Gilat Satellite Networks Ltd. (NASDAQ:GILT) Q4 2018 Earnings Conference Call Transcript

Feb 12, 2019 • 09:30 am ET

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Gilat Satellite Networks Ltd. (NASDAQ:GILT) Q4 2018 Earnings Conference Call Transcript

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Q & A
Operator
Operator

Thank you. Ladies and gentlemen, at this time, we'll begin the question-and-answer session. (Operator Instructions) The first question is from Gunther Karger of Discovery Group. Please go ahead. Gunther, please go ahead.

Analyst
Gunther Karger

Can you hear me?

Executive
Yona Ovadia

Yes.

Analyst
Gunther Karger

Yes, congratulations on an excellent year. The question, is there any color on the M&A activity ongoing?

Executive
Adi Sfadia

Hi, Gunther. In respect of M&A, as I said, we have sufficient funds as of December 31st, 2018. We have about $104 million even with the dividend distribution, we still have plenty of funds. We continue to generate cash from operations quarter-over-quarter. So we have the flexibility to do non-organic M&A acquisition. We are -- it's something that is on our table, but we don't have anything concrete right now. We are looking for our opportunities and once we will have something, we will let everyone know.

Analyst
Gunther Karger

Yeah. Thank you very much.

Operator
Operator

The next question is from Michael Hebner of IFS Securities. Please go ahead.

Analyst
Michael Hebner

Yes. Good morning, guys.

Executive
Yona Ovadia

Hi, good morning.

Analyst
Michael Hebner

Do you hear me?

Executive
Yona Ovadia

Yes. We hear you. Okay.

Analyst
Michael Hebner

The low flying satellites everybody is putting up in there, how are we taking advantage of that? Are we on any of these programs? And if so -- and if not why?

Executive
Yona Ovadia

Absolutely, we are active in this market. I cannot go into specific opportunities and our position in those opportunities, but we are active. We are investing quite significantly. As I mentioned earlier, there are two achievements that we have reported already this year. One was the in-flight connectivity, the first ever airplane to fly in connect to a GEO satellite switching to LEO in back. This was done with the collaboration of Global Eagle and Gilat's modem.

The second one which we reported, not too long ago was the maritime trial again with a leader in this space. Also connecting to the Telesat LEO test satellite. So these two are -- were announced last year. We are active in this market. I can also say that Telesat is not the only opportunity that we are engaged with. So definitely we are active in this market. Quiet a significant amount of our investments in R&D is directed towards that type of constellations, and we are optimistic that we will get a portion of this business as those constellations mature, reach decisions and start the launch.

Analyst
Michael Hebner

Now, before you talked, somebody asked the question about acquisitions and stuff. If I was with the technology in a number of wins you have, why wouldn't somebody try to buy you guys, and so they would keep the technology so they would -- DishTV or whoever, so they could utilize your technology and nobody else could?

Executive
Yona Ovadia

That's a question to the potential candidates. I don't know, I think that what I would -- I feel comfortable saying is that our Board is optimistic regarding our long-term prosperity and our long-term holders of our shares and do not intend to cash on these investments in the short-term. So, we have