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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

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of September 2024 (Report No. 2)

Commission File Number: 001-41544

SATIXFY COMMUNICATIONS LTD.

(Translation of registrant’s name into English)

12 Hamada Street, Rehovot 7670314

Israel

(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 ☐

CONTENTS

This Report of Foreign Private Issuer on Form 6-K of SatixFy Communications Ltd. (the “Company”) consists of the Company’s: (i) press release issued on September 6, 2024 entitled “SatixFy Announces First Half 2024 Results,” which is attached hereto as Exhibit 99.1; (ii) Unaudited Interim Condensed Consolidated Financial Statements as of June 30, 2024, which are attached hereto as Exhibit 99.2; and (iii) Operating and Financial Review and Prospects as of June 30, 2024, which is attached hereto as Exhibit 99.3.

Exhibits 99.2 and 99.3 of this Report of Foreign Private Issuer on Form 6-K is incorporated by reference into the Company’s Registration Statements on Form F-3 (File No. 333-279869) and Form S-8 (Registration Nos. 333-268005 and 333-275902), filed with the Securities and Exchange Commission, to be a part thereof from the date on which this Report of Foreign Private Issuer on Form 6-K is submitted, to the extent not superseded by documents or reports subsequently filed or furnished.

EXHIBIT INDEX

Exhibit No.
99.1		Press release entitled “SatixFy Announces First Half 2024 Results”.
99.2		SatixFy Communications Ltd. Unaudited Interim Condensed Consolidated Financial Statements as of June 30, 2024.
99.3		SatixFy Communications Ltd.’s Operating and Financial Review and Prospects as of June 30, 2024.

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.

	SATIXFY COMMUNICATIONS LTD.

Date: September 6, 2024	By:	/s/ Oren Harari
		Name	Oren Harari
		Title:	Interim Chief Financial Officer

EX-99.1 2 exhibit_99-1.htm EXHIBIT 99.1

Exhibit 99.1

SatixFy Announces First Half 2024 Results

Rehovot, Israel – September 6, 2024 – SatixFy Communications Ltd. (the “Company” or “SatixFy”) (NYSE American: SATX), a pioneering force in next-generation satellite communication systems driven by in-house developed chipsets, has released its consolidated financial results as of and for the six months ended June 30, 2024.

Management Commentary

Nir Barkan, Chief Executive Officer of SatixFy, commented, “We are very pleased with the progress we have made in 2024, with a solid increase in revenue and gross profit, driven by shipments of engineering samples of our space-grade Application Specific Integrated Circuits (ASICs). We are on track towards commercialization, which we expect by mid-2025. Strategically during the second quarter, we are proud of our landmark order of over $20 million for our Prime2 Space-Grade Digital Beam Former Chips from a world-leading technology company that is building-out its global low earth orbit (LEO) satellite network. This demonstrates the growing demand for our high-performance and market-leading satellite communication solutions. We continue to invest strongly in R&D, to maintain and build on our competitive lead, ultimately commercializing our technology that will underpin tomorrow’s leading satellite communication systems. "

Financial Highlights for the First Half of 2024

•

Total revenues for the first half of 2024 were $6.1 million, an increase of 7% compared to $5.7 million in the first half of 2023. The majority of revenues were product sales, driven by commencement of shipment of engineering sample of space-grade ASICs. The decrease in revenues from development services and preproduction provided to customers was primarily due to the completion of various development services agreements and the shift towards product sales.

•

Gross profit for the first half of 2024 was $4.5 million (gross margin of 74%), a 96% increase from $2.3 million (gross margin of 41%) in the first half of 2023. The increase in gross profit and margin was due to the product mix favoring higher-margin space-grade ASIC products.

•

Operating loss was $13.7 million in the first half of 2024, a 17% improvement from the loss of $16.6 million in the first half of 2023. The increase was mainly attributed to a higher gross profit and a reduction in operating expenses, as described below.

•

Expenses Breakdown:

•

Research and Development (R&D): $13.3 million, a 1% decrease compared to $13.4 million for the first half of 2023. R&D expenses were primarily driven by the Company’s significant efforts to develop its space grade ASICs and bring them to maturity.

•

Selling and Marketing: $1.1 million, a 21% decrease compared to $1.4 million for the first half of 2023. The decrease was primarily due to a decrease in payroll and related costs.

•

General and Administrative: $3.9 million, a 7% decrease compared to $4.2 million for the first half of 2023. The decrease was mainly due to a decrease in legal fees and insurance costs.

•

Finance expenses: $7.6 million, a 43% increase compared to $5.3 million for the first half of 2023. The increase was mainly attributed to $1.5 million of interest accruals recorded on advanced payments from MDA Space and Robotics Limited.

•

Net loss for the first half of 2024 was $21.3 million, or $0.25 per basic and diluted share, a 54% improvement compared with a net loss of $46.3 million, or $0.57 per basic and diluted share, in the first half of 2023. The net loss in the first half of 2023 was impacted by a $24.1 million derivatives revaluation, whereas no such revaluation occurred in the first half of 2024.

•

Cash and Cash Equivalents: Cash and cash equivalents as of June 30, 2024, amounted to $7.9 million, compared to $14.0 million as of December 31, 2023.

About SatixFy

SatixFy develops end-to-end next-generation satellite space and ground communications systems, including satellite multi beam digital antennas, user terminals and modems, based on powerful chipsets that it develops in house.

SatixFy’s products include modems that feature Software Defined Radio (SDR) and Fully Electronically Steered Multi Beam Antennas (ESMA) that support the advanced communications standard DVB-S2X. SatixFy’s innovative ASICs improve the overall performance of satellite communications systems, reduce the weight and power requirements of terminals and payloads, and save real estate for gateway equipment. SatixFy’s advanced Very Small Aperture Terminal and multi-beam fully electronically steered antenna arrays are optimized for a variety of mobile applications and services, using LEO, Medium Earth Orbit and Geostationary satellite communications systems, for aero/in-flight connectivity systems, high-end communications-on-the-move applications, and more.

SatixFy is headquartered in Rehovot, Israel with additional offices in the UK, U.S. and Bulgaria.

