company's share in
losses of an affiliated company for the year ended December 31, 2003 was NIS 7.0
million ($1.6 million) as compared to NIS 2.8 million reported last year. This
increase is attributable to the inclusion of the losses of a development stage
affiliated company for the entire year 2003 while in 2002 the Company's share in
the losses of this affiliated company was applicable to fourth quarter.
Net income from discontinuing operations for the year ended December 31,
2003, was NIS 13.0 million ($3.0 million), or NIS 0.78 ($0.18) basic earnings
per share, compared with NIS 89.0 million or NIS 5.33 basic earnings per share,
reported last year. This decrease is attributable mainly to the results of
2
the subassemblies segment activities and to the gain derived from the sale of
this segment, which were reported in the year ended December 31, 2002.
Loss for the year ended December 31, 2003 was NIS 66.4 million ($15.2
million), or NIS 3.97 ($0.90) basic loss per share, compared with net income of
NIS 62.3 million, or NIS 3.73 basic earnings per share, reported last year.
Elscint Limited has interests in hotels in Western Europe, in hotel development
projects principally in Western and Central Europe and in the commercial and
entertainment center at Herzlia Marina in Israel.
This release contains certain forward-looking statements which involve known and
unknown risks, uncertainties or other factors not under the Company's control
which may cause actual results, performance or achievements of the Company to be
materially different from the results, performance or other expectations implied
by these forward-looking statements. These factors include, but are not limited
to, those detailed in the Company's periodic filings with the Securities and
Exchange Commission.
For Further Information:
Company Contact Investor Contact
Marc Lavine Rachel Levine
Elscint, Ltd. The Anne McBride Company
+972-3-608-6011 +212-983-1702 x.207
Mlavine@elscint.net rlevine@annemcbride.com
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Financial Tables Follow
3
ELSCINT LIMITED AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS (1)
ADJUSTED TO THE NIS OF DECEMBER 2003
Convenience
translation
December 31, December 31, December 31,
2003 2002 2003
----------- ----------- -----------
Adjusted Adjusted
NIS NIS U.S.$
(thousands) (thousands) (thousands)
----------- ----------- -----------
ASSETS
Current Assets
Cash and cash equivalents 98,460 91,200 22,485
Short-term investments and deposits 164,571 154,536 37,582
Accounts receivable - trade, net 17,419 18,646 3,978
Other accounts receivable and prepaid expenses 30,432 21,347 6,950
Hotels Inventories 2,865 3,050 654
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313,747 288,779 71,649
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Long-term Accounts and Investments
Investments, loans and long-term receivables,
net 79,791 345,836 18,221
Investments in affiliated company 24,340 31,897 5,558
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104,131 377,733 23,779
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Fixed Assets, Net 2,003,427 1,606,786 457,508
--------- --------- ---------
Other Assets, Net 10,916 12,003 2,493
--------- --------- ---------
Assets Related to Discontinuing Operation 16,228 111,983 3,706
--------- --------- ---------
2,448,449 2,397,284 559,135
========= ========= =========
(1) Prepared in accordance with Israeli GAAP.
ELSCINT LIMITED AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS (1)
ADJUSTED TO THE NIS OF DECEMBER 2003
Convenience
Translation
December 31, December 31, December 31,
2003 2002 2003
------------ ------------ -----------
Adjusted Adjusted
NIS NIS U.S.$
(thousands) (thousands) (thousands)
------------ ------------ -----------
LIABILITIES AND
SHAREHOLDERS' EQUITY
Current Liabilities
Short-term credits 407,599 522,241 93,080
Accounts payable - trade 56,749 *45,025 12,959
Accrued liabilities 76,955 63,116* 17,574
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541,303 630,382 123,613
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Long-term Liabilities
Loans and other long term liabilities 850,002 626,765 194,109
Liability for employee severance
benefits, net 468 503 107
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850,470 627,268 194,216
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Liabilities Related to Discontinuing
Operations 82,217 108,469 18,775
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Minority interest 28,261 29,011 6,454
--------- --------- ---------
Shareholders' Equity 946,198 1,002,154 216,077
--------- --------- ---------
2,448,449 2,397,284 559,135
========= ========= =========
* Reclassified.
(1) Prepared in accordance with Israeli GAAP.
ELSCINT LIMITED AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENT OF OPERATION (1)
ADJUSTED TO THE NIS OF DECEMBER 2003
Convenience
translation
Year ended December 31, December 31,
-----------------------------
2003 2002 2001 2003
-------- -------- ------- ------------
Adjusted NIS (thousands) U.S.$
(thousands)
----------------------------- ------------
Revenues
Operating and managing hotels 189,205 206,679 139,223 43,207
Hotel leasing 13,495 - - 3,082
Commercial and entertainment center 20,106 - - 4,592
Long-term contracts - 1,509 10,028 -
-------- -------- -------- ----------
222,806 208,188 149,251 50,881
-------- -------- -------- ----------
Cost of revenues
Hotels operations and management 128,301 133,207 95,851 29,299
Hotel leasing 3,510 - - 802
Commercial and entertainment center 21,975 - - 5,018
Long-term contracts - 1,392 7,311 -
-------- -------- -------- ----------
153,786 134,599 103,162 35,119
-------- -------- -------- ----------
Gross profit 69,020 73,589 46,089 15,762
Hotels' depreciation, amortization
and operation expenses 50,432 61,503 31,550 11,517
Initiation expenses, net 4,303 1,773 3,960 982
Selling and marketing expenses 8,948 - - 2,043
General and administrative
expenses 29,355 31,574 25,790 6,704
-------- -------- -------- ----------
Operating loss (24,018) (21,261) (15,211) (5,484)
Finance (expenses) income, net (41,262) 12,805 65,093 (9,423)
Other expenses, net (16,176) (21,502) (13,114) (3,694)
-------- -------- -------- ----------
(Loss) income before income taxes (81,456) (29,958) 36,768 (18,601)
Income taxes (tax benefits) (8,384) (5,221) 5,383 (1,915)
-------- -------- -------- ----------
(Loss) income after income taxes (73,072) (24,737) 31,385 (16,686)
The Company's share in loss
of affiliated companies (7,019) (2,847) (9,712) (1,603)
Minority interest in loss
of a subsidiary, net 746 879 1,288 170
-------- -------- -------- ----------
Net (loss) income from continuing
Operations (79,345) (26,705) 22,961 (18,119)
Net income from discontinuing
operation 12,972 88,983 33,935 2,962
-------- -------- -------- ----------
Net (loss) income (66,373) 62,278 56,896 (15,157)
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(1) Prepared in accordance with Israeli GAAP.
ELSCINT LIMITED AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENT OF OPERATION (1)
ADJUSTED TO THE NIS OF DECEMBER 2003
Convenience
translation
Year ended December 31, December 31,
-------------------------------
2003 2002 2001 2003
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Adjusted NIS U.S.$
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Basic earnings (loss) per
ordinary share (NIS 0.05 par value) from:
Continuing operations (4.75) (1.60) 1.37 (1.08)
Discontinuing operation 0.78 5.33 2.03 0.18
----------- -------- -------- ------------
(3.97) 3.73 3.40 (0.90)
=========== ======== ======== ============
Diluted earnings (loss) per ordinary
share (NIS 0.05 par value) from:
Continuing operations (1.66)
Discontinuing operation 5.10
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3.44
==========
(1) Prepared in accordance with Israeli GAAP.