6-K
Caesarstone Ltd. (CSTE)
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
Pursuant to Rule 13a-16 or 15d-16 of the
Securities Exchange Act of 1934
For the month of August 2020
Commission File Number: 001-35464
Caesarstone Ltd.
(Translation of registrant’s name into English)
Kibbutz Sdot-Yam
MP Menashe
Israel 3780400
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): __
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): __
EXPLANATORY NOTE
Second Quarter 2020 Financial Results
On August 5, 2020, Caesarstone Ltd. (the “Company”) issued a press release titled “Caesarstone Reports Second Quarter 2020 Financial Results”, a copy of which is furnished as Exhibit 99.1 herewith.
Change in Board of Directors
On August 3, 2020, Eric D. Herschmann, a member of the Board of Directors (the “Board”) of Caesarstone Ltd. notified the Board that he was resigning from the Company’s Board effective immediately, as he assumed a position with the U.S. government.
The Company noted that Mr. Herschmann’s resignation did not result from any disagreement with the Company regarding financial, operational or other matters. The Board accepted Mr. Herschmann’s resignation and wishes to thank Mr. Herschmann for his efforts and contribution to the Company.
Following Mr. Herschmann’s resignation, the Board consists of nine members, five of whom satisfy the independence requirements of the Nasdaq Stock Market (“Nasdaq”). The independent members of the board are Irit Ben-Dov, Ofer Borovsky, Ofer Tsimchi, Ronald Kaplan and Roger Abravanel. The non-independent members of the board are Ariel Halperin, Dori Brown, Shai Bober and Tom Pardo Itzhaki. As a result, following the resignation of Mr. Herschmann, the Company remains compliant with the Nasdaq rule requiring that a majority of its board be comprised of directors that satisfy Nasdaq’s independence requirements.
The GAAP financial information included in consolidated balance sheets, consolidated statements of income and condensed consolidated statements of cash flows contained in the press release attached as Exhibit 99.1 to this Report on Form 6-K is hereby incorporated by reference into (i) the Company’s Registration Statements on Form S-8 (Files No. 333- 180313 and No. 333-210444) and (ii) the Company’s Registration Statement on Form F-3 (File No. 333-196335).
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| CAESARSTONE LTD. | ||
|---|---|---|
| Date: August 5, 2020 | By: | /s/ Ron Mosberg |
| Name: Ron Mosberg | ||
| Title: General Counsel & Corporate Secretary |
EXHIBIT INDEX
The following exhibits are furnished as part of this Form 6-K:
| Exhibit | Description |
|---|---|
| 99.1 | Press<br> release titled “Caesarstone Reports Second Quarter 2020 Financial Results” dated August 5, 2020. |
| --- | --- |
Exhibit 99.1
Caesarstone Reports Second Quarter 2020 Financial Results
Revenue of $99.0 Million, With Encouraging Demand Improvement in All Regions During June -
Net Loss of $5.9 Million, or ($0.17) Per Share -
Adjusted Net Loss of $3.5 Million, or ($0.10) Per Share -
Adjusted EBITDA of $6.5 Million -
Strong Liquidity Position With $130.1 Million in Cash and Marketable Securities -
MP MENASHE, Israel - August 5, 2020 - Caesarstone Ltd. (NASDAQ: CSTE), a leading developer and manufacturer of high-quality engineered surfaces, today reported financial results for its second quarter ended June 30, 2020.
Yuval Dagim, Chief Executive Officer, commented, “Our proactive actions taken in March allowed us to effectively right size our resources and mitigate the impact of the unprecedented environment brought on by the COVID-19 pandemic. At the same time, we continue to focus on factors that are in our control, such as executing our Global Growth Acceleration Plan and making strategic investments to strengthen our position as a leading premium countertop Company. With our strong cash position, we will continue to execute this strategy to improve our business over the long-term, most particularly in areas of product innovation, production processes, technology, and go-to-market capabilities. Looking ahead, we are fortunate to have a talented workforce, leading products and solid financial resources to deliver on our focused approach to value creation in the quarters and years ahead.”
