Aryt Industries Ltd. - Quarterly Report.Business Editors TEL-AVIV, Israel--(BUSINESS WIRE)--Dec. 3, 2001 Aryt Industries Ltd. (OTCBB OTCBB See OTC Bulletin Board (OTCBB). :ARYTF) (the "Company" or "Aryt"), published its financial statements for the nine months period ended September September: see month. 30, 2001. Aryt is a managing holding company, doing business through its three divisions; the Defence Division, the Technological Division and the Medical Division. The Defence Division includes ARYT SYSTEMS LTD. ("Aryt Systems") (89%) and its subsidiaries: RESHEF TECHNOLOGIES LTD. ("Reshef") (90%), AMCORAM LTD. ("Amcoram") (100%) and C.T.S. Ltd., Amcoram's subsidiary ("CTS (1) (Clear To Send) The RS-232 signal sent from the receiving station to the transmitting station that indicates it is ready to accept data. Contrast with RTS. (2) (Common Type System) The data typing used in . ") (51%). The Technological Division includes SENSOTECH LTD. (53%) ("Sensotech") and SENSOTECH AUTOMOTIVE LTD., Sensotech's subsidiary (100%), OFFICECORE.COM (1) (Computer Output Microfilm) Creating microfilm or microfiche from the computer. A COM machine receives print-image output from the computer either online or via tape or disk and creates a film image of each page. LTD. (45%) ("Officecore"), VOICE DIARY LTD. ("Voice Diary") (64%) and Sky Dart dart see blow dart. dart gun see blow dart. Ltd. ("Sky Dart") (51%). The Medical division includes ELSCINTEC SYSTEMS LTD. ("ElscinTec") (50%) and SYGMED LTD. ("Sygmed") (28%). Aryt carries out its operations through its consolidated companies and associated companies associated company associate n → Partnerfirma f associated company n → società collegata wherein where·in adv. In what way; how: Wherein have we sinned? conj. 1. In which location; where: the country wherein those people live. 2. Aryt has material influence and which are included in Aryt's Financial Statements on the equity basis. Presently Aryt endeavours to enhance the business and to increase the value of its divisions as well as examining various companies and activities synergetic synergetic /syn·er·get·ic/ (sin?er-jet´ik) synergic. syn·er·get·ic adj. Synergistic. to its own. THE DEFENCE DIVISION Aryt Systems Ltd. is a public company which shares are traded in the Tel-Aviv Stock exchange. Aryt Systems is engaged through its subsidiaries Reshef and Amcoram in the development, manufacture and sale of advanced military equipment highly reputable rep·u·ta·ble adj. Having a good reputation; honorable. rep  u·ta·bil in the local market and
world wide.
Reshef Technologies Ltd., a private company, engaged in the development, manufacture and sale of electronic fuzes for the military market, and in the manufacture of laser warning systems and computerised firing ranges for Amcoram. In March 2001, Reshef and Soltam This article or section may contain original research or unverified claims. Please help Wikipedia by adding references. See the for details. This article has been tagged since September 2007. System Ltd. ("Soltam") signed a marketing and distribution agreement whereby Soltam which owns 10% of Reshef's outstanding shares may increase its holdings in Reshef to 50%, but in any event not more than Aryt Systems' share in Reshef, in consideration of Soltam's marketing and sales of Reshef's products. Aryt's management believes that the co-operation with Soltam shall contribute to Reshef's international marketing efforts resulting in increase of sales. Amcoram Ltd., a private company, which is engaged in the development and sale of computerised firing ranges and simulators for the military market. The systems are intended for indoor and field training and constitute a complete platform for the military training of the individual soldier to a company of infantry infantry, body of soldiers who fight in an army on foot and are equipped with hand-carried weapons, in contradistinction originally to cavalry and other branches of an army. or armoured corps. The systems are characterised by the integration of software and hardware designed to client's specifications. All these training systems are developed and maintained by Amcoram according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. long term service contracts. Amcoram's products are manufactured in Sderot Sderot (Hebrew: שׂדרות, «boulevards», Arabic: سديروت) is a city in the South District of Israel. , Israel Israel, in the Bible Israel (ĭz`rēəl, ĭz`rāəl) [as understood by Hebrews,=he strives with God], according to the book of Genesis, name given to Jacob as eponymous ancestor of the Hebrews, the chosen people of God. , by Amcoram and by Reshef, as a subcontractor One who takes a portion of a contract from the principal contractor or from another subcontractor. When an individual or a company is involved in a large-scale project, a contractor is often hired to see that the work is done. . C.T.S., Ltd., a private company, possessing the rights for military applications of a patented technology utilizing lasers with wireless activation activation /ac·ti·va·tion/ (ak?ti-va´shun) 1. the act or process of rendering active. 