SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN ISSUER
Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934
For the month of June 30, 1998
ICTS International N.V.
(Transition of registrant's name into English)
Biesbosch 225, 1181 JC 1185 ZH Amstelveen,
The Netherlands (Address of principal
executive offices)
Indicate by check mark whether the registrant by furnishing the
information contained in this Form is also thereby furnishing the information to
the Commission pursuant to rule 12g3-2(b) under the Securities Exchange Act of
1934.
Yes ______ No X
[If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3- 2(b):82-_______]
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ICTS INTERNATIONAL N.V.
CONDENSED CONSOLIDATED BALANCE SHEET
(US $ in thousands)
December 31, June 30,
1997 1998
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $13,699 $15,111
Time deposits and Marketable Securities 3,301 1,107
Accounts receivable 8,627 8,700
Other current assets 1,967 2,088
Short-term loans 1,043 1,066
Total current assets 28,637 28,072
INVESTMENTS:
Investment in affiliates 2,000 1,107
Other investment 3,621 6,185
5,621 7,292
PROPERTY AND EQUIPMENT:
Cost 3,286 3,368
Less- accumulated depreciation 1,386 1,543
1,900 1,825
LONG-TERM RECEIVABLE,
net of discount and current maturities 163 155
GOODWILL, net of accumulated amortization
of $ 965 in 1998 and $ 872 in 1997 8,542 8,240
DEFERRED TAXES 657 615
OTHER ASSETS AND DEFERRED CHARGES 199 204
9,398 9,059
Total assets $45,719 $46,403
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LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term bank debt $1,987 $2,072
Current maturities of long-term debt 277 201
Account payable-trade 1,516 1,343
Accrued expenses and other liabilities 8,952 9,344
Total current liabilities 12,732 12,960
LONG-TERM DEBT, net of current maturities 1,607 1,556
ACCRUED SEVERANCE PAY 1,248 1,243
Total long-term liabilities 2,855 2,799
SHAREHOLDERS' EQUITY Share capital:
Common shares, par value-NLG 1 per share,
10,000,000 shares authorized; 6,569,480 issued
and outstanding shares 3,564 3,564
Additional paid-in capital 19,090 19,090
Retained earnings 11,553 12,314
Cumulative translation adjustments (4,075) (4,324)
30,132 30,644
Total liabilities and shareholders' equity $45,719 $46,403
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INTERNATIONAL N.V.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(US $ in thousands, except share and per share data)
Three months ended Six months ended
30-June-97 30 June 98 30-June-97 30 June 98
Revenues $11,718 $15,503 $22,200 $29,081
Cost of revenues 9,726 12,960 18,886 24,474
Gross profit 1,992 2,543 3,314 4,607
Amortization of goodwill 45 120 82 237
Selling, general and
administrative expenses 1,439 1,743 2,558 3,450
Operating income 508 680 674 920
Interest income 175 (331) 561 624
Interest expense (37) (38) (197) (191)
Exchange rate differences 903 (427) 2,494 62
Other income (expense), net (37) 3 (87) 3
Income before income taxes and
equity in results of affiliates 1,512 549 3,445 1,418
Income taxes (587) (355) (1,377) (743)
Income before equity in results
of affiliates 925 194 2,068 675
Equity in results of affiliates 30 55 84 86
Net income 955 249 2,152 761
Earning per Common Share 0.15 0.04 0.33 0.12
Earning per Common Share -
assuming dilution 0.14 0.04 0.32 0.12
Weighted average of common shares
outstanding 6,565,000 6,569,480 6,565,000 6,569,480
Diluted 6,617,934 6,607,888 6,658,516 6,612,527
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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(US $ in thousands)
Six months ended
30-June-97 30 June 98
CASH FLOWS FROM OPERATING ACTIVITIES
Net income for the period $2,152 $761
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization............................................................ 429.... 230
Deferred income taxes................................................................... 1,069........... 45
Increase in accrued severance pay....................................................... 131........... 7
(Gain) loss on sale of equipment........................................................ 2.......... (3)
Realized gain on marketable securities and interest and exchange rate income
on short-term loans and other investments............................................. (971) (417)
Imputed interest income................................................................. (9)
Equity in results of affiliates......................................................... (57).......... (86)
Changes in assets and liabilities:
Accounts receivable..................................................................... (411)............(125)
Other current assets.................................................................... (528)............(237)