Ophir Yakovian, Chief Financial Officer, added, “Second quarter sales in all of our four global regions were better than initially expected at the onset of the pandemic. We experienced the majority of adverse impacts in our Americas region during April and May. Since that time, we have been encouraged to see sequential improvement in June as more customers opened for business and demand began to return. As we look to the balance of 2020, we recognize that there is potential for additional limitations through national and local government orders aimed to safeguard the public from the pandemic. That said, we will continue to focus on managing cash, controlling costs and adjusting our production as needed to appropriately manage our inventory in this volatile environment. We remain committed to our strategy and continue allocating resources to enhance our position as a global, premium countertop expert with a leading and valued customer-focused brand.”
Second Quarter 2020 Results
Revenue in the second quarter of 2020 was $99.0 million compared to $141.1 million in the prior year quarter. On a constant currency basis, second quarter revenue was lower by 28.3% year-over-year, driven by extended shelter-in-place guidelines, particularly during the first two months of the quarter with the biggest impact in the Americas region.
Gross margin in the second quarter was 20.4% compared to 28.2% in the prior year quarter. Adjusted gross margin in the second quarter was 20.5% compared to 27.3% in the prior year quarter. The lower adjusted gross margin primarily reflects lower sales volume and less favorable regional and product mix as well as currency exchange headwinds, partially offset by lower raw material prices.
Operating loss in the second quarter was $2.9 million compared to operating income of $10.6 million in the prior year quarter. The year-over-year difference mainly reflects lower gross margin.
Adjusted EBITDA, which excludes expenses for share-based compensation, legal settlements and loss contingencies and for non-recurring items, was $6.5 million in the second quarter, representing a margin of 6.6%. This compares to adjusted EBITDA of $19.2 million, representing a margin of 13.6%, in the prior year quarter.
Finance expense in the second quarter was $2.5 million compared to $1.8 million in the prior year quarter. The difference was primarily a result of the unfavorable impact of foreign currency exchange rates.
Net loss for the second quarter was $5.9 million compared to net income of $6.4 million in the prior year quarter. Loss per share for the second quarter was ($0.17) compared to diluted net income per share of $0.19 in the prior year quarter. Adjusted diluted net loss per share for the second quarter was ($0.10) on 34.5 million shares, compared to adjusted diluted net income per share of $0.23 on a similar share count in the prior year quarter.
Balance Sheet & Liquidity
The Company believes it has a strong financial position and the flexibility required to support its global operations during this volatile period. The Company's balance sheet as of June 30, 2020 remained strong, including cash, cash equivalents and short-term bank deposits and short and long term marketable securities of $130.1 million.
Dividend
The Company’s dividend policy provides for a quarterly cash dividend of up to 50% of reported net income on a year-to-date basis, less any amount already paid as dividend for the respective period (the “calculated dividend”), subject in each case to approval by the Company’s board of directors. No dividend is paid if it would be less than $0.10 per share. Pursuant to the Company’s dividend policy, the Company does not intend to pay a dividend for the second quarter of 2020, based on its reported net loss for the period.
Webcast and Conference Call Details
The Company will host a live webcast and conference call today at 8:30 a.m. ET to discuss the results, followed by a question and answer session for the investment community. The live webcast of the call can be accessed at ir.caesarstone.com. Due to potential extended wait times to access the conference call via dial-in, the Company encourages use of the webcast. For those unable to access the webcast, the conference call will be accessible by dialing 1-877-407-4018 (domestic) or +1-201-689-8471 (international). The toll-free Israeli number is 1 80 940 6247. Upon dialing in, please request to join the Caesarstone Second Quarter Earnings Call.
To listen to a telephonic replay of the conference call, dial toll-free 1-844-512-2921 (domestic) or +1-412-317-6671 (international) and enter pass code 13706779. The replay will be available beginning at 11:00 a.m. ET on Wednesday, August 5, 2020 and will last through 11:59 p.m. ET on Wednesday, August 12, 2020.