For more information, please refer to www.SatixFy.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and other Federal securities laws. Words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates" and similar expressions or variations of such words are intended to identify forward-looking statements. For example, SatixFy is using forward looking statement in this press release when it discusses the development of its space-grade ASICs; its commercialization efforts and timing thereof; the demand for its solutions; and its investments in R&D. Important factors that could cause actual results, developments and business decisions to differ materially from those anticipated in these forward-looking statements include, among others: the Company's planned level of revenues and capital expenditures; the Company's available cash and its ability to obtain additional funding; the Company's ability to market and sell its products; legal and regulatory developments in the United States and other countries; the Company's ability to maintain its relationships with suppliers, distributors and other partners; the Company's ability to maintain or protect the validity of its patents and other intellectual property; political, economic and military instability in the Middle East, specifically in Israel; as well as those factors set forth in the Risk Factors section of the Company's Annual Report on Form 20-F for the year ended December 31, 2023 filed with the SEC on March 29, 2024, as amended, and other documents filed with or furnished to the SEC which are available on the SEC's website, www.sec.gov. The Company undertakes no obligation to update these statements for revisions or changes after the date of this release, except as required by law.

Contacts

Investor Contact:
Kenny Green & Ehud Helft, EK Global IR, satixfy@ekglobal.com

Media Contact:
Aviv Sax Nahamoni, info@satixfy.com

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

	For the six-month period ended June 30
	2024			2023
	USD in thousands, except share and per share data
Revenues:
Development services and preproduction		1,641			4,129
Sale of products		4,410			1,540
Total revenues		6,051			5,669

Cost of sales and services:
Development services and preproduction		291			2,673
Sale of products		1,267			649
Total cost of sales and services		1,558			3,322

Gross profit		4,493			2,347

Research and development expenses, net		13,275			13,390
Selling and marketing expenses		1,059			1,395
General and administrative expenses		3,873			4,194
Loss from operations		(13,714	)		(16,632	)

Finance Income		87			37
Finance Expenses		(7,615	)		(5,296	)
Derivatives Revaluation		-			(24,104	)
Company’s share in the loss of a company accounted by equity method, net		(19	)		(261	)
Loss before income taxes		(21,261	)		(46,256	)
Income taxes		-			-
Loss for the period		(21,261	)		(46,256	)

Other comprehensive income (loss) net of tax:
Exchange gain (loss) arising on translation of foreign operations		-			(272	)
Total comprehensive loss for the period		(21,261	)		(46,528	)

Basic and diluted loss per share (in dollars)		(0.25	)		(0.57	)
Basic and diluted weighted average common shares outstanding		83,777,164			80,732,123

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

	June 30,		December 31,
	2024		2023
ASSETS
CURRENT ASSETS:
Cash and cash equivalents		7,922		13,979
Trade accounts receivable, net		2,455		2,260
Contract assets		3,358		4,091
Prepaid expenses and other		1,735		2,332
Government departments and agencies receivables		4,130		3,076
Related parties		46		75
Promissory notes		2,841		20,000
Inventory		1,903		1,475
Total current assets		24,390		47,288

NON-CURRENT ASSETS:
Other long-term receivables		2,000		2,000
Right-of-use assets, net		1,895		2,235
Property, plant and equipment, net		1,934		1,420
Investment in Jet Talk		1,532		1,551
Long-term deposits		181		208
Total non-current assets		7,542		7,414

TOTAL ASSETS		31,932		54,702

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL

POSITION

	June 30,			December 31,
	2024			2023
LIABILITIES AND SHAREHOLDERS’ DEFICIT
CURRENT LIABILITIES:
Trade payables		1,388			1,378
Contract liabilities		120			1,720
Current interest payable of Long term loans from financial institutions, net		9,174			-
European Space Agency (“ESA”) advance payments		3,047			3,842
Prepayments from customers		2,758			3,858
Advanced payments from MDA Space and Robotics Limited, an affiliate of MDA Ltd. (“MDA”), against future orders		29,634			28,138
Lease liabilities		696			639
Other accounts payable and accrued expenses		4,724			9,704
Related parties		164			740
Total current liabilities		51,705			50,019

NON-CURRENT LIABILITIES:
Long-term loans from financial institutions		56,581			59,792
Lease liabilities		1,653			2,067
Derivatives instruments liabilities		114			114
Liability for royalties payable		1,193			1,496
Total non-current liabilities		59,541			63,469
SHAREHOLDERS’ DEFICIT:
Share capital		-			-
Share premium		451,826			451, 093
Capital reserves		1,444			1,444
Accumulated deficit		(532,584	)		(511,323	)
Total shareholders’ deficit		(79,314	)		(58,786	)
TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIT		31,932			54,702

Exhibit 99.2

SATIXFY COMMUNICATIONS LTD.

UNAUDITED INTERIM CONDENSED CONSOLIDATED

FINANCIAL STATEMENTS AS OF JUNE 30, 2024

SATIXFY COMMUNICATIONS LTD.

UNAUDITED INTERIM CONDENSED CONSOLIDATED

FINANCIAL STATEMENTS AS OF JUNE 30, 2024

TABLE OF CONTENTS

Unaudited Interim Condensed Consolidated Statements of Financial Position	F- 2 - F-3
Unaudited Interim Condensed Consolidated Statements of Comprehensive Loss	F-4
Unaudited Interim Condensed Consolidated Statements of Changes in Shareholders’ Deficit	F-5 - F-6
Unaudited Interim Condensed Consolidated Statements of Cash Flows	F-7 - F-8
Notes to the Unaudited Interim Condensed Consolidated Financial Statements	F-9 - F-13

SATIXFY COMMUNICATIONS LTD.

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(in thousands of USD)

	June 30,		December 31,
	2024		2023
ASSETS
CURRENT ASSETS:
Cash and cash equivalents		7,922		13,979
Trade accounts receivable, net		2,455		2,260
Contract assets		3,358		4,091
Prepaid expenses and other		1,735		2,332
Government departments and agencies receivables		4,130		3,076
Related parties		46		75
Promissory notes		2,841		20,000
Inventory		1,903		1,475
Total current assets		24,390		47,288

NON-CURRENT ASSETS:
Other long-term receivables		2,000		2,000
Right-of-use assets, net		1,895		2,235
Property, plant and equipment, net		1,934		1,420
Investment in Jet Talk		1,532		1,551
Long-term deposits		181		208
Total non-current assets		7,542		7,414

TOTAL ASSETS		31,932		54,702

The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.

F - 2

SATIXFY COMMUNICATIONS LTD.

