Market Newsdesk

May 4, 2021 7:19 am

First United Corporation Announces First Quarter 2021 Earnings

Strong earnings per share driven by wealth management, gains, and reduced provision and core expenses

Increased dividend resulting in attractive yield

PR Newswire

OAKLAND, Md., May 4, 2021 /PRNewswire/ — First United Corporation (NASDAQ: FUNC), a bank holding company and the parent company of First United Bank & Trust (the “Bank”), today announced earnings results for the three-month periods ended March 31, 2021 and 2020.

First Quarter 2021 Financial Highlights:

Total assets grew by $48.4 million when compared to December 31, 2020, a 2.8% increase.
Loan and deposit growth were 2.7% and 3.1%, respectively, when compared to December 31, 2020.
Net interest margin, on a fully tax equivalent (“FTE”) basis, declined to 3.11% at March 31, 2021 compared to 3.69% at March 31, 2020 and 3.34% at December 31, 2020, attributable to the lower interest rate environment, higher cash balances and lower yielding PPP loans.
The ratio of the allowance for loan losses (“ALL”) to loans outstanding was 1.38% at March 31, 2021 as compared to 1.42% at March 31, 2020. The ALL to loans outstanding, excluding PPP loan balances of $145.2 million, was 1.57% at March 31, 2021, non-GAAP.

Total provision expense was $0.1 million and $2.7 million for the three months ended March 31, 2021 and 2020, respectively
Lower provision expense was due to strong asset quality as net charge offs and delinquency ratios remain low, as well as minimal growth in non-Paycheck Protection Program (“PPP”) loans

Consolidated net income increased 95.4% to $3.4 million compared to $1.8 million for the first quarter of 2020, inclusive of litigation settlement expenses of $3.3 million in the first quarter of 2021.

Basic and diluted net income per share were both $0.49 compared to $0.25 for the first quarter of 2020, a 96.0% increase
Increased net income due to decrease in provision expense, increased gains, insurance proceeds and wealth income, offset by litigation settlement expenses and income taxes

Net income increased to $6.0 million for the first quarter of 2021, exclusive of litigation settlement expenses, non-GAAP.

Basic and diluted net income per share both increased to $0.86, exclusive of litigation settlement expenses
Increased net income due to decrease in expense, increased gains, insurance proceeds and wealth income and reduced operating expenses, offset by increased income taxes

Net interest income increased $0.3 million for the quarter ended March 31, 2021 when compared with the same period of 2020.

Increased PPP loan origination fees
Margin compression caused by low yielding PPP loans, continued low-rate environment resulting in lower yields on new loans and repricing of existing loans to lower rates, and increased cash levels
Growth of non-interest bearing and low-cost core deposits and further reduction in deposit rates

Other operating income, including gains, increased $1.3 million for the first three months of 2021 when compared to 2020.

Net gains increased $0.5 million, related to $0.5 million in gains on the sale of mortgages to the secondary market
Continued growth in wealth management activity led to an increase of $0.5 million in fees due to growing new client relationships and favorable market returns
Increased debit card income of $0.2 million due to increased usage of electronic payment methods
Reduced service charge income, primarily non-sufficient funds (“NSF”) income resulting from reduced spending, and stimulus packages related to the COVID-19 pandemic
Other income increased due primarily to the receipt of $0.4 million in insurance proceeds related to litigation claims

Other operating expenses increased $1.9 million for the first quarter of 2021 when compared to the same period of 2020, primarily due to the litigation settlement expenses, offset by deferred PPP loan origination costs in salary expense and a net credit to expense for Other Real Estate Owned (“OREO”) related to gains on sales of properties.
Efficiency ratio of 54.9%, exclusive of settlement expenses. The efficiency ratio benefitted from recognition of a $0.5 million gain on the sale of OREO and collection of $1.0 million of fee income for the origination of PPP loans during the quarter.
Non-recurring litigation settlement expenses in the amount of $3.3 million were recorded in the first quarter of 2021.

Other miscellaneous expenses increased $3.1 million during the first quarter of 2021 when compared with the same period of 2020. Legal, professional, and investor relations costs increased $0.5 million, and litigation settlement expenses in the amount of $3.3 million were recorded in the first quarter of 2021. These amounts were offset by decreases in other miscellaneous expenses such as travel and lodging, business related meals, printed and office supplies, mileage reimbursements, schools and seminars, contract labor and in house training

“2021 started strong with solid core performance driven by our wealth management income, mortgage and commercial production and robust low-cost deposit growth. Our continued focus on cost reduction and process efficiencies also added to the bottom line. This allowed our Board of Directors to increase our quarterly dividend to $0.15 per share, contributing to a healthy yield for our shareholders” commented Carissa L. Rodeheaver, Chairman, President and Chief Executive Officer. “Our Board, management team and associates have been steadfast in our commitment to First United’s shareholders, clients, and the communities we serve. As we look forward, we are very pleased to continue to focus on executing on our strategy, the safe and prudent stewardship of stakeholder resources, and guiding our organization during unpredictable and dynamic times.”

COVID-19

During the first quarter of 2021, we continued to assist our business customers with the PPP loan forgiveness process, as well as originating additional PPP loans. We continued to be diligent in protecting our associates and customers from the effects of the pandemic, delaying opening our lobbies until the first of April, as we allowed time for more of our communities to be vaccinated. Most of our sales and support employees continued to work remotely as we continue to monitor our market areas, maintaining travel protocols and utilizing safety precautions while continuing to provide full banking services to our customers.

Paycheck Protection Program

The Company continues to actively participate in the SBA’s PPP program. On January 19, 2021, the Small Business Administration (the “SBA”) implemented an additional PPP loan program. The Company originated $59.8 million in loans during the first quarter of 2021 related to this new program, consisting of 675 loans with an average loan size of $89 thousand. An additional 149 loans, totaling $5.3 million, were funded through April 24, 2021.

During the second and third quarters of 2020, a total of $148.5 million in PPP loans were originated under the initial program, consisting of 1,174 loans with an average loan size of $162 thousand, with $34.5 million, or 290 loans, forgiven in 2020, resulting in a remaining balance at December 31, 2020 of $114.0 million. During the first quarter of 2021, a total of 389 loans, with an aggregate principal balance of $28.7 million, were forgiven, resulting in a remaining balance of $85.3 million at March 31, 2021. An additional 136 loans, with an aggregate principal balance of $15.6 million, were forgiven through April 24, 2021. Of the 1,174 loans originated in 2020, 815 have been forgiven totaling $78.8 million through April 24, 2021, representing 69.4% of the number of 2020 loans originated and 53.1% of 2020 originated principal balances.

COVID Modifications

While the COVID-19 pandemic has had an impact on most industries, some have been more affected than others. In accordance with Section 4013 of the Coronavirus Aid, Relief, and Economic Security Act and related regulatory pronouncements, we have not accounted for modifications of loans affected by the pandemic as troubled debt restructurings nor have we designated them as past due or nonaccrual.

As of April 24, 2021, there were 12 loans totaling $5.7 million in total loan modifications, comprised of five commercial loans totaling $5.0 million; three mortgage loans totaling $0.5 million; and four consumer loans totaling $0.2 million. Two commercial loans in the accommodations sector represent the majority of the commercial loan modifications.

Balance Sheet Overview

Total assets at March 31, 2021 increased by $48.4 million to $1.8 billion from December 31, 2020. During the first quarter of 2021, cash and interest-bearing deposits in other banks increased by $43.6 million, the investment portfolio decreased by $21.8 million and gross loans increased by $31.5 million. The increase in cash was due to continued deposit growth, cash flow from calls on the investment portfolio due to the continued low-rate environment, commercial loan payoffs, PPP loan forgiveness, and continued refinancing of balances in our mortgage portfolio. OREO balances decreased due to the sale of a parcel of real estate securing a large commercial participation loan that moved to OREO in the fourth quarter of 2020.

Total liabilities increased by $50.3 million when compared with liabilities at December 31, 2020. The increase in the first quarter of 2021 was primarily attributable to strong deposit growth of $45.9 million due to the PPP loan program and to increased relationship balances attributable to growth in core relationships and customer preference for insured products given the volatile economic environment. Our Treasury Management overnight investment sweep increased $2.3 million due to growth in existing customer balances. Total shareholders’ equity decreased by $1.9 million during the first quarter of 2021, as the quarter’s earnings were offset by an increase of $4.3 million in accumulated other comprehensive loss.

Outstanding loans of $1.2 billion at March 31, 2021 reflected the growth of $31.5 million during the first quarter of 2021, which was primarily attributable to the participation in the PPP program and core commercial loan growth that was partially offset by a decline in our mortgage loan portfolio. Commercial real estate (“CRE”) loans decreased $3.4 million. Acquisition and development (“A&D”) loans increased by $6.7 million and commercial and industrial (“C&I”) loans increased by $32.4 million, as newly originated PPP loans and growth in portfolio loans was slightly offset by PPP loan forgiveness. The growth in the commercial portfolios was offset by a decline in residential mortgage loans of $4.8 million, as refinancing activity continued during the first quarter. Given the current low interest rate environment, customers prefer longer-term fixed-rate loans. We continue to utilize the secondary market rather than hold these longer-term fixed rate mortgage loans in the portfolio. The consumer loan portfolio increased slightly by $0.7 million during the first quarter of 2021.

Commercial loan production for the first quarter of 2021 was approximately $50.0 million, and SBA loan production was approximately $7.0 million, exclusive of PPP loan originations. Commercial construction funding continues to ramp up as projects are entering their larger draw periods contributing to current year growth. At March 31, 2021, unfunded, committed commercial construction loans totaled approximately $25.0 million. Commercial amortization and payoffs were approximately $38.0 million through March 31, 2021, exclusive of PPP.

Consumer mortgage loan production was approximately $27.0 million for the first quarter of 2021. The production and pipeline mix of in-house, portfolio loans and investor loans remained strong at March 31, 2021, with those loans totaling $22.0 million, consisting of $13.0 million in portfolio loans and $9.0 million in investor loans.

Total deposits at March 31, 2021 increased by $45.9 million when compared with deposits at December 31, 2020. During the first quarter of 2021, non-interest-bearing deposits increased by $64.9 million, driven by retail and commercial account growth as well as deposits from newly originated PPP loans. Traditional savings accounts increased by $18.6 million, as we continued to see significant growth in our Prime Saver product, and total demand deposits increased by $5.5 million. Total money market accounts decreased by $40.7 million due primarily to management’s decision to move wealth management money market funds to off balance sheet products prior to quarter end due to our increasing cash balances. Time deposits decreased by $2.4 million as we continue to lower pricing on single-service relationships.

Inclusive of the $3.3 million in litigation settlement expenses, book value was $18.46 per share at March 31, 2021, compared to $18.74 per share at December 31, 2020. At March 31, 2021, there were 6,998,617 of basic outstanding shares and 7,001,997 of diluted outstanding shares of common stock.

Income Statement Overview

Consolidated net income was $3.4 million, inclusive of litigation settlement expenses of $3.3 million, for the quarter ended March 31, 2021 compared to $1.8 million for the quarter ended March 31, 2020. Basic and diluted net income per share for the first quarter of 2021 were both $0.49, compared to basic and diluted net income per share of $0.25 for the same period of 2020, a 96.0% increase.

The increase in earnings was primarily due to an increase in net interest income of $0.3 million, an increase in other operating income, including gains, of $1.3 million, and a decrease in provision expense of $2.5 million, partially offset by an increase in other operating expenses of $1.9 million, inclusive of the $3.3 million in litigation settlement expenses.

Net-Interest Income (Tax-Equivalent Basis -Non-GAAP)

Net interest income, on a non-GAAP, FTE basis, increased $0.4 million (3.0%) during the quarter ended March 31, 2021 when compared with the quarter ended March 31, 2020, driven by a $0.9 million (33.1%) decrease in interest expense, partially offset by a decrease in interest income of $0.5 million. The net interest margin, on a fully-taxable equivalent (“FTE”) basis, declined for the quarter ended March 31, 2021 to 3.11% compared to 3.69% for the same period of 2020.

The decrease in interest income was driven by a slight decrease in interest and fees on loans and reduced income on the investment portfolio. While the average balance of the investment portfolio increased by $59.4 million, bonds at higher yielding rates were called and replaced with lower yielding investments, resulting in a decrease in average yield on the investment portfolio of 108 basis points. The increase in the average balance of investments is due to a strategic decision in December 2020 to invest $70.0 million of excess cash into the investment portfolio. Significantly higher cash levels invested at an average yield on Fed Funds of 0.07% for the first quarter of 2021, compared to 1.24% for the first quarter of 2020, also negatively impacted the margin for the first quarter of 2021. The increase in average balance of loans of $156.9 million, primarily driven by PPP loans, offset the declining yield in the portfolio leading to slightly reduced interest and fees on loans when comparing the first quarter of 2021 to the first quarter of 2020. The average balances of PPP loans of approximately $142.5 million generated $1.2 million of interest and fees but had a negative impact on the margin of approximately three basis points. The average loan yield was also negatively impacted by the low-rate environment, which resulted in loan production and loans repricing at lower rates. These factors resulted in a decrease of approximately 64 basis points in average loan yield when compared with the quarter ended March 31, 2020.

The decrease in interest expense of $0.9 million, despite an increase in average interest-bearing liabilities of $149.9 million, was a direct result of a reduction in the cost of deposits of 34 basis points, a 5 basis point decrease in the cost of our short-term borrowings and a 67 basis point decrease in the cost of long-term borrowings. The decrease in the rate on long-term borrowings is primarily due to the restructuring of three long-term Federal Home Loan Bank advances late in the fourth quarter of 2020 that resulted in a reduced weighted average rate of 80 basis points on the $70.0 million portfolio. The average balance on our interest-bearing money market accounts increased $86.5 million, while the rate on these accounts decreased by 55 basis points. Average growth of $39.1 million in our non-interest-bearing accounts benefited our overall cost of deposits.