About Caesarstone
Caesarstone is a concept and lifestyle-driven company with a customer-centered approach to designing, developing, and producing high-end engineered surfaces used in residential and commercial buildings. Our products offer superior aesthetic appeal and perfected functionality through a distinct variety of colors, styles, textures, and finishes used in countertops, vanities, wall cladding, floors, and other interior surfaces. Marked by their inherent longevity characteristics such as non-porousness, scratch and stain resistance, and durability, the company’s product umbrella offers a highly desirable alternative to other surfaces. Strong commitment to service has fostered growing customer loyalty in over 50 countries where the five distinct Caesarstone product collections are available: Classico, Supernatural, Metropolitan, Concetto and Outdoor. For more information please visit our website: www.caesarstone.com.
Non-GAAP Financial Measures
The non-GAAP measures presented by the Company should be considered in addition to, and not as a substitute for, comparable GAAP measures. Reconciliations of GAAP gross profit to adjusted gross profit, GAAP net income (loss) to adjusted net income (loss) and net income (loss) to Adjusted EBITDA are provided in the schedules to this release. To calculate revenues growth rates that exclude the impact of changes in foreign currency exchange rates, the Company converts actual reported results from local currency to U.S. dollars using constant foreign currency exchange rates in the current and comparable period. The Company provides these non-GAAP financial measures because it believes that they present a better measure of the Company's core business and management uses the non-GAAP measures internally to evaluate the Company's ongoing performance. Accordingly, the Company believes that they are useful to investors in enhancing an understanding of the Company's operating performance.
Forward-Looking Statements
Information provided in this press release may contain statements relating to current expectations, estimates, forecasts and projections about future events that are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to the Company's plans, objectives and expectations for future operations, including estimations relating to the impact of the COVID-19 pandemic and mitigation measures in connection thereto, expectations of the results of the Company’s business optimization initiative and its projected results of operations. These forward-looking statements are based upon management's current estimates and projections of future results or trends. Actual results may differ materially from those projected as a result of certain risks and uncertainties, both known or unknown. These factors include, but are not limited to: the impact of the COVID-19 pandemic on end-consumers, the global economy and the Company’s business and results of operations; the ability of the company to realign aspects of its business based on the business optimization initiative, the strength of the home renovation and construction sectors; intense competitive pressures; the outcome of silicosis and other bodily injury claims; regulatory requirements relating to hazards associated with exposure to silica dust; manufacturing of existing products and managing required changes in production and supply chain; economic conditions within any of our key existing markets changes in raw material prices; fluctuations in currency exchange rates; the success of our expansion efforts in the United States; unpredictability of seasonal fluctuations in revenues; disturbances to the Company’s operations or the operations of its suppliers, distributors, customers or other third parties and other factors discussed under the heading "Risk Factors" in our most recent annual report on Form 20-F and other documents filed with the Securities and Exchange Commission. These forward-looking statements are made only as of the date hereof, and the Company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.
