Q4 2021 Rada Electronic Industries Ltd Earnings Call
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Ladies and gentlemen, thank you for standing by and welcome to the Rada electronic industries fourth quarter.
Speaker 2: Ladies and gentlemen, thank you for standing by. Welcome to the Rada Electronic Industries fourth quarter.
Speaker 2: 2021 results conference call. All participants are present in listen-only mode. Following management formal presentation instructions will be given to the question and answer session.
2021 results conference call. All participants are present in listen only mode. Following management's formal presentation instructions will be given for the question and answer session. As a reminder, this conference is being recorded you should have all received by now the Companys press release, if you have not received it please contact rod doesn't invest.
Speaker 2: As a reminder, this conference is being recorded. You should have all received by now the company's press release. If you're not received it, please contact Radha's Investor Relations team at GK Investor and Public Relations at 1-212-378-040. Or view it in the new section of the company's website www.radha.com.
Relations team at GK, Investor and public relations at one to one to 370 8040 or view it in the news section of the company's website Www Dot Robert Dot Com.
Speaker 2: I would now like to hand over the call to Mr. Ehudh-Health of GK Investor Relations. Mr. Health, would you like to begin?
Now like to hand over the call to Mr. Ehud Helft of GK Investor Relations, Mr. Hal would you like to begin.
Yeah. Thank you operator, I would like to welcome all of Us.
Speaker 3: Yeah, thank you all for being here. I was actually very comfortable with this conference talk with the staff, others, for the school years, it's not just 21 without. So.
Yes.
For the quarter.
He was when he runs his own.
Oh, Thank Rada management for hosting this call with us on the block.
Speaker 3: May President Daccombo tell me, on five things you truly understand the Trey wipe.
The last Chief Executive Officer.
Right.
No.
So in summary, the key highlights.
Speaker 3: these were all some of the
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Speaker 3: Some ST D like to go out with safe our world probably in today's firstle also beginning to list conents of the.
I've always thought that Mexico city.
Publishing today virtually.
Good day.
So.
Great.
Speaker 3: And with that, I would now like to introduce Brother Steve Europe , Mr. John Taylor. Please give a hand.
And none of them actually.
Please go ahead.
Speaker 4: Take your oath to pray to all our participants.
Good day to all.
All participants.
Weird to pool in the U K, just a few weeks ago, and we talked about already.
Speaker 4: We had a call with our investors just a few weeks ago. What are we talking about? Are we going to market strategy? We cover the statements for far markets and discussed our 2022 guidance.
They go to market strategy, we talked about this pacing so far markets and it gives customers turning to guidance.
Speaker 4: In today's call, we will provide a summary of our fourth quarter and full year of 2021. The results of that remind you of our forecast ahead and we generate our guidance for planning to. So let's start.
And delightful regarding funding for fourth quarter and full year of letting 71.
And then revert to remind you of the following forecast.
And we have raised our guidance to account for anything.
So let me start with the financial highlights.
Speaker 4: We demonstrate year-over-year revenue growth in excess of 50% in recent years.
We demonstrated year over year revenue growth in excess of 50% and we sit here in.
Speaker 4: some years well over one other even. Such growth rates, particularly expected the full successful early stage technology companies. And it is unusual to say they lived for established and profitable public companies like us. And even more so.
And for New York.
Why not do it using such growth rate expected for successful early stage technology companies.
It is unusual.
Before you established appropriately public companies like us.
And even more so in the defense industry.
Speaker 4: We reported the revenue of $117 million after 54% year of her year. And we remind you that only two years ago in 2019, our revenue was $44 million.
We reported revenue of $117 million.
The 54% year over year.
And we remind you that only two years ago in 2019 $44 million.
Speaker 4: a bit more than a third of what we have already told you today.
It's more than a third is supposed to be in three areas of focus.
David.
We are exceptionally proud of them.
Speaker 4: We are exceptionally proud of these results, and even more so, even the ongoing coronavirus pandemic and associated work and travel restrictions.
And even more so given the ongoing corona pandemic and associated work and travel restrictions.
Speaker 4: supply chain constraints and part shortages. And specifically, the US, the delay in the US budget for this year and the continuous resolution condition, which is still in a-
<unk> strength and broad shortages.
And specifically the U S B rating for your budget for this year and the junior food nutrition condition, which you feel you can fit.
Speaker 4: A ibea for the year almost 27.2 million D nine point seven million.
Our EBITDA for the year was $27 3 million versus $9 7 million last year.
It is almost three times a year over year over year growth.
Speaker 4: It is almost three times year of year of growth.
Speaker 4: Why couldn't you rule 54 percent if Lara Trade number 862% showedurer N Basic of your person or inventor, but you can't get all this evidence to challenge someone that's not gonna need to not bring false evidence
Revenue grew 54% EBITDA growth for 482% demonstrates the operating leverage leverage in our business model.
Speaker 4: The presence of investments made in the past few years in our business, especially in the US.
The focus of the investments made in the past few years in our business, especially in the U S.
Speaker 4: Our business operating expense footprint is right side for today's revenue level. And our operating expenses now grow at the much slower rate than revenue.