Asset Quality

The ALL remained stable at $16.6 million at March 31, 2021 compared to $16.5 million at December 31, 2020. The provision for loan losses was $0.1 million for the quarter ended March 31, 2021 and $2.7 million for the quarter ended March 31, 2020. The higher provision expense recorded in the first quarter of 2020 was driven by an increase in the qualitative factors reflecting the uncertainty of the economic environment related to the COVID-19 pandemic and its impact on our borrowers. Net charge-offs of $42 thousand were recorded for the first three months of 2021, compared to net charge offs of $0.2 million for the first three months of 2020. The ratio of the ALL to loans outstanding, including PPP loan balances, was 1.38% at March 31, 2021 compared to 1.42% at March 31, 2020 and 1.41% at December 31, 2020. The ALL to loans outstanding, excluding PPP loan balances of $145.2 million, was 1.57% at March 31, 2021, non-GAAP.

The ratio of net charge-offs to average loans for the quarter ended March 31, 2021 was an annualized 0.01%, compared to 0.07% for the quarter ended March 31, 2020. Details of the ratio, by loan type are shown below. Our special assets team continues to effectively collect on charged-off loans, resulting in ongoing overall low net charge-off ratios.

Ratio of Net (Charge Offs)/Recoveries to Average Loans
	03/31/2021	03/31/2020
Loan Type	(Charge Off) / Recovery	(Charge Off) / Recovery
Commercial Real Estate	0.00%	0.08%
Acquisition & Development	0.07%	0.00%
Commercial & Industrial	0.05%	(0.28%)
Residential Mortgage	(0.07%)	(0.07%)
Consumer	(0.37%)	(0.95%)
Total Net (Charge Offs)/Recoveries	(0.01%)	(0.07%)

Non-accrual loans totaled $7.9 million at March 31, 2021 compared to $3.3 million at December 31, 2020. The increase in non-accrual balances at March 31, 2021 was due to the movement of two hospitality loans totaling approximately $4.0 million in the first quarter of 2021. These loans suffered reduced cash flows due to the impact of the pandemic, have received modifications and were classified as substandard at December 31, 2020. It is anticipated that these loans will return to payment status in the near term.

Non-accrual loans that have been subject to partial charge-offs totaled $0.4 million at March 31, 2021 and $0.2 million at December 31, 2020. Loans secured by 1-4 family residential real estate properties in the process of foreclosure were $0.4 million at March 31, 2021 and December 31, 2020. Foreclosure and repossession activities were temporarily suspended as a result of COVID-19. As a percentage of the loan portfolio, accruing loans past due 30 days or more decreased to 0.15%, including PPP loans, or 0.22% excluding PPP loans, compared to 0.67% at March 31, 2020.

Non-Interest Income and Non-Interest Expense

Other operating income, including net gains, increased $1.3 million for the quarter ended March 31, 2021 when compared to the quarter ended March 31, 2020. Gains on the sale of mortgages to the secondary market, which we have utilized in lieu of retaining long-term fixed rate loans in our portfolio, increased $0.4 million related to continued refinancing activity. Trust and brokerage income increased $0.5 million quarter-over-quarter due to growth in new client relationships and assets under management, despite market volatility early in 2021. Debit card income increased $0.2 million for the quarter ended March 31, 2021 when compared with the same period of 2020 as we continue to grow our deposit relationships and our customers increase use of our electronic services. Other income increased $0.4 million, due primarily to the receipt of insurance proceeds related to litigation claims. Service charge income, primarily NSF income, decreased $0.2 million as the consumer and business overdraft activity declined due to reduced consumer spending and increased cash balances resulting from the receipt of government stimulus payments and PPP funding.

Other operating expenses increased $1.9 million, inclusive of litigation settlement expenses, for the quarter ended March 31, 2021 when compared with the same period of 2020. Salaries and benefits decreased $0.9 million when compared to the first quarter of 2020, primarily due to reductions of $0.2 million in life and health insurance costs, a $1.0 million offset in salary expense from deferred loan origination costs primarily attributable to PPP loans and $0.1 million of reduced executive equity compensation due to a timing difference in long-term incentive grants. These decreases were offset by an increase of $0.2 million in salaries, incentives and related payroll costs and $0.2 million in 401(k) plan expenses. Federal Deposit Insurance Corporation premiums increased slightly by $0.1 million due to credits received on quarterly assessments in 2020. Equipment, occupancy and technology expenses remained stable when compared with the first quarter of 2020 as we began to realize cost savings from our core processor related to a new contract negotiated in the fourth quarter of 2020. OREO expenses were a net credit in the first quarter of 2021 due to $0.5 million in gains attributable to the sale of OREO properties. Professional services increased $0.4 million as a result of increased legal and professional and investor relations expenses due to costs related to the 2021 proxy season and litigation.

Subsequent to the quarter-end, the Company settled outstanding litigation for the amount of $3.3 million, which was recorded in the first quarter of 2021. Additional details surrounding the settlement were provided in the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on April 16, 2021. Insurance proceeds of $0.4 million related to the litigation were also recorded in the quarter as discussed above and are included in other operating income.

The effective income tax rate as a percentage of income for the three-month periods ended March 31, 2021 and 2020 was 24.3% and 22.9%, respectively. The increase in the tax rate was primarily due to the reduction in tax exempt income as well as the reduction in tax credits related to the expiration of the low income housing tax credit in June 2021.

ABOUT FIRST UNITED CORPORATION

First United Corporation is the parent company of First United Bank & Trust, a Maryland trust company with commercial banking powers, and two statutory trusts that were used as financing vehicles. The Bank has four wholly-owned subsidiaries: OakFirst Loan Center, Inc., a West Virginia finance company; OakFirst Loan Center, LLC, a Maryland finance company; First OREO Trust, a Maryland statutory trust that holds and services real estate acquired by the Bank through foreclosure or by deed in lieu of foreclosure; and FUBT OREO I, LLC, a Maryland company that likewise holds and services real estate acquired by the Bank through foreclosure or by deed in lieu of foreclosure. The Bank also owns 99.9% of the limited partnership interests in Liberty Mews Limited Partnership; a Maryland limited partnership formed for the purpose of acquiring, developing and operating low-income housing units in Garrett County, Maryland. The Corporation’s website is www.mybank.com.

FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements do not represent historical facts, but are statements about management’s beliefs, plans and objectives about the future, as well as its assumptions and judgments concerning such beliefs, plans and objectives. These statements are evidenced by terms such as “anticipate,” “estimate,” “should,” “expect,” “believe,” “intend,” and similar expressions. Although these statements reflect management’s good faith beliefs and projections, they are not guarantees of future performance and they may not prove true. The beliefs, plans and objectives on which forward-looking statements are based involve risks and uncertainties that could cause actual results to differ materially from those addressed in the forward-looking statements. For a discussion of these risks and uncertainties, see the section of the periodic reports that First United Corporation files with the Securities and Exchange Commission entitled “Risk Factors,” including among many others the risk factor set forth in First United’s Annual Report on Form 10-K, as amended, for the year ended December 31, 2020 entitled, “The outbreak of the recent coronavirus (‘COVID-19’), or an outbreak of another highly infectious or contagious disease, could adversely affect the Corporation’s business, financial condition and results of operations.” and any updates thereto that might be contained in subsequent reports filed by First United. The risks and uncertainties associated with the COVID-19 pandemic and its impact on First United will depend on, among other things, the length of time that the pandemic continues; the duration of the potential imposition of further restrictions on travel in the future; the effect of the pandemic on the global, national, and local economies and on the businesses of our borrowers and their ability to make payments on their obligations; the remedial actions and stimulus measures adopted by federal, state, and local governments; and the inability of employees to work due to illness, quarantine, or government mandates.

FIRST UNITED CORPORATION
Oakland, MD
Stock Symbol : FUNC
Financial Highlights – Unaudited

(Dollars in thousands, except per share data)
		Three Months Ended
		March 31,	March 31,
		2021	2020
Results of Operations:
	Interest income	$ 14,062	$ 14,616
	Interest expense	1,826	2,729
	Net interest income	12,236	11,887
	Provision for loan losses	110	2,654
	Other operating income	4,742	4,008
	Net gains	588	41
	Other operating expense	12,927	11,005
	Income before taxes	$ 4,529	$ 2,277
	Income tax expense	1,099	522
	Net income	$ 3,430	$ 1,755

Per share data:
	Basic/ Diluted net income	$ 0.49	$ 0.25
	Adjusted Basic/Diluted net income (1)	$ 0.86	$ 0.25
	Dividends declared per share	$ 0.15	$ 0.13
	Book value	$ 18.46	$ 17.01
	Adjusted book value (1)	$ 18.82	$ 17.01
	Diluted book value	$ 18.45	$ 16.95
	Adjusted diluted book value (1)	$ 18.81	$ 16.95
	Tangible book value per share	$ 16.89	$ 15.43
	Adjusted tangible book value per share (1)	$ 17.25	$ 15.43
	Diluted Tangible book value per share	$ 16.88	$ 15.38
	Adjusted diluted tangible book value per share (1)	$ 17.24	$ 15.38

	Closing market value	$ 17.62	$ 14.29
	Market Range:
	High	$ 20.05	$ 24.99
	Low	$ 15.30	$ 11.09

Shares outstanding at period end		6,998,617	6,966,898

Performance ratios: (Year to Date Period End, annualized)
Return on average assets		0.79%	0.49%
Adjusted return on average assets (1)		1.38%	0.49%
Return on average shareholders’ equity		10.58%	5.62%
Adjusted return on average shareholders’ equity (1)		18.36%	5.62%
Net interest margin (Non-GAAP), includes tax exempt income of $239 and $223		3.11%	3.69%
Net interest margin GAAP		3.05%	3.63%
Efficiency ratio		72.94%	68.29%
Adjusted efficiency ratio (1)		54.90%	68.29%
(1) See reconcilation of this non-GAAP financial measure provided elsewhere herein.
		March 31,	December 31,	March 31,
		2021	2020	2020
Financial Condition at period end:
Assets		$ 1,781,833	$ 1,733,414	$ 1,461,513
Earning assets		$ 1,481,045	$ 1,473,733	1,267,718
Gross loans		$ 1,199,325	$ 1,167,812	1,053,732
	Commercial Real Estate	$ 365,731	$ 369,176	337,688
	Acquisition and Development	$ 123,625	$ 116,961	121,333
	Commercial and Industrial	$ 299,178	$ 266,745	123,509
	Residential Mortgage	$ 374,327	$ 379,170	434,969
	Consumer	$ 36,464	$ 35,760	36,233
Investment securities		$ 273,363	$ 295,148	222,191
Total deposits		$ 1,468,263	$ 1,422,366	1,172,394
	Noninterest bearing	$ 485,311	$ 420,427	299,961
	Interest bearing	$ 982,952	$ 1,001,939	872,433
Shareholders’ equity		$ 129,189	$ 131,047	118,549

Capital ratios:

	Tier 1 to risk weighted assets	14.99%	14.83%	14.76%
	Common Equity Tier 1 to risk weighted assets	12.76%	12.61%	12.43%
	Tier 1 Leverage	10.22%	10.36%	11.52%
	Total risk based capital	16.24%	16.08%	16.01%

Asset quality:

Net (charge-offs)/recoveries for the quarter		$ (42)	$ (123)	$ (179)
Nonperforming assets: (Period End)
	Nonaccrual loans	$ 7,891	$ 3,339	$ 11,012
	Loans 90 days past due and accruing	6	724	623
	Total nonperforming loans and 90 day past due	$ 7,897	$ 4,063	$ 11,635

	Restructured loans	$ 3,892	$ 3,958	$ 4,103
	Other real estate owned	$ 7,533	$ 9,386	$ 4,040

Allowance for loan losses to gross loans		1.38%	1.41%	1.42%
Allowance for loan losses to gross loans, excluding PPP loans		1.57%	1.55%	–
Nonperforming and 90 day past due loans to total loans		0.66%	0.35%	1.10%
Nonperforming loans and 90 day past due loans to total assets		0.44%	0.23%	0.80%

Non-GAAP Financial Measures (unaudited)
Reconciliation of as reported (GAAP) and non-GAAP financial measures

The following tables below provide a reconciliation of certain financial measures calculated under generally accepted accounting principles (“GAAP”) (as reported) and non-GAAP. A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed in the most directly comparable measure calculated and presented in accordance with GAAP in the United States. The Company’s management believes the presentation of non-GAAP financial measures provide investors with a greater understanding of the Company’s operating results in addition to the results measured in accordance with GAAP. While management uses these non-GAAP measures in its analysis of the Company’s performance, this information should not be viewed as a substitute for financial results determined in accordance with GAAP or considered to be more important than financial results determined in accordance with GAAP.

The following non-GAAP financial measures exclude settlement charges associated with the settlement with Driver Management.

	Three months ended March 31,
	2021		2020
(in thousands, except for per share amount)
Net income – as reported	$	3,430	$	1,755
Adjustments:
Settlement Expense		3,300		—
Income tax effect of adjustment		(735)		—
Adjusted net income (non-GAAP)	$	5,995	$	1,755

Basic and Diluted earnings per share – as reported	$	0.49	$	0.25
Adjustments:
Settlement Expense		0.47		—
Income tax effect of adjustment		(0.10)		—
Adjusted basic and diluted earnings per share (non-GAAP)	$	0.86	$	0.25



	As of or for the three months ended
	March 31,
(in thousands, except per share data)	2021		2020
Per Share Data
Basic net income per common share (1) – as reported	$	0.49	$	0.25
Basic net income per common share (1) – non-GAAP		0.86		0.25
Diluted net income per common share (1) – as reported	$	0.49	$	0.25
Diluted net income per common share (1) – non-GAAP		0.86		0.25
Basic book value per common share (1) – as reported	$	18.46	$	17.01
Basic book value per common share (1) – non-GAAP		18.82		17.01
Diluted book value per common share (1) – as reported	$	18.45	$	16.95
Diluted book value per common share (1) – non-GAAP		18.81		16.95

Significant Ratios:

Return on Average Assets (1) – as reported		0.79%		0.49%
Expenses		0.59%		—
Income tax effect of adjustment		—		—
Adjusted Return on Average Assets (1) (non-GAAP)		1.38%		0.49%

Return on Average Equity (1) – as reported		10.58%		5.62%
Expenses		5.41%		—
Income tax effect of adjustment		2.37%		—
Adjusted Return on Average Equity (1) (non-GAAP)		18.36%		5.62%

Average Equity to Average Assets		7.45%		8.69%

(1) See reconcilation of this non-GAAP financial measure provided elsewhere herein.