2. the transformation of a proenzyme into an active enzyme by the action of a kinase or another enzyme. 3. method and receipt of a feedback from the hit target. This patent provides a technological platform for various training systems. The rights to use this patent were purchased from Sky Dart Ltd., an affiliated company. Presently CTS does not have any sales revenues. THE TECHNOLOGICAL DIVISION Sensotech Ltd., is a private company engaged in the development, manufacture and sale of intelligent, ultrasonic ultrasonic /ul·tra·son·ic/ (-son´ik) beyond the upper limit of perception by the human ear; relating to sound waves having a frequency of more than 20,000 Hz. ul·tra·son·ic adj. 1. security sensors
Sensotech has developed security sensors intended for the automotive industry The automotive industry is the industry involved in the design, development, manufacture, marketing, and sale of motor vehicles. In 2006, more than 69 million motor vehicles, including cars and commercial vehicles were produced worldwide. ("Accessor"), for the public transportation ("Class"), for elevators ("Sensolift") and for robotics robotics, science and technology of general purpose, programmable machine systems. Contrary to the popular fiction image of robots as ambulatory machines of human appearance capable of performing almost any task, most robotic systems are anchored to fixed positions and automatization au·tom·a·ti·za·tion n. Automation. ("Robosense"), as well as additional products based on Sensotech's unique technology. In 2001 Sensotech has commenced manufacturing and sale of some of its products. In August 2000, Sensotech formed a wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. - Sensotech Automotive Ltd., with the intention to centralise Verb 1. centralise - make central; "The Russian government centralized the distribution of food" centralize, concentrate alter, change, modify - cause to change; make different; cause a transformation; "The advent of the automobile may have altered the its Accessor's activity, to help locating strategic investors in the automotive industry with its unique characteristics. In the first quarter of 2001, Sensotech Automotive Ltd. signed a joint venture agreement with an approved parts manufacturer for a big car company in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. to set up a production line for the car industry. Officecore.com, Ltd., is engaged in the development of an internet complete work environment, primarily for the small and medium size businesses, including office applications, customer relations management (CRM (Customer Relationship Management) An integrated information system that is used to plan, schedule and control the presales and postsales activities in an organization. ) and inventory management. The service is provided via the internet utilizing central server mounted at the service provider. The system enables to increase the number of groups and individual users, providing secured access and privacy. Presently Officecore does not charge for its services. In order to secure its existence and reduce its dependence on raising additional capital, Officecore now operates as software house for various customers. This should provide a permanent positive cash flow securing its ability to continue developing its products. Voice Diary Ltd. is a private company engaged in the development of palm diary, activated activated a state of being more than usually active. In biological systems this is usually brought about by chemical or electrical means. Commonly said of pharmaceutical and chemical products. by voice and intended for users with sight impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. . In the second half of 2001 the company is expected to supply its distributors approximately 1,000 units (for approximately $140,000). The company's future depends on its ability to obtain additional orders, developing a new generation of products and the willingness of Aryt to increase its investment in the company. Sky Dart Ltd. is a private company owning a patent of technology utilizing lasers with wireless activation method and receipt of a feedback. This patent provides a technological platform for various applications, including an application, in the developing stage, fitted for plaything, activated by remote control. The company has commenced to market its technological applications. THE MEDICAL DIVISION Sygmed Ltd., is a private company engaged in the development, marketing and sale of medical robotic systems robotic system An integrated system of devices that automate production and manufacturing of goods and services Surgery An AI-based surgical assistant system, which processes sensory input from haptic interfaces and/or allows