Our business operating expense footprint is right sized for two rigs wherever and whenever.
And our operating expenses now grow with a much slower rate than revenue.
Speaker 4: Furthermore, we have the manufacturing capacity for a revenue at significantly higher levels than what we are currently delivering. Which gives us...
Furthermore, we have the manufacturing capacity for revenue.
Currently higher levels than what we are currently the luxury.
Which gives us ample room to grow.
Speaker 4: And beyond that, we have also built an ability to add new capacity quickly and at reasonable cost as needed in the future.
And beyond this we have also built an ability to add new code.
<unk> quickly and at reasonable cost if needed in the future.
In terms of our balance sheet, we ended the quarter with 90 $779 million net cash.
Speaker 4: In terms of our balance sheet, we added the quarter only $97.9 million net cash and we absolutely know that.
We have absolutely no doubt.
Speaker 4: Throughout the year, we have leveraged our storm catch level to increase our walking capital. Most of our inventory for semiconductors to avoid any footlight changes.
Throughout the year, we have leveraged our strong cash flow to increase our working capital most of the inventory for semiconductors to avoid any supply chain issues.
Speaker 4: We are also planning to use our cash for potential M&A. We are looking to expand our addressable markets beyond the current estimation of the organic term of $6 billion over the next decade, and we'll also be able to bring some news on this one in the future.
We are also planning to use our cash for potential M&A, we are looking to expand our addressable market beyond the current estimation.
The organic food.
$6 billion over the next two decades.
And hope to be able to bring to some news.
Good for them in the future.
Let's discuss our 2022 guidance.
Speaker 4: In our analysis call a few weeks ago, we issued our guidance for 2022 of $440 million, representing growth of around 20% year over year.
No I don't even call. It a few weeks ago, we issued our guidance for 2022 or $440 million.
Presenting a growth of around 20% year over year.
This is comprised of a number of factors and 9 million dogs are associated to review on X revenues, which is a similar level to wherever it needs to be achieved from this business over the past few years.
Speaker 4: This is from parts of the number of factors. 9 million dollars are associated to with the UNIX revenues, which is a similar level to the revenue to the achieved from this business over the past few years.
Speaker 4: In the non-US shore at Sledgepoint defense market, we focused over 40 million dollars for the revenue during 2022. It includes also counter-USN.
In the non U S insurer.
Point defense market.
We forecast over $40 million for you already for you during 'twenty planning tool. It includes also counter UAS maturity.
Speaker 4: in the United States with the stabilization of the short and point defense market for us. And adding class to forecast, and it's based on the relevant light items in the US defense side.
In the United States, the stabilization of the short and point defense market for us, enabling us to forecast our revenues based on the relevant line items with the U S defense budget.
About 90%, 90% of our guidance.
Speaker 4: About 90% of our guidance.
Speaker 4: Our incoherent is in France budget line items. This gives us both this ability and which is uncomfortable with our US forecast of 90 million for 2020.
Our info Boise music trends budget line items.
It gives us good visibility and we feel comfortable with our forecast of 19 medium for 2022.
Speaker 4: Today I want to add that we also know we see very short timelines and urgent need to achieve delivery of requirements.
With that I want to add that we often receive very short timelines and urgent need who can ship disease, where your requirements.
Speaker 4: with the whole process taking sometimes very few weeks. This means we are also operating without the luxury of planned backlogs for these types of orders, and it's one of the reasons we maintain a high level of inventory so we can meet this demand.
With the low quarter thinking sometimes very few weeks. This means we are also operating without the luxury of learning Beck plant backlog for these types of photos and he is one of the reasons, we maintain a high level of inventory. So we can meet this demand.
These type of customers.
Speaker 4: This new and growing market appreciates the top-level and short-term supply that they receive from us.
This new and growing market appreciate the top level in short term around supply.
They receive from us.
Speaker 4: that they cannot typically find somewhere else. And if the key structure in us, we need new businesses with...
Are they did they cannot typically find somewhere else and is a key factor in us winning new businesses.
New car stores.
We note.
Speaker 4: We note the deal short term turn around with the news that are not part of our focus.
These short term turnaround revenues that are not part of our forecast.
Speaker 4: Research, deeper upside for German youth customization.
For a further oxide to our U S revenue expectation for this year.
Speaker 4: Let's take a look at our markets and the forecast for the coming year.
Let's.
Take a look at our markets.
The forecast for the coming years.
Longer term it is.
Speaker 4: Long term, it is a loan to achieve 250 million dollars in annual revenue within 24 years.
All to achieve 250 million Golar golar in annual revenue within three to four years.
Speaker 4: which implies an accelerating acceleration of our energy growth in 2033 and beyond.
Which implies an accelerating acceleration of our revenue growth.
In particular, the three of them.
A significant driver will be the ETF market, if we choose.
Speaker 4: The Gniskum Zleiter will be the APS market, which is half of our potential market and very much in the information stage as of now.
Or a potential market and very much in the incubation stage now.
We have currently a backlog to do.
Speaker 4: We have currently a backlog to deliver radar to the Aron 5th APS at the level of about 30 million.