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SOURCE First United Corporation

May 4, 2021 7:18 am

Versus Systems to Power Second Screen Engagement in Canelo Alvarez Title Fight on May 8th

Keurig Dr. Pepper brand Crush, to work with the Frias Agency to beta test Versus’ engagement platform for live audiences of Canelo-Saunders middleweight title fight

LOS ANGELES, May 04, 2021 (GLOBE NEWSWIRE) — Versus Systems Inc. (“Versus” or the “Company”) (Nasdaq: VS) (FRANKFURT: BMVB) announced today that in concert with the Frias Agency, the Company will be launching a beta test of XEO, Versus’ second screen gamified rewards platform for the May 8th, 2021 Canelo Alvarez vs. Billy Joe Saunders middleweight boxing title fight taking place at AT&T stadium in Dallas, Texas. The Versus technology will allow Crush to create a unique engagement experience for fans watching the fight live, whether they are in-stadium or watching on DAZN pay-per-view. More than 60,000 fans are expected to be in attendance, making the Canelo-Saunders fight the largest United States sporting crowd since the COVID-19 shutdown began in March 2020.

In the days leading up to the fight, and during the fight itself, fans will be able to go to www.Crush-Canelo.com on their smart phones and other mobile devices and answer predictive questions about the weigh-in and the main event. They will also be able to play games and win daily prizes – including signed boxing gloves, DAZN codes, and Crush soda.

Additionally, a limited audience will be invited to access the proprietary mobile engagement platform via a live URL and a QR code that will be revealed by Canelo Alvarez and Crush on social media this week. Those fans that are invited into the beta test will be able to interact with Crush-sponsored content, prizes and event-related trivia and polling during the title fight. The experience will be available online, as well as via Android and iOS mobile devices.

“We are thrilled to work with Crush and Canelo on this project,” said Matthew Pierce, CEO of Versus Systems. “This beta test is an opportunity to showcase innovative brands, such as Crush, and to provide engaging content for millions of Canelo fans and boxing fans in general, both in-venue and at home.”

The Canelo-Saunders fight will take place at AT&T Stadium in Arlington, Texas. The event will also be televised via DAZN worldwide in over 200 countries and territories with the Versus second screen engagement experience available to limited TV and live event audiences. Past Canelo fights have garnered more than 800,000 pay-per-view purchases, and his last televised fight in February 2021 had an audience of more than eight million TV viewers.

“The Versus XEO platform makes it possible for brands like Crush to provide Canelo fans with a unique experience, giving brands real-time access to a captive audience while increasing viewership and creating memorable experiences for sports fans,” says Andre Martelly, CEO of Frias Agency, the marketing and experiential agency for brands and franchises, including Crush, Modelo and Constellation Brands.

About Versus Systems

Versus Systems Inc. has developed a proprietary prizing and promotions engine that allows publishers, developers, and creators of streaming media, live events, broadcast TV, games, apps, and other content to offer real world prizes inside their content. Audiences can choose from among the offered prizes and then complete in-game or in-app challenges to win the prizes. The Versus platform can be integrated into streaming media, TV, mobile, console, and PC games, as well as mobile apps. For more information, please visitwww.versussystems.com or visit the official Versus SystemsYouTube channel.

Investor contact:

Sean McGowan, Cody Cree
Gateway Investor Relations
949-574-3860
[email protected]
or
[email protected]

Disclaimer for Forward-Looking Information

This news release contains certain forward-looking information and forward-looking statements within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward looking statements and are based on expectations, estimates and projections as at the date of this news release. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends” or variations of such words and phrases or stating that certain actions, events or results “may” or “could”, “would”, “might” or “will” be taken to occur or be achieved) are not statements of historical fact and may be forward looking statements. These forward-looking statements are based on reasonable assumptions and estimates of management of the Company at the time such statements were made. Actual future results may differ materially as forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to materially differ from any future results, performance or achievements expressed or implied by such forward-looking statements. Although the forward-looking statements contained in this news release are based upon what management of the Company believes, or believed at the time, to be reasonable assumptions, the Company cannot assure shareholders that actual results will be consistent with such forward-looking statements, as there may be other factors that cause results not to be as anticipated, estimated or intended. Accordingly, readers should not place undue reliance on forward-looking statements and information. There can be no assurance that forward-looking information, or the material factors or assumptions used to develop such forward-looking information, will prove to be accurate. The Company does not undertake any obligations to release publicly any revisions for updating any voluntary forward-looking statements, except as required by applicable law.

About Frias Agency

Frias Agency is a full-service Experiential Marketing and Event Management agency specializing in experiential activations, digital advertising, brand strategy and creative services. Frias has offices and warehouses strategically located across the U.S. in California, Texas and Florida to provide vertical integration to activation for some of the largest music tours, major sporting events and festivals in the country. Frias’s experience includes more than 1,200 live events providing unforgettable experiences for millions of people. They partner brands with superstar athletes, such as Canelo Alvarez, and they have built multiple campaigns that resulted in double digit increases of sales for clients such as Crush. Frias’s partnership with Corona Light and Kenny Chesney reached over 1 million consumers with more than 50 thousand sweepstake entries and thousands of on-site impressions. For more information, please visit www.friasagency.com.

May 4, 2021 7:18 am

Intelligent Systems Reports First Quarter 2021 Results

NORCROSS, Ga., May 04, 2021 (GLOBE NEWSWIRE) — Intelligent Systems Corporation [NYSE American: INS], the leading provider of innovative credit technology solutions and processing services to the financial technology and services market, announced today its financial results for the quarter ended March 31, 2021.

“First-quarter results were in-line with expectations and continued to demonstrate the adaptability of our business model and the resiliency of our employees around the world. Despite challenges stemming from the spread of COVID-19, we continued to service our customers without any delays or impacts,” said Leland Strange, CEO of Intelligent Systems. “We generated revenues of $8.9 million in the quarter, a 13% increase relative to the first quarter of 2020. As expected, our year-over-year top-line growth was driven by professional services and processing and maintenance revenue. While we did not recognize any license revenue in the quarter, we continue to expect licensing revenue in the second quarter and more substantially in the second half of fiscal 2021. Due to the costs of opening our new office in Dubai and developing a new platform, income from operations and net income declined from the comparable prior quarter.”

“The infrastructure investments we are making are already showing results. We announced that we entered a partnership with the Al Ansari Exchange, a UAE-based foreign exchange and worldwide money transfer company, and CoreCard’s first customer in the Middle East region. This partnership validates the strategic investments we made, and we remain confident in our strategic vision.”

Mr. Strange continued, “Throughout the first quarter, Intelligent Systems continued to provide high-quality, on-time delivery for all of our clients despite a challenging and constantly shifting environment. Additionally, we repurchased an additional $2.7 million of shares in the quarter and we extended the buyback authorization for an additional $10 million. While some headwinds persist, I am encouraged by the start we have had in fiscal 2021 and we are on track to achieve top-line growth of 20% to 25% for the year.”

Financial Highlights for the three months ended March 31, 2021

Total revenues– Total revenue in the three-month period ended March 31, 2021 was $8,912,000 which represents an increase of 13 percent compared to the comparable period in 2020.

In the following table, revenue is disaggregated by type of revenue for the three months ended March 31, 2021 and 2020:

Three months ended March 31, (in thousands)		2021		2020
License	$	—	$	—
Professional services		5,747		5,279
Processing and maintenance		2,607		2,194
Third party		558		420
Total	$	8,912	$	7,893

Income from operations was $1,465,000 for the first quarter compared to income from operations of $2,379,000 in the comparable prior year quarter.

Net income was $1,040,000 for the first quarter compared to net income of $1,047,000 in the comparable prior year quarter.

Earnings per diluted share was $0.12 for the first quarter compared to $0.12 in the comparable prior year quarter.

Investor Conference Call Today

The company is holding an investor conference call today, May 4, 2021, at 11 A.M. Eastern Standard Time. Interested investors are invited to attend the conference call by accessing the webcast at https://www.webcast-eqs.com/intelligentsystems050411/en or by dialing 1-877-407-0890. As part of the conference call Intelligent Systems will be conducting a question-and-answer session where participants are invited to email their questions to [email protected] prior to the call. A transcript of the call will be posted on the company’s website at www.intelsys.com as soon as available after the call.

The company will file its Form 10-Q for the period ended March 31, 2021 with the Securities and Exchange Commission today. For additional information about reported results, investors will be able to access the Form 10-Q on the company’s website at www.intelsys.com or on the SEC website, www.sec.gov.

About Intelligent Systems Corporation

For over thirty-five years, Intelligent Systems Corporation [NYSE American: INS] has identified, created, operated and grown technology companies. The company’s principal operations are CoreCard Software, Inc. (www.corecard.com) and its affiliate companies. CoreCard provides prepaid and credit card processing services using its proprietary software solutions that it also licenses to others. CoreCard has designed and developed a comprehensive suite of software solutions that corporations, financial institutions, retailers and processors use to manage credit and debit cards, prepaid cards, private label cards, fleet cards, loyalty programs, and accounts receivable and small loan transactions. CoreCard’s flexible and proven processing platform is being utilized in many countries in addition to the United States including Australia, Canada, China, the United Arab Emirates, France, Italy, Mexico, New Zealand, Singapore, South Africa and the United Kingdom. Further information is available on the company’s website at www.intelsys.com or by calling the company at 770-381-2900.

In addition to historical information, this news release may contain forward-looking statements relating to Intelligent Systems Corporation and its subsidiary and affiliated companies. These statements include all statements that are not statements of historical fact regarding the intent, belief or expectations of Intelligent Systems Corporation and its management with respect to, among other things, results of operations, product plans, and financial condition. The words “may,” “will,” “anticipate,” “believe,” “intend,” “expect,” “estimate,” “plan,” “strategy” and similar expressions are intended to identify forward-looking statements. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties and that actual results may differ materially from those contemplated by such forward-looking statements. The company does not undertake to update or revise any forward-looking statements whether as a result of new developments or otherwise, except as required by law. Among the factors that could cause actual results to differ materially from those indicated by such forward-looking statements are instability in the financial markets, delays in product development, undetected software errors, competitive pressures, changes in customers’ requirements or financial condition, market acceptance of products and services, the impact of new or changes in current laws, regulations or other industry standards, risks relating to unauthorized access to confidential information due to criminal conduct, attacks by hackers, employee or insider malfeasance and/or human error and declines in general economic and financial market conditions, particularly those that cause businesses to delay or cancel purchase decisions.

For further information, call
Matt White, 770-564-5504 or
email to [email protected]

Intelligent Systems Corporation

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited, in thousands, except share and per share amounts)

	Three Months Ended March 31,
	2021			2020
Revenue
Services	$	8,912		$	7,893
Products		‒			‒
Total net revenue		8,912			7,893
Cost of revenue
Services		4,429			3,506
Products		‒			‒
Total cost of revenue		4,429			3,506
Expenses
Marketing		37			32
General and administrative		880			1,058
Research and development		2,101			918
Income from operations		1,465			2,379
Investment income (loss)		(133	)		(1,050	)
Other income, net		75			136
Income before income taxes		1,407			1,465
Income taxes		367			418
Net income	$	1,040		$	1,047
Earnings per share:
Basic	$	0.12		$	0.12
Diluted	$	0.12		$	0.12
Basic weighted average common shares outstanding		8,899,011			8,924,988
Diluted weighted average common shares outstanding		8,933,090			9,021,754

Intelligent Systems Corporation

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

As of	March 31, 2021			December 31, 2020
ASSETS	(unaudited)			(audited)
Current assets:
Cash	$	31,001		$	37,956
Accounts receivable, net		5,069			3,270
Notes and interest receivable, current portion		220			—
Other current assets		1,059			1,263
Total current assets		37,349			42,489
Investments		1,788			1,921
Notes and interest receivable, net of current portion		3,030			2,681
Property and equipment, at cost less accumulated depreciation		7,555			6,914
Other long-term assets		4,111			3,020
Total assets	$	53,833		$	57,025
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	781		$	714
Deferred revenue, current portion		794			1,322
Accrued payroll		1,543			1,901
Accrued expenses		262			321
Income tax payable		1,383			954
Other current liabilities		2,640			4,850
Total current liabilities		7,403			10,062
Noncurrent liabilities:
Deferred revenue, net of current portion		101			—
Deferred tax liability		818			818
Long-term lease obligation		2,864			1,994
Total noncurrent liabilities		3,783			2,812
Stockholders’ equity:
Common stock, $0.01 par value: Authorized shares – 20,000,000;
Issued shares – 8,996,868 and 8,929,368 at March 31, 2021 and December 31, 2020, respectively;
Outstanding shares – 8,882,350 and 8,885,797 at March 31, 2021 and December 31, 2020, respectively		90			89
Additional paid-in capital		15,999			15,836
Treasury stock, 114,518 and 43,571 shares at March 31, 2021 and December 31, 2020, respectively, at cost		(4,351	)		(1,639	)
Accumulated other comprehensive loss		(136	)		(140	)
Accumulated income		31,045			30,005
Total stockholders’ equity		42,647			44,151
Total liabilities and stockholders’ equity	$	53,833		$	57,025

May 4, 2021 7:18 am

ADC Therapeutics to Participate in May Investor Conferences

ADC Therapeutics to Participate in May Investor Conferences

LAUSANNE, Switzerland–(BUSINESS WIRE)–
ADC Therapeutics SA (NYSE: ADCT), a commercial-stage biotechnology company leading the development of novel antibody drug conjugates (ADCs) to treat hematological malignancies and solid tumors, announced today that Chris Martin, Chief Executive Officer, will participate in a fireside chat at two virtual investor conferences in May.