surgeons to act with more accuracy than designed for early detection of breast cancer. The flagship product A primary product of a company, which is typically why the company was founded and/or what made it well known. For example, MS-DOS, Windows and the Microsoft Office suite have been flagship products of Microsoft. CorelDRAW is a flagship product of Corel Corporation. of the company is the Robolite, a computerized computerized adapted for analysis, storage and retrieval on a computer. computerized axial tomography see computed tomography. biopsy biopsy (bīäp`sē), examination of cells or tissues removed from a living organism. Excised material may be studied in order to diagnose disease or to confirm findings of normality. system that enables the examining physician to guide the biopsy needle biopsy needle Surgery A thin–'skinny' needle passed percutaneously into an organ, often liver and kidney to obtain tissue for evaluation by light microscopy to the precise location of the suspected tissue with pinpoint accuracy. The system can be installed on all types of mammography mammography, diagnostic procedure that uses low-dose X rays to detect abnormalities in the breasts. The early diagnosis of breast cancer made possible by the routine use of mammography for screening women increases a woman's treatment alternatives and improves her machines. The Robolite has been approved by the FDA FDA abbr. Food and Drug Administration FDA, n.pr See Food and Drug Administration. FDA, n.pr the abbreviation for the Food and Drug Administration. (U.S.) and currently under process to obtain the CE (Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). ) approval. Aryt presently owns
28% of Sygmed Ltd.
ElscinTec Systems Ltd. is a private company, engaged in the development manufacture and sale, worldwide, of mammography systems for the detection and diagnostic of breast cancer. ElscinTec Systems is a known brand name. All ElscinTec's products are FDA (U.S.) and CE (Europe) approved. As of today 600 ElscinTec's mammography units were installed worldwide. During the 3rd quarter ElscinTec introduced it new product - Digital Biopsy. This product elevates ElscinTec's line of products. Aryt presently owns 50% of ElscinTec. FINANCIAL CONDITION Main Changes in the Company's Consolidated Balance Sheet consolidated balance sheet A balance sheet in which assets and liabilities of a parent company and its controlled subsidiaries are combined, thereby presenting balance sheet items for the parent and its subsidiaries as if they were a single firm. : As of September 30, 2001, Aryt's total balance sheet amounted to $35,358 thousand, compared with $35,304 thousand on December December: see month. 31, 2001. Current Assets Current Assets Appearing on a company's balance sheet, it represents cash, accounts receivable, inventory, marketable securities, prepaid expenses, and other assets that can be converted to cash within one year. As of September 30, 2001, current assets amounted to $17,443 thousand, compared with $27,139 thousand on December 31, 2000. The decrease in current assets is mainly attributed to reduction of the cash balance, receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed and debit balances Debit balance The amount that is owed to a broker by a margin customer for loans the customer uses to buy securities. debit balance The amount owed in a brokerage margin account. (resulting from reimbursement Reimbursement Payment made to someone for out-of-pocket expenses has incurred. by the income tax authorities). The increase in the inventory by $2,445 thousand compared to 12.31.2000 is mainly attributed to the proportionate pro·por·tion·ate adj. Being in due proportion; proportional. tr.v. pro·por·tion·at·ed, pro·por·tion·at·ing, pro·por·tion·ates To make proportionate. consolidation of Sensotech and ElscinTec, and to Reshef's stockpiling stock·pile n. A supply stored for future use, usually carefully accrued and maintained. tr.v. stock·piled, stock·pil·ing, stock·piles To accumulate and maintain a supply of for future use. for orders deliverable during the 4th quarter of 2001. Long Term Investments and Loans As of September 30, 2001, long term investments and debit balances amounted to $8,422 thousand compared with $2,837 thousand on December 31, 2000. The increase in the long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. loans is mainly attributed to Aryt's decision to reclassify Verb 1. reclassify - classify anew, change the previous classification; "The zoologists had to reclassify the mollusks after they found new species" class, classify, sort out, assort, sort, separate - arrange or order by classes or categories; "How would you short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. loans as long-term loans, due to its decision to reclassify certain investments as long term investments. The decrease in the long-term investments is mainly attributed to the increase of Aryt's