Koor's shrinking losses - TheStreet

Koor Industries (NYSE:KOR) today reported losing a net $105 million for the first quarter of 2002, largely thanks to its defunct Tadiran subsidiary.

Earlier this week Koor said it would be posting an NIS 383 million loss on accrued conversion differences by its subsidiary Tadiran Communications, which it is transferring to the "shareholders equity surplus" section in its balance sheet. That alone lowered its bottom line by $82 million.

Minus the Tadiran effect, Koor would have lost about $23 million for the quarter, a significant improvement compared with the $214 million it lost in the first quarter of 2001.

Revenues excluding from ECI Telecom (Nasdaq:ECIL) totaled $410 million, up 4% from the parallel quarter, when it brought in revenues of $396 million.

Operating profit came to $43 million, up a huge 375% from the parallel quarter, when it achieved $9 million.

Operating profit climbed to 11% of revenue, compared with 2% in the corresponding quarter of 2001.

Koor CEO Jonathan Kolber commented that the financials demonstrate the results of severe steps the company has been taking over the last 15 months, which included cutting expenses, improving cash flow among the group's companies and reinforcing the company's financial soundness.

He also noted that affiliated firm ECI had achieved an "impressive operating cash flow", and that chemicals company Makhteshim Agan had continued to pursue new investment opportunities. Defense systems maker Elisra also continued to show rising revenues and profits, Kolber said.

Elisra's revenues for the quarter rose 28% to $97 million, and it netted $4 million, compared with losing $11 million in the corresponding quarter.

But then Elisra makes defense systems. Telrad Networks is still suffering from the telecommunications crash. Its quarterly revenues sank by 26% to $39 million, compared with $53 million in the parallel quarter. Despite that Tekrad's loss shrank slightly to $6 million, from $7 million in the parallel three months of last year.

Koor said that Telrad's sales were hurt primarily by trouble at its key customer, Nortel.

Makhteshim Agan, in which Koor holds 51%, reported revenues of $236 million, about the same as in the parallel. Its bottom line also stood steady at $21 million.

ECI Telecom brought some cheer this time around. The company's losses contracted from $256 million in the parallel quarter to $52 million. But its revenues came to $195 million, down 23% from the corresponding quarter.

Koor posted negative cash flow of $14.6 for the quarter. Its current credit from the banks totaled $386.6 million at the end of the first quarter. Its shareholders equity stood at $2.83 billion.