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(in thousands of USD)

		June 30,			December 31,
	Note	2024			2023
LIABILITIES AND SHAREHOLDERS’ DEFICIT
CURRENT LIABILITIES:
Trade payables			1,388			1,378
Contract liabilities			120			1,720
Current interest payable of Long term loans from financial institutions, net			9,174			-
European Space Agency (“ESA”) advance payments			3,047			3,842
Prepayments from customers			2,758			3,858
Advanced payments from MDA Space and Robotics Limited, an affiliate of MDA Ltd. (“MDA”), against future orders			29,634			28,138
Lease liabilities			696			639
Other accounts payable and accrued expenses			4,724			9,704
Related parties			164			740
Total current liabilities			51,705			50,019

NON-CURRENT LIABILITIES:
Long-term loans from financial institutions			56,581			59,792
Lease liabilities			1,653			2,067
Derivatives instruments liabilities			114			114
Liability for royalties payable			1,193			1,496
Total non-current liabilities			59,541			63,469

SHAREHOLDERS’ DEFICIT:
Share capital			-			-
Share premium			451,826			451, 093
Capital reserves	2c		1,444			1,444
Accumulated deficit			(532,584	)		(511,323	)
Total shareholders’ deficit			(79,314	)		(58,786	)

TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIT			31,932			54,702

September 5, 2024		/s/ Nir Barkan		/s/ Oren Harari		/s/ Yoav Leibovitch
Date of approval of the financial statements		Nir Barkan CEO		Oren Harari Interim CFO		Yoav Leibovitch Executive Chairman of Board

F - 3

SATIXFY COMMUNICATIONS LTD.

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(in thousands of USD)

	For the six-month period ended June 30
	2024			2023
Revenues:
Development services and preproduction		1,641			4,129
Sale of products		4,410			1,540
Total revenues		6,051			5,669

Cost of sales and services:
Development services and preproduction		291			2,673
Sale of products		1,267			649
Total cost of sales and services		1,558			3,322

Gross profit		4,493			2,347

Research and development expenses, net		13,275			13,390
Selling and marketing expenses		1,059			1,395
General and administrative expenses		3,873			4,194
Loss from operations		(13,714	)		(16,632	)

Finance income		87			37
Finance expenses		(7,615	)		(5,296	)
Derivatives revaluation		-			(24,104	)
Company's share in the loss of a company accounted by equity method, net		(19	)		(261	)
Loss before income taxes		(21,261	)		(46,256	)
Income taxes		-			-
Loss for the period		(21,261	)		(46,256	)

Other comprehensive income (loss) net of tax:
Exchange gain (loss) arising on translation of foreign operations		-			(272	)
Total comprehensive loss for the period		(21,261	)		(46,528	)

Basic and diluted loss per share (in dollars)		(0.25	)		(0.57	)
Basic and diluted weighted average common shares outstanding		83,777,164			80,732,123

The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.

F - 4

SATIXFY COMMUNICATIONS LTD.

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ DEFICIT

(in thousands of USD)

For the six-month period ended June 30, 2024

	Ordinary shares		Share capital		Share premium		Accumulated deficit			Capital reserves		Total
	In USD thousand

Balance as of January 1, 2024		83,114,193		-		451,093		(511,323	)		1,444		(58,786	)
Exercise of options		1,521,271		-		1		-			-		1
Share-based payments		-		-		732		-			-		732
Total comprehensive loss		-		-		-		(21,261	)		-		(21,261	)
Balance as of June 30, 2024		84,635,464		-		451,826		(532,584	)		1,444		(79,314	)

The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.

F - 5

SATIXFY COMMUNICATIONS LTD.

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ DEFICIT

(in thousands of USD)

For the six-month period ended June 30, 2023

	Ordinary shares		Share capital		Share premium		Accumulated deficit			Capital reserves			Total
	In USD thousand

Balance as of January 1, 2023		80,672,674		-		446,488		(481,608	)		3,498			(31,622	)
Exercise of options		84,293		-		26		-						26
Share-based payments		-		-		308		-			-			308
Total comprehensive loss		-		-		-		(46,256	)		(272	)		(46,528	)
Balance as of June 30, 2023		80,756,967		-		446,822		(527,864	)		3,226			(77,816	)

The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.

F - 6

SATIXFY COMMUNICATIONS LTD.

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands of USD)

	For the six-month period ended June 30
	2024			2023
Cash flows from operating activities:
Loss for the period		(21,261	)		(46,256	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		541			591
Company's share in the loss of a company accounted by equity method, net		19			262
Finance expenses on loans		5,767			4,595
Change in the fair value of warrant liabilities		-			24,104
Share-based compensation		732			308
Decrease (increase) in trade accounts receivable		(195	)		1,045
Decrease in contract assets		733			780
Decrease (increase) in inventory		(428	)		56
Increase in other current assets		(428	)		(983	)
Increase in trade payables		10			931
Decrease in ESA prepayments		(795	)		(655	)
Decrease in other accounts payable and accrued expenses		(7,364	)		(3,810	)
Increase in prepayments from customers		(1,100	)		8,760
Increase in prepayments from MDA		1,496			-
Increase in liability for royalties payable		(4	)		32
Net cash used in operating activities		(22,277	)		(10,240	)

Cash flow from investing activities
Decrease (increase) in long-term bank deposit		27			(9	)
Proceeds from selling a subsidiary		17,159			-
Purchase of property, plant and equipment		(681	)		(28	)
Net cash provided by (used in) investing activities		16,505			(37	)

The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.

F - 7

SATIXFY COMMUNICATIONS LTD.

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands of USD)

	For the six-month period ended June 30
	2024			2023
Cash flows from financing activities
Payments of lease liabilities		(286	)		(454	)
Cash received from derivatives FPA		-			10,026
Option exercises to shares by employees		1			26
Net cash provided )used) by financing activities		(285	)		9,598

Decrease in cash and cash equivalents		(6,057	)		(679	)
Cash and cash equivalents balance at the beginning of the period		13,979			11,934
Effect of changes in foreign exchange rates on cash and cash equivalents		-			216
Cash and cash equivalents balance at the end of the period		7,922			11,471

	For the six-month period ended June 30
	2024		2023

Appendix A - Cash paid and received during the period for:

Interest paid		78		61

The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.