shares in Sensotech, a subsidiary company, and the consolidation of Sensotech. Other Assets other assets Assets of relatively small value. For financial reporting purposes, firms frequently combine small assets into a single category rather than listing each item separately. As of September 30, 2001, net other assets amounted to $7,605 thousand, compared with $3,605 thousand on December 31, 2000. The increase in net other assets is attributed mainly to goodwill associated with the purchase of new companies or companies which were consolidated for the first time. Current Liabilities Current Liabilities Usually appearing on a company's balance sheet, it represents the amount owed for interest, accounts payable, short-term loans, expenses incurred but unpaid, and other debts due within one year. As of September 30, 2001, current liabilities amounted to $8,768 thousand, compared with $5,566 thousand on December 31, 2000. The increase is mainly attributed to short-term bank loans obtained by Reshef and Amcoram, and to the first time consolidation of Sensotech and ElscinTec. Long Term Liabilities As of September 30, 2001, long-term liabilities Long-Term Liabilities Recorded on the balance sheet, a company's liabilities for leases, bond repayments and other items due in more than one year. Notes: A company's long-term liabilities are accounted for by its debt obligations to other parties which last longer than amounted to $6,111 thousand, compared with $5,484 thousand on December 31, 2000. The increase is mainly attributed to a long-term bank loan of subsidiaries whose financial statements were consolidated for the first time. Equity As of September 30, 2001, Shareholders' Equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. amounted to $20,061 thousand, constituting 57% of the total balance sheet, compared with $24,224 thousand on December 31, 2000, constituting 69% of the total balance sheet. This decrease is attributed to losses incurred during this nine months period. CASH FLOW In the nine months period ended September 30, 2001, there was a negative cash flow from current operations amounting to $3,445 thousand compared with $1,597 thousand in the same period last year. The increase of the negative cash flow from current operations is mainly attributed to the increase of the losses from operations compared to the same period last year. The cash flow from investment activity was negative and amounted to $817 thousand, resulting mainly from investments in companies, compared with a positive cash flow of $7,664 thousand in the same period of last year. The large positive cash flow from investments' activity in the same period last year resulted from the sale of marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has . In the nine months period ended September 30, 2001, there was a positive cash flow from financial activity of $2,336 thousand, compared with a negative cash flow of $495 thousand in the same period last year. The positive cash resulted from bank loans. RESULTS OF OPERATIONS Net Profit (Loss) In the nine months period ended on September 30, 2001 Aryt had a net loss of $4,143 thousand compared with a net profit of $27,489 thousand in the same period, last year. Last year profit resulted from the sale of an affiliated company and of the shares received in exchange thereof. Sales The consolidated sales in the nine months period ended on September 30, 2001, amounted to $6,343 thousand compared with $4,715 thousand in the same period, last year. During the nine months period ended on September 30, 2001, the aggregate sales of the Aryt's group of companies (including proportionate sales of unconsolidated companies) amounted to $7,526 thousand, compared with $4,662 thousand in the same period, last year. The increase in aggregate sales is attributed to the first inclusion of Sensotech and proportionate inclusion of ElscinTec. Research and Development Expenses Net R&D expenses in the nine months period ended on September 30, 2001, amounted to $770 thousand, and were incurred mainly by Sensotech and ElscinTec. Same period last year Net R&D Expenses amounted to $422 thousand and were attributed to Reshef. Selling and Marketing Expenses Selling and marketing expenses in the nine months period ended September 30, 2001, amounted to $666 thousand compared with $259 thousand in the same period, last year. The increase in selling and marketing expenses is mainly attributed to an increase of $81 thousand in the expenses of Amcoram and Reshef of the Military Division, due to a strategic decision to expand the marketing efforts of Reshef's fuzez and Amcoram's combat training systems, and to the first time inclusion of Sensotech and ElscinTec. G&A Expenses G&A expenses in the nine months period ended September 30, 2001, amounted to $3,502 thousand compared with $1,381 thousand in the same period, last year. The increase in the G&A expenses is mainly attributed to the first time