Details of the events are as follows:

BofA Securities 2021 Virtual Health Care Conference on Tuesday, May 11, 2021, at 8:00 a.m. ET
2021 RBC Capital Markets Global Healthcare Conference on Wednesday, May 19, 2021, at 9:45 a.m. ET

A live webcast of each fireside chat will be available via the Events & Presentations page in the Investors section of ADC Therapeutics’ website, ir.adctherapeutics.com. A replay of each webcast will be available for approximately 30 days.

About ADC Therapeutics

ADC Therapeutics (NYSE: ADCT) is a commercial-stage biotechnology company improving the lives of cancer patients with its next-generation, targeted antibody drug conjugates (ADCs). The Company is advancing its proprietary PBD-based ADC technology to transform the treatment paradigm for patients with hematologic malignancies and solid tumors.

ADC Therapeutics’ CD19-directed ADC ZYNLONTA™ (loncastuximab tesirine-lpyl) is approved by the FDA for the treatment of relapsed or refractory diffuse large B-cell lymphoma after two or more lines of systemic therapy. ZYNLONTA is also in late-stage clinical trials in combination with other agents. Cami (camidanlumab tesirine) is being evaluated in a late-stage clinical trial for relapsed or refractory Hodgkin lymphoma and in a Phase 1b clinical trial for various advanced solid tumors. In addition to ZYNLONTA and Cami, the Company has multiple PBD-based ADCs in ongoing clinical and preclinical development.

ADC Therapeutics is based in Lausanne (Biopôle), Switzerland and has operations in London, the San Francisco Bay Area and New Jersey. For more information, please visit https://adctherapeutics.com/ and follow the Company on Twitter and LinkedIn.

ZYNLONTA™ is a trademark of ADC Therapeutics SA.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210504005366/en/

Investors

Eugenia Litz

ADC Therapeutics

[email protected]

+44 7879 627205

Amanda Hamilton

ADC Therapeutics

[email protected]

+1 917-288-7023

EU Media

Alexandre Müller

Dynamics Group

[email protected]

+41 (0) 43 268 3231

USA Media

Annie Starr

6 Degrees

[email protected]

+1 973-768-2170

KEYWORDS: Switzerland Europe

INDUSTRY KEYWORDS: Biotechnology Pharmaceutical Health

MEDIA:

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May 4, 2021 7:17 am

Heritage Cannabis Enters the U.S. Cannabis Market Through Partnership with 3Fifteen Cannabis

Heritage Cannabis Enters the U.S. Cannabis Market Through Partnership with 3Fifteen Cannabis

Definitive agreement to provide extraction expertise to 3Fifteen and launch Heritage branded products in Missouri
First agreement under the partnership with Merida Capital Holdings to enter multiple, high growth U.S. cannabis markets

TORONTO–(BUSINESS WIRE)–
Heritage Cannabis Holdings Corp. (CSE: CANN) (OTCQX: HERTF) (“Heritage” or the “Company”), is pleased to announce a five-year partnership with Como Health LLC, doing business as 3Fifteen Primo Cannabis (“3Fifteen”), a rapidly growing cannabis company with five dispensary licenses of which two are in operation and three are in construction phase. 3Fifteen holds one of only 11 manufacturing licenses approved to operate in the state of Missouri, and will contribute the use of the license to the partnership allowing Heritage to produce branded products to be offered to medical cannabis consumers in Missouri.

Under the agreement, Heritage will supply production equipment to 3Fifteen, as well as provide training and supervision of staff on the proprietary methods of extraction and oil production developed by Heritage. The partnership will grant shelf minimums for Heritage’s branded products in 3Fifteen’s Missouri dispensaries which are projected to grow to over USD$21 million in gross revenue by 2022.

Missouri saw its first legalized medical sales in October 2020 and the market has already grown to 80 operating dispensaries that reached nearly USD$32 million in the first six months of sales. Total sales in Missouri are expected to grow to USD $650 million by 2024.

“With strong market growth projected in Missouri, we believe this is the right time to enter the U.S. and with a strategic partner like 3Fifteen, we are creating a blueprint we can use to continue our state-by-state expansion,” stated David Schwede, President of Heritage’s Recreational Cannabis. “With our extraction expertise and inspired branding capabilities, along with 3Fifteen’s impressive market penetration, we expect Heritage’s branded offerings to be in high demand.”

“3Fifteen Primo Cannabis is thrilled to partner with Heritage and to bring their extraction expertise and expansive brand catalog to our Missouri market,” says Jason Corrado, CEO of 3Fifteen. “I can’t wait to see these products in dispensary show cases across the ‘Show Me’ state.”

Today’s announcement is the first definitive agreement signed by Heritage as part of the previously announced expanded relationship with Merida Capital Holdings to enter multiple U.S. cannabis markets. “Our strategy will continue to focus on new high growth markets in partnership with established teams and low barriers to entry,” Schwede continued. “Heritage will continue to add new markets in a purposeful and capital efficient way with a focus on creating value for our shareholders.”

Follow Heritage’s Purefarma, Pura Vida, RAD, Premium 5, and feelgood. brands on Instagram and Facebook for more information.

About Heritage Cannabis Holdings Corp.

Heritage is a leading cannabis products company operating two licensed manufacturing facilities in Canada and offering innovative products to both the medical and recreational legal cannabis markets in Canada and US. The company has an extensive portfolio of high quality cannabis products under the brands Purefarma, Pura Vida, RAD, Premium 5, feelgood. and ArthroCBD.

ON BEHALF OF THE BOARD OF DIRECTORS OF HERITAGE CANNABIS HOLDINGS CORP.

“Clint Sharples”

Clint Sharples

CEO

The Canadian Securities Exchange does not accept responsibility for the adequacy or accuracy of this release.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210504005723/en/

For more information contact:

Kelly Castledine

Tel: 647-660-2560

[email protected]

KEYWORDS: United States North America Canada Missouri

INDUSTRY KEYWORDS: Agriculture Natural Resources Pharmaceutical Alternative Medicine Other Retail Health Specialty Retail

MEDIA:

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May 4, 2021 7:14 am

MESH01 Appoints Tim Penasack as President

MESH01 Taps Seasoned Tech Executive and Strategist Tim Penasack to Navigate Growth and Enterprise-Level Relationships

PORTSMOUTH, N.H., May 04, 2021 (GLOBE NEWSWIRE) — MESH01 announced today the appointment of Tim Penasack as President. Tim brings over 20 years of corporate strategy and business development experience to be leveraged as MESH01 navigates continued growth and deeper relationships with many of the world’s largest and most recognized brands and retailers.

Tim’s proven track record of successful, customer-centric strategy development includes early years as a Strategy Consultant at Accenture before he moved into technology leadership roles including Senior Director, Strategy and Planning at Cisco Systems, and Vice President at Brocade. As VP, Corporate Development at Demandware, Tim’s evidence-based predictions of eCommerce innovation enabled the post-IPO organization and now a subsidiary of Salesforce, to provide its clients with a newly defined competitive advantage in the rapidly evolving eCommerce space, resulting in significant shared success.

“As today’s brands and retailers continue to realize the value of data-driven decision making within product development, the nature of MESH01’s customer relationships is expanding from point and program-level to enterprise-wide solutions,” explains Penasack. “I am joining MESH01 with an incredible amount of energy and excitement for this business and our customers. Rarely does one have the opportunity to lead a category-defining offering validated by such an inspiring brand roster. The opportunity for both MESH01 and its customers is still in its early stages, and I’m eager to partner with our brands and retailers as they transform their processes to continuously bring exceptional product experiences to market.”

About MESH01, LLC

MESH01 brings purpose-built product testing technology, an integrated product tester community and industry expertise to the apparel and footwear, retail and consumer goods industries. Brands and retailers including The North Face, Hanes, Target, L.L.Bean and Walmart use MESH01 to test and inform their product development from concept to product launch by engaging their customers throughout their product development process. Bringing new value to business processes in transformation, MESH01 was named to Unilever’s Foundry 50 in 2016 for its innovative contributions in Data, Insights and Personalization.

For press inquiries dial +1 603.766.0957 or email [email protected].

A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/22ee6549-765a-4ed4-b192-c3763f33b459

May 4, 2021 7:13 am

Vishay Reports Results for First Quarter 2021

Revenues Q1 of $765 million
Gross margin Q1 of 26.5%
Operating margin Q1 of 12.7%
EPS Q1 of $0.49; adjusted EPS $0.46
Free Cash for the trailing 12 months Q1 of $211 million
Guidance Q2 for revenues of $790 to $830 million at a gross margin of 27.3% plus/minus 60 basis points at Q1 exchange rates.

MALVERN, Pa., May 04, 2021 (GLOBE NEWSWIRE) — Vishay Intertechnology, Inc. (NYSE: VSH), one of the world’s largest manufacturers of discrete semiconductors and passive components, today announced its results for the fiscal quarter ended April 3, 2021.

Revenues for the fiscal quarter ended April 3, 2021 were $764.6 million, compared to $667.2 million for the fiscal quarter ended December 31, 2020, and $612.8 million for the fiscal quarter ended April 4, 2020. Net earnings attributable to Vishay stockholders for the fiscal quarter ended April 3, 2021 were $71.4 million, or $0.49 per diluted share, compared to $37.6 million, or $0.26 per diluted share, for the fiscal quarter ended December 31, 2020, and $27.2 million, or $0.19 per diluted share, for the fiscal quarter ended April 4, 2020.

As summarized on the attached reconciliation schedule, all periods presented include items affecting comparability. Adjusted earnings per diluted share, which exclude certain items net of tax and unusual tax items, were $0.46, $0.28, and $0.21 for the fiscal quarters ended April 3, 2021, December 31, 2020, and April 4, 2020, respectively.

Commenting on results for the first quarter 2021, Dr. Gerald Paul, President and Chief Executive Officer stated, “In the first quarter of 2021, the steep upturn of our business that began in October of last year accelerated even further. Quarterly orders and backlog reached all-time highs. Sales in the first quarter of Vishay’s products from distribution to end customers increased 21% over the fourth quarter of last year and inventories of our products at distribution were reduced by $34 million. Virtually all markets are in excellent shape and supply chains have become rather depleted.”

Dr. Paul continued, “Over the next few years, we expect to experience higher growth rates than over the last decade. This expectation is based upon accelerated electrification, such as factory automation, electrical vehicles, and 5G infrastructure. To be well positioned to service our customers and to fully participate in these growing markets, Vishay intends to increase its capital expenditures for expansion in the mid-term. For the year 2021, we expect to invest approximately $225 million in capital expenditures.”

Commenting on the outlook Dr. Paul stated, “For the second quarter 2021 we guide for revenues in the range of $790 to $830 million at a gross margin of 27.3% plus/minus 60 basis points at the exchange rates of Q1 2021.”

A conference call to discuss Vishay’s first quarter financial results is scheduled for Tuesday, May 4, 2021 at 9:00 a.m. ET. The dial-in number for the conference call is 877 589-6174 (+1 706-643-1406, if calling from outside the United States) and the access code is 6669583.

A live audio webcast of the conference call and a PDF copy of the press release and the quarterly presentation will be accessible directly from the Investor Relations section of the Vishay website at http://ir.vishay.com.

There will be a replay of the conference call from 12:05 p.m. ET on Tuesday, May 4, 2021 through 11:59 p.m. ET on Wednesday, May 19 The telephone number for the replay is +1 855-859-2056 (+1 404-537-3406, if calling from outside the United States or Canada) and the access code is 6669583.

About Vishay

Vishay manufactures one of the world’s largest portfolios of discrete semiconductors and passive electronic components that are essential to innovative designs in the automotive, industrial, computing, consumer, telecommunications, military, aerospace, and medical markets. Serving customers worldwide, Vishay is The DNA of tech.™ Vishay Intertechnology, Inc. is a Fortune 1,000 Company listed on the NYSE (VSH). More on Vishay at www.Vishay.com.

This press release includes certain financial measures which are not recognized in accordance with U.S. generally accepted accounting principles (“GAAP”), including adjusted net earnings; adjusted earnings per share; adjusted gross margin; adjusted operating margin; free cash; earnings before interest, taxes, depreciation and amortization (“EBITDA”); adjusted EBITDA; and adjusted EBITDA margin; which are considered “non-GAAP financial measures” under the U.S. Securities and Exchange Commission rules. These non-GAAP measures supplement our GAAP measures of performance or liquidity and should not be viewed as an alternative to GAAP measures of performance or liquidity. Non-GAAP measures such as adjusted net earnings, adjusted earnings per share, adjusted gross margin, adjusted operating margin, free cash, EBITDA, adjusted EBITDA, and adjusted EBITDA margin do not have uniform definitions. These measures, as calculated by Vishay, may not be comparable to similarly titled measures used by other companies. Management believes that such measures are meaningful to investors because they provide insight with respect to intrinsic operating results of the Company. Although the terms “free cash” and “EBITDA” are not defined in GAAP, the measures are derived using various line items measured in accordance with GAAP. Reconciling items to arrive at adjusted net earnings represent significant charges or credits that are important to understanding the Company’s intrinsic operations. Reconciling items to calculate adjusted gross margin, adjusted operating margin and adjusted EBITDA represent those same items used in computing adjusted net earnings, as relevant. Furthermore, the presented calculation of adjusted EBITDA is substantially similar to, but not identical to, a measure used in the calculation of financial ratios required for covenant compliance under Vishay’s revolving credit facility. These reconciling items are indicated on the accompanying reconciliation schedules and are more fully described in the Company’s financial statements presented in its annual report on Form 10-K and its quarterly reports presented on Forms 10-Q.