Contacts:
Investor Relations:
ICR, Inc. - Rodny Nacier
+1 646 277-1237
| Caesarstone Ltd. and its subsidiaries<br><br> Condensed consolidated balance sheets | ||||||
|---|---|---|---|---|---|---|
| As of | ||||||
| --- | --- | --- | --- | --- | --- | --- |
| U.S. dollars in thousands | June 30,<br><br> <br>2020 | December 31,<br><br> <br>2019 | ||||
| (Unaudited) | (Audited) | |||||
| ASSETS | ||||||
| CURRENT ASSETS: | ||||||
| Cash and cash equivalents and short-term bank deposits | $ | 117,064 | $ | 139,372 | ||
| Short-term available for sale marketable securities | 2,025 | - | ||||
| Trade receivables, net | 67,007 | 78,282 | ||||
| Other accounts receivable and prepaid expenses | 27,987 | 34,066 | ||||
| Inventories | 133,611 | 122,686 | ||||
| Total current assets | 347,694 | 374,406 | ||||
| LONG-TERM ASSETS: | ||||||
| Severance pay fund | 3,510 | 3,475 | ||||
| Other long-term receivables | 3,577 | 3,176 | ||||
| Deferred tax assets, net | 8,513 | 7,881 | ||||
| Long-term deposits and prepaid expenses | 4,260 | 2,887 | ||||
| Operating lease right-of-use assets | 73,544 | 72,047 | ||||
| Long-term available for sale marketable securities | 10,978 | - | ||||
| Property, plant and equipment, net | 201,980 | 204,776 | ||||
| Goodwill | 34,804 | 35,218 | ||||
| Total long-term assets | 341,166 | 329,460 | ||||
| Total assets | $ | 688,860 | $ | 703,866 | ||
| LIABILITIES AND EQUITY | ||||||
| CURRENT LIABILITIES: | ||||||
| Trade payables | 37,274 | 53,072 | ||||
| Related party and other loan | 2,076 | 2,212 | ||||
| Short term legal settlements and loss contingencies | 23,377 | 28,300 | ||||
| Accrued expenses and other liabilities | 44,414 | 42,782 | ||||
| Total current liabilities | 107,141 | 126,366 | ||||
| LONG-TERM LIABILITIES: | ||||||
| Long-term loan and financing liability of land from a related party | 7,044 | 7,915 | ||||
| Legal settlements and loss contingencies long-term | 27,891 | 21,505 | ||||
| Long-term lease liabilities | 65,264 | 64,638 | ||||
| Accrued severance pay | 4,373 | 4,333 | ||||
| Long-term warranty provision | 1,372 | 1,385 | ||||
| Total long-term liabilities | 105,944 | 99,776 | ||||
| EQUITY: | ||||||
| Ordinary shares | 371 | 371 | ||||
| Treasury shares - at cost | (39,430 | ) | (39,430 | ) | ||
| Additional paid-in capital | 158,932 | 157,225 | ||||
| Capital fund related to non-controlling interest | (5,587 | ) | (5,587 | ) | ||
| Accumulated other comprehensive loss | (3,740 | ) | (3,288 | ) | ||
| Retained earnings | 365,229 | 368,433 | ||||
| Total equity | 475,775 | 477,724 | ||||
| Total liabilities and equity | $ | 688,860 | $ | 703,866 |
Caesarstone Ltd. and its subsidiaries
Condensed consolidated statements of income \(loss\)
| Three months ended June 30, | Six months ended June 30, | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| U.S. dollars in thousands (except per share data) | 2020 | 2019 | 2020 | 2019 | ||||||
| (Unaudited) | (Unaudited) | |||||||||
| Revenues | $ | 99,037 | $ | 141,071 | $ | 225,594 | $ | 269,268 | ||