inclusion of Sensotech and ElscinTec and an increase of $298 thousand in the G&A expenses of the companies of the Military Division attributed to the increasing activity of these companies to be reflected in the future periods. Financing Income / Expenses Net financing expenses in the nine months period ended September 30, 2001, amounted to $958 thousand compared with financing income of $27,011 thousand in the same period, last year. The financing income last year resulted from the appreciation of Terayon Terayon Communication Systems, Inc. is a company that sells equipment to broadband service providers for delivering broadband voice, video and data services to residential and business subscribers. shares, received in exchange of shares of an affiliated company. Other Expenses, Net The Company's other expenses in the nine months period ended September 30, 2001, amounted to $29 thousand compared with an income of $12,856 thousand in the same period, last year. Last year income is attributed to a gain from the sale of an affiliated company. Profit (Loss) Per Share The loss per one ordinary share of NIS Niš or Nish (both: nēsh), city (1991 pop. 175,391), SE Serbia, on the Nišava River. An important railway and industrial center, it has industries that manufacture textiles, electronics, spirits, and locomotives. . 1.00 par value in the nine months period ended September 30, 2001 was $0.1 compared with a profit of $0.64 in the same period, last year. Data of Affiliated Companies Affiliated Companies A situation that occurs when one company owns a minority interest (less than 50%) in another company. Also refers to companies that are related to each other in some way. Notes: An affiliated company is sometimes referred to as a subsidiary. Aryt's results from operations is affected by the results of operations of its subsidiaries and affiliated companies. The following is selected financial data taken from the financial statements of Aryt's subsidiaries and affiliated companies.
----------------------------------------------------------------------
SALES NET PROFIT (LOSS)
(US Dollars in thousands) (US Dollars in thousands)
IN THE NINE MONTHS PERIOD IN THE NINE MONTHS PERIOD
ENDED SEPTEMBER 30 ENDED SEPTEMBER 30
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----------------------------------------------------------------------
2001 2000 2001 2000
----------------------------------------------------------------------
----------------------------------------------------------------------
Aryt Systems 4,175 4,525 (1,524) (1,011)
(Proforma) (a)
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----------------------------------------------------------------------
Sygmed 273 -- (464) --
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Sensotech 1,027 91 (95) (625)
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----------------------------------------------------------------------
Officecore 268 -- (121) (261)
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Voice Diary 2 46 (149) (171)
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ElscinTec 1,781 -- (805) --
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Sky Dart -- -- (45) --
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Total 7,526 4,662 (3,203) (2,068)
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(a) Following the sale the Company's shares in Reshef and Amcoram
to Aryt Systems, the financial data of Aryt Systems includes these
companies' data as if they were owned by it in the relevant periods
excluding the data in respect of discontinued activity.
GENERAL Amcoram - In January January: see month. 2001,Amcoram declared and paid $1,137 thousand in dividends to Aryt. In January 2001, Aryt invested $1,137 thousand in Amcoram. In September 2001, Aryt converted part of its long-term loan ($500 thousand) given to Amcoram into a non redeemable Redeemable Eligible for redemption under the terms of an indenture. treasury note bearing zero interest. Investment in ElscinTec - In January 2001, Aryt completed the acquisition of all the shares in Tawton Ltd. for $1,250,000, which owns 50% of the outstanding shares in ElscinTec Holdings Ltd. that owns 100% of the outstanding shares in ElscinTec. As part of this transaction Aryt provided guarantees in favor of upon the side of; favorable to; for the advantage of. See also: favor ElscinTec up to $1,250,000 for a period of three years. Aryt Systems Ltd. (previously Ram-Zur Industries Ltd.) - In June June: see month. 28, 2001, the Company has sold all its interests in Amcoram and Reshef to Aryt Systems in consideration of 36,571,150 Ordinary shares in Aryt Systems. Consequently Aryt presently owns 89% of Aryt Systems outstanding shares. Officecore.com, Ltd.- In February February: see month. 