Literally down to the iron ore increased safety after the level of about $30 million.
And we expect to double or even frequently triggered by the end of this year, which means we have revenues in 2023 and beyond.
Speaker 4: And we expect to double or even triple it by the end of this year, which means increased revenues in 2022 and beyond.
In the U S.
Speaker 4: In the US, the qualification testing of the R-on-Fift on the Berkeley AFP will take place during 22-30, already ongoing. In terms of future potential, we also believe that the solution we are part of, mainly the R-on-Fift is the real candidate for strike-a-reacles as well.
The qualification testing with our own fixed on the Bradley AFP.
We've taken place during 2022 it's already ongoing in terms of future potential. We also believe that the solution. We are causal mainly to our increased is a real candidate for stryker vehicles as well.
And the other programs, such as <unk>, or even <unk> and Acs or Vps advanced configuration, such a Max are also.
Speaker 4: and other programs such as Olin-Free and APFs or VPS and Grand Configuration such as MEPs are also in both interest from growth potential in future years.
The closing period for growth potential in.
In future years.
Regarding the Shaw.
Speaker 4: Regarding the shoreline, flashpoint defense market in the USA.
For the defense market in New York City.
Speaker 4: I want to go since 2017 is mainly due to the US COF and short market segment.
Our fleet growth since 2017 is mainly due to the U S.
The C O air.
Insurance market segment.
And to date, we have delivered around $160 million of tactical radars.
Speaker 4: And today we have delivered around $60 million of the tacticaloiders for this market segment in the US over half of that in 2022.
If the market segment in the U S over half of that in 2022.
Speaker 4: It reflects a newly emerging market for urgent acquisition processes, typically June , June , and other operational needs statements.
This reflects the new and emerging market towards an acquisition processes typically Q1 s.
<unk> operational needs statements.
Speaker 4: with relatively limited multi-year visibility. We now see our market shifting into a phase of stable growth with multi-year planning and visibility reflected in line items in the U.S. defense budget, as I mentioned earlier.
With relatively limited multiyear visibility we now see.
Market shifting into a phase of stable growth with multi year planning and visibility reflected in later line items in the U S defense budget as I mentioned earlier.
But the urgency is still very much a wrong, because we see a dry a recent drone and the inclusion of side effects and the near East.
Speaker 4: But urgency is still very much around, as we see via recent drone and the cruise missile attacks in the Near East and other geographies.
Other geography.
Speaker 4: show us and join defense programs such as the U.S. and CIGVA.
Sure the important defense programs, such as the U S M C G but.
U S Army am short U S Air Force APAC, so complete and others.
Speaker 4: Your army ensured your cell phones, A-bugs, so-called feet and others. It's become right now, anything the budget and reflect Mount Ayrton's decision plan.
It's becoming a entering the budget and reflects the entire Europe division plants.
Speaker 4: such transitions from nuance to programs of record or ODAs typically take a year or more. The fact that we are engaging multiple programs has ensured the sustained growth you have seen from us in recent years, which we expect to continue in the future.
Such transitions from June two programs or foreclosed, all otas typically takes a year or more the fact that we are engaging in multiple programs.
As ensure their sustained growth.
Seen from us in recent years, which we expect to continue in the future.
While we are continuous resolution is still a wrong.
Speaker 4: Once we are, continuous resolution is still around.
Speaker 4: June was compensated for some of the projects in delays in the US.
And you all have compensated for some of the purchasing delays in the U S.
Speaker 4: The re theaward of the soum flict moagyear program to end oil.
The recent award of the silicone free prepared a multiyear program to to Android.
Speaker 4: A company which is our customer who's over $1 billion to them is an encouraging signal that such delay...
As a company, which is our customer was over $1 billion to them is an encouraging signal there.
The tragedy very Greenfield ultra.
Regarding the short the Flashpoint defense markets in Europe for the World.
Speaker 4: Regarding the short the flashpoint defense markets in direct from the world.
Speaker 4: This market is currently around 25% of our total revenues and we believe that it will rise to the US level within a third year.
And this market is currently at around the 25% of our total revenues and we believe that it will rise to the U S level.
Again, there are very few years.
Speaker 4: The Near East often lay suffer from terrorist drones and caused me to attack.
The nearest often suffers from very strong includes misread effects.
It's been an active market for radar since 2019.
Speaker 4: has been an active market for a while since 2019.
2019.
Speaker 4: and continue to hold significant growth potential for us.
And continues to hold significant growth potential for us.
The European NATO countries are typically following the doctrine of solution into the U S. Nearly three.
Speaker 4: the U.L.T. and Sledge NATO countries are typically following the doctrine of and pollution of the U.S. Navy III.
Speaker 4: the need for sure art and point differences becoming work of nice. Currently the market is
And the need for short and foreign defense is becoming recognized there.
Currently the market is really the integration phase.
We are engaged in.
Speaker 4: We are engaged in quite a few prominent European weapon system providers and our inner's are integrated and continuously being tested as part of the evolution.
Quite a few prominent European weapon system provider.
Radar for our integrated them continuously being tested as part of those solutions.
