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6-K 1 zk2431381.htm 6-K

UNITED STATES
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 May, 2024

Commission File Number 000-23288
 
SILICOM LTD.
(Translation of Registrant’s name into English)
 
14 Atir Yeda St., P.O.Box 2164, Kfar-Sava 4464323, Israel
(Address of Principal Executive Offices)
 
Indicate by check mark whether the registrant files or will file annual reports under cover of 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):___
 

On May 02, 2024, the Registrant issued a press release announcing the Registrant's first quarter 2024 financial results. Attached hereto are the following exhibits:
 
Exhibit 99.1          Press Release
 
The US GAAP information set forth on the Consolidated Balance Sheet and Consolidated Statement of Operations in the financial tables on Pages 4 and 5 of Exhibit 99.1 is hereby incorporated by reference into all effective registration statements filed by the registrant under the Securities Act of 1933.
 

SIGNATURES
 
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.
 
 
SILICOM LTD.
(Registrant)
 
 
 
 
 
Date: May 02, 2024
By
/s/ Eran Gilad
 
 
Eran Gilad
 
 
Chief Financial Officer
 
 
EX-99.1 2 exhibit_99-1.htm EXHIBIT 99.1
Exhibit 99.1


FOR IMMEDIATE RELEASE

EARNINGS RELEASE

Silicom Reports Q1 2024 Results &
Progress of Strategic 5-Year Plan

- $13M positive operating cash flow for the quarter -
- Company announces new one-year $15m share buyback program -

KFAR SAVA, Israel, May 2, 2024 - Silicom Ltd. (NASDAQ: SILC), a leading provider of high-performance networking and data infrastructure solutions, today reported its financial results for the first quarter ended March 31, 2024, together with its progress to date executing the 5-Year Strategic Plan announced on February 1st.

Financial Results
 
Silicom’s revenues for the first quarter of 2024 totalled $14.4 million compared with $37.2 million for the first quarter of 2023.
 
On a GAAP basis, the company’s net loss for the quarter totalled $(3.4) million, or $(0.55) per ordinary share (basic and diluted), compared with net income of $3.5 million, or $0.52 per ordinary share (basic and diluted), for the first quarter of 2023.
 
On a non-GAAP basis (as described and reconciled below), net loss for the quarter totalled $(2.4) million, or $(0.38) per ordinary share (basic and diluted), compared with net income of $4.2 million, or $0.61 per diluted share ($0.62 per basic share), for the first quarter of 2023.
 
Guidance
 
Management projects that revenues for the second quarter of 2024 will range from $15 million to $17 million. We believe that excess customer inventories and global economy headwinds will ease moving forward through 2024, resulting in second half revenues that are higher than those of the first half, and full-year revenues of approximately $70 million.

Share Repurchase Plan
 
In addition, the Company today announced that its Board of Directors has authorized a new one-year share buyback plan allowing the Company to invest up to $15 million to repurchase its ordinary shares. This plan will take effect as soon as the previously-announced $15 million one-year plan is completed. The timing and actual number of shares repurchased will depend upon a variety of factors, including share market price and general business and market conditions. The plan authorizes management to repurchase ordinary shares using a variety of methods, including open market transactions in compliance with the rules of the US Securities and Exchange Commission and other applicable legal requirements. Repurchases will be funded from available working capital. The plan does not obligate Silicom to buy back any specific number of shares and may be suspended or terminated at any time at Management’s discretion. Management notes that its cash balance provides sufficient working capital and financial flexibility to weather the current environment while completing the Company’s current share buyback program and carrying out this new one.
 

Comments of Management  
 
Liron Eizenman, Silicom’s President and CEO, commented, “During the past three months, execution of the first phase of our 5-Year Strategic Plan has stabilized our operating expenses and strengthened our core business platform. By discontinuing non-core programs and carrying out a company-wide efficiency initiative, our operating expenses are now at a level that will fully support our future growth drivers and return us to profitability at projected revenue levels. We are proud to have delivered an impressive $13 million positive operating cash flow during this challenging quarter, demonstrating the strength and quality of our working capital. We continue to aim for 20% compound average annual growth from 2024 as a baseline, with Earnings Per Share (EPS) increasing gradually to above $3 in 2028.”