2001, Aryt exercised its option to invest $300,000 in OfficeCore. As a result of this investment, Aryt increased its holdings in OfficeCore to 45% of the outstanding shares of OfficeCore. Sensotech Ltd. - In February 2001, Aryt exercised its option to purchase additional 15% in Sensotech for $1 million. Consequently, Aryt increased its holdings in Sensotech to 53% of the outstanding shares of Sensotech. Acquisition of Business Activity and Share Issuance in Reshef to Soltam Systems Ltd. In March 2001, Reshef and Kaf Mem Fuzes Engineering (Soltam) Ltd. ("Soltam") signed an agreement. Pursuant to this agreement Reshef purchased Soltam's electronic fuzes business activity for $300,000. Concurrently, Reshef and Soltam System Ltd. ("Soltam System") signed an agreement whereby Reshef issued to Soltam System shares for $300,000 so that consequently Soltam owns 10% of Reshef's outstanding shares. Soltam System has obtained an option to increase its holdings in Reshef up to Aryt Systems' share in Reshef, in consideration of its marketing and sales efforts and their results. Sky Dart Ltd. In May 2001, Sky Dart Ltd., a private company in which Aryt owns 51% of its outstanding shares, acquired CTS's Patent and immediately gave CTS a license to use the patent for all the military applications. Additionally CTS waived its right to obtain financing of $300,000 from Aryt or Amcoram and instead Aryt has undertaken to finance Sky Dart or CTS up to the same amount. Sygmed Ltd. - In July 2001, Aryt exercised its option to purchase additional shares in Sygmed for $300,000. Consequently, Aryt increased its holdings in Sygmed to 28% of the outstanding shares of Sygmed. Pionet Ventures Capital Investments Ltd. - In September 2001, Aryt has signed an Investment Agreement with Pionet under which Aryt undertook to invest US$ 1,000,000 in Pionet for Pionet's newly issued shares representing 52% of Pionet's outstanding shares following the shares issue. Pionet is a company incorporated under the laws of the State of Israel whose shares are traded on the Tel-Aviv Stock Exchange. Since March 2001, Pionet has ceased all its business activities. This transaction is subject to the approval of the audit committee, board of directors and shareholders of Pionet, as well as of the Tel Aviv Stock Exchange Tel Aviv Stock Exchange Israel's only stock exchange. and the Securities Authority. Concurrently with this agreement, Aryt, together with others, have signed a share purchase agreement with certain shareholders of Pionet regarding the purchase of 28% of Pionet outstanding shares (following the shares issue to Aryt by Pionet). Aryt's share in this acquisition is less than 1% of Pionet's outstanding shares. The completion of this transaction is conditioned on the Closing of the Investment Agreement. If concluded, the total investment of Aryt for the purchase of Pionet's shares will amount to approximately US$ 1,100,000. The investment in Pionet, is part of the Company's reorganization plan A scheme authorized by federal law and promulgated by the president whereby he or she alters the structure of federal agencies to promote government efficiency and economy through a transfer, consolidation, coordination, authorization, or abolition of functions. to merge the activities of its Medical Division into the acquired "shell company". Interested Party's Transactions - Aryt signed an Employment Agreement with Mr. Gilad Shabtai, who serves as an active chairman of the boards of directors of Aryt and Aryt Systems and as a director of Reshef and Amcoram. Mr. Shabtai will receive a monthly wages (retroactively ret·ro·ac·tive adj. Influencing or applying to a period prior to enactment: a retroactive pay increase. [French rétroactif, from Latin from January 1, 2001) of approximately $15,000 (including expenses), at a total cost to the Company of approximately $18,500 per month. Since Mr. G. Shabtai is the brother of Mr. Benjamin Shabtai, which is a controlling shareholder of the Company, this transaction was subject to the approval of the Company's Audit committee, Board of Directors and Shareholders meeting. The Agreement was signed on March 28, 2001, and was approved by Aryt's Audit committee on January 30, 2001, by Aryt's Board of Directors on March 28, 2001, and by Aryt's Shareholders meeting on September 16, 2001. The effectiveness of this agreement is January 1, 2001. POST BALANCE SHEET EVENTS Compliance with the TASE TASE Tel Aviv Stock Exchange TASE The All Seeing Eye TASE Tactical Air Support Element TASE Thrust Assessment Support Environment TASE Telecontrol Application Service Elements (IEC communications protocol) Regulations - The Tel Aviv Stock Exchange ("TASE") has informed Aryt Systems that since Aryt owns and holds more than 85% of Aryt Systems' outstanding shares, Aryt Systems is in violation of the TASE regulations. In case this violation shall not be cured until March 31, 2002, Aryt Systems' shares may be de-listed from the TASE. Aryt and Aryt Systems are currently taking all necessary measures to enable Aryt Systems to be in compliance with the TASE regulations.