And we estimate that the market will uptick in the near future.
Speaker 4: We have seen the rocket will upkicking the near future.
The Indian market is also waking up around the need to mitigate the small UAS threats, mainly and also short term Jeremy trends in view of the recent drone attacks.
Speaker 4: The Indian market is also waking up around the need to mitigate the small U.S. threat, mainly and also short-term daily trips in view of the recent role.
Speaker 4: We expect significant additional say of counter drone pollution in this market in this year 2022 and strong growth from the region beyond the
Expect significant or the initial phase of counter drone solutions in this market in this year 2022.
So any growth from the region beyond that.
In view of the size of this market and they are volatile environment, we announced three months ago, our plans to set up an Indian JV with a local partner and established local production capabilities.
Speaker 4: We built the size of this market in the Robolator environment. We announced a few months ago our plans to set up an Indian JV with a local partner and established local production capabilities.
Yes.
Let's summarize.
Speaker 4: As of 2021, we have shown rather continuous experience versus on growth, both on the top line and significantly amplified on the bottom line due to our operating leverage.
As our 2020 one results show, Nevada continues to experience very strong growth.
Also on the top line and significantly amplified on the bottom line due to our operating leverage.
We are enjoying now.
The discussion of our guidance in the coming projects projects indicated we expected growth trying to continue for the foreseeable future.
Speaker 4: The discussion of our guidance and the coming project projects indicate, we expect it growth trying to continue for the foreseeable future.
And finally I want to thank all of our products employees.
Speaker 4: And finally, I want to thank all of your brothers and brothers for their tremendous efforts and success in bringing these exceptional results.
For their tremendous efforts and success in bringing these exceptional results.
In 2021.
I'd like now to hand over the discussion to Avi Israel our CFO .
Speaker 4: I'd like now to hand over the discussion to our viewers and our viewers.
<unk>.
Speaker 4: Thank you, Dubin. Hi everybody. If you can find out, it's also the press conference where we are today.
Thank you <unk>.
You can find our results on the press release, we issued earlier today.
As Bill mentioned, we are very proud of our financial performance and I will provide a short summary of the fourth quarter results in the U S.
Speaker 4: As do the nation, we are very proud of our financial performance. Now we provide the short summary of the fourth water result and the year as a whole.
As a whole.
Fourth quarter revenue grew 31 $8 million up 36% year over year full year 2021 revenue.
Speaker 3: For the revenue of $31.8 million, up 36% year over year. For the year 2021 revenue, where $117.2 million, up 54% year over year.
$117 2 million.
Up 54% year over year.
Speaker 3: A growth margin in the border was 41% compared to 39% in 2004 last year. For the year, growth margin was 41% versus 37% in 2020.
Gross margin in the quarter with 41% compared to 39% in Q4 of last year for the year gross margin was 41% versus 37% in 2020.
Speaker 3: Operating expenses in the quarter was $7 million, compared to $6.2 million in the queue for last year.
Operating expenses in the quarter was $7 million.
Compared to $6 $2 million in Q4 of last year.
Operating expenses for the year were $27 2 million compared to $22 9 million in <unk>.
Speaker 3: Operating stages for the year were 27.2 million from person 22.9 million in 2020.
<unk> thousand 20.
I remind you that I'll call. It seven of operation expenses for both our current and expected operations in the short and medium term. So opex is expected to grow at a much slower pace than revenue.
Speaker 3: I remind you that our current level of operation expenses support our current and expected operation. In the short and mid term, the operation is expected to grow at the most slower pace than revenue.
Speaker 3: Operating income was $6 million in the quarter, versus $2.8 million in the future of last year. For the year, operating income was $20.4 million compared to $5.5 million of last year. Adjusted EBDA for the quarter was $8 million, which is 25% of revenue, up 103% versus 3.9 million, over 17% of revenue in the future of last year.
Operating income was $6 million in the quarter versus $2 8 million in Q2 of last year.
For the year operating income was $20 4 million compared to $5 5 million.
Last year Jeff.
Adjusted EBITDA for the quarter was $8 million, which is 25% of revenue up 103% versus $3 9 million over 17%.
Revenue in Q4 of last year.
Speaker 3: for 2021, adjusted the data was 27.3 million, which was 23% of revenue, up 182%.
For 2021, adjusted EBITDA was $27 3 million, which was 23% of revenue up 182%.
Speaker 3: Compared to 9.7 million dollars, which was 13% of revenues in 2020.
Compared to $9 7 million.
Which was 13% of revenues in 2020.
I would also like to summarize and point out some highlights from our balance sheet as of December 31, 2021, we had $78 $8 million in cash.
Speaker 3: I would also like to summarize and point out some highlights from our balance sheet. As of December 31, 2021, we had $278.8 million in cash and absolute is zero financial.
Absolutely view financial debt.
Speaker 3: I'll show you how the Zekmutics is $156 million, financing 77% of our balance sheet, and up from $72 million as of year and 20.
Shareholders equity stood at $156 million financing, 77% of our balance sheet.
And that's up from $72 million.
As of year end 2020.