F - 8

SATIXFY COMMUNICATIONS LTD.
NOTES TO THE UNAUDITED INTERIM CONDENSED FINANCIAL STATEMENTS
(in thousands of USD)

NOTE 1 – GENERAL

The SatixFy Communications Ltd. (“SatixFy” or the “Company”) and its subsidiaries are engaged in the development and marketing of integrated circuit products for specific applications, antennas and terminals used for satellite communications. The Company has developed a new generation of integrated silicon chips for modems and antennas based on its own proprietary technology and provides end-to-end solutions for the satellite communications industry, including terminals, payloads and hubs. The Company develops its advanced chips (Application Specific Integrated Circuit chips (ASICs) and Radio Frequency Integrated Circuit chips (RFICs)) based on technology designed to meet a variety of applications and services, such as broadband aviation, IOT, mobility and maritime, and operating on geostationary (GEO), low earth orbit (LEO) and medium earth orbit (MEO) satellites. The Company’s technology includes electronically steered antenna arrays, forming and design of digital beams, beam hopping, on-board processing payload chips and software-defined radio (SDR) modem chips.

General market, political and economic conditions in the countries in which the Company operates, including those related to recent unrest and actual or potential armed conflict in Israel and other parts of the Middle East, such as the Israel-Hamas war, the on-going war of attrition with the Hezbollah in the north, the on-going threats from Iran, Palestinian military organizations in the West Bank, the Houthi Movement in Yemen, and other hostile countries, such as Syria have not had a direct impact on the Company.

As of June 30, 2024, the Company had incurred accumulated losses of $532,584 and expects to continue to fund its operations through issuance of convertible securities, Ordinary Shares and warrants, revenues from existing customers which is also expected to include additional prepayments from such customers, revenues from new customers and governmental grants. The Company also intends to restructure its existing debt. In October 2022, the Company entered into an Equity Line of Credit with CF Principal Investments LLC, an affiliate of Cantor Fitzgerald & Co. (“CF”), pursuant to which the Company may issue and sell to CF, from time to time and subject to the conditions in the related purchase agreement, up to an aggregate amount of $77,250 in the Company’s Ordinary Shares for aggregate gross proceeds to the Company of up to $75,000 after deducting the applicable purchase price discount on sales to CF thereunder. On July 29, 2024, the Company entered into a Sales Agreement with A.G.P./Alliance Global Partners ("Sales Agent"), pursuant to which the Company may offer and sell, from time to time, Ordinary Shares in an “at-the-market” offering, for an aggregate offering price of up to $7,100. See also note 3.

F - 9

SATIXFY COMMUNICATIONS LTD.

NOTES TO THE UNAUDITED INTERIM CONDENSED FINANCIAL STATEMENTS

(in thousands of USD)

NOTE 1 – GENERAL (CONT.):

The Company’s management believes that the above transaction along with the transaction described in Note 3 will generate enough cash sufficient for the foreseeable future from the date of the approval of these financial statements.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.

The affiliated company Jet Talk Limited (“Jet Talk”) is engaged in the development and marketing of a unique antenna for in-flight connectivity (IFC) passenger aircraft and computers that receive broadband video transmissions from satellites.

The Company operates primarily through five wholly owned subsidiaries: SatixFy Israel Ltd., SatixFy UK Limited (“UK Subsidiary”), SatixFy Bulgaria Ltd., SatixFy US LLC and Endurance Acquisition Corp. (collectively, the ("Group"), all of which have been consolidated in these consolidated financial statements.

Name	Holding Percentage		Held By	Country of Incorporation
	June 30, 2024	December 31, 2023
SatixFy Israel Ltd.	100%	100%	SatixFy Communications Ltd.	Israel
SatixFy UK Limited	100%	100%	SatixFy Communications Ltd.	England and Wales
SatixFy Bulgaria Ltd.	100%	100%	SatixFy UK Limited	Bulgaria
SatixFy US LLC	100%	100%	SatixFy Communications Ltd.	USA
Endurance Acquisition Corp.	100%	100%	SatixFy Communications Ltd.	Cayman Islands

F - 10

SATIXFY COMMUNICATIONS LTD.

NOTES TO THE UNAUDITED INTERIM CONDENSED FINANCIAL STATEMENTS

(in thousands of USD)

NOTE 1 – GENERAL (CONT.):

In addition, the Company holds 51% of the shares of the following entity:

Name	Holding Percentage		Held By	Country of Incorporation
	June 30, 2024	December 31, 2023
Jet Talk	51%	51%	SatixFy UK Limited	England and Wales

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES:

Basis of preparation

Statement of compliance

These interim condensed consolidated financial statements have been prepared in accordance with International Accounting Standards (“IAS”) 34, “Interim Financial Reporting.” They do not include all disclosures that would otherwise be required in a complete set of financial statements and should be read in conjunction with the 2023 annual consolidated financial statements. The Company has applied the same accounting policies and methods of computation in its interim consolidated financial statements as in its 2023 annual consolidated financial statements.

Changes in accounting policies

A number of amended standards became applicable for the current reporting period. The Company did not have to change its accounting policies or make retrospective adjustments as a result of adopting these amended standards:

New International Financial Reports Standards (“IFRSs”) adopted in the period

The following amendments are effective for the period beginning January 1, 2024:

Supplier Finance Arrangements (Amendments to IAS 7 & IFRS 7): These amendments have no effect on the measurement or presentation of any items in the Interim Condensed Consolidated Financial Statements of the Company but affect the disclosure of accounting policies of the Company.

Lease Liability in a Sale and Leaseback (Amendments to IFRS 16): These amendments had no material effect on the Interim Condensed Consolidated Financial Statements of the Company.

F - 11

SATIXFY COMMUNICATIONS LTD.

NOTES TO THE UNAUDITED INTERIM CONDENSED FINANCIAL STATEMENTS

(in thousands of USD)

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (Cont):

Classification of Liabilities as Current or Non-Current (Amendments to IAS 1): These amendments had no material effect on the Interim Condensed Consolidated Financial Statements of the Company.

On April 9, 2024, the International Accounting Standards Board published IFRS 18, “Presentation and Disclosure in Financial Statements,” which replaces IAS 1, “Presentation of Financial Statements” and is mandatorily effective for annual reporting periods beginning on or after January 1, 2027; the main changes are as follows:

Mandatory sub totals to be presented in the statement of profit and loss.

Aggregation and disaggregation of information including the introduction of overall principles for how information should be aggregated and disaggregated in financial statements.