UNAUDITED CONSOLIDATED BALANCE SHEETS
September September December
30, 2001 30, 2000 31, 2000
--------------------------------------------
U.S. Dollars
--------------------------------------------
(In thousands)
ASSETS
CURRENT ASSETS:
Cash and case equivalents 1,083 7,192 3,082
Short term investments 7,429 17,556 15,395
Trade receivables 2,870 1,716 3,120
Other accounts receivable 1,042 702 2,968
Inventories 5,019 3,347 2,574
--------------------------------------------
17,443 30,513 27,139
--------------------------------------------
LONG-TERM INVESTMENTS AND
LOANS:
Long term investment 6,119 1,255 -
Investments in affiliates 1,463 1,322 2,734
Long loan and accounts
receivable 840 35 103
--------------------------------------------
8,422 2,612 2,837
--------------------------------------------
FIXED ASSETS, NET 1,779 1,678 1,628
--------------------------------------------
MINORITHY INDEBTEDNESS 109 - 95
--------------------------------------------
OTHER ASSETS, NET 7,605 1,223 3,605
--------------------------------------------
35,358 36,026 35,304
--------------------------------------------
LIABILITIES
CURRENT LIABILITIES:
Credit from banks and
others 3,771 2,614 1,581
Trade payables 1,903 842 1,222
Other accounts payable
and accrued expenses 2,903 2,018 2,702
Customer advances 191 51 61
--------------------------------------------
8,768 5,525 5,566
--------------------------------------------
LONG-TERM LIABILITIES:
Convertible debentures 1,697 2,122 1,697
Credit from bank 2,573 791 2,537
Other long-term
liabilities 1,195 - 839
Accrued severance pay 646 422 411
--------------------------------------------
6,111 3,335 5,484
--------------------------------------------
MINORITHY INTEREST 418 39 30
--------------------------------------------
SHAREHOLDERS' EQUITY 20,061 27,127 24,224
--------------------------------------------
35,358 36,026 35,304
--------------------------------------------
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
Six months ended Three month ended Year ended
--------------------------------------------------------
--------------------------------------------------------
September 30 September 31 December 31
--------------------------------------------------------
2001 2000 2001 2000 2000
--------------------------------------------------------
US Dollars
--------------------------------------------------------
(In thousands)
Revenues from
sales and
services 6,343 4,715 2,408 1,521 7,681
Cost of sales 4,424 3,916 1,589 978 5,938
--------------------------------------------------------
--------------------------------------------------------
Gross profit
(loss) 1,919 799 819 543 1,743
--------------------------------------------------------
--------------------------------------------------------
Research and
development
expenses,
net 770 422 240 165 858
Selling and
marketing
expenses 666 259 280 68 359
General and
admini-
strative
expenses 3,502 1,381 1,390 513 2,255
--------------------------------------------------------
--------------------------------------------------------
4,938 2,062 1,910 746 3,472
--------------------------------------------------------
--------------------------------------------------------
Operating
loss (3,019)(1,263) (1,091) (203) (1,729)
Financial
income
(expenses),
net (958)27,011 (369) (99) 23,411
Other income
(expenses),
net (29)12,856 - (187) 11,884
--------------------------------------------------------
--------------------------------------------------------
Income (loss)
before taxes
on income (4,006)38,604 (1,460) (489) 33,566
Taxes on
income 31 10,906 - - 8,594
--------------------------------------------------------
--------------------------------------------------------
Income (loss)
before
equity in
losses of
affiliate (4,037)27,698 (1,460) (489) 24,972
Equity in
losses of
affiliate (258) (209) (77) (119) (414)
Minority
interest in
losses of
subsidiaries 152 - 216 - 16
--------------------------------------------------------
--------------------------------------------------------
Income (loss)
for the
period (4,143)27,489 (1,321) (608) 24,574
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