Accounts payable........................................................................ (366)............(107)
Accrued expenses and other liabilities.................................................. 339.... ........ 475
Net cash provided by operating activities........................................................1,581 742
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of time deposits and marketable securities.................................... (9,609) (627)
Proceeds from sale of short-term investments............................................11,162.......... 2,906
Short-term loans........................................................................ (300)
Collection on short-term loans.......................................................... 324
Other investments............................................................................... (1,136)
Purchase of equipment...................................................................(513).......... (165)
Acquisition net of cash acquired (divestitures, net of cash sold) (a)................... (91) (38)
Investment in affiliates..............................................................(2,194) (194)
Collection on long-term receivable.................................................... 202
Proceeds from sale of equipment......................................................... 27 ........ 18
Increase in other assets............................................................... .(93).............. (6)
Net cash provided by (used in) investing activities...................................(1,109) 782
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from long-term borrowings....................................................... ....... 54
Payments on long-term borrowings........................................................ (300)............(171)
Increase (decrease) in net borrowings under short-term bank facilities.................. 891 105
Net cash provided by financing activities............................................... 591......... (12)
EFFECT OF FOREIGN CURRENCY EXCHANGE RATES ON CASH AND
CASH EQUIVALENTS........................................................................(1,960) (100)
Increase (decrease) in cash and cash equivalents............................................... ..(897)........ 1,412
Balance of cash and cash equivalents at beginning of period......................................16,366 13,699
Balance of cash and cash equivalents at end of period............................................$15,469........$15,111
(a) Acquisition net of cash acquired (divestitures, net of cash sold)
(a) Assets and liabilities of a subsidiary at date of acquisition:
Working capital, excluding cash and cash equivalents..............................(30)..... (129)
Property, equipment, investments and other assets................................ 2......... (22)
Minority interest.......................................................................(17)......... 0
Excess of cost over equity upon acquisition.............................................499.......... 0
Loans which were received for financing the acquisition................................(363)
Increase in other investments..................................................................... 189
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91 38
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ICTS INTERNATIONAL N.V.
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(US $ in thousands)
Accumulated
other
Common share Additional Retained comprehensive
Shares Amount Paid -in earnings income
capital (deficit) adjustments Total
Balance at January 1, 1995 4,000,000 $2,063 $431 $(370) $373 $2,497
Translation adjustments 336.00 336.00
Net income 1,113 1,113
Balance at December 31, 1995 4,000,000 2,063 431 743 709 3,946
Initial Public Offering 1,500,000 878 7,322 8,200
Second Public Offering 1,065,000 621 11,311 11,932
Translation adjustments (769) (769)
Net income 6,764 6,764
Balance at December 31, 1996 6,565,000 3,562 19,064 7,507 (60) 30,073
Stock options exercise 4,480 2 26 28
Unrealized gain on marketable
securities 20 20
Translation adjustments (4,035) (4,035)
Net income 4,046 4,046
Balance at December 31, 1997 6,569,480 $3,564 $19,090 $11,553 $(4,075) $30,132
Stock options exercise 0
Unrealized gain on marketable
securities (1) (1)
Translation adjustments (248) (248)
Net income 761 761
Balance at June 30, 1998 6,569,480 $3,564 $19,090 $12,314 $(4,324) $30,644
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Signature
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
undersigning, thereunto duly authorized.
ICTS INTERNATIONAL N.V.
Date : August 13, 1998 By : /s/ Raanan Nir
Name : Raanan Nir
Title:Chief Financial Officer
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