Disclosures related to management defined performance measures (MPMs).

The Company is currently assessing the impact of IFRS 18 on the financial statements, but at this stage it is unable to estimate such an impact. The effect of the new standard, however it may be, will only affect matters of presentation and disclosure.

Change in Subsidiary’s functional currency

In 2024, the Company noted that following the sale of SatixFy Space Systems UK Ltd., the weight of its UK Subsidiary’s U.S. dollars revenues and expenses is expected to significantly increase. Also, the volume of intra-group transactions with the UK Subsidiary is expected to increase, and the UK Subsidiary started retaining most of its cash in U.S. dollars bank accounts. As a result, the Company re-evaluated the functional currency of its UK Subsidiary and determined that a change in its functional currency from GBP to U.S. dollars was appropriate. The change in functional currency for the UK Subsidiary has been applied prospectively, and exchange differences arising from the translation of a foreign operation in other comprehensive income were not reclassified from equity to profit or loss. From January 1, 2024, the Company ceased translating the UK Subsidiary’s assets and liabilities to its own functional currency. Accordingly all transactions in GBP were accounted as foreign currency transactions. There Company examined the impact of that change and found that there was no material impact on both consolidated net loss and other comprehensive income (loss) utilizing U.S. dollars as the functional currency of the UK Subsidiary as of June 30, 2024, compared to the related impact if the functional currency of the UK Subsidiary would have remained GBP.

F - 12

SATIXFY COMMUNICATIONS LTD.

NOTES TO THE UNAUDITED INTERIM CONDENSED FINANCIAL STATEMENTS

(in thousands of USD)

NOTE 3 – SUBSEQUENT EVENTS:

On July 29, 2024, the Company entered into a Sales Agreement with the Sales Agent, pursuant to which the Company may offer and sell, from time to time, Ordinary Shares in an “at-the-market” offering, for an aggregate offering price of up to $7,100. The Company will pay the Sales Agent a commission equal to 3.0% of the gross sales price per share sold pursuant to the terms of the Sales Agreement. The Company is not obligated to sell any Ordinary Shares under the Sales Agreement and no assurance can be given that the Company will sell any Ordinary Shares under such agreement, or, if it does, as to the price or number of such shares that the Company sell or the dates on which any such sales will take place.

Each time that the Company wishes to issue and sell its Ordinary Shares under the Sales Agreement, the Company will provide the Sales Agent with a placement notice describing the amount of Ordinary Shares to be sold, the time period during which sales are requested to be made, any limitation on the amount of Ordinary Shares that may be sold in any single day, any minimum price below which sales may not be made or any minimum price requested for sales in a given time period and any other instructions relevant to such requested sales. Upon receipt of a placement notice, the Sales Agent, acting as the Company’s sales agent, will use commercially reasonable efforts, consistent with its normal trading and sales practices and applicable state and federal laws, rules and regulations and the rules of the NYSE American, to sell the Company’s Ordinary Shares under the terms and subject to the conditions of the placement notice and the Sales Agreement. The Company or the Sales Agent may suspend the offering of Ordinary Shares pursuant to a placement notice upon notice and subject to other conditions.

F - 13

EX-99.3 4 exhibit_99-3.htm EXHIBIT 99.3

Exhibit 99.3

OPERATING AND FINANCIAL REVIEW AND PROSPECTS

You should read the following selected financial data and discussion of our operating and financial condition and prospects in conjunction with the financial statements and the notes thereto included elsewhere in the Report of Foreign Private Issuer on Form 6-K, or Form 6-K, to which this exhibit relates. Our financial statements are prepared in conformity with International Financial Reporting Standards, or IFRS, and interpretations, as issued by the International Accounting Standards Board. Also, the interim financial statements have been prepared on basis of International Accounting Standards 34, Interim Financial Reporting. Unless otherwise indicated or the context otherwise requires, all references herein to the terms “SatixFy,” “SatixFy Communications,” the “Company,” “we,” “us” and “our” refer to SatixFy Communications Ltd. The term “NIS” refers to New Israeli Shekels, the lawful currency of the State of Israel, and the terms “dollar” or “$” refer to U.S. dollars, the lawful currency of the United States.

Cautionary Statement Regarding Forward Looking Statements

Certain statements included herein may constitute “forward-looking statements” for purposes of the federal securities laws. Our forward-looking statements include, but are not limited to, statements regarding us or our management team’s expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “appear,” “approximate,” “believe,” “continue,” “could,” “estimate,” “expect,” “foresee,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “seek,” “should,” “would” and similar expressions (or the negative version of such words or expressions) may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward- looking. Forward- looking statements included herein may include, for example, statements about:

Forward-looking statements involve a number of risks, uncertainties and assumptions, and actual results or events may differ materially from those projected or implied in those statements.

Important factors that could cause such differences include, but are not limited to:

•

Unpredictability in the satellite communications industry;

•

The regulatory environment and changes in laws, regulations or policies in the jurisdictions in which we operate;

•

Competition in the satellite communications industry, and the failure to introduce new technologies and products in a timely manner to compete successfully against competitors;

•

Failure by us to adjust our supply chain volume due to changing market conditions or failure to estimate its customers’ demand;

•

Disruptions in relationships with any one of our key customers;

•

Disruptions in relationships with any one of our third-party manufacturers or suppliers;

•

Any difficulty selling our products if customers do not design its products into their product offerings;

•

Our dependence on winning selection processes and gaining market acceptance of our technologies and products;

•

Our ability to generate timely or sufficient net sales or margins from our technologies and products;

•

Our ability to execute our strategies, manage growth and maintain our corporate culture as we grow;

•

Sustained yield problems or other delays in the manufacturing process of our products;

•

Changes in the need for capital and the availability of financing and capital to fund our needs;

•

Changes in the need for capital and the availability of financing and capital to fund out needs;

•

Our expectations to continue to fund our operations through issuance of convertible securities, ordinary shares no par value, or the Ordinary Shares, and warrants, revenues from existing customers and additional prepayments from such customers, revenues from new customers and governmental grants;

•

Our plans to restructure our existing debt;

•

Our ability to maintain effective internal control over financial reporting;

•

Our ability to retain key personnel and to replace such personnel on a timely basis or on acceptable terms;

•

Exchange rate fluctuations;

•

Changes in interest rates or rates of inflation;

•

Legal, regulatory and other proceedings;

•

Changes in applicable laws or regulations, or the application thereof on us;

•

The results of future financing efforts;

•

Our ability to maintain continued listing standards with the NYSE American LLC:

•

General market, political and economic conditions in the countries in which we operate including those related to recent unrest and actual or potential armed conflict in Israel and other parts of the Middle East, such as the Israel-Hamas war, the on-going war of attrition with the Hezbollah in the north, the on-going threats from Iran, Palestinian military organizations in the West Bank, the Houthi Movement in Yemen, as well as other hostile countries, such as Syria; and

•

The other matters described in “Item 3. Key Information – D. Risk Factors” section in our Annual Report (as defined below).