Statements contained herein that relate to the Company’s future performance, including statements with respect to forecasted revenues, margins, inventories, product demand, anticipated areas of growth, market segment performance, capital expenditures, and the performance of the economy in general, are forward-looking statements within the safe harbor provisions of Private Securities Litigation Reform Act of 1995. Words such as “believe,” “estimate,” “will be,” “will,” “would,” “expect,” “anticipate,” “plan,” “project,” “intend,” “could,” “should,” or other similar words or expressions often identify forward-looking statements. Such statements are based on current expectations only, and are subject to certain risks, uncertainties and assumptions, many of which are beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results, performance, or achievements may vary materially from those anticipated, estimated or projected. Among the factors that could cause actual results to materially differ include: general business and economic conditions; manufacturing or supply chain interruptions or changes in customer demand because of COVID-19; delays or difficulties in implementing our cost reduction strategies; delays or difficulties in expanding our manufacturing capacities; an inability to attract and retain highly qualified personnel; changes in foreign currency exchange rates; uncertainty related to the effects of changes in foreign currency exchange rates; competition and technological changes in our industries; difficulties in new product development; difficulties in identifying suitable acquisition candidates, consummating a transaction on terms which we consider acceptable, and integration and performance of acquired businesses; changes in U.S. and foreign trade regulations and tariffs, and uncertainty regarding the same; changes in applicable domestic and foreign tax regulations, and uncertainty regarding the same; changes in applicable accounting standards and other factors affecting our operations that are set forth in our filings with the Securities and Exchange Commission, including our annual reports on Form 10-K and our quarterly reports on Form 10-Q. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

The DNA of tech ™ is a trademark of Vishay Intertechnology.

Contact:
Vishay Intertechnology, Inc.
Peter Henrici
Senior Vice President, Corporate Communications
+1-610-644-1300

VISHAY INTERTECHNOLOGY, INC.
Summary of Operations
(Unaudited – In thousands, except per share amounts)

	Fiscal quarters ended
	April 3, 2021			December 31, 2020			April 4, 2020

Net revenues	$	764,632		$	667,180		$	612,841
Costs of products sold*		561,683			514,896			465,601
Gross profit		202,949			152,284			147,240
Gross margin		26.5	%		22.8	%		24.0	%

Selling, general, and administrative expenses**		105,685			92,272			99,832
Operating income		97,264			60,012			47,408
Operating margin		12.7	%		9.0	%		7.7	%

Other income (expense):
Interest expense		(4,376	)		(7,159	)		(8,552	)
Loss on early extinguishment of debt		–			(553	)		(2,920	)
Other		(5,731	)		(5,570	)		198
Total other income (expense) – net		(10,107	)		(13,282	)		(11,274	)

Income before taxes		87,157			46,730			36,134

Income tax expense		15,514			8,887			8,750

Net earnings		71,643			37,843			27,384

Less: net earnings attributable to noncontrolling interests		208			276			165

Net earnings attributable to Vishay stockholders	$	71,435		$	37,567		$	27,219

Basic earnings per share attributable to Vishay stockholders	$	0.49		$	0.26		$	0.19

Diluted earnings per share attributable to Vishay stockholders	$	0.49		$	0.26		$	0.19

Weighted average shares outstanding – basic		144,968			144,855			144,792

Weighted average shares outstanding – diluted		145,463			145,251			145,295

Cash dividends per share	$	0.095		$	0.095		$	0.095

* Includes incremental costs of products sold separable from normal operations directly attributable to the COVID-19 pandemic of $268 and $3,130 for the fiscal quarters ended December 31, 2020 and April 4, 2020, respectively.
** Includes incremental selling, general, and administrative expenses (benefits) separable from normal operations directly attributable to the COVID-19 pandemic of $(580) and $317, for the fiscal quarters ended December 31, 2020 and April 4, 2020, respectively.

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets
(In thousands)

	April 3, 2021			December 31, 2020
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	643,847		$	619,874
Short-term investments		137,348			158,476
Accounts receivable, net		385,238			338,632
Inventories:
Finished goods		129,310			120,792
Work in process		212,273			201,259
Raw materials		132,373			126,200
Total inventories		473,956			448,251

Prepaid expenses and other current assets		140,536			132,103
Total current assets		1,780,925			1,697,336

Property and equipment, at cost:
Land		75,339			76,231
Buildings and improvements		629,550			641,041
Machinery and equipment		2,705,346			2,732,771
Construction in progress		94,981			86,520
Allowance for depreciation		(2,587,948	)		(2,593,398	)
		917,268			943,165

Right of use assets		98,001			102,440

Goodwill		157,693			158,183

Other intangible assets, net		64,123			66,795

Other assets		192,552			186,554
Total assets	$	3,210,562		$	3,154,473

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets (continued)
(In thousands)

	April 3, 2021			December 31, 2020
	(Unaudited)

Liabilities and equity
Current liabilities:
Trade accounts payable	$	206,741		$	196,203
Payroll and related expenses		136,069			141,034
Lease liabilities		21,275			22,074
Other accrued expenses		197,246			182,642
Income taxes		26,715			20,470
Total current liabilities		588,046			562,423

Long-term debt less current portion		453,213			394,886
U.S. transition tax payable		125,438			125,438
Deferred income taxes		1,856			1,852
Long-term lease liabilities		82,260			86,220
Other liabilities		103,881			104,356
Accrued pension and other postretirement costs		287,407			300,113
Total liabilities		1,642,101			1,575,288

Redeemable convertible debentures		–			170

Equity:
Vishay stockholders’ equity
Common stock		13,271			13,256
Class B convertible common stock		1,210			1,210
Capital in excess of par value		1,345,284			1,409,200
Retained earnings		217,214			138,990
Accumulated other comprehensive income (loss)		(11,526	)		13,559
Total Vishay stockholders’ equity		1,565,453			1,576,215
Noncontrolling interests		3,008			2,800
Total equity		1,568,461			1,579,015
Total liabilities, temporary equity, and equity	$	3,210,562		$	3,154,473

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Statements of Cash Flows
(Unaudited – In thousands)
	Three fiscal months ended
	April 3, 2021			April 4, 2020
	(Unaudited)
Operating activities
Net earnings	$	71,643		$	27,384
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation and amortization		42,146			41,520
Gain on disposal of property and equipment		(177	)		(45	)
Accretion of interest on convertible debt instruments		–			3,637
Inventory write-offs for obsolescence		4,784			5,643
Loss on early extinguishment of debt		–			2,920
Deferred income taxes		901			(3,517	)
Other		5,728			3,524
Changes in operating assets and liabilities, net of effects of businesses acquired		(67,703	)		(46,588	)
Net cash provided by operating activities		57,322			34,478

Investing activities
Purchase of property and equipment		(28,527	)		(24,328	)
Proceeds from sale of property and equipment		200			53
Purchase of short-term investments		(12,853	)		(35,463	)
Maturity of short-term investments		29,519			–
Other investing activities		347			(1,507	)
Net cash used in investing activities		(11,314	)		(61,245	)

Financing activities
Repurchase of convertible debt instruments		(300	)		(19,849	)
Net proceeds (payments) on revolving credit lines		–			54,000
Net changes in short-term borrowings		–			85
Dividends paid to common stockholders		(12,608	)		(12,592	)
Dividends paid to Class B common stockholders		(1,149	)		(1,149	)
Cash withholding taxes paid when shares withheld for vested equity awards		(1,963	)		(1,991	)
Net cash provided by (used in) financing activities		(16,020	)		18,504
Effect of exchange rate changes on cash and cash equivalents		(6,015	)		(5,167	)

Net increase (decrease) in cash and cash equivalents		23,973			(13,430	)

Cash and cash equivalents at beginning of period		619,874			694,133
Cash and cash equivalents at end of period	$	643,847		$	680,703

VISHAY INTERTECHNOLOGY, INC.
Reconciliation of Adjusted Earnings Per Share
(Unaudited – In thousands, except per share amounts)
	Fiscal quarters ended
	April 3, 2021			December 31, 2020			April 4, 2020

GAAP net earnings attributable to Vishay stockholders	$	71,435		$	37,567		$	27,219

Reconciling items affecting gross profit:
Impact of the COVID-19 pandemic	$	–		$	268		$	3,130

Other reconciling items affecting operating income:
Impact of the COVID-19 pandemic	$	–		$	(580	)	$	317

Reconciling items affecting other income (expense):
Loss on early extinguishment of debt	$	–		$	553		$	2,920

Reconciling items affecting tax expense (benefit):
Change in tax regulation	$	(4,395	)	$	–		$	–
Change in deferred taxes due to early extinguishment of debt		–			(217	)		(1,346	)
Effects of changes in uncertain tax positions		–			3,751			–
Tax effects of pre-tax items above		–			(12	)		(1,482	)

Adjusted net earnings	$	67,040		$	41,330		$	30,758

Adjusted weighted average diluted shares outstanding		145,463			145,251			145,295

Adjusted earnings per diluted share	$	0.46		$	0.28		$	0.21

VISHAY INTERTECHNOLOGY, INC.
Reconciliation of Free Cash
(Unaudited – In thousands)
	Fiscal quarters ended
	April 3, 2021			December 31, 2020			April 4, 2020
Net cash provided by operating activities	$	57,322		$	125,699		$	34,478
Proceeds from sale of property and equipment		200			110			53
Less: Capital expenditures		(28,527	)		(52,798	)		(24,328	)
Free cash	$	28,995		$	73,011		$	10,203

VISHAY INTERTECHNOLOGY, INC.
Reconciliation of EBITDA and Adjusted EBITDA
(Unaudited – In thousands)
	Fiscal quarters ended
	April 3, 2021			December 31, 2020			April 4, 2020

GAAP net earnings attributable to Vishay stockholders	$	71,435		$	37,567		$	27,219
Net earnings attributable to noncontrolling interests		208			276			165
Net earnings	$	71,643		$	37,843		$	27,384

Interest expense	$	4,376		$	7,159		$	8,552
Interest income		(287	)		(385	)		(1,854	)
Income taxes		15,514			8,887			8,750
Depreciation and amortization		42,146			42,454			41,520
EBITDA	$	133,392		$	95,958		$	84,352

Reconciling items
Impact of the COVID-19 pandemic	$	–		$	(312	)	$	3,447
Loss on early extinguishment of debt		–			553			2,920

Adjusted EBITDA	$	133,392		$	96,199		$	90,719

Adjusted EBITDA margin**		17.4	%		14.4	%		14.8	%

** Adjusted EBITDA as a percentage of net revenues

May 4, 2021 7:10 am

Vulcan Reports First Quarter 2021 Results

Aggregates Business Drives Earnings Growth and Margin Expansion

Strong Execution Supports Improvement in Full Year Outlook

PR Newswire

BIRMINGHAM, Ala., May 4, 2021 /PRNewswire/ — Vulcan Materials Company (NYSE: VMC), the nation’s largest producer of construction aggregates, today announced results for the quarter ended March 31, 2021.

Financial and Operating Highlights:

Net earnings were $161 million, or $1.20 per diluted share
Sale of reclaimed quarry produced net proceeds of $182 million and pretax gain of $115 million ($85 million after tax, or $0.64 per diluted share)
First quarter Adjusted EBITDA was $244 million (excluding gain on land sale), a year-over-year increase of 22 percent
Aggregates unit profitability increased 12 percent year-over-year to $4.82 per ton
A disciplined approach to leveraging our capital base contributed to an improvement in return on invested capital of 90 basis points to 14.8 percent
Full-year 2021 Adjusted EBITDA guidance raised to between $1.380 to $1.460 billion (excluding gain on sale of land)

Tom Hill, Chairman and Chief Executive Officer, said, “Our first quarter results are a testament to the resiliency of our best-in-class aggregates business. While severe winter weather conditions in February resulted in an uneven start to the year, strong execution from our teams allowed us to drive earnings growth and margin expansion. As the construction season got underway during March, many of our key markets began to see shipments rebound. Our four strategic disciplines helped us grow our aggregates cash gross profit by 9 percent to $6.56 per ton.”

Mr. Hill stated, “We continue to see strength in residential construction activity, driven by single-family housing. Recent growth in highway awards and construction employment trends in our markets also bode well for further recovery in construction activity later in 2021. Shipments into private nonresidential continue to benefit from heavy industrial projects, such as data centers and warehouses, while leading nonresidential indicators suggest growth opportunities in other categories are on the horizon. The pricing environment remains positive, and we continue to execute at a high level, positioning us well for 2021. These trends in the key drivers of our aggregates business lead us to an improved earnings outlook for the remainder of the year.”

Highlights as of March 31, 2021 include:

	First Quarter		Trailing-Twelve Months
Amounts in millions, except per unit data	2021	2020	2021	2020
Total revenues	$1,068.3	$1,049.2	$4,875.9	$4,981.8
Gross profit	$ 229.3	$ 201.7	$1,309.0	$1,265.9
Aggregates segment
Segment sales	$ 894.9	$ 868.2	$3,971.0	$4,023.5
Freight-adjusted revenues	$ 681.2	$ 648.0	$3,040.8	$3,033.6
Gross profit	$ 223.6	$ 194.1	$1,188.7	$1,155.1
Shipments (tons)	46.4	45.0	209.7	214.9
Freight-adjusted sales price per ton	$ 14.67	$ 14.39	$ 14.50	$ 14.12
Gross profit per ton	$ 4.82	$ 4.31	$ 5.67	$ 5.38
Asphalt, Concrete & Calcium segment gross profit	$ 5.6	$ 7.6	$ 120.3	$ 110.9
Selling, Administrative and General (SAG)	$ 88.6	$ 86.4	$ 361.9	$ 366.7
SAG as % of total revenues	8.3%	8.2%	7.4%	7.4%
Earnings from continuing operations before income taxes	$ 222.3	$ 72.2	$ 893.9	$ 755.3
Net earnings	$ 160.6	$ 60.3	$ 684.8	$ 614.6
Adjusted EBIT	$ 143.9	$ 105.5	$ 965.1	$ 897.5
Adjusted EBITDA	$ 244.3	$ 201.0	$1,366.8	$1,278.4
Earnings from continuing operations per diluted share	$ 1.21	$ 0.45	$ 5.17	$ 4.64
Adjusted earnings from continuing operations per diluted share	$ 0.69	$ 0.47	$ 4.91	$ 4.71

Segment Results

Aggregates
First quarter segment sales increased 3 percent and gross profit increased 15 percent to $224 million. Gross profit margin increased 260 basis points due to modest growth in both volume and price as well as effective cost control. Earnings improvement was widespread across the Company’s footprint.

