NextVison Stabilized Systems (TASE: NXSN) gave one of the highest returns on the Tel Aviv Stock Exchange in the Jewish year 5783 just ended. While the main indices on the local exchange have been marking time, NextVision’s share price rocketed by 200%.
NextVision is one of the technology companies that went public in the wave of flotations in 2021, but, unlike dozens of immature technology companies that have since lost most of their value and occasioned their investors heavy losses, NextVision has become a success story. Since the company’s flotation in June 2021, its share price has risen by 326%.
NextVision, a developer of stabilized cameras, has a current market cap of NIS 1.8 billion, giving it a trailing p/e ratio of 27. Senior managers of the company realized some of their holdings last year and this year, for an aggregate NIS 180 million.
Last week, it was reported that four of the senior managers – director Ofer Sandler, CTO and co-founder Boris Kipnis, chief business development officer and co-founder Chen Golan, and CEO Michael Grosman – sold shares for an aggregate NIS 77 million. The deals were all at NIS 22.85 per share, close to the market price.
Sandler sold shares for NIS 28.9 million, and remains with a holding of 13.3% in NextVision; Golan sold shares for NIS 32 million, and has a holding of 8.2%; Kipnis sold shares for NIS 6 million and has a holding of 9.7%; and Grosman sold shares for NIS 10 million and has a holding of 1.3%. Golan, Kipnis and Grosman also sold shares earlier this year. In March, the three sold shares for an aggregate amount of NIS 50 million, at a price less than half of the price in last week’s transactions: NIS 10 per share. A year previously, five senior managers of the company sold shares for a similar sum, at a price of NIS 8.9 per share.
NextVision develops and produces lightweight stabilized day and night cameras for vehicles and aircraft. The company, founded by Golan and Kipnis in 2009, sells in both the civilian and military markets. Among other applications, its cameras are installed on drones and UAVs.
In the past year, the company has benefitted from heightened demand because of the war in Ukraine. In recent weeks, the company has reported several orders of between $1 million and $2.5 million each.
In the first half of 2023, NextVision’s revenue grew 80% to $