The foregoing list is intended to identify only certain of the principal factors that could cause actual results to differ. For a more detailed description of the risks and uncertainties affecting our company, reference is made to our Annual Report on Form 20-F for the year ended December 31, 2023, or our Annual Report, which is on file with the Securities and Exchange Commission, or the SEC, and the other risk factors discussed from time to time by our company in reports filed or furnished to the SEC.

Except as otherwise required by law, we undertake no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

Our Company

We are a vertically integrated satellite communications systems provider using our own semiconductors, focused on designing chips and systems that serve the entire satellite communications value chain — from the satellite payload Application Specific Integrated Circuits, or ASICs, to user terminals. We create chip technologies capable of enabling satellite-based broadband delivery to markets around the world. Since we commenced operations in June 2012, through June 30, 2024 we have invested over $258 million in research and development, or R&D, to create what we believe are the most advanced satellite communications and ground terminal chips in the world.

We develop advanced ASICs and RFICs based on technology designed to meet the requirements of a variety of satellite communications applications, mainly for LEO, MEO and GEO satellite communications systems, Aero/IFC systems and certain COTM applications. Our chip technology supports ESMA, digital beamforming and beam-hopping, on-board processing for payloads and SDR modems — each of which will be critical for providing optimized access to LEO satellite constellations.

We believe we are one of the only vertically integrated maker of satellite communications systems selling products across the entire satellite communications value chain. All of our systems integrate our proprietary semiconductor chips, of which we are a fabless manufacturer. We design our chips, code our software and design end-to-end communications systems for use in various satellite communications applications.

Our end-to-end solutions for the satellite communications industry include satellite payloads, user terminals (ground and Aero/IFC) and hubs, each built around our advanced ASICs and RFICs. We have a diverse customer base in terms of types of customers, including satellite operators, airlines, manufacturers of satellite communications systems, and other connectivity service providers that integrate our chips and systems in their satellite communications infrastructure. We believe that our modular, scalable and software controllable technology, our focus on producing products for the entire satellite communications value chain and our ability and experience in designing our systems to meet our customers’ specifications, differentiate us from our competitors.

We expect that our growth in the coming years will be driven by continued rapid increases in demand for high-speed broadband services across the globe, which will be propelled by an increasing number of internet users, broadband connected devices, amount of global data usage and the need for ubiquitous connectivity. We believe that our technologies are well positioned to meet the need for compatible chips and systems to connect new satellite technologies with existing systems and maximize their innovative potential.

We have incurred operating losses in each year since our inception. We incurred net losses of $21.3 million and $46.3 million for the six months ended June 30, 2024 and 2023, respectively. As of June 30, 2024, we had an accumulated deficit of $532.6 million, mostly attributed to a non-recurring, non-cash listing expense due to the application of IFRS 2 (Share-based Payments) and to non-cash finance expense reflecting the revaluation of a derivative contract relating to the transactions under an OTC Equity Prepaid Forward Transaction by and among us, Endurance Acquisition Corp., SatixFy MS, our wholly owned subsidiary, and Vellar Opportunity Fund SPV LLC- Series 7, dated October 24, 2022, which was terminated in October 2023, or the Forward Purchase Agreement.

Recent Developments

Recent Purchase Order

On June 17, 2023, we announced that we secured a significant order from an undisclosed customer. Under the terms of the order, we will be supplying Prime2 Space-Grade chips and software over the coming five quarters in exchange for payment from the customer to us of more than $20 million. This is a follow up order to an earlier $4 million order from September 2023.

At-The-Market Offering

On July 29, 2024, we entered into a Sales Agreement, or the Sales Agreement, with A.G.P./Alliance Global Partners, or the Sales Agent, pursuant to which we may offer and sell, from time to time, to or through the Sales Agent as agent or principal, Ordinary Shares. in an “at-the market” offering, as defined in Rule 415(a)(4) promulgated under the Securities Act, for an aggregate offering price of up to $7.145 million. We will pay the Sales Agent a commission equal to 3.0% of the gross sales price per share sold pursuant to the terms of the Sales Agreement. We are not obligated to sell any Ordinary Shares under the Sales Agreement and no assurance can be given that we will sell any Ordinary Shares under such agreement, or, if we do, as to the price or number of such shares that we will sell or the dates on which any such sales will take place.

Principal Components of Our Results of Operations

Revenues

In the six months ended June 30, 2024, we generated substantially all of our revenues from the sale of our products, while during the corresponding period ended June 30, 2023, we generated substantially all of our revenues from development services and preproduction provided to our customers in connection with projects on which we are engaged (although we maintain ownership of the intellectual property developed in connection with such projects). Our revenue from sales of products consisted mostly of revenue from contracts for the provision of products, including product prototypes, and components, such as our proprietary chips.

Our mix of revenue has begun to gradually shift to sales of products since the end of 2023 and we expect this trend to continue as we attract more customers, develop custom-tailored and off-the-shelf products and begin to deliver satellite communications systems at scale.

Cost of sales and services

Our cost of sales and services for the six months ended June 30, 2024 includes mainly the costs of our chip manufacturing subcontractors, chip manufacturing tools and materials and models, shipping costs, and related depreciation and amortization. The cost of sales and services for the six months ended June 30, 2023 includes mainly salaries and related expenses of our research and development services personnel, chip manufacturing tools and materials and models.

Research and development expenses

Research and development expenses consist primarily of salaries (including bonuses, share-based payments, benefits and related expenses) of personnel involved in R&D and the cost of development tools, third-party intellectual property licenses, and subcontractors, net of public sector grants, including from the European Space Agency, or ESA, which offset some of our research and development expenses.

