On behalf of BATM’s Board of Directors, I am delighted to report that BATM has had a strong year in 2018, in which we continued to deliver excellent results for our shareholders. BATM’s Executives continue to pursue opportunities and optimise our corporate strategy to create long-term value for you, our valued shareholders.
BATM has gone through a transformational year following a period of significant investment and the continued implementation of our strategy. We have created a strategy that builds on past achievements, which has resulted in a substantial improvement in BATM’s 2018 results. This reflects the key pillar of our strategy: investing in the future of our businesses, while giving considerable attention to mitigating risk.
Our experienced management, including the Executive Team and the heads of the business units, deserve the credit for steering the group through this period and delivering the financial results set out in this Annual Report. It is gratifying to note that the hard work that has gone into this performance has been recognised by the impressive rise in the company’s share price – which increased almost 80% over the course of the 2018.
This is possible by delivering on our main objective of providing our clients with what they need at the highest possible quality, and that objective goes across all our lines of business globally.
During 2018, we met the targets we set ourselves in terms of winning customers, securing contracts and moving into new territories.
We continued to build on the solid base of growth we have established in the Networking & Cyber and Bio-Medical divisions. The operational progress made in the two divisions resulted in an 11.6% rise in group revenues to $119.6m. It was particularly pleasing to see adjusted EBITDA increase to $4.9m, up from $2.2m in the previous year, and cash from operations of $2.6m compared with $0.1m last year. BATM is a well-established business operating in large, growth markets across both divisions and we are receiving increasing demand for our new products and solutions and significant interest in those soon-to-be launched.
It was another strong year for the Bio-Medical division, with increased revenues driven by growth in the Distribution unit. It was lifted by a contract to deliver instruments to a medical facility in Moldova and expansion of activities at our laboratories in Romania.
Eco-Med showed its potential upside with good progress on agricultural waste projects, including delivery of the first mobile unit, and deployment of the new ISS 500 medical waste treatment units in the US and elsewhere.
In Diagnostics, there was further progress on the Ador joint venture developing the NATlab diagnostics system. It passed a significant milestone, post period, with a conditional agreement for an investment of up to $30m towards commercialisation, demonstrating its potential value and derisking BATM’s investment.
Ador’s potential markets are large. Global Market Insight’s report, “Molecular Diagnostics Market Report, 2024”, predicts that the molecular diagnostics market alone is expected to reach $12.5bn by 2024, up from $7.2bn in 2017.
Networking & Cyber Division
The benefits of long-term contractual relationships with government and blue-chip customers were reflected in increased revenues and adjusted operating profits in the Networking & Cyber Division.
It was a year of substantial progress in implementing our strategy in the networking unit with the signing of a strategic partnership with Arm to develop our NFVTime operating system to enable a full ecosystem of Virtual Network Function services that are optimised to run on Arm’s architecture. There was also strong growth in sales of ICT services.
The Cyber unit secured a number of contracts from a government defence department and continued work on the enhancement of the T-Sense platform ahead of a new product package launch expected in 2020.
At the Board, we welcome two new Non-Executive Directors – Prof. Varda Shalev and Prof. Ari Shamiss – who bring with them tremendous experience and expertise. I would like to extend my thanks to both Ms. Orna Pollack and Prof. Avigdor Shafferman for their hard work and insight during their time on the Board. 2018 was a busy year for the Board, and I am grateful to all my fellow directors for the dedication and expertise they have contributed to the Board in 2018.
Our 2018 growth would not have been achieved without the great efforts of Dr. Zvi Marom, our CEO, Mr. Moti Nagar, our CFO, and our entire Executive Team. I would like to take this opportunity to say many thanks to every one of our managers and employees around the globe for their dedication and
commitment. As ever, I would also like to mark our appreciation of our loyal shareholders and their ongoing support.
Going forward, BATM’s Executives will continue to pursue opportunities to stay at the forefront of the ever-evolving marketplace. We remain committed to creating substantial value for our shareholders in the years to come and over the long term, and I look forward to reporting on our continued progress.
Dr. Gideon Chitayat
23 April 2019
Dr. Gideon Chitayat
Dr. Gideon Chitayat is the Chairman and CEO of GMBS Ltd Strategic Consulting Firm. He is currently a director of Delta Galil Industries, Paz Oil Company and Milissron Shopping malls. Dr. Chitayat has served as a director for Teva Israel Pharmaceutical Industries, Bank Hapoalim and Israel Aircraft Industries. He has provided consultancy services to the Board and Presidents of Companies. Dr. Chitayat holds a Ph.D. in Business & Applied Economics from the University of Pennsylvania and a Masters in Business & Applied Economics from the Hebrew University, Jerusalem and joined the Board of BATM in June 2010.
Founder & CEO
Dr. Zvi Marom
Founder & CEO
Dr. Zvi Marom founded BATM in 1992. He holds degrees in Engineering and Medicine. Prior to establishing BATM, he was the head of the Electronic faculty of the Israeli Open University and senior consultant to several industrial and academic institutions. He graduated in excellence from the naval academy and served in combat command posts. He was awarded the Techmark “Technology Man of the Year” award from the London Stock Exchange in 2000. He is currently a director of Shore Capital Group plc, a UK-listed company, and receives remuneration for his services.