Aggregates shipments increased 3 percent from the prior year’s first quarter. Average daily shipping rates were lower year-over-year in February, though higher in January and March. This cadence was due to winter weather that moved from Texas into parts of the southeast and mid-Atlantic during the month of February.

The pricing environment continues to be positive across the Company’s footprint as demand visibility continues to improve. For the quarter, freight-adjusted pricing increased 2 percent (mix-adjusted pricing increased 1.3 percent). Mix-adjusted pricing improved sequentially in March, reflecting recently announced price increases in certain key markets. Prices are expected to continue to increase sequentially during the remainder of the year.

Operating efficiency gains helped drive year-over-year declines in freight-adjusted unit cost of sales – down 2 percent in total and 3 percent on a cash basis. Flexible operating plans and disciplined cost control mitigated the impact of any operational disruptions caused by the uneven start to the year.

Asphalt, Concrete and Calcium
Overall, nonaggregates segments gross profit was collectively $5.6 million compared to $7.6 million in the prior year’s first quarter. Asphalt segment gross profit was a loss of $3.0 million, as compared to a loss of $2.4 million in the prior year’s first quarter. The year-over-year decline was driven mostly by the impact of weather conditions in Alabama, Tennessee and Texas.

First quarter concrete segment gross profit was $7.8 million compared to $9.2 million in the prior year. Shipments decreased 16 percent versus the prior year, again due to weather in Virginia, and average selling prices increased 3 percent compared to the prior year.

Calcium segment gross profit was $0.9 million, in line with the prior year quarter.

Selling, Administrative and General (SAG) and Other Items

SAG expense was $89 million in the quarter and $362 million on a trailing-twelve month basis. As a percentage of total revenues, SAG expense remained at 7.4 percent on a trailing-twelve month basis. The Company remains focused on further leveraging its overhead cost structure.

During the quarter, the Company sold a reclaimed quarry in Southern California. The transaction resulted in a pretax gain of $115 million, or $0.64 per diluted share. The Company remains focused on its efforts to maximize the value of its portfolio of quarry operations as they move through their life-cycle of land management.

Other nonoperating income was $6 million, compared to expense of $9 million in the prior year quarter. The prior year’s results include a foreign currency translation loss of $6 million, resulting from the rapid devaluation of the Mexican peso in March due to the COVID-19 pandemic.

Financial Position, Liquidity and Capital Allocation

Capital expenditures in the first quarter were $71 million, including both core operating and maintenance projects as well as growth projects. During the fourth quarter of 2020, the Company restarted planned growth projects that were put on hold in the first quarter of 2020 as a result of the pandemic. For the full year 2021, the Company expects to spend between $450 and $475 million on capital expenditures, including growth projects. The Company will continue to review its plans and will adjust as needed.

At March 31, 2021, total debt to trailing-twelve month Adjusted EBITDA was 2.0 times, or 1.4 times on a net debt basis reflecting $891 million of cash on hand. As planned, the Company paid off approximately $500 million of debt maturities in March. The Company’s weighted-average debt maturity was 15 years, and its effective weighted-average interest rate was 4.6 percent.

Return on invested capital increased 90 basis points year-over-year to 14.8 percent driven by solid operating earnings growth coupled with disciplined capital management and a balanced approach to growth.

Outlook

Management expectations for 2021 include the following updates:

Aggregates shipments to increase between 1 percent and 4 percent compared to 2020
An effective tax rate of approximately 23 to 24 percent
Earnings from continuing operations of between $4.85 and $5.30 per diluted share, excluding land sale gain
Adjusted EBITDA of between $1.380 and $1.460 billion, excluding land sale gain
All other aspects of the Company’s expectations for 2021 remain unchanged from those reported as part of its fourth quarter earnings in February.

Mr. Hill concluded, “We remain focused on factors within our control, including pricing and cost actions, both of which will drive further improvement in our industry-leading unit margins. Our operating plans are underpinned by four strategic disciplines (Commercial and Operational Excellence, Logistics Innovation and Strategic Sourcing), a healthy balance sheet and the engagement of our people. Our performance clearly demonstrates that a balanced approach to growth, focusing on organic investments, acquisitions, and greenfield developments is the best way to create value for our shareholders.”

Conference Call

Vulcan will host a conference call at 9:00 a.m. CT on May 4, 2021. A webcast will be available via the Company’s website at www.vulcanmaterials.com. Investors and other interested parties may access the teleconference live by calling 833-962-1439, or 832-900-4623 if outside the U.S., approximately 10 minutes before the scheduled start. The conference ID is 6357979. The conference call will be recorded and available for replay at the Company’s website approximately two hours after the call.

About Vulcan Materials Company

Vulcan Materials Company, a member of the S&P 500 Index with headquarters in Birmingham, Alabama, is the nation’s largest producer of construction aggregates – primarily crushed stone, sand and gravel – and a major producer of aggregates-based construction materials, including asphalt and ready-mixed concrete. For additional information about Vulcan, go to www.vulcanmaterials.com.

FORWARD-LOOKING STATEMENT DISCLAIMER
This document contains forward-looking statements. Statements that are not historical fact, including statements about Vulcan’s beliefs and expectations, are forward-looking statements. Generally, these statements relate to future financial performance, results of operations, business plans or strategies, projected or anticipated revenues, expenses, earnings (including EBITDA and other measures), dividend policy, shipment volumes, pricing, levels of capital expenditures, intended cost reductions and cost savings, anticipated profit improvements and/or planned divestitures and asset sales. These forward-looking statements are sometimes identified by the use of terms and phrases such as “believe,” “should,” “would,” “expect,” “project,” “estimate,” “anticipate,” “intend,” “plan,” “will,” “can,” “may” or similar expressions elsewhere in this document. These statements are subject to numerous risks, uncertainties, and assumptions, including but not limited to general business conditions, competitive factors, pricing, energy costs, and other risks and uncertainties discussed in the reports Vulcan periodically files with the SEC.

Forward-looking statements are not guarantees of future performance and actual results, developments, and business decisions may vary significantly from those expressed in or implied by the forward-looking statements. The following risks related to Vulcan’s business, among others, could cause actual results to differ materially from those described in the forward-looking statements: general economic and business conditions; a pandemic, epidemic or other public health emergency, such as the COVID-19 outbreak; Vulcan’s dependence on the construction industry, which is subject to economic cycles; the timing and amount of federal, state and local funding for infrastructure; changes in the level of spending for private residential and private nonresidential construction; changes in Vulcan’s effective tax rate; the increasing reliance on information technology infrastructure, including the risks that the infrastructure does not work as intended, experiences technical difficulties or is subjected to cyber-attacks; the impact of the state of the global economy on Vulcan’s businesses and financial condition and access to capital markets; the highly competitive nature of the construction industry; the impact of future regulatory or legislative actions, including those relating to climate change, wetlands, greenhouse gas emissions, the definition of minerals, tax policy or international trade; the outcome of pending legal proceedings; pricing of Vulcan’s products; weather and other natural phenomena, including the impact of climate change and availability of water; energy costs; costs of hydrocarbon-based raw materials; healthcare costs; the amount of long-term debt and interest expense incurred by Vulcan; changes in interest rates; the impact of a discontinuation of the London Interbank Offered Rate (LIBOR); volatility in pension plan asset values and liabilities, which may require cash contributions to the pension plans; the impact of environmental cleanup costs and other liabilities relating to existing and/or divested businesses; Vulcan’s ability to secure and permit aggregates reserves in strategically located areas; Vulcan’s ability to manage and successfully integrate acquisitions; the effect of changes in tax laws, guidance and interpretations; significant downturn in the construction industry may result in the impairment of goodwill or long-lived assets; changes in technologies, which could disrupt the way Vulcan does business and how Vulcan’s products are distributed; and other assumptions, risks and uncertainties detailed from time to time in the reports filed by Vulcan with the SEC. All forward-looking statements in this communication are qualified in their entirety by this cautionary statement. Vulcan disclaims and does not undertake any obligation to update or revise any forward-looking statement in this document except as required by law.

	Table A
Vulcan Materials Company
and Subsidiary Companies
	(in thousands, except per share data)
	*Three Months Ended*
Consolidated Statements of Earnings		*March 31*
(Condensed and unaudited)	2021	2020

Total revenues	$1,068,344	$1,049,242
Cost of revenues	839,077	847,519
Gross profit	229,267	201,723
Selling, administrative and general expenses	88,593	86,430
Gain on sale of property, plant & equipment
and businesses	117,165	999
Other operating expense, net	(8,326)	(3,991)
Operating earnings	249,513	112,301
Other nonoperating income (expense), net	5,913	(9,336)
Interest expense, net	33,118	30,773
Earnings from continuing operations
before income taxes	222,308	72,192
Income tax expense	60,638	12,194
Earnings from continuing operations	161,670	59,998
Earnings (loss) on discontinued operations, net of tax	(1,056)	260
Net earnings	$160,614	$60,258

Basic earnings (loss) per share
Continuing operations	$1.22	$0.45
Discontinued operations	($0.01)	$0.00
Net earnings	$1.21	$0.45

Diluted earnings (loss) per share
Continuing operations	$1.21	$0.45
Discontinued operations	($0.01)	$0.00
Net earnings	$1.20	$0.45


Weighted-average common shares outstanding
Basic	132,749	132,567
Assuming dilution	133,415	133,259
Effective tax rate from continuing operations	27.3%	16.9%

			Table B
Vulcan Materials Company
and Subsidiary Companies
			(in thousands)
Consolidated Balance Sheets	*March 31*	December 31	March 31
(Condensed and unaudited)	2021	2020	2020
Assets
Cash and cash equivalents	$722,344	$1,197,068	$120,041
Restricted cash	168,595	945	232
Accounts and notes receivable
Accounts and notes receivable, gross	596,006	558,848	601,182
Allowance for doubtful accounts	(2,878)	(2,551)	(3,517)
Accounts and notes receivable, net	593,128	556,297	597,665
Inventories
Finished products	368,758	378,389	403,612
Raw materials	36,095	33,780	33,676
Products in process	4,573	4,555	5,010
Operating supplies and other	31,903	31,861	28,449
Inventories	441,329	448,585	470,747
Other current assets	67,612	74,270	88,095
Total current assets	1,993,008	2,277,165	1,276,780
Investments and long-term receivables	34,265	34,301	57,987
Property, plant & equipment
Property, plant & equipment, cost	9,110,336	9,102,086	8,907,788
Allowances for depreciation, depletion & amortization	(4,746,996)	(4,676,087)	(4,506,700)
Property, plant & equipment, net	4,363,340	4,425,999	4,401,088
Operating lease right-of-use assets, net	421,625	423,128	420,930
Goodwill	3,172,112	3,172,112	3,167,061
Other intangible assets, net	1,114,617	1,123,544	1,083,515
Other noncurrent assets	233,793	230,656	222,021
Total assets	$11,332,760	$11,686,905	$10,629,382
Liabilities
Current maturities of long-term debt	15,436	515,435	25
Trade payables and accruals	255,624	273,080	243,019
Other current liabilities	294,797	259,368	232,632
Total current liabilities	565,857	1,047,883	475,676
Long-term debt	2,772,901	2,772,240	2,785,566
Deferred income taxes, net	733,561	706,050	648,405
Deferred revenue	172,377	174,045	178,568
Operating lease liabilities	397,306	399,582	399,489
Other noncurrent liabilities	554,517	559,775	551,352
Total liabilities	$5,196,519	$5,659,575	$5,039,056
Equity
Common stock, $1 par value	132,664	132,516	132,433
Capital in excess of par value	2,797,687	2,802,012	2,782,738
Retained earnings	3,385,604	3,274,107	2,885,084
Accumulated other comprehensive loss	(179,714)	(181,305)	(209,929)
Total equity	$6,136,241	$6,027,330	$5,590,326
Total liabilities and equity	$11,332,760	$11,686,905	$10,629,382

	Table C
Vulcan Materials Company
and Subsidiary Companies
	(in thousands)
	*Three Months Ended*
Consolidated Statements of Cash Flows		*March 31*
(Condensed and unaudited)	2021	2020
Operating Activities
Net earnings	$160,614	$60,258
Adjustments to reconcile net earnings to net cash provided by operating activities
Depreciation, depletion, accretion and amortization	100,368	95,480
Noncash operating lease expense	10,528	8,851
Net gain on sale of property, plant & equipment and businesses	(117,165)	(999)
Contributions to pension plans	(2,124)	(2,144)
Share-based compensation expense	7,869	6,716
Deferred tax expense	26,949	19,671
Changes in assets and liabilities before initial
effects of business acquisitions and dispositions	(16,992)	(99,597)
Other, net	(785)	(5,761)
Net cash provided by operating activities	$169,262	$82,475
Investing Activities
Purchases of property, plant & equipment	(100,650)	(142,650)
Proceeds from sale of property, plant & equipment	186,497	2,536
Other, net	25	9,872
Net cash provided by (used for) investing activities	$85,872	($130,242)
Financing Activities
Payment of current maturities and long-term debt	(500,006)	(6)
Settlements of interest rate derivatives	0	(19,863)
Purchases of common stock	0	(26,132)
Dividends paid	(49,085)	(45,100)
Share-based compensation, shares withheld for taxes	(12,086)	(15,064)
Other, net	(1,031)	(301)
Net cash used for financing activities	($562,208)	($106,466)
Net decrease in cash and cash equivalents and restricted cash	(307,074)	(154,233)
Cash and cash equivalents and restricted cash at beginning of year	1,198,013	274,506
Cash and cash equivalents and restricted cash at end of period	$890,939	$120,273

	Table D

Segment Financial Data and Unit Shipments
	(in thousands, except per unit data)
	*Three Months Ended*
		*March 31*
	2021	2020
Total Revenues
Aggregates ¹	$894,909	$868,226
Asphalt ²	147,167	139,789
Concrete	81,359	94,765
Calcium	2,060	2,026
Segment sales	$1,125,495	$1,104,806
Aggregates intersegment sales	(57,151)	(55,564)
Total revenues	$1,068,344	$1,049,242
Gross Profit
Aggregates	$223,638	$194,131
Asphalt	(2,991)	(2,435)
Concrete	7,768	9,213
Calcium	852	814
Total	$229,267	$201,723
Depreciation, Depletion, Accretion and Amortization
Aggregates	$80,808	$77,136
Asphalt	9,095	8,734
Concrete	3,952	4,082
Calcium	39	49
Other	6,474	5,479
Total	$100,368	$95,480
Average Unit Sales Price and Unit Shipments
Aggregates
Freight-adjusted revenues ³	$681,155	$648,033
Aggregates – tons	46,437	45,048
Freight-adjusted sales price ⁴	$14.67	$14.39

Other Products
Asphalt Mix – tons	2,217	2,057
Asphalt Mix – sales price	$56.78	$58.51

Ready-mixed concrete – cubic yards	613	734
Ready-mixed concrete – sales price	$131.52	$127.91

Calcium – tons	75	73
Calcium – sales price	$27.64	$27.56


¹Includes product sales (crushed stone, sand and gravel, sand, and other aggregates), as well as freight & delivery
costs that we pass along to our customers, and service revenues related to aggregates.
²Includes product sales, as well as service revenues from our asphalt construction paving business.
³Freight-adjusted revenues are Aggregates segment sales excluding freight & delivery revenues and immaterial
other revenues related to services, such as landfill tipping fees, that are derived from our aggregates business.
⁴Freight-adjusted sales price is calculated as freight-adjusted revenues divided by aggregates unit shipments.

