EX-1 3 ex1tojune2003.txt EXHIBIT 1 Elscint Ltd. Reports First Quarter 2003 Results Monday June 2, 11:46 am ET TEL AVIV, Israel, June 2 /PRNewswire-FirstCall/ -- Elscint Ltd. (NYSE: ELT - News), a subsidiary of Elbit Medical Imaging Ltd. (Nasdaq: EMITF - News), today announced its results for the quarter ended March 31, 2003. First Quarter Results Consolidated revenues for the first quarter of 2003 were NIS 43.5 million (US$9.3 million) compared with NIS 43.0 million reported in the corresponding quarter last year. Revenues include NIS 3.4 million (US$0.7 million) from the lease of the Bernard Shaw Hotel to a third party for a period of twenty-five years. Revenues from operating and managing hotels decreased to NIS 40.0 million (US$8.5 million) compared to NIS 42.0 million in the same quarter last year. This decrease is attributed mainly to discontinuing operations at the Bernard Shaw hotel at the beginning of the year, as a consequence of leasing the property, and to the closing of the Bucuresty Hotel in Romania for renovation. The decrease was offset, in part, by the increase in revenues generated by the Victoria London Hotel and Sherlock Holmes Hotel in London, as well as an increase in the exchange rate of the Euro and the British Pound against the NIS. Gross profit for the first quarter of 2003 was NIS 14.8 million (US$3.1 million) compared with NIS 11.9 million in the corresponding quarter of 2002. The increase in gross profit is principally derived from an increase in the gross profit of the Victoria London Hotel and Sherlock Holmes Hotel in London, as well as the commencement of the lease of the Bernard Shaw Hotel. Operating loss in the first quarter of 2003 was NIS 6.8 million (US$1.4 million) compared with NIS 10.1 million for the first quarter of last year. This decrease is mainly due to the increase in gross profit mentioned above. Net loss from continuing operations for the first quarter of 2003 was NIS 18.1 million (US$3.9 million), or NIS 1.08 (US$0.23) basic loss per share, compared with net income of NIS 10.3 million, or NIS 0.62 basic earnings per share, for the same quarter last year. The loss from continuing operation results primarily from finance expenses, net of NIS 6.0 million (US$1.3 million), compared with finance income, net of NIS 20.0 million in the same quarter of last year. This decrease is attributed mainly to exchange rate and inflation fluctuation. Net income from discontinuing operations for the first quarter of 2003 was NIS 4.2 million (US$0.9 million), or NIS 0.25 (US$0.05) basic earnings per share, compared to NIS 6.1 million or NIS 0.36 basic earnings per share, for the first quarter last year. This decrease is attributed mainly to gains of the subassemblies segment reported in the first quarter of 2002. The Company sold this segment in December 2002, and therefore the profit from this segment is not included in the first quarter of 2003. Net loss for the first quarter of 2003 was NIS 13.9 million (US$3.0 million), or NIS 0.83 (US$0.18) basic loss per share, compared with net income of NIS 16.4 million, or NIS 0.98 basic earnings per share, for the same quarter last year. Elscint Limited has interests in hotels in Western Europe, in hotel development projects principally in Western and Central Europe and in the commercial and entertainment center at Herzlia Marina in Israel. This release contains certain forward-looking statements which involve known and unknown risks, uncertainties or other factors not under the Company's control which may cause actual results, performance or achievements of the Company to be materially different from the results, performance or other expectations implied by these forward-looking statements. These factors include, but are not limited to, those detailed in the Company's periodic filings with the Securities and Exchange Commission. ELSCINT LIMITED AND SUBSIDIARY COMPANIES CONDENSED CONSOLIDATED BALANCE SHEETS (1) ADJUSTED TO THE NIS OF MARCH 2003 Convenience translation March 31, December 31, March 31, 2003 *2002 2002 2003 (Unaudited) (Audited) (Unaudited) U.S.