Gilat Reports Improved Financial Results in Q3 2006

PETAH TIKVA, Israel, Nov. 6, 2006/Satnews Daily/ ― Gilat Satellite Networks Ltd. (Nasdaq: GILT) reported today revenues increased to $63.8 million representing a 30 percent year-over-year growth while net income increased to $2.7 million, from a net loss of $1.7 million in 3Q2005.

Gilat said revenues for the third quarter of 2006 were $63.8 million, up from $49 million in the same period of 2005. Net income for the third quarter of 2006 was $2.7 million or $0.11 per diluted share, compared to a net loss of $1.7 million or $0.08 per diluted share in the third quarter of 2005. Non-GAAP net income (1) for the third quarter of 2006 was $3.5 million, or $0.14 per diluted share, versus a net loss of $1.7 million or $0.08 per diluted share in the same quarter of 2005. EBITDA for the third quarter of 2006 was $10.0 million, increased from $4.0 million in the comparable period of 2005.

Revenues for the nine month period ended September 30, 2006 were $183.4 million, up from $153.4 million in the comparable period of 2005. Net income for the nine month period ended September 30, 2006 was $6.0 million or $0.25 per diluted share, compared to a net loss of $4.7 million or $0.21 per diluted share in the same period of 2005.

Non-GAAP net income for the nine month period ended September 30, 2006 was $9.2 million, or $0.39 per diluted share, versus a net loss of $4.7 million or $0.21 per diluted share in the comparable period of 2005. EBITDA for the nine month period ended September 30, 2006 was $28.2 million, increased from $13.9 million in the comparable period of 2005.

On September 27, York Capital Management exercised its option to convert all of its $70.4 million loan, plus accrued interest of approximately $1.0 million, into approximately 10.6 million ordinary shares of Gilat. After the conversion, Gilat’s outstanding shares increased from roughly 23.2 million shares to approximately 33.8 million shares.

Following the transaction, York owns approximately 33 percent of Gilat’s outstanding and issued shares.

Gilat’s CEO and chairman of the board Amiram Levinberg said the company has succeeded in achieving improvement in all its main financial parameters during the quarter. “We further increased our revenues, improved our operating income and enhanced our net income. During the quarter, we saw more business in emerging markets, especially in Russia, Africa, and Latin America,” he said.

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