To date, we have expensed all of our R&D costs as incurred. We expect to continue investing in R&D and, accordingly, expect our research and development expenses to increase. We also expect to benefit from additional funding from the ESA and other government and public sector entities, which, if obtained, would offset a portion of our research and development expenses.

Selling and marketing expenses

Selling and marketing expenses consist mainly of salaries (including bonuses, share-based awards, benefits and related expenses) of our personnel involved in the sales and marketing of our products, as well as advertising, exhibition and related expenses (including related travel).

We expect our sales and marketing costs to increase as we bring more products to market, the demand for our products increases and we hire more sales and marketing personnel.

General and administrative expenses

General and administrative expenses consist mainly of salaries (including bonuses, share-based awards, benefits and related expenses) of management and administrative personnel, overhead costs (including facilities rent and utilities), legal expenses, depreciation and amortization of property and equipment not used in the manufacturing of our products or provisions of our services and costs associated with being a public company, such as costs related to director and officer liability insurance, director fees and public company-related auditing and compliance costs.

Share in the loss of a company accounted by equity method, net

This represents our share in the loss of a company accounted by equity method, net, which reflects our proportionate share of the loss of Jet Talk, a joint venture with STE. We own 51% of Jet Talk’s equity, but do not control the company, as STE controls the company’s financing, participates substantially in directing its marketing and R&D activities (the latter generally being contracted to us) and also participates in the appointment of the chief executive officer, among other senior management personnel. We are committed to provide Jet Talk with future development services for a large Aero/IFC terminal, exclusive marketing rights for the commercial aviation market, technical skills, staff expertise, R&D facilities and an exclusive, royalty-free, world-wide, perpetual, non-transferable, irrevocable license to use and commercially exploit our intellectual property for the development, production, sales and marketing of satellite antenna systems for the commercial aviation market. While Jet Talk has generated losses to date, we expect Jet Talk to contribute significantly to our results of operations in the future.

Finance Income and Expenses

Finance income includes mainly the impact of foreign exchange remeasurement of certain subsidiary financial assets and liabilities, fair value adjustments related to financial assets and liabilities and interest on bank deposits.

Finance expenses include mainly interest on loans and bank fees, depreciation of our right-of-use assets, amortization of debt and warrant discounts, fair value adjustments related to financial assets and liabilities and the impact of foreign exchange remeasurement of certain subsidiary financial assets and liabilities.

Income taxes

To date, we have not been subject to income taxes, due to the fact that we have incurred losses in every year since commencing operations, and we have not recorded any income tax benefits since there is uncertainty as to our ability to utilize our tax loss carryforwards in future periods.

A. Results of Operations

Our results of operations for the six months ended June 30, 2024 and 2023 were as follows:

	For the six-month period ended June 30
	2024			2023
	USD in thousands, except share and per share data
Revenues:
Development services and preproduction		1,641			4,129
Sale of products		4,410			1,540
Total revenues		6,051			5,669

Cost of sales and services:
Development services and preproduction		291			2,673
Sale of products		1,267			649
Total cost of sales and services		1,558			3,322

Gross profit		4,493			2,347

Research and development expenses, net		13,275			13,390
Selling and marketing expenses		1,059			1,395
General and administrative expenses		3,873			4,194
Loss from operations		(13,714	)		(16,632	)

Finance Income		87			37
Finance Expenses		(7,615	)		(5,296	)
Derivatives Revaluation		-			(24,104	)
Company’s share in the loss of a company accounted by equity method, net		(19	)		(261	)
Loss before income taxes		(21,261	)		(46,256	)
Income taxes		-			-
Loss for the period		(21,261	)		(46,256	)

Other comprehensive income (loss) net of tax:
Exchange gain (loss) arising on translation of foreign operations		-			(272	)
Total comprehensive loss for the period		(21,261	)		(46,528	)

Basic and diluted loss per share (in dollars)		(0.25	)		(0.57	)
Basic and diluted weighted average common shares outstanding		83,777,164			80,732,123

Revenues

Total Revenues

Total revenues of $6.1 million increased by $0.4 million, or 7%, for the six months ended June 30, 2024 compared to $5.7 million for the six months ended June 30, 2023. In the six months ended June 30, 2024, we generated substantially all of our revenues from the sale of our products while during the corresponding period ended June 30, 2023, we generated substantially all of our revenues from development services and preproduction provided to our customers in connection with projects on which we are engaged.

Development services and preproduction

Development services and preproduction of $1.6 million decreased by $2.5 million, or 61%, for the six months ended June 30, 2024 compared to $4.1 million for the six months ended June 30, 2023. The decrease was primarily driven by completion of some of our development services agreement while shifting towards sale of products.

Sale of products

Sale of products of $4.4 million increased by $2.9 million, or 193%, for the six months ended June 30, 2024 compared to $1.5 million for the six months ended June 30, 2023. The increase was primarily driven by commencement of shipment of engineering sample of our space-grade ASICs.

Cost of Sales and Services

Total Cost of sales and services

Total cost of sales and services of $1.6 million decreased by $1.7 million, or 52%, for the six months ended June 30, 2024 compared to $3.3 million for the six months ended June 30, 2023. The decrease is due to the increase in the sales of our space-grade ASICs, which bear higher gross margins.

Development services and preproduction

Development services and preproduction of $0.3 million decreased by $2.4 million, or 89%, for the six months ended June 30, 2024 compared to $2.7 million for the six months ended June 30, 2023. The decrease reflects the decrease in the provision of development services during the six months ended June 30, 2024.

Sale of Products

Sale of products of $1.3 million increased by $0.7 million, or 117%, for the six months ended June 30, 2024 compared to $0.6 million for the six months ended June 30, 2023. The increase was primarily driven by an increase in the provision of our products during the six months ended June 30, 2024.

Gross profit

Gross profit of $4.5 million increased by $2.2 million, or 96%, for the six months ended June 30, 2024 compared to $2.3 million for the six months ended June 30, 2023, reflecting our increase in the provision of our space-grade ASICs, which bear higher gross margins.

Research and development expenses

Net Research and development expenses of $13.3 million decreased by $0.1 million, or 1%, for the six months ended June 30, 2024 compared to $13.4 million for the six months ended June 30, 2023. Our gross R&D expenditure decreased mainly due to the decrease in salaries and related costs and a decrease of post silicon costs related to ASICs. Our net research and development expenses were affected mostly by the decrease of the costs mentioned above offset by lower ESA funding for the six months ended June 30, 2024.