Mr. Eizenman continued, “At the same time, as part of our re-focus on our Server Adapter and Edge solution portfolios, we are investing significantly to develop two strategic new product families aimed at expanding our leadership and revenues from some of the market’s highest growth segments. We have also implemented a new sales compensation plan that has positively impacted our Design Win pipeline, already bringing us an initial flow of new small-to-medium Design Wins.”

Mr. Eizenman concluded, “As a concrete indication of our confidence, we continue to execute on our aggressive share buyback program, and the Board has just approved a new repurchase plan for the coming year. During the first quarter, we repurchased approximately 250,000 shares, well ahead of our original schedule for repurchasing 1.6 million shares by the end of 2025. We believe this effort, coupled with our focus on the core and continued strict discipline with expenses, will return us to growth and profitability, creating significant shareholder value over the long term.”

***
 

Conference Call Details
Silicom’s Management will host an interactive conference today, May 2nd, at 9am Eastern Time (6am Pacific Time, 4pm Israel Time) to review and discuss the results.
 
To participate, investors may either listen via a webcast link hosted on Silicom’s website or via the dial-in. The link is under the investor relations’ webcast section of Silicom’s website at https://www.silicom-usa.com/webcasts/
 
For those that wish to dial in via telephone, one of the following teleconferencing numbers may be used:
 
US: 1 866 860 9642
ISRAEL: 03 918 0609
INTERNATIONAL:  +972 3 918 0609
At: 9:00am Eastern Time, 6:00am Pacific Time, 4:00pm Israel Time
 
It is advised to connect to the conference call a few minutes before the start.
 
For those unable to listen to the live call, a replay of the call will be available for three months from the day after the call under the above-mentioned webcast section of Silicom’s website.
 
***
 
2
Non-GAAP Financial Measures
 
This release, including the financial tables below, presents other financial information that may be considered "non-GAAP financial measures" under Regulation G and related reporting requirements promulgated by the Securities and Exchange Commission (the "SEC") as they apply to our company. These non-GAAP financial measures exclude compensation expenses in respect of options and RSUs granted to directors, officers and employees, impairment of goodwill, taxes on amortization and impairment of acquired intangible assets, impairment of intangible assets and related write-offs, as well as lease liabilities - financial expenses (income). Non-GAAP financial measures should be evaluated in conjunction with, and are not a substitute for, GAAP financial measures. The tables also present the GAAP financial measures, which are most comparable to the non-GAAP financial measures as well as reconciliation between the non-GAAP financial measures and the most comparable GAAP financial measures. The non-GAAP financial information presented herein should not be considered in isolation from or as a substitute for operating income (loss), net income (loss) or per share data prepared in accordance with GAAP.
 
About Silicom
 
Silicom Ltd. is an industry-leading provider of high-performance networking and data infrastructure solutions. Designed primarily to improve performance and efficiency in Cloud and Data Center environments, Silicom’s solutions increase throughput, decrease latency and boost the performance of servers and networking appliances, the infrastructure backbone that enables advanced Cloud architectures and leading technologies like NFV, SD-WAN and Cyber Security. Our innovative solutions for high-density networking, high-speed fabric switching, offloading and acceleration, which utilize a range of cutting-edge silicon technologies as well as FPGA-based solutions, are ideal for scaling-up and scaling-out cloud infrastructures.
 
Silicom products are used by major Cloud players, service providers, telcos and OEMs as components of their infrastructure offerings, including both add-on adapters in the Data Center and stand-alone virtualized/universal CPE devices at the edge.
 
Silicom’s long-term, trusted relationships with more than 200 customers throughout the world, its more than 400 active Design Wins and more than 300 product SKUs have made Silicom a “go-to” connectivity/performance partner of choice for technology leaders around the globe.
 