| Cost of revenues | 78,865 | 101,308 | 169,021 | 198,236 | ||||||
| Gross profit | 20,172 | 39,763 | 56,573 | 71,032 | ||||||
| Operating expenses: | ||||||||||
| Research and development | 763 | 1,280 | 1,543 | 2,222 | ||||||
| Marketing and selling | 11,435 | 15,579 | 30,064 | 32,653 | ||||||
| General and administrative | 9,241 | 10,572 | 21,108 | 21,605 | ||||||
| Legal settlements and loss contingencies, net | 1,637 | 1,729 | 4,475 | 3,305 | ||||||
| Total operating expenses | 23,076 | 29,160 | 57,190 | 59,785 | ||||||
| Operating income (loss) | (2,904 | ) | 10,603 | (617 | ) | 11,247 | ||||
| Finance expenses, net | 2,507 | 1,825 | 1,638 | 2,147 | ||||||
| Income (loss) before taxes | (5,411 | ) | 8,778 | (2,255 | ) | 9,100 | ||||
| Taxes on income (loss) | 471 | 2,364 | 949 | 3,091 | ||||||
| Net income (loss) | $ | (5,882 | ) | $ | 6,414 | $ | (3,204 | ) | $ | 6,009 |
| Basic net income (loss) per ordinary share | $ | (0.17 | ) | $ | 0.19 | $ | (0.09 | ) | $ | 0.17 |
| Diluted net income (loss) per ordinary share | $ | (0.17 | ) | $ | 0.19 | $ | (0.09 | ) | $ | 0.17 |
| Weighted average number of ordinary shares used in computing basic income (loss) per ordinary share | 34,412,369 | 34,380,799 | 34,406,107 | 34,373,848 | ||||||
| Weighted average number of ordinary shares used in computing diluted income (loss) per ordinary share | 34,412,369 | 34,425,797 | 34,406,107 | 34,427,899 |
| Caesarstone Ltd. and its subsidiaries<br><br> Selected Condensed consolidated statements of cash flows | ||||||
|---|---|---|---|---|---|---|
| Six months ended June 30, | ||||||
| --- | --- | --- | --- | --- | --- | --- |
| U.S. dollars in thousands | 2020 | 2019 | ||||
| (Unaudited) | ||||||
| Cash flows from operating activities: | ||||||
| Net income (loss) | $ | (3,204 | ) | $ | 6,009 | |
| Adjustments required to reconcile net income (loss) to net cash provided by operating activities: | ||||||
| Depreciation and amortization | 14,102 | 14,862 | ||||
| Share-based compensation expense | 1,707 | 1,884 | ||||
| Accrued severance pay, net | 7 | (8 | ) | |||
| Changes in deferred tax, net | (640 | ) | (1,242 | ) | ||
| Capital loss | 22 | 338 | ||||
| Legal settlemnets and loss contingencies, net | 4,475 | 3,305 | ||||
| Decrease (increase) in trade receivables | 9,942 | (10,479 | ) | |||
| Decrease (increase) in other accounts receivable and prepaid expenses | 3,172 | (4,726 | ) | |||
| Decrerase (increase) in inventories | (12,621 | ) | 21,571 | |||
| Decrease in trade payables | (16,117 | ) | (9,800 | ) | ||
| Decrease in warranty provision | (98 | ) | (82 | ) | ||
| Changes in right of use assets | (1,347 | ) | (74,159 | ) | ||
| Changes in lease liabilities | 1,554 | 76,385 | ||||
| Amortization of premium and accretion of discount on marketable securities, net | 6 | - | ||||
| Changes in Accrued interest related to Marketable Securities | (8 | ) | - | |||
| Increase in accrued expenses and other liabilities including related party | 4,173 | 2,088 | ||||
| Net cash provided by operating activities | 5,125 | 25,946 | ||||
| Cash flows from investing activities: | ||||||
| Purchase of property, plant and equipment | (12,459 | ) | (11,955 | ) | ||
| Proceeds from sale of property, plant and equipment | 6 | 54 | ||||
| Investment in marketable securities | (13,002 | ) | - | |||
| Increase in long term deposits | (711 | ) | (192 | ) | ||
| Net cash used in investing activities | (26,166 | ) | (12,093 | ) | ||
| Cash flows from financing activities: | ||||||
| Changes in short-term bank credit and loans, net | (459 | ) | (7,771 | ) | ||