Selling and marketing expenses

Selling and marketing expenses of $1.1 million decreased by $0.3 million, or 21%, for the six months ended June 30, 2024 compared to $1.4 million for the six months ended June 30, 2023. The decrease was mostly driven by a decrease in salaries and related travel.

General and administrative expenses

General and administrative expenses of $3.9 million decreased by $0.3 million, or 7%, for the six months ended June 30, 2024 compared to $4.2 million for the six months ended June 30, 2023. The decrease is mainly attributable to a decrease in legal fees and insurance costs.

Loss from operations

Loss from operations of $13.7 million decreased by $2.9 million, or 17%, for the six months ended June 30, 2024 compared to $16.6 million for the six months ended June 30, 2023, reflecting the factors discussed above.

Finance Income

Finance income of $0.09 million increased by $0.05 million, or 125%, for the six months ended June 30, 2024 compared to $0.04 million for the six months ended June 30, 2023.

Finance Expenses

Finance expenses of $7.6 million increased by $2.3 million, or 43%, for the six months ended June 30, 2024 compared to $5.3 million for the six months ended June 30, 2023. The increase was mainly attributed to the $1.5 million expense of interest recorded on the advanced payments from MDA (See Note 3 to our audited consolidated financial statements for the fiscal year ended December 31, 2023) and an increase in interest expenses associated with the amendments of the credit agreement, dated February 1, 2022, by and among the Company, on the one hand, and Wilmington Savings Fund Society, as administrative agent and the lenders thereunder. (See Note 12 to our unaudited interim condensed consolidated financial statements as of June 30, 2024, included as exhibit 99.1 of the Report of Foreign Private Issuer on Form 6-K of which this exhibit forms a part).

Derivatives Revaluation

Derivatives revaluation were null for the six months ended June 30, 2024 compared to $24 million for the six months ended June 30, 2023. The decrease was primarily driven by a decrease in our stock price, which effected our financial instruments (Price Adjustment Shares (as described in our Annual Report on Form 20-F for the year ended December 31, 2023) and warrants).

Share in the loss of a company accounted by equity method, net

Share in the loss of a company accounted by equity method, net, of $0.02 million decreased by $0.24 million, or 93%, for the six months ended June 30, 2024 compared to $0.26 million for the six months ended June 30, 2023.

Income taxes

We did not record tax benefits or expenses in the six months ended June 30, 2024 or the six months ended June 30, 2023.

Net loss for the period

Net loss for the period of $21.3 million decreased by $25 million, or 54%, for the six months ended June 30, 2024 compared to $46.3. million the six months ended June 30, 2023, reflecting the factors discussed above.

B. Liquidity and Capital Resources

Overview

Our primary cash needs are for working capital, including funding our R&D goals and meeting our contractual obligations and other commitments, and payment of principal and interest on our outstanding debt. To date, we have funded these working capital requirements and other expenses mainly through issuances of equity capital and borrowings, as well as grants and other funds received from the ESA. Our ability to expand our business and become cash flow positive will depend on many factors, including our working capital needs, the availability of equity or debt financing and, over time, our ability to generate positive cash flows from operations, all of which depend on our ability to attract and retain customers, develop new products and compete effectively, as well as certain factors outside of our control.

We expect to continue to fund our operations through issuance of convertible securities, Ordinary Shares (including under the Sales Agreement and potential use of an equity line of credit, which is not currently active) and warrants, revenues from existing customers and additional prepayments, revenues from new customers and governmental grants. We also intend to restructure our existing debt.

As of June 30, 2024, our cash and cash equivalents amounted to $7.9 million and our financial debt amounted to $65.7 million.

Cash flows

The following table summarizes our statement of cash flows for the six months ended June 30, 2024 and 2023:

	For the six-month period ended June 30
	2024			2023
Net cash used in operating activities		(22,277	)		(10,240	)
Net cash provided by (used in) investing activities		16,505			(37	)
Net cash provided by (used in) financing activities		(285	)		9,598
(Decrease) increase in cash and cash equivalents		(6,057	)		(679	)

Net cash used in operating activities

Net cash used in operating activities was $22.3 million and $10.2 million for the six months ended June 30, 2024 and 2023, respectively. The increase of $12 million reflects a change in the fair value of warrant liabilities expense of $0 in 2024 compared to a $24.1 million expense in 2023, finance expenses on loans of $4.6 million in 2023 compared to $0.4 million in 2022, and the evolution of our working capital.

Net cash used in investing activities

Net cash provided by investing activities was $16 million for the six months ended June 30, 2024 compared to $37 thousand used in investing activities for the six months ended June 30, 2023. The change was mainly attributed to the MDA transaction (see Note 3 to our unaudited interim condensed consolidated financial statements as of June 30, 2024, included as exhibit 99.1 of the Report of Foreign Private Issuer on Form 6-K of which this exhibit forms a part ).

Net cash provided by financing activities

Net cash used in financing activities was $0.3 million for the six months ended June 30, 2024 compared to $9.6 million provided by financing activities for the six months ended June 30, 2023. The change was mainly attributed to issuance of shares in 2023 of $10 million as part of the Forward Purchase Agreement.

Off-Balance Sheet Arrangements.

We did not have during the periods presented, and we do not currently have, any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

C. Research and development, patents and licenses, etc.

A comprehensive discussion of our research and development, patents and licenses, etc., is included in “Item 5. Operating and Financial Review and Prospects – Management’s Discussion and Analysis of Financial Condition and Results of Operations” section in our Annual Report.

D. Trend Information.

Other than as disclosed elsewhere herein or the Form 6-K to which this exhibit relates (including the other exhibits to the Form 6-K), we are not aware of any trends, uncertainties, demands, commitments or events for the period from January 1, 2024 to June 30, 2024 that are reasonably likely to have a material adverse effect on our revenue, income, profitability, liquidity or capital resources, or that caused our disclosed financial information to be not necessarily indicative of future operating results or financial condition.

E. Critical Accounting Policies and Estimates

The preparation of financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, obligations, income and expenses during the reporting periods. For a comprehensive discussion of our critical accounting estimates please see “Item 5. Operating and Financial Review and Prospects – Management’s Discussion and Analysis of Financial Condition and Results of Operations – E. Critical Accounting Estimates” section in our Annual Report.