	Appendix 1
1. Reconciliation of Non-GAAP Measures

Aggregates segment freight-adjusted revenues is not a Generally Accepted Accounting Principle (GAAP) measure. We present this metric as it is consistent with the basis by which we review our operating results. We believe that this presentation is consistent with our competitors and meaningful to our investors as it excludes revenues associated with freight & delivery, which are pass-through activities. It also excludes immaterial other revenues related to services, such as landfill tipping fees, that are derived from our aggregates business. Additionally, we use this metric as the basis for calculating the average sales price of our aggregates products. Reconciliation of this metric to its nearest GAAP measure is presented below:

Aggregates Segment Freight-Adjusted Revenues

	(in thousands, except per ton data)
	*Three Months Ended*
		*March 31*
	2021	2020
Aggregates segment
Segment sales	$894,909	$868,226
Less: Freight & delivery revenues ¹	197,226	205,707
Other revenues	16,528	14,486
Freight-adjusted revenues	$681,155	$648,033
Unit shipment – tons	46,437	45,048
Freight-adjusted sales price	$14.67	$14.39

¹At the segment level, freight & delivery revenues include intersegment freight & delivery (which are eliminated at the consolidated level) and freight to remote

distribution sites.

Aggregates segment incremental gross profit flow-through rate is not a GAAP measure and represents the year-over-year change in gross profit divided by the year-over-year change in segment sales excluding freight & delivery (revenues and costs). We present this metric as it is consistent with the basis by which we review our operating results. We believe that this presentation is consistent with our competitors and meaningful to our investors as it excludes revenues associated with freight & delivery, which are pass-through activities. Reconciliation of this metric to its nearest GAAP measure is presented below:

Aggregates Segment Incremental Gross Profit Margin in Accordance with GAAP
	(dollars in thousands)
	*Three Months Ended*
		*March 31*
	2021	2020
Aggregates segment
Gross profit	$223,638	$194,131
Segment sales	$894,909	$868,226
Gross profit margin	25.0%	22.4%
Incremental gross profit margin	110.6%

Aggregates Segment Incremental Gross Profit Flow-through Rate (Non-GAAP)
		(dollars in thousands)
		*Three Months Ended*
		*March 31*
	2021	2020
Aggregates segment
Gross profit	$223,638	$194,131
Segment sales	$894,909	$868,226
Less: Freight & delivery revenues ¹	197,226	205,707
Segment sales excluding freight & delivery	$697,683	$662,519
Gross profit margin excluding freight & delivery	32.1%	29.3%
Incremental gross profit flow-through rate	83.9%

¹At the segment level, freight & delivery revenues include intersegment freight & delivery (which are eliminated at the consolidated level) and freight to remote

distribution sites.

GAAP does not define “Aggregates segment cash gross profit” and it should not be considered as an alternative to earnings measures defined by GAAP. We and the investment community use this metric to assess the operating performance of our business. Additionally, we present this metric as we believe that it closely correlates to long-term shareholder value. We do not use this metric as a measure to allocate resources. Aggregates segment cash gross profit per ton is computed by dividing Aggregates segment cash gross profit by tons shipped. Reconciliation of this metric to its nearest GAAP measure is presented below:

Aggregates Segment Cash Gross Profit
	(in thousands, except per ton data)
	*Three Months Ended*
		*March 31*
	2021	2020
Aggregates segment
Gross profit	$223,638	$194,131
Depreciation, depletion, accretion and amortization	80,808	77,136
Aggregates segment cash gross profit	$304,446	$271,267
Unit shipments – tons	46,437	45,048
Aggregates segment cash gross profit per ton	$6.56	$6.02

				Appendix 2
Reconciliation of Non-GAAP Measures (Continued)

GAAP does not define “Earnings Before Interest, Taxes, Depreciation and Amortization” (EBITDA) and it should not be considered as an alternative to earnings measures defined by GAAP. We use this metric to assess the operating performance of our business and as a basis for strategic planning and forecasting as we believe that it closely correlates to long-term shareholder value. We do not use this metric as a measure to allocate resources. We adjust EBITDA for certain items to provide a more consistent comparison of earnings performance from period to period. Reconciliation of this metric to its nearest GAAP measure is presented below:

EBITDA and Adjusted EBITDA
			(in thousands)
	*Three Months Ended*			*TTM*
		*March 31*		*March 31*
	2021	2020	2021	2020
Net earnings	$160,614	$60,258	$684,836	$614,621
Income tax expense	60,638	12,194	204,247	136,699
Interest expense, net	33,118	30,773	136,738	126,839
(Earnings) loss on discontinued operations, net of tax	1,056	(260)	4,831	3,945
EBIT	$255,426	$102,965	$1,030,652	$882,104
Depreciation, depletion, accretion and amortization	100,368	95,480	401,694	380,895
EBITDA	$355,794	$198,445	$1,432,346	$1,262,999
Gain on sale of real estate and businesses, net	(114,695)	0	(114,695)	(9,289)
Property donation	0	0	0	10,847
Charges associated with divested operations	336	0	7,271	3,033
Business development ¹	385	1,060	6,659	2,808
COVID-19 direct incremental costs	2,468	648	11,990	648
Pension settlement charge	0	0	22,740	0
Restructuring charges	0	868	465	7,325
Adjusted EBITDA	$244,288	$201,021	$1,366,776	$1,278,371
Depreciation, depletion, accretion and amortization	(100,368)	(95,480)	(401,694)	(380,895)
Adjusted EBIT	$143,920	$105,541	$965,082	$897,476
Adjusted EBITDA margin	22.9%	19.2%	28.0%	25.7%

¹Represents non-routine charges or gains associated with acquisitions including the cost impact of purchase accounting inventory valuations.

Similar to our presentation of Adjusted EBITDA, we present Adjusted Diluted earnings per share (EPS) from continuing operations to provide a more consistent comparison of earnings performance from period to period. This metric is not defined by GAAP and should not be considered as an alternative to earnings measures defined by GAAP. Reconciliation of this metric to its nearest GAAP measure is presented below:

Adjusted Diluted EPS from Continuing Operations (Adjusted Diluted EPS)

	*Three Months Ended*		*TTM*
	*March 31*		*March 31*
	2021	2020	2021	2020
Diluted EPS from continuing operations	$1.21	$0.45	$5.17	$4.64
Items included in Adjusted EBITDA above	(0.62)	0.02	(0.36)	0.07
Alabama NOL carryforward valuation allowance	0.10	0.00	0.10	0.00
Adjusted Diluted EPS	$0.69	$0.47	$4.91	$4.71

Net debt to Adjusted EBITDA is not a GAAP measure and should not be considered as an alternative to metrics defined by GAAP. We, the investment community and credit rating agencies use this metric to assess our leverage. Net debt subtracts cash and cash equivalents and restricted cash from total debt. Reconciliation to its nearest GAAP measure is presented below:

Net Debt to Adjusted EBITDA
		(in thousands)

		*March 31*
	2021	2020
Debt
Current maturities of long-term debt	$15,436	$25
Long-term debt	2,772,901	2,785,566
Total debt	$2,788,337	$2,785,591
Less: Cash and cash equivalents and restricted cash	890,939	120,273
Net debt	$1,897,398	$2,665,318
Trailing Twelve Months (TTM) Adjusted EBITDA	$1,366,776	$1,278,371
Total debt to TTM Adjusted EBITDA	2.0x	2.2x
Net debt to TTM Adjusted EBITDA	1.4x	2.1x

		Appendix 3
Reconciliation of Non-GAAP Measures (Continued)

We define “Return on Invested Capital” (ROIC) as Adjusted EBITDA for the trailing-twelve months divided by average invested capital (as illustrated below) during the trailing 5-quarters. Our calculation of ROIC is considered a non-GAAP financial measure because we calculate ROIC using the non-GAAP metric EBITDA. We believe that our ROIC metric is meaningful because it helps investors assess how effectively we are deploying our assets. Although ROIC is a standard financial metric, numerous methods exist for calculating a company’s ROIC. As a result, the method we use to calculate our ROIC may differ from the methods used by other companies. This metric is not defined by GAAP and should not be considered as an alternative to earnings measures defined by GAAP. Reconciliation of this metric to its nearest GAAP measure is presented below:

Return on Invested Capital
	(dollars in thousands)
		*TTM*
		*March 31*
	2021	2020
Adjusted EBITDA	$1,366,776	$1,278,371
Average invested capital ¹
Property, plant & equipment	$4,383,447	$4,314,098
Goodwill	3,171,102	3,166,018
Other intangible assets	1,108,672	1,081,741
Fixed and intangible assets	$8,663,221	$8,561,857

Current assets	$1,968,479	$1,263,843
Less: Cash and cash equivalents	822,231	108,702
Less: Current tax	17,110	17,985
Adjusted current assets	1,129,138	1,137,156

Current liabilities	839,612	573,944
Less: Current maturities of long-term debt	308,071	24
Less: Short-term debt	0	63,100
Adjusted current liabilities	531,541	510,820
Adjusted net working capital	$597,597	$626,336

Average invested capital	$9,260,818	$9,188,193

Return on invested capital	14.8%	13.9%

¹Average invested capital is based on a trailing 5-quarters.

The following reconciliation to the mid-point of the range of 2021 Projected EBITDA excludes adjustments (as noted in Adjusted EBITDA above) as they are difficult to forecast (timing or amount). Due to the difficulty in forecasting such adjustments, we are unable to estimate their significance. This metric is not defined by GAAP and should not be considered as an alternative to earnings measures defined by GAAP. Reconciliation of this metric to its nearest GAAP measure is presented below:

2021 Projected EBITDA
											(in millions)
											Mid-point
Net earnings											$680
Income tax expense											210
Interest expense, net of interest income											130
Depreciation, depletion, accretion and amortization											400
Projected EBITDA											$1,420

View original content to download multimedia:http://www.prnewswire.com/news-releases/vulcan-reports-first-quarter-2021-results-301283031.html

SOURCE Vulcan Materials Company

May 4, 2021 7:10 am

Gilat Reports First Quarter 2021 Results

PETAH TIKVA, Israel, May 04, 2021 (GLOBE NEWSWIRE) — Gilat Satellite Networks Ltd. (NASDAQ: GILT, TASE: GILT), a worldwide leader in satellite networking technology, solutions and services, today reported its results for the first quarter of 2021.

F
irst
Quarter
Financial Highlights

R
evenues
of
$
4
4
.
7
million versus $47.7 million in Q1 2020 and up from $42.6 million in the previous quarter;
GAAP operating
loss
of
$
3.7
million versus operating loss of $10.8 million in Q1 2020 and an operating income of $62.7 million in Q4 2020; GAAP operating income in Q4 2020 included income related to the legal settlement with Comtech, net of related expenses, of $64.8 million;
N
on
-GAAP operating loss
of
$
3.8
million, compared with operating loss of $7.6 million in Q1 2020, and an operating loss of $1.6 million in the previous quarter;
GAAP net
loss
of
$
5.
1
million, or loss of $0.09 per diluted share, compared with net loss of $11.8 million, or loss of $0.21 per diluted share in Q1 2020 and net income in the previous quarter of $62.4 million, or income of $1.12 per share; GAAP net income in the previous quarter included $64.8 million income related to the settlement with Comtech, net of related expenses;
N
on-GAAP net loss
of
$
5.
2
millio
n, or loss of $0.09 per diluted share, compared with net loss of $8.6 million, or loss of $0.15 per diluted share in Q1 2020, and compared with a net loss of $1.9 million, or loss of $0.03 per share, as reported in the previous quarter;
A
djusted EBITDA
loss of
$
1
.
4
million compared with adjusted EBITDA loss of $5.0 million in Q1 2020; and adjusted EBITDA of $1.1 million in the previous quarter;

Management Commentary

Adi Sfadia,
Gilat’s
CEO, commented: “We continue to see strong momentum across all our business units, with the exception of the IFC market segment, which is yet to show a recovery. We believe that this growth trend will continue during 2021 and expect to show sequential quarterly growth throughout the year and increasing profitability. Looking further out, 2022 is expected to show significant improvement both in revenue and profitability with the pick-up in IFC, Cellular Backhaul and NGSO.

“As a testament to the strong momentum we are seeing, I am very pleased to report that we entered a mega strategic agreement valued at tens of millions of dollars, including a potential for significant project expansions, with a large government corporation in Asia Pacific. I believe that we will see additional large strategic transactions in the near future.