| Repayment of a financing leaseback related to Bar-Lev transaction | (610 | ) | (588 | ) | ||
| Net cash used in financing activities | (1,069 | ) | (8,359 | ) | ||
| Effect of exchange rate differences on cash and cash equivalents | (198 | ) | 304 | |||
| Decrease in cash and cash equivalents and short-term bank deposits | (22,308 | ) | 5,798 | |||
| Cash and cash equivalents and short-term bank deposits at beginning of the period | 139,372 | 93,562 | ||||
| Cash and cash equivalents and short-term bank deposits at end of the period | $ | 117,064 | $ | 99,360 | ||
| Non - cash investing: | ||||||
| Changes in trade payables balances related to purchase of fixed assets | (954 | ) | (2,500 | ) |
Caesarstone Ltd. and its subsidiaries
| Three months ended June 30, | Six months ended June 30, | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| U.S. dollars in thousands | 2020 | 2019 | 2020 | 2019 | ||||||
| (Unaudited) | (Unaudited) | |||||||||
| Reconciliation of Gross profit to Adjusted Gross profit: | ||||||||||
| Gross profit | $ | 20,172 | $ | 39,763 | $ | 56,573 | $ | 71,032 | ||
| Share-based compensation expense (a) | 122 | 63 | 253 | 139 | ||||||
| Non-recurring import related income | - | (2,611 | ) | - | (1,501 | ) | ||||
| Other non-recurring items (b) | - | 1,367 | $ | - | 1,367 | |||||
| Adjusted Gross profit (Non-GAAP) | $ | 20,294 | $ | 38,582 | $ | 56,826 | $ | 71,037 | ||
| (a) | Share-based compensation includes expenses related to stock options and restricted stock units granted to employees and directors of the Company. | |||||||||
| --- | --- | |||||||||
| (b) | Relates mainly to one time amortization of machinery equipment with no future alternative use. |
Caesarstone Ltd. and its subsidiaries
| Three months ended June 30, | Six months ended June 30, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| U.S. dollars in thousands | 2020 | 2019 | 2020 | 2019 | ||||||||
| (Unaudited) | (Unaudited) | |||||||||||
| Reconciliation of Net Income (loss) to Adjusted EBITDA: | ||||||||||||
| Net income (loss) | $ | (5,882 | ) | $ | 6,414 | $ | (3,204 | ) | $ | 6,009 | ||
| Finance expenses, net | 2,507 | 1,825 | 1,638 | 2,147 | ||||||||
| Taxes on income | 471 | 2,364 | 949 | 3,091 | ||||||||
| Depreciation and amortization | 6,987 | 8,099 | 14,102 | 14,862 | ||||||||
| Legal settlements and loss contingencies, net (a) | 1,637 | 1,729 | 4,475 | 3,305 | ||||||||
| Share-based compensation expense (b) | 801 | 832 | 1,707 | 1,884 | ||||||||
| Non-recurring import related expense (income) | - | (2,611 | ) | - | (1,501 | ) | ||||||
| Other non-recurring items (c) | - | 504 | - | 993 | ||||||||
| Adjusted EBITDA (Non-GAAP) | $ | 6,521 | $ | 19,156 | $ | 19,667 | $ | 30,790 | ||||
| (a) | Consists of legal settlements expenses and loss contingencies, net, related to product liability claims and other adjustments to on-going legal claims, including related legal fees. | |||||||||||
| --- | --- | |||||||||||
| (b) | Share-based compensation includes expenses related to stock options and restricted stock units granted to employees and directors of the Company. | |||||||||||
| (c) | Three and six months ended June 30, 2019 relates to non-recurring expenses related to North American region establishment and one time charge related to reduction in headcount. |
Caesarstone Ltd. and its subsidiaries
| Three months ended June 30, | Six months ended June 30, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| U.S. dollars in thousands (except per share data) | 2020 | 2019 | 2020 | 2019 | ||||||||