Non-executive External Director
Harel Locker holds an LL.B. degree from Tel Aviv University’s School of Law (1994), a B.A. degree in accounting from Tel Aviv University Business School (1994) and an LL.M. (with distinction) in taxation from Georgetown University Law School, Washington DC (2001). Mr. Locker has wide experience in law and finance with first tier law firms in both Tel Aviv and New York, including Danziger, Clagsbald & Co., Law Firm, Tel Aviv, Israel; Fried, Frank, Harris, Shriver & Jacobson LLP, New York, N.Y. (2001-2004); Shohat, Locker & Co., Law Firm (2005-2007); and S. Friedman & Co., Law Firm (2007-2011). He was appointed and served as the Director General of the Israeli Prime Minister’s Office and head of Prime Minister Benjamin Netanyahu’s economic headquarters, between 2011 and 2015. He is currently the sole owner and director of his consultancy and investments company, Pitkrai Investments Ltd, and he currently also holds the position of a Chairman of the board of Israel Aerospace Industries (IAI). Mr. Locker was appointed to the Board of BATM in September 2016.
Professor Ari Shamiss
Prof. Ari Shamiss
Non-executive Senior Director
Prof. Ari Shamiss, aged 60, is a medical expert with over 35 years’ experience in the healthcare and biotechnology industries. He is currently CEO of Assuta Medical Centers, a network of eight hospitals and medical centres in Israel. Prior to assuming this position in 2016, Prof. Shamiss spent over 30 years at the Sheba Medical Center, which is the largest hospital in Israel and where a significant proportion of the country’s clinical research is conducted, in various roles and most latterly being CEO of the Sheba General Hospital from 2005 to 2016.
He has also served in advisory roles at various private and public organisations, including academic institutions such as being a Senior Lecturer at Tel Aviv University School of Medicine and a Senior Researcher at Harvard Business School. He has provided business advisory and consultancy to companies such as Quantason LLC, a California-based med-tech company that has developed a next-generation ultrasound technology, and currently BioGaming, an Israeli provider of an artificial intelligence solution to enhance physical therapy to improve rehabilitation outcomes. He also sits on the advisory board of the Sheba Cancer Research Center Council and the Gertner Institute for Epidemiology and Health Policy Research.
Prof. Varda Shalev
Non-executive External Director
Prof. Varda Shalev (née Borst), aged 59, is a specialist in epidemiology, medical informatics and predictive analytics in community healthcare. She currently holds the position of Director of the Morris Kahn & Maccabi Institute for Health Research and Innovation and is an active primary care physician in Maccabi Healthcare Services in Tel Aviv, where she has worked for eight years. She has pioneered the development of multiple disease registries to support chronic disease management. In addition, she is a faculty member at the Tel Aviv University School of Public Health and sits on the advisory board of several med-tech businesses, including Belongtail Ltd, Ibex Medical Analytics Ltd, NUVO Inc and Valera Health, and is a director of the Israel Advanced Technology Industries, a non-profit organisation. She is a director and co-owner of Dr. Benjamin Shalev Eye Physician Ltd, through which she provides physician services.
She holds an MD degree from Ben-Gurion University Medical School in Israel, and completed her residency in family medicine and earned a Master of Public Health Administration at Clark University in the US. She then completed a two-year fellowship in medical informatics at the Johns Hopkins University Hospital in the US. Prof. Shalev has authored or co-authored over 200 publications in peer-reviewed medical journals.
Executive Director & CFO
Moti Nagar joined BATM in 2014. Previously, Mr. Nagar held several management positions in Deloitte. As Senior Manager at Deloitte, he interfaced and handled the engagement relationships with leading corporate global clients, including companies traded on the LSE, NASDAQ, TSE and large private companies in the fields of industry, services, energy and holding companies. Mr. Nagar also led and supported public offerings of corporations in Israel and provided advice on taxation, including international taxation. Mr. Nagar graduated in Business Management and Accounting and qualified as an Israeli certified Accountant (CPA, Israel) in 2008. He also holds an MBA in Financial Management from Tel Aviv University.
COO of Medical Division
Ofer Bar-Ner, COO of Medical Division, joined BATM in 1999. From 1996 he was Chief Financial Officer of Silver Arrow LP, a subsidiary of Elbit Systems and EL-OP, and between 1989 and 1993 he was group manager in the finance department of Elbit. He graduated in Industrial Engineering and Management from the Technion in Haifa and has an MBA and MA in accounting from Northeastern University in Boston, MA.
COO of Telecom Division & CEO of Telco Systems
Ariel Efrati is the Chief Operating Officer of BATM, where he oversees BATM’s global business operations and telecommunications practices, and acts as Chief Executive Officer for Telco Systems, a BATM wholly owned subsidiary. Previously, Ariel held several senior positions in the telecom industry. As Senior Vice President, Ariel led Amdocs (NYSE:DOX) Venture Investments, Open Innovation and Product M&A unit, he headed Amdocs corporate competitive strategy unit, and he was the General Manager of the Service Fulfillment Product Business Division. Ariel also led Amdocs strategic and substantial entry to the OSS markets through organic growth and M&A activities. Ariel was the CEO of CallmyName, a startup in the Mobile sphere, and is a member of several successful startups’ BoDs, and is highly experienced in technological and market innovations. In the past, as a senior officer, Ariel led an advanced technological unit in the Israel Defense Forces (IDF) Intelligence Corps. Ariel is a software engineer and an EMBA graduate of the Kellogg School of Management (Northwestern University).
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