Speaker 3: In summary, as God mentioned, and as the financial results demonstrate, we continue to be very pleased with our progress. That ends my summary. We should now open the call for questions. Operate the plea.
In summary, as Dov mentioned and as the financial results demonstrate we continue to be very pleased with our progress that ends my summary, we should now open the call for questions operator. Please.
Speaker 2: Thank you. Ladies and gentlemen, at this time, we will begin the question and answer session. If you have a question, please press star one. If you wish to cancel your request, please press star two. If you are using speaker equipment, kindly with the handset before pressing the numbers. Your questions will be pulled in the order they are received. Please stand by while we pull for your question.
Thank you ladies and gentlemen at this time, we will begin the question and answer session. If you have a question. Please press star one.
Wish to cancel your request please press star two.
You are using speaker equipment currently what's the handset before pressing the numbers question will be Paul in the order. They are seen please standby, while we poll for your questions.
The first question is from Greg Konrad of Jefferies. Please go ahead.
Speaker 2: The first question is from Greg Conrad of Jekreys. Please go ahead.
Good morning, good quarter.
Thank you.
Speaker 2: I did just taking in the outlook a little bit more. I mean, per for 2020.
Just digging into the outlook a little bit more for 2022.
Speaker 2: It seems like both US, Shura and Point and NAUS are both maybe in the commercial 10 million of sales in 2022 with the NAUS, you know, the less on New England East.
It seems like both U S sure.
And clean.
But our book.
So $10 million in 2022, what did not do that.
A faster growth rate.
Speaker 5: Can you maybe just give up enough data and come watch your seeing in that market around the board timing?
Maybe just give us enough data, what youre seeing in that market around more tiny.
Speaker 5: and we need to think about 2022. What are the major program drivers?
You're thinking about 2022, what are the major program drivers this year.
Sure.
Speaker 4: Yeah, the short, the ULS continues, but you know the big four.
Yeah sure the helix continues but.
The big four and probably bigger than the Shaw because you know at least half of the program. We have already delivered in 2021.
Speaker 4: probably bigger than the shore because you know at least half of the program we have already delivered in 2021, at this stage of the program, the bigger ones can be so conceived and A-Bud, we do have high expectations and also G-Bud of the Marine Corps, so all these are what we call internally the big floor for us. In the U.S., we probably contribute over 60% of our venues in 2020.
This phase of the program.
The bigger ones can be so can seep into APAC.
Do any of our expectations and also <unk> of them are equal so all easily able to equally internally to be good for us.
The U S.
We'd probably contribute over 60% of our revenues.
In 2020 two.
Speaker 4: that's in the US, in the other countries in the world, you know, mainly the Middle East, the Indiais are indicated, these are the major geography, and also the...
That's in the U S and the other prices seem to work.
In the World you know, mainly the middle East, India as I've indicated.
These are the major or geography.
And also the.
Speaker 4: You know the integration and testing FLC new which are starting to accumulate with some pieces become even some significant numbers at the end.
The integration and testing.
<unk> in Europe , which they are starting to accumulate the bits and pieces become there.
Some significant numbers with you.
Speaker 4: That's the general overview of the Shoradma.
So that's the general overview of the of the share of the market.
Okay, and then just to follow up on the $250 million range.
Speaker 5: And then just to follow up on the $250 million revenue target out three to four years, I mean, how do you think about the visibility towards that revenue number, either through a contract in the end, or these programs that you're already expecting to, the universe is including the competitive pursuits that you know aren't designed.
Looking out three to four years.
How do you think about the visibility toward that.
Number either through a contract in hand.
The programs that you're already back in here.
Including <unk>.
Net proceeds.
Yes.
Speaker 4: Yeah. We do believe that the EUR market is stabilizing on us. At the level of you know, between $100 to $120 million, that's the market potential basically. And we see it happening. We also forecast $90 million this year. So let's assume it stabilizes the over $100 million.
Yeah.
We do believe that the U S market is stabilizing though not at the level of you know between $100 million to $120 million, that's the market potential basically and we see certainly we also forecast $90 million. This year, so lets assume it stabilizes to over $100 million.
Speaker 4: And we do believe that the rest of the world, the market of show and point defense will climb to that level.
And we do believe that the rest of the world.
Market that show up and point defense.
Climbed to the pleasant.
So you have the $200 million within.
Speaker 4: So you have 200 million dollars within several few years. Add to that active projection which starts to affect our top line in 2023 and onwards at the level of a few tens of millions of dollars and including Greece. Maybe later, then you will be at the 250 within three to four years.
Within a few years after that active protection, which is hard to.
Two.
[noise] affect our top line in 2023 and onwards.
The level of few tens of millions of dollars in.
Maybe later then you'll get the 250 within three to four years.
Thank you.
Speaker 5: Thank you, and then just last one for me, you provided sales guidance for 22 and talked about ongoing trends of sales, you know, rising parts faster than operating margins. I mean, it seems like your head or your head of your e-pid to a large in target. I mean, is there a way to frame kind of the opportunity in 2022 just from a margin perspective just thinking about what can apply on an operating expense?
Last one for me.