“In light of the many opportunities we see ahead of us, we are investing significant R&D efforts in order to capture these opportunities and accelerate our future growth. We expect that NGSO, IFC and Cellular Backhaul will be the main market segments that will drive this growth during 2021 and beyond, and we also see strong potential for the defense business to support our growth in a more meaningful way than it has done in the past.

“We made positive progress during the first quarter in our strategic growth areas of NGSO and Cellular Backhaul. We received additional orders for a LEO constellation, where our gateway Solid State Power Amplifiers (SSPAs) have been selected as the solution of choice. On the Cellular Backhaul front, we received a multi-million-dollar expansion and follow-on orders from Tier-1 mobile operators around the globe including in Japan, Australia, Europe and South America.

“In addition, we have made great progress in Peru with the government’s acceptance for the operational phase in the Cusco region, bringing us significantly closer to our goal of recurring revenue of over $50M in Peru.”

Key Recent Announcements

Gilat Enters Strategic Agreement Valued at Tens of Millions of Dollars with a Large Government Corporation in Asia Pacific
Gilat Achieves Critical Milestone in Peru with Approval to Enter Operational Phase, Unlocking Access to Recurring Revenue of Multi Million Dollars per Annum
Tier-1 Telco in Latin America Awards Gilat Over $3M to Provide Broadband Connectivity in Support of Bridging the Digital Divide
Gilat Receives Over $5M for Cellular Backhaul Expansion from Tier-1 Mobile Network Carrier in Japan
Gilat Awarded Over $20 Million in Orders for Support of Low Earth Orbit Constellation
SES Selected Gilat to Enable Tier-1 4G/LTE MNO in Brazil to Provide Broadband Connectivity for Education
Telespazio Selects Gilat to Supply Enterprise Connectivity in Brazil for a Multinational Leading Energy Company
Gilat Announces Appointment of Isaac Angel as Chairman of the Board
Gilat’s In-Flight Connectivity High-Power Transceiver Successfully Tested by Global Eagle Entertainment for DO-160G Certification
Gilat Launches Next Generation VSAT Family Supporting 5G Networks and LEO/MEO Constellations

Conference
C
all
D
etails

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

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

A simultaneous webcast of the conference call will be available on the Gilat website at www.gilat.com and through this link: www.veidan-stream.com/gilatq1-2021.html

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

Non-GAAP Measures

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

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

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

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

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

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

Contact:

Gilat Satellite Networks
Doreet Oren, Director Corporate Communications
[email protected]

Ehud Helft
GK Investor & Public Relations
[email protected]
+1 646 688 3559


GILAT SATELLITE NETWORKS LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except share and per share data)
	Three months ended
	March 31,
		2021			2020

	Unaudited

Revenues	$	44,713		$	47,673
Cost of revenues		32,356			38,787

Gross profit		12,357			8,886

Research and development expenses		8,111			7,634
Less – grants		184			272
Research and development expenses, net		7,927			7,362
Selling and marketing expenses		5,004			5,066
General and administrative expenses		3,083			4,818
Merger, acquisition and related litigation expenses		–			2,405

Total operating expenses		16,014			19,651

Operating loss		(3,657	)		(10,765	)

Financial expenses, net		(1,192	)		(972	)

Loss before taxes on income		(4,849	)		(11,737	)

Taxes on income		247			18

Net loss	$	(5,096	)	$	(11,755	)

Basic loss per share	$	(0.09	)	$	(0.21	)

Diluted loss per share	$	(0.09	)	$	(0.21	)

Weighted average number of shares used in computing loss per share
Basic		56,031,343			55,493,258
Diluted		56,031,343			55,493,258

GILAT SATELLITE NETWORKS LTD.
RECONCILIATION BETWEEN GAAP AND NON-GAAP STATEMENTS OF OPERATIONS
FOR COMPARATIVE PURPOSES
U.S. dollars in thousands (except share and per share data)
	Three months ended									Three months ended
	March 31, 2021									March 31, 2020
	GAAP			Adjustments			Non-GAAP			GAAP			Adjustments			Non-GAAP

	Unaudited									Unaudited

Gross profit	$	12,357			66		$	12,423		$	8,886			62		$	8,948
Operating expenses		16,014			169			16,183			19,651			(3,106	)		16,545
Operating loss		(3,657	)		(103	)		(3,760	)		(10,765	)		3,168			(7,597	)
Loss before taxes on income		(4,849	)		(103	)		(4,952	)		(11,737	)		3,168			(8,569	)
Net loss		(5,096	)		(103	)		(5,199	)		(11,755	)		3,168			(8,587	)

Basic loss per share	$	(0.09	)	$	–		$	(0.09	)	$	(0.21	)	$	0.06		$	(0.15	)
Diluted loss per share	$	(0.09	)	$	–		$	(0.09	)	$	(0.21	)	$	0.06		$	(0.15	)


Weighted average number of shares used in computing loss per share
Basic		56,031,343						56,031,343			55,493,258						55,493,258
Diluted		56,031,343						56,031,343			55,493,258						55,493,258



	Three months ended									Three months ended
				March 31, 2021									March 31, 2020
				Unaudited									Unaudited

GAAP net loss				$	(5,096	)							$	(11,755	)

Gross profit
Non-cash stock-based compensation expenses					61									57
Amortization of intangible assets related to acquisition transactions					5									5
					66									62
Operating expenses (income)
Non-cash stock-based compensation expenses					(220	)								366
Amortization of intangible assets related to acquisition transactions					51									51
Trade secrets and other litigation expenses					–									11
Merger, acquisition and related litigation expenses					–									2,405
Restructuring and re-organization costs					–									273
					(169	)								3,106

Non-GAAP net loss				$	(5,199	)							$	(8,587	)

GILAT SATELLITE NETWORKS LTD.
SUPPLEMENTAL INFORMATION
U.S. dollars in thousands


ADJUSTED EBITDA:

	Three months ended
	March 31,
		2021			2020

	Unaudited

GAAP operating loss	$	(3,657	)	$	(10,765	)
Add (deduct):
Non-cash stock-based compensation expenses		(159	)		423
Trade secrets and other litigation expenses		–			11
Restructuring and re-organization costs		–			273
Merger, acquisition and related litigation expenses		–			2,405
Depreciation and amortization (*)		2,385			2,664

Adjusted EBITDA	$	(1,431	)	$	(4,989	)

(*) Including amortization of lease incentive

SEGMENT REVENUE:

	Three months ended
	March 31,
		2021			2020

	Unaudited

Fixed Networks	$	25,302		$	23,011
Mobility Solutions		11,079			19,201
Terrestrial Infrastructure Projects		8,332			5,461

Total revenue	$	44,713		$	47,673

GILAT SATELLITE NETWORKS LTD.
CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands

	March 31,			December 31,
	2021			2020
	Unaudited			Audited

ASSETS

CURRENT ASSETS:
Cash and cash equivalents	$	48,905		$	88,754
Restricted cash		26,642			27,162
Trade receivables, net		27,820			27,976
Contract assets		46,060			41,573
Inventories		33,339			31,304
Other current assets		18,832			16,637

Total current assets		201,598			233,406

LONG-TERM ASSETS:
Long-term restricted cash		12			42
Severance pay funds		6,414			6,665
Deferred taxes		18,778			19,295
Operating lease right-of-use assets		4,478			4,879
Other long term receivables		8,339			7,797

Total long-term assets		38,021			38,678

PROPERTY AND EQUIPMENT, NET		76,612			77,172

INTANGIBLE ASSETS, NET		971			1,082

GOODWILL		43,468			43,468

TOTAL ASSETS	$	360,670		$	393,806

GILAT SATELLITE NETWORKS LTD.
CONSOLIDATED BALANCE SHEETS (Cont.)
U.S. dollars in thousands

	March 31,			December 31,
	2021			2020
	Unaudited			Audited

LIABILITIES AND SHAREHOLDERS’ EQUITY

CURRENT LIABILITIES:
Current maturities of long-term loans	$	–		$	4,000
Trade payables		21,428			20,487
Accrued expenses		47,465			46,387
Advances from customers and deferred revenues		35,404			26,244
Operating lease liabilities		1,678			1,911
Dividend payable		–			35,003
Other current liabilities		16,161			13,322

Total current liabilities		122,136			147,354

LONG-TERM LIABILITIES:
Accrued severance pay		6,875			7,136
Long-term advances from customers		307			1,890
Operating lease liabilities		2,847			2,985
Other long-term liabilities		396			631

Total long-term liabilities		10,425			12,642

SHAREHOLDERS’ EQUITY:
Share capital – ordinary shares of NIS 0.2 par value		2,704			2,647
Additional paid-in capital		928,410			928,626
Accumulated other comprehensive loss		(6,463	)		(6,017	)
Accumulated deficit		(696,542	)		(691,446	)

Total shareholders’ equity		228,109			233,810

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	360,670		$	393,806

GILAT SATELLITE NETWORKS LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
U.S. dollars in thousands

	Three months ended
	March 31,
		2021			2020

	Unaudited
Cash flows from operating activities:
Net loss	$	(5,096	)	$	(11,755	)
Adjustments required to reconcile net income
to net cash provided by (used in) operating activities:
Depreciation and amortization		2,330			2,604
Capital loss from disposal of property and equipment		–			(33	)
Stock-based compensation of options		(159	)		423
Accrued severance pay, net		(10	)		43
Deferred income taxes, net		518			634
Decrease (increase) in trade receivables, net		(1,933	)		13,607
Increase in contract assets		(4,487	)		(4,851	)
Decrease (increase) in other assets (including short-term, long-term
and deferred charges)		(220	)		1,673
Increase in inventories		(2,212	)		(6,635	)
Increase in trade payables		950			2,375
Increase (decrease) in accrued expenses		969			(1,652	)
Increase (decrease) in advance from customer and deferred revenues		7,688			(2,827	)
Increase in current and non current liabilities		2,003			2,811
Net cash provided by (used in) operating activities		341			(3,583	)

Cash flows from investing activities:
Purchase of property and equipment		(1,483	)		(951	)
Net cash used in investing activities		(1,483	)		(951	)

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

Effect of exchange rate changes on cash, cash equivalents and restricted cash		(254	)		(695	)

Decrease in cash, cash equivalents and restricted cash		(40,399	)		(9,325	)

Cash, cash equivalents and restricted cash at the beginning of the period		115,958			101,969

Cash, cash equivalents and restricted cash at the end of the period	$	75,559		$	92,644

May 4, 2021 7:08 am

Comscore Announces New Agreement with Lightbox OOH Video Network for Digital Out-of-Home Measurement

PR Newswire

RESTON, Va., May 4, 2021 /PRNewswire/ — Comscore (Nasdaq: SCOR), a trusted partner for planning, transacting and evaluating media, today announced an agreement with Lightbox OOH Video Network, a leading digital out-of-home media company, to provide out-of-home (OOH) audience measurement. Under the agreement, Lightbox will receive digital ad impressions, reach estimates and audience profiles reported by month. This custom solution, available now for all brands, will become eligible for inclusion in Comscore’s Plan Metrix® planning tool.

Lightbox is a digital out-of-home network that reaches audiences at scale in environments along the consumer journey with 100% video. While it is the largest video network in shopping and lifestyle destinations, the company has significantly expanded into new environments under the leadership of CEO Greg Glenday. Its network now includes all U.S. WeWork locations and Lightbox Unlimited, powered by FrontRunner, a flexible digital product that transforms commercial window fronts into video displays.

With the new agreement, Lightbox becomes the first company to utilize Comscore’s emerging OOH solution. Comscore recently announced its expansion into OOH measurement, forging alliances with DPAA and the Out of Home Advertising Association of America (OAAA) and accelerating product development to incorporate OOH measurement into its industry-leading cross-platform product suite.

“It’s finally time for digital out-of-home to behave like an actual digital medium,” said Greg Glenday, CEO, Lightbox. “At Lightbox, our largest client partners want to buy our audiences and it’s past time for us to make that easier for them. Comscore is the measurement solution the clients asked for, and we’re thrilled to partner with them to innovate in this space. Companies like Comscore planting a flag in digital out-of-home is why analysts are so bullish on the future growth of our industry.”

Comscore continues to execute on its vision to measure outdoor, cinema, and place-based advertising platforms, such as those found in retail spaces, business and medical offices, entertainment venues and transportation hubs.

Measured OOH audiences will be made available to advertisers and agencies through Comscore Plan Metrix® Multi-Platform and existing APIs. Plan Metrix® combines consumers’ desktop and mobile behavior with detailed information about their lifestyles, interests, attitudes, demographics, and behaviors for a unified digital view. Digital out-of-home networks will be treated as any other digital publisher, giving hundreds of agencies access to its audiences.

“We are thrilled that Lightbox has turned to us for their measurement needs,” said Gary Warech, Executive Vice President, Comscore. “Our charter subscribers will help shape the way digital out-of-home is planned and bought for a long time to come. Lightbox is an essential voice to have at that table.”

“For more than 20 years, the media ecosystem has relied on Comscore’s stable, granular measurement to achieve better business outcomes, and we are excited to now begin executing on our vision to incorporate out-of-home into our holistic cross-platform approach,” said Bill Livek, CEO, Comscore. “Consumers are increasingly spending more time outside, giving brands a prime opportunity to engage with relevant audiences. Comscore is ready to help marketers optimize their OOH campaigns with advanced audience insights.”

About Comscore
Comscore (NASDAQ: SCOR) is a trusted partner for planning, transacting and evaluating media across platforms. With a data footprint that combines digital, linear TV, over-the-top and theatrical viewership intelligence with advanced audience insights, Comscore allows media buyers and sellers to quantify their multiscreen behavior and make business decisions with confidence. A proven leader in measuring digital and TV audiences and advertising at scale, Comscore is the industry’s emerging, third-party source for reliable and comprehensive cross-platform measurement. For more information, visit comscore.com.

About Lightbox
Lightbox is a leading digital out-of-home video network that leverages technology and creativity to connect advertisers with millions of consumers in the real world. The premium video network offers national scale with hyper-local execution via 10,000+ can’t-miss, audio-available screens in shopping destinations, city streets, and WeWork locations across North America.

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SOURCE Comscore