$ Adjusted NIS (thousands) (thousands) ASSETS Current Assets Cash and cash equivalents 95,084 258,452 93,679 20,287 Short-term investments and deposits 160,903 160,583 158,736 34,330 Accounts receivable - trade, net 18,724 17,085 19,153 3,995 Other accounts receivable and prepaid expenses 23,244 19,732 21,927 4,959 Hotels inventories 2,394 3,039 3,133 511 300,349 458,891 296,628 64,082 Long-term Accounts and Investments Investments, loans and long-term receivables, net 343,808 369,517 355,236 73,353 Investments in affiliated company 28,683 - 32,764 6,120 Venture capital investment - 29,931 - - 372,491 399,448 388,000 79,473 Fixed Assets, Net 1,707,568 1,434,609 1,650,459 364,320 Other Assets, Net 14,603 11,121 12,330 3,116 Assets Related to Discontinuing Operation 31,103 174,016 115,026 6,636 2,426,114 2,478,085 2,462,443 517,627 * Reclassified. (1) Prepared in accordance with Israeli GAAP. ELSCINT LIMITED AND SUBSIDIARY COMPANIES CONDENSED CONSOLIDATED BALANCE SHEETS (1) ADJUSTED TO THE NIS OF MARCH 2003 Convenience translation March 31, December 31, March 31, 2003 *2002 2002 2003 (Unaudited) (Audited) (Unaudited) U.S.$ Adjusted NIS (thousands) (thousands) LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Short-term credits 233,093 460,144 536,436 49,732 Accounts payable - trade 25,299 20,103 23,247 5,398 Accrued liabilities 87,877 67,877 87,834 18,749 Advance from customer in respect of project in progress, net - 606 - - 346,269 548,730 647,517 73,879 Long-term Liabilities Long-term debts 927,896 619,632 632,772 197,972 Deferred income tax liability 9,936 18,941 11,029 2,120 Liability for employee severance benefits, net 673 322 517 144 938,505 638,895 644,318 200,236 Liabilities Related to Discontinuing Operations 98,783 215,803 111,417 21,076 Minority interest 30,369 28,873 29,799 6,479 Contingencies and Commitments (see Note 4) Shareholders' Equity 1,012,188 1,045,784 1,029,392 215,957 2,426,114 2,478,085 2,462,443 517,627 * Reclassified. (1) Prepared in accordance with Israeli GAAP. ELSCINT LIMITED AND SUBSIDIARY COMPANIES CONDENSED CONSOLIDATED STATEMENT OF OPERATION (1) ADJUSTED TO THE NIS OF MARCH 2003 Convenience Translation March 31, December 31, March 31, 2003 *2002 2002 2003 (Unaudited) (Audited) (Unaudited) U.S.$ Adjusted NIS (thousands) (thousands) Revenues Operating and managing hotels 40,048 42,071 212,297 8,544 Hotel leasing 3,494 - - 745 Revenue from long-term contracts - 945 1,550 - 43,542 43,016 213,847 9,289 Cost of revenues Hotels operations and management 28,060 30,202 136,827 5,987 Cost of long-term contracts - 883 1,430 - Depreciation of leased hotel 669 - - 143 28,729 31,085 138,257 6,130 Gross profit 14,813 11,931 75,590 3,159 Hotels' depreciation, amortization and other operation expenses 13,264 13,411 63,175 2,830 Initial expenses, net 1,175 1,596 1,821 251 General and administrative expenses 7,169 7,050 32,433 1,529 21,608 22,057 97,429 4,610 Operating loss (6,795) (10,126) (21,839) (1,451) Finance (expenses) income, net (5,973) 20,064 13,152 (1,274) Other expenses, net (3,072) (28) (22,086) (655) (Loss) income before income taxes (15,840) 9,910 (30,773) (3,380) Income taxes 1,359 361 5,363 290 (Loss) income after income taxes (14,481) 10,271 (25,410) (3,090) The Company's share in loss of affiliated company (3,662) - (2,925) (781) Minority interest in loss of a subsidiary, net 72 8 903 15 Net (loss) income from continuing Operations (18,071) 10,279 (27,432) (3,856) Net income from discontinuing operation 4,190 6,077 91,402 894 Net (loss) income (13,881) 16,356 63,970 (2,962) * Reclassified. (1) Prepared in accordance with Israeli GAAP. ELSCINT LIMITED AND SUBSIDIARY COMPANIES CONDENSED CONSOLIDATED STATEMENT OF OPERATION (1) ADJUSTED TO THE NIS OF MARCH 2003 Convenience Translation March 31, December 31, March 31, 2003 * 2002 2002 2003 (Unaudited) (Audited) (Unaudited) U.S.$ Adjusted NIS (thousands) (thousands) Basic (loss) earnings per ordinary share (NIS 0.05 par value) from: Continuing operations (1.08) 0.62 (1.64) (0.23) Discontinuing operation 0.25 0.36 5.47 0.05 (0.83) 0.98 3.83 (0.18) Diluted (loss) earnings per ordinary share (NIS 0.05 par value) from: Continuing operations (1.08) 0.54 (1.70) (0.23) Discontinuing operation 0.25 0.35 5.24 0.05 (0.83) 0.89 3.54 (0.18) * Reclassified. (1) Prepared in accordance with Israeli GAAP.