You provided guidance for quanta to you talked about ongoing trend of sales.
In contrast to that operating margin.
It seems like Youre ahead.
Our EBITDA margin target.
Is there a way to frame kind of the opportunity in 2020 Puget.
<unk> margin perspective, thinking about what's implied operating expense growth.
I think.
Speaker 3: I think there, this is like this Edita we as the the forces international
This is Greg.
We have the.
For the analysts.
Speaker 3: that released their numbers for 2022. I would say that generally speaking, it looks like they are pretty in line with our expectations.
<unk> released their numbers for 2022, I would say that generally speaking it looks like they are pretty in line with our expectations.
Speaker 3: We do not really guide them as far as we can, but taking into consideration the guide for the revenue.
We do not give guidance as far as EBITDA is concerned but take into consideration.
Guidance for the revenue and assuming that we are expecting to maintain our gross profit at the level of 40% to 41% that's the area.
Speaker 3: and assuming that we are expecting to maintain our growth growth is at the level of 40, 41% that's the area. Estabilizing our offer, as I mentioned earlier, and you can calculate the numbers technically. But the numbers of the analysts, the market consensus are pretty accurate.
Our opex as I mentioned earlier.
And you can calculate the numbers, they're technically but the numbers of.
The analysts the market consensus.
Pretty accurate.
Thank you.
Thank you.
Speaker 2: The next question is from Peter Arment of Baird. Please go ahead.
The next question is from Peter Arment of Baird. Please go ahead.
Good afternoon, everyone.
Speaker 3: You're going to get to be ready to run. Right. You're going to get to spend $20,000, $20,000. How do you spend $20,000? You're going to get to be ready to run. There's a past year about $50,000.
Yes.
Susan.
Hum.
Okay.
This past year.
Okay.
Hum.
Speaker 1: And so this is really about the maps of the year. And I just think about the optimum movement that has taken place anyways, I'm from the other sideode, how especĂfic about, kind of, my model and the teams and how you... P sesi
Mountain view.
Yes.
Yeah.
Yes.
How should we think about kind of modeling.
And how you're thinking about.
Adam.
Yeah, well here.
Speaker 4: Well here, you know, the condition of the US budget and the CR effects are first half. So we do expect that we will have growth maybe even quarterly towards the end of the year. It will not be linear, but you know actually that was our situation for the last few years.
And you know the condition of the U S budget and the SCR effects, our first half so we do expect that.
We'll have growth.
Maybe even quarterly.
Towards the end of year will not be we don't believe me on that you know actually that was our situation for the last few years.
Speaker 4: Maybe it's going to be female.
And so maybe it's going to be similar.
Speaker 4: I think this is the start, we'd be kind of similar to the end of last year, the last two Daniel Mystery's
I think that this thought we'd be kind of similar to the end of last year. The last two quarters, but it will accelerate from them.
Speaker 4: You knowif that's up, and then we believe that it problebab ized out we ability to kind of run ST ahead of we kind of the surprlies in show So that we need to do to up right lebble.
That's helpful and then Martin.
Mark one zone.
We will count as one.
This is lightning in small groups.
Thank you.
Right.
Okay.
Sure.
You know even before Covid.
Speaker 4: You know, even the short COVID, we realize very early on that this is real market and we don't produce the stock we are going to...
We realized very early on that this is new market. If we don't forget the stock we are going to win.
Speaker 4: You know, not to capitalize on the potential and actually it became a one-of-a-file competitive advantage.
No not to capitalize on the potential and actually became one of our competitive advantages.
Speaker 4: And then copy the fields we kind of saw in you.
And then probably the field, we kind of slow immune.
Speaker 4: then we decided to even further enhance our inventory to over a year of supply potentially based on our production plan.
We decided to even further enhance our inventory to over a year of supply potentially based on our production plan.
Speaker 4: And again, it is based on our pipeline and also on the decklam because we do understand a lot of it is looking ship. And that's where we are today.
And again it is based on our pipeline and also on the backlog because if you understand a lot of it is book and ship.
And that's where we are today.
Nope.
It's not that.
Speaker 4: It's a tough environment, if you see allocations all over, you'll see prices that are changing. We were immune.
It's a tougher environment, you'll see allocations all over we will see prices that are changing.
We were EMEA and until now.
Speaker 4: And I do hope that what we did will keep us as such along the...
And I do hope that what we need.
Keep us.
As such along the.
Speaker 4: along 2022. In some cases we have to play more and we have to select pieces here. An
Along 2022 in some cases, we have to pay more.
And we of course, let me walk up almost <unk>.
In.
It's not overwhelming.
Speaker 4: It's not over one minute, it's really in the low number.
Early in the in the low number.
Okay.
Speaker 5: Okay, so watching me on Pone P.S., I think the last time I needed to slow the backlog around 30 million with the plans that we have to start from 2020. If any two of my friends, we should be watching for it because I think about 10 to 2 in terms of that. So that's that, folks.
Yeah on Etfs.
Well I find even slogan backlog of around 90 million.
Plans.
Let me turn the milestones we should be launching more.
102 in terms of volume through that backlog.
No we won't go early.