| (Unaudited) | (Unaudited) | |||||||||||
| Reconciliation of net income (loss) to adjusted net income: | ||||||||||||
| Net income (loss) | $ | (5,882 | ) | $ | 6,414 | $ | (3,204 | ) | $ | 6,009 | ||
| Legal settlements and loss contingencies, net (a) | 1,637 | 1,729 | 4,475 | 3,305 | ||||||||
| Share-based compensation expense (b) | 801 | 832 | 1,707 | 1,884 | ||||||||
| Non cash revaluation of lease liabilities (c) | 1,256 | 799 | (215 | ) | 2,226 | |||||||
| Non-recurring import related income (d) | - | (2,611 | ) | - | (1,501 | ) | ||||||
| Other non-recurring items (e) | - | 1,704 | - | 2,193 | ||||||||
| Total adjustments | 3,694 | 2,453 | 5,967 | 8,107 | ||||||||
| Less tax on non-tax adjustments (f) | 1,310 | 871 | 2,116 | 2,875 | ||||||||
| Total adjustments after tax | 2,384 | 1,582 | 3,851 | 5,232 | ||||||||
| Adjusted net income (loss) (Non-GAAP) | $ | (3,498 | ) | $ | 7,996 | $ | 647 | $ | 11,241 | |||
| Adjusted diluted EPS (g) | $ | (0.10 | ) | $ | 0.23 | $ | 0.02 | $ | 0.33 | |||
| (a) | Consists of legal settlements expenses and loss contingencies, net, related to product liability claims and other adjustments to on-going legal claims, including related legal fees. | |||||||||||
| --- | --- | |||||||||||
| (b) | Share-based compensation includes expenses related to stock options and restricted stock units granted to employees and directors of the Company. | |||||||||||
| (c) | Exchange rate diffrences deriving from revaluation of lease contracts in accoradance with FASB ASC 842. | |||||||||||
| (d) | Three and six months ended June 30, 2019 relates mainly to non-recurring import related expenses and relocation expenses of Caesarstone USA headquarters, the Company's subsidiary. | |||||||||||
| (e) | Three and six months ended June 30, 2019 relates to non-recurring expenses related to North American region establishment and one time charge related to reduction in headcount. | |||||||||||
| (f) | Tax adjustments for the three and six months ended June 30, 2020, based on the effective tax rates of the comparative periods. | |||||||||||
| (g) | In calculating adjusted diluted (Non-GAAP) EPS for the six month ended June 30, 2020, the diluted weighted average number of shares outstanding excludes the effects of share-based compensation expense in<br> accordance with FASB ASC 718. |
Caesarstone Ltd. and its subsidiaries
Geographic breakdown of revenues by region
| Three months ended June 30, | Six months ended June 30, | |||||||
|---|---|---|---|---|---|---|---|---|
| U.S. dollars in thousands | 2020 | 2019 | 2020 | 2019 | ||||
| (Unaudited) | (Unaudited) | |||||||
| USA | $ | 41,726 | $ | 64,590 | $ | 101,781 | $ | 121,007 |
| Canada | 14,435 | 23,342 | 32,993 | 43,520 | ||||
| Latin America | 132 | 1,351 | 638 | 1,947 | ||||
| America's | 56,293 | 89,283 | 135,412 | 166,474 | ||||
| Australia | 23,534 | 28,292 | 45,888 | 53,506 | ||||
| Asia | 1,732 | 3,311 | 4,563 | 7,907 | ||||
| APAC | 25,266 | 31,603 | 50,451 | 61,413 | ||||
| EMEA | 8,031 | 11,419 | 19,371 | 21,874 | ||||
| Israel | 9,447 | 8,766 | 20,360 | 19,507 | ||||
| Total Revenues | $ | 99,037 | $ | 141,071 | $ | 225,594 | $ | 269,268 |
Caesarstone Ltd. and its subsidiaries
Geographic breakdown of revenues by region - Supplemental data
| Three months ended | ||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| U.S. dollars in thousands | 6/30/2020 | 3/31/2020 | 12/31/2019 | 9/30/2019 | 6/30/2019 | 3/30/2019 | 12/31/2018 | 9/30/2018 | 6/30/2018 | |||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||||||