For more information, please visit: www.silicom.co.il
 
Statements in this press release which are not historical data are 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, Silicom’s increasing dependence for substantial revenue growth on a limited number of customers, the speed and extent to which Silicom's solutions are adopted by the relevant markets, difficulty in commercializing and marketing of Silicom’s products and services, maintaining and protecting brand recognition, protection of intellectual property, competition, disruptions to its manufacturing, sales & marketing, development and customer support activities, the impact of the wars in Gaza and in the Ukraine, attacks on shipping by Huthis in the Red Sea, rising inflation, rising interest rates and volatile exchange rates, as well as any continuing or new effects resulting from the COVID-19 pandemic, and  the global economic uncertainty, which may impact customer demand by encouraging them to exercise greater caution and selectivity with their short-term IT investment plans. The factors noted above are not exhaustive.
 
Further information about the company’s businesses, including information about factors that could materially affect Silicom’s results of operations and financial condition, are discussed in our Annual Report on Form 20-F and other documents filed by the Company and that may be subsequently filed by the company from time to time with the SEC. These forward-looking statements can generally be identified as such because the context of the statement will include words such as “expect,” “should,” “believe,” “anticipate” or words of similar import. Similarly, statements that describe future plans, objectives or goals are also forward-looking statements. In light of significant risks and uncertainties inherent in forward-looking statements, the inclusion of such statements should not be regarded as a representation by the company that it will achieve such forward-looking statements. The company disclaims any duty to update such statements, whether as a result of new information, future events, or otherwise.
 
Company Contact:
Eran Gilad, CFO
Silicom Ltd.
Tel: +972-9-764-4555
E-mail: erang@silicom.co.il
Investor Relations Contact:
Ehud Helft
EK Global Investor Relations
Tel: +1 212 378 8040
E-mail: silicom@ekgir.com

-- FINANCIAL TABLES FOLLOW – Silicom Ltd. Consolidated Balance Sheets
 
3
(US$ thousands)

   
March 31,
    
December 31,
  
   
2024
    
2023
  
             
Assets
            
             
Current assets
            
Cash and cash equivalents
  
$
61,148
    
$
46,972
  
Marketable securities
    
4,978
      
7,957
  
Accounts receivables: Trade, net
    
11,902
      
25,004
  
Accounts receivables: Other
    
5,050
      
3,688
  
Inventories
    
46,292
      
51,507
  
Total current assets
    
129,370
      
135,128
  
                 
Marketable securities
    
14,583
      
16,619
  
Assets held for employees’ severance benefits
    
1,294
      
1,357
  
Deferred tax assets
    
2,290
      
2,359
  
Property, plant and equipment, net
    
3,310
      
3,552
  
Intangible assets, net
    
2,255
      
2,253
  
Right of Use
    
6,121
      
6,466
  
Total assets
  
$
159,223
    
$
167,734
  
                 
Liabilities and shareholders' equity
                
                 
Current liabilities
                
Trade accounts payable
  
$
3,032
    
$
4,139
  
Other accounts payable and accrued expenses
    
6,522
      
6,668
  
Lease liabilities
    
1,792
      
2,070
  
                 
Total current liabilities
    
11,346
      
12,877
  
                 
Lease liabilities
    
3,648
      
3,877
  
Liability for employees’ severance benefits
    
2,616
      
2,672
  
Deferred tax liabilities
    
130
      
46
  
                 
Total liabilities
    
17,740
      
19,472
  
                 
Shareholders' equity
                
Ordinary shares and additional paid-in capital
    
71,443
      
70,693
  
Treasury shares
    
(47,728
)
    
(43,631
)
Retained earnings
    
117,768
      
121,200
  
Total shareholders' equity
    
141,483
      
148,262
  
                 
Total liabilities and shareholders' equity
  
$
159,223
    
$
167,734
  

4
Silicom Ltd. Consolidated Statements of Operations
(US$ thousands, except for share and per share data)

   
Three-month period
  
   
ended March 31,
  
   
2024
    
2023
  
Sales
  
$
14,365
    
$
37,181
  
Cost of sales
    
10,326
      
25,396
  
Gross profit
    
4,039
      
11,785
  
                 
Research and development expenses
    
4,921
      
5,138
  
Selling and marketing expenses
    
1,520
      
1,503
  
General and administrative expenses
    
1,061
      
1,093
  
Total operating expenses
    
7,502
      
7,734
  
                 
Operating income (loss)
    