Speaker 4: You know, we regularly, probably every quarter, we announce the new business that we receive along the quarter and we try to the peak to reach the market segment.
Probably every quarter we announce.
The new business that we received.
Along with the quarter and we try to the peak.
To which market segment.
Speaker 4: So, yeah, I mean, follow the backlog of accumulation or the new business accumulation around APS and you will have the picture because, you know, with APS as opposed to the urgency of the show-out and point defense market, this business by nature is a long term issue and you can plan ahead.
So yeah I mean.
Follow their backlog accumulation or the new business accumulation around Apis and you will have the picture with us.
With Aps as opposed to the urgency of the Shaw and defense market.
This business by nature is lumpy.
Long term mission and you can plan ahead.
Here, we are we are establishing better OXXO. So every every order that we receive is not therefore immediate visuals.
Speaker 4: Here we are establishing that look so. So every order that we receive is not there for immediate deliver.
Speaker 4: It's about over two or three years something like that. So I think if you follow our new business announcements, you will have a very good picture. We can always can elaborate more on that whenever needed. Thank you.
It's spread over two or three years, something like that I think.
If you follow all new business announcements.
Very good.
We can always can elaborate more on that whenever needed.
Regenerative medicine.
Thank you Peter.
The next question is from Bryan King right now.
Speaker 2: The next question is from Brian King Flimmer of Alliance Global Partners. Please go ahead.
Of Alliance Global Partners. Please go ahead.
Hi, guys. Thanks for taking my questions.
Speaker 2: Hi guys, thanks for giving my questions. You may now be potential for sure a long time, even APF to send to the board, so just on the market. Should you think about M&A, and you're thinking about complimentary products to radars that can expand your market opportunity, and we talk about your M&A priorities, please, and how advanced are the discussions you're having with it.
Without the potential for strong long term evenly plastic because of course, there is a quantitative market.
Think about nominal thinking about complementary.
Thanks to radars that can expand your market opportunity can you talk about your commentary on what is pleasing.
How has the band from discussions with Michael.
Sure.
Yes.
Yeah.
Speaker 4: We are examining the federal opportunity first to come already, but we have started to informally, kind of formally within our company, we forward.
Well, we are examining all opportunities as they come already but we have slots, which has been formally kind of formally leaving our company.
Ford.
Speaker 4: The cut-able is in general terms, and it is a bit too early to go with close-respected. The cut-able is our technology geography.
The categories are in general terms.
It is a bit too early to give.
Flows were detailed.
The categories are our technology geography.
Speaker 4: um you know complementary products that make sense to us
You'll know complementary products that it makes sense to us.
Speaker 4: We don't want to lose our profile of growing company, technology growth company. We don't want to inflate our pipeline just for the sake of within digging numbers. So we are carefully examining our footprint in our strategic markets like we did in the US. We plan to do in India and maybe also in Europe , you'll see.
We don't want to lose our our profile of our growing company technology growth company, we don't tend to inflate our supplying just for the sake of it.
I can dig into the numbers.
Carefully examining the our footprint in key strategic markets like we did in the U S. We plan to do in India, and maybe also in Europe , we will see.
Speaker 4: and maybe not directly but also in the Middle East. We are continuously examining the technology market for the around us and what's happening and we don't have to invent the weed every time, you know. Maybe we can enjoy airfolds of others and join forces.
And maybe not directly but also in the middle East.
We are continuously examining the technology market for you guys around us and what's happening in the.
We don't have to reinvent the wheel every time you know.
Maybe we can enjoy the efforts of others joined forces.
Speaker 4: And these are the actually categories, the general categories that we are in these days and weeks. We are translating the direction.
Dan.
They're all key categories the general categories.
In these days and weeks.
It's making it simpler.
Okay.
Speaker 4: And then my second question is, currently inventory increased to the number of subdued. Can you talk about what this inventory level covers? Is it all of 2022? Is it a bit more? Is it a bit less? They send the general expectations? And so.
My second question.
Coal inventories.
Inventories increased from them, it's a combo.
Can you talk about what the inventory level of cover all of 2022 is a little bit more as to what the class based on the demand on spectrum auctions and so much.
Speaker 4: Well, I was a big decision most one, at least one full year of semi-conductors based on our estimations and we continue to maintain that.
Yeah, well also teaches decision was to have at least one full year.
Semiconductors based on our estimation and we.
We continue to make.
<unk> maintained it.
Thank you.
Thank you Brian standpoint.
Yes.
The next question is from Austin Moeller of Canaccord. Please go ahead.
Speaker 2: The next question is from Austin Moller of Canacord. Please go ahead.
Good morning.
Okay.
Speaker 2: My first question here, based on the 30 million that you forecast for action protection systems in 2023, are you confident that when Biden's fiscal year 22 budget comes out probably in April , that there'll be a funding account to possibly the Brad H.F.I.N.C.
My first question here please.
From a certain volume.
Forecasts for asset protection systems in 2023 are you comfortable with.
Partly it comes out in April .
In the cloud.
Yeah.
Bradley.
No. We are not Country-dance, we don't have certainty unfolds, you'll see because it you know it depends on successful testing, but we are we.