| USA | $ | 41,726 | $ | 60,055 | $ | 64,659 | $ | 64,805 | $ | 64,590 | $ | 56,417 | $ | 60,200 | $ | 61,933 | $ | 60,358 | ||||||||||||
| Canada | 14,435 | 18,558 | 20,575 | 21,881 | 23,341 | 20,178 | 23,834 | 25,140 | 27,349 | |||||||||||||||||||||
| Latin America | 132 | 506 | 735 | 1,434 | 1,351 | 596 | 1,212 | 1,635 | 1,738 | |||||||||||||||||||||
| America's | 56,293 | 79,119 | 85,969 | 88,120 | 89,282 | 77,191 | 85,246 | 88,708 | 89,445 | |||||||||||||||||||||
| Australia | 23,534 | 22,354 | 26,000 | 28,642 | 28,294 | 25,214 | 33,484 | 33,968 | 34,731 | |||||||||||||||||||||
| Asia | 1,732 | 2,831 | 3,932 | 3,675 | 3,311 | 4,596 | 4,929 | 4,189 | 4,221 | |||||||||||||||||||||
| APAC | 25,266 | 25,185 | 29,932 | 32,317 | 31,605 | 29,810 | 38,413 | 38,157 | 38,952 | |||||||||||||||||||||
| EMEA | 8,031 | 11,340 | 9,464 | 11,719 | 11,418 | 10,455 | 9,954 | 11,115 | 11,721 | |||||||||||||||||||||
| Israel | 9,447 | 10,913 | 8,502 | 10,683 | 8,766 | 10,741 | 9,268 | 9,709 | 9,125 | |||||||||||||||||||||
| Total Revenues | $ | 99,037 | $ | 126,557 | $ | 133,867 | $ | 142,839 | $ | 141,071 | $ | 128,197 | $ | 142,881 | $ | 147,689 | $ | 149,243 | ||||||||||||
| YoY % change | YoY % Constant Currency change (*) | |||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| 6/30/2020 | 3/31/2020 | 12/31/2019 | 9/30/2019 | 6/30/2019 | 6/30/2020 | 3/31/2020 | 12/31/2019 | 9/30/2019 | 6/30/2019 | |||||||||||||||||||||
| (Unaudited) | (Unaudited) | |||||||||||||||||||||||||||||
| USA | (35.4 | )% | 6.4 | % | 7.4 | % | 4.6 | % | 7.0 | % | (35.4 | )% | 6.4 | % | 7.4 | % | 4.6 | % | 7.0 | % | ||||||||||
| Canada | (38.2 | )% | (8.0 | )% | (13.7 | )% | (13.0 | )% | (14.7 | )% | (36.0 | )% | (7.1 | )% | (13.6 | )% | (12.1 | )% | (11.6 | )% | ||||||||||
| Latin America | (90.2 | )% | (15.1 | )% | (39.4 | )% | (12.3 | )% | (22.3 | )% | (90.2 | )% | (15.2 | )% | (39.4 | )% | (12.3 | )% | (22.3 | )% | ||||||||||
| America's | (36.9 | )% | 2.5 | % | 0.8 | % | (0.7 | )% | (0.2 | )% | (36.4 | )% | 2.7 | % | 0.9 | % | (0.4 | )% | 0.7 | % | ||||||||||
| Australia | (16.8 | )% | (11.3 | )% | (22.3 | )% | (15.7 | )% | (18.5 | )% | (11.5 | )% | (3.3 | )% | (18.2 | )% | (10.0 | )% | (12.0 | )% | ||||||||||
| Asia | (47.7 | )% | (38.4 | )% | (20.2 | )% | (12.3 | )% | (21.5 | )% | (45.9 | )% | (37.1 | )% | (14.7 | )% | (8.8 | )% | (18.6 | )% | ||||||||||
| APAC | (20.1 | )% | (15.5 | )% | (22.1 | )% | (15.3 | )% | (18.9 | )% | (15.1 | )% | (8.5 | )% | (17.8 | )% | (9.9 | )% | (12.7 | )% | ||||||||||
| EMEA | (29.7 | )% | 8.5 | % | (4.9 | )% | 5.4 | % | (2.6 | )% | (26.9 | )% | 11.4 | % | (4.4 | )% | 10.9 | % | 2.8 | % | ||||||||||
| Israel | 7.8 | % | 1.6 | % | (8.3 | )% | 10.0 | % | (3.9 | )% | 4.5 | % | (1.5 | )% | (14.0 | )% | 7.8 | % | (3.5 | )% | ||||||||||
| Total Revenues | (29.8 | )% | (1.3 | )% | (6.3 | )% | (3.3 | )% | (5.5 | )% | (28.3 | )% | 0.5 | % | (5.5 | )% | (1.5 | )% | (2.9 | )% | ||||||||||
| (*) Change in revenues at constant currency is calculated so that revenues can be viewed without the impact of fluctuations s in foreign currency exchange rates, thereby facilitating period-to-period<br> comparisons of business performance. Change in revenues adjusted for currency are calculated by translating current period activity in local currency using the comparable prior-year period’s currency conversion rate. Exchange rates used,<br> are the representative exchange rate published by the Bank of Israel for the relevant periods. | ||||||||||||||||||||||||||||||
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