(3,463
)
    
4,051
  
                 
Financial income (expenses), net
    
399
      
299
  
Income (loss) before income taxes
    
(3,064
)
    
4,350
  
Income taxes
    
368
      
813
  
Net income (loss)
  
$
(3,432
)
  
$
3,537
  
                 
Basic income (loss) per ordinary share (US$)
  
$
(0.55
)
  
$
0.52
  
                 
Weighted average number of ordinary shares used to compute basic income (loss) per share (in thousands)
    
6,274
      
6,747
  
                 
Diluted income (loss) per ordinary share (US$)
  
$
(0.55
)
  
$
0.52
  
                 
Weighted average number of ordinary shares used to compute diluted income (loss) per share (in thousands)
    
6,274
      
6,848
  

5
Silicom Ltd. Reconciliation of Non-GAAP Financial Results
(US$ thousands, except for share and per share data)

   
Three-month period
  
   
ended March 31,
  
   
2024
    
2023
  
             
GAAP gross profit
  
$
4,039
    
$
11,785
  
(1) Share-based compensation (*)
    
61
      
114
  
Non-GAAP gross profit
  
$
4,100
    
$
11,899
  
                 
GAAP operating income (loss)
  
$
(3,463
)
  
$
4,051
  
Gross profit adjustments
    
61
      
114
  
(1) Share-based compensation (*)
    
689
      
610
  
Non-GAAP operating income (loss)
  
$
(2,713
)
  
$
4,775
  
                 
GAAP net income (loss)
  
$
(3,432
)
  
$
3,537
  
Operating income (loss) adjustments
    
750
      
724
  
(2) Lease liabilities - Financial expenses (income)
    
(43
)
    
(168
)
(3) Taxes on amortization and impairment of acquired intangible assets
    
353
      
68
  
Non-GAAP net income (loss)
  
$
(2,372
)
  
$
4,161
  
                 
GAAP net income (loss)
  
$
(3,432
)
  
$
3,537
  
Adjustments for Non-GAAP Cost of sales
    
61
      
114
  
Adjustments for Non-GAAP Research and development expenses
    
313
      
306
  
Adjustments for Non-GAAP Selling and marketing expenses
    
176
      
153
  
Adjustments for Non-GAAP General and administrative expenses
    
200
      
151
  
Adjustments for Non-GAAP Financial income (loss), net
    
(43
)
    
(168
)
Adjustments for Non-GAAP Income taxes
    
353
      
68
  
Non-GAAP net income (loss)
  
$
(2,372
)
  
$
4,161
  
                 
GAAP basic income (loss) per ordinary share (US$)
  
$
(0.55
)
  
$
0.52
  
(1) Share-based compensation (*)
    
0.12
      
0.11
  
(2) Lease liabilities - Financial expenses (income)
    
(0.01
)
    
(0.02
)
(3) Taxes on amortization and impairment of acquired intangible assets
    
0.06
      
0.01
  
Non-GAAP basic income (loss) per ordinary share (US$)
  
$
(0.38
)
  
$
0.62
  
                 
GAAP diluted income (loss) per ordinary share (US$)
  
$
(0.55
)
  
$
0.52
  
(1) Share-based compensation (*)
    
0.12
      
0.11
  
(2) Lease liabilities - Financial expenses (income)
    
(0.01
)
    
(0.03
)
(3) Taxes on amortization and impairment of acquired intangible assets
    
0.06
      
0.01
  
Non-GAAP diluted income (loss) per ordinary share (US$)
  
$
(0.38
)
  
$
0.61
  

(*) Adjustments related to share-based compensation expenses according to ASC topic 718 (SFAS 123 (R))

6