Speaker 4: Now we are not confident, we don't have certain things unfortunately because it depends on successful testing but we are out in the state that once the testing is full enough with proof successful, the budget will come.
We also continue to take that.
Once the testing.
Soon enough will prove successful.
The budgets will come.
Okay. That's helpful. My second question on them.
Speaker 4: Okay, that's helpful. My second question is the Army expected to decide on purchasing additional Ford vehicles based on the testing that's currently going on beyond the existing 144, the first Ford Italian that you're already under contract for sometime this year?
Got you.
Syed on purchasing additional four vehicles based on the Thompson, what's currently going on beyond the existing 140 for the first four battalions, but youre already under contract for some time this year.
Yeah, you know the initial.
Speaker 4: The initial show at the plan of the army talked about 10 to 12 maybe 10 but then the talks increased maybe to 12 battalions altogether. That's the full structure that is probably needed by the army. that is neighbors. That is terror. The fight called G
The Asia Shawn plan of the Army talked about 10 to 12, maybe 10, but then the tox increases it may be to 12 four battalions altogether. That's the full structure that is probably needed by the army also.
And it was going to be purely kinetic like what wasn't done until now and.
Speaker 4: It's not going to be purely kinetic like what was done until now. And the Director Energy will kick in. Director Energy will be completed in 2020 soon based on what we know.
Directed energy.
Kiki direction thereafter, the energy will be completed in 2023 based on that based on what we know.
Speaker 4: again to be put on strikeers and there is an initial initial effort done by the rocket capabilities
Again to be put on strike us some very good initial our initial effort done by ER directed capabilities.
Speaker 4: branch of the army that put a few lasers on force tricons, actually four laser on force tricons, as prototype, but it's going to be completed. We believe that our sensors on world sensors will stay intact.
Our branch of the Army that book.
A few lasers for.
Four strikeouts victory for four lasers on fourth podcasts as prototype.
It's going to be completed we believe that the.
Our sense of onboard sensors will stay intact.
Speaker 4: That's our plan, but tell you know we are working with the potential friends also the lasers. We are working on it with the army To ensure that we we stay there And it will be completed as I said in 2023 and maybe some more battalions genetic battalions in the configuration that we have now We'll be also added
That's our plan, but that you know.
We are working with the potential rentals of delays as we are working directly with the army.
To ensure that we stay there.
And it will be completed as I said in 2023, and maybe some more battalions genetic battalions.
Proportion that we have now will be also added.
Yes.
Okay, great. Thank you that's very helpful.
Speaker 2: Okay, great. Thank you, that's really helpful. Thank you.
Sure.
The next question is from Matt home marshy. Please go ahead.
Speaker 2: The next question is from Nacho Morshiks. Please go ahead.
Speaker 5: Yeah, how are you doing Mr. Sela? I have a question you talked in the past about the conditions. Do you mean that you want to collire other companies or other companies for collire or you?
Yeah, how are you doing.
Mr Sella.
Quick question you talked in the past.
About the acquisitions did you mean that you want to acquire other companies or other companies to acquire.
I can't talk about what I want to do and not what others want to do to me. So hopefully a few and we're talking about M&A.
Speaker 4: I can't talk about what I want to do and not what others want to do to me. So I hope you have seen when we are talking about M&A, we are talking about the hours.
The thing about the hours.
Speaker 4: Okay, and what do you think it's gonna happen? Hopefully these year even.
Okay.
Okay, and when do you think it's going to happen.
Hopefully this year even.
Great. Thank you very much thank you.
Speaker 2: Thank you. If there are any additional questions, please press star one. If you wish to cancel your request, please press star two. Please stand by while we poll for more questions.
Thank you if there are any additional questions. Please press star one if you wish to cancel your class. Please press star two please standby, while we poll for more questions.
There are no further questions at this time, Mr. Sella would you like to make your concluding statement.
Speaker 2: There are no further questions at this time. Mr. Sella, would you like to make your concluding statement?
Speaker 4: Yes, thank you, Pointer. On behalf of the management, I would like to thank you all for your continuous interest in our business.
Thank you operator.
On behalf of the management I would like to thank you all for your continuous interest in our business.
And we will be presenting at the current conference Tomorrow.
Speaker 4: We will be presenting at the current conference tomorrow. And if you want to stick to us, please either approach the conference.
And if you want to speak to us.
Either our approach to the conference.
Overnight.
Speaker 4: organizers but you always can approach our investor relations
But you always can therefore, Charlie Investor relations directly.
Speaker 4: and we will find the time to meet. We look forward to sticking with you in the next quarter. And thank you very much.
And we will find the time to make we look forward to speaking with you in the next quarter.
And thank you very much and heavy duty.
Thank you. This concludes the Rada electronic industries fourth quarter 2021 results conference call. Thank you for your participation you May go ahead and disconnect.
Speaker 2: Thank you. This concludes the Rada Electronic Industries 4th quarter 2021 Results Conference call. Thank you for your participation. You may go ahead and disconnect.
Okay.
Speaker 1: The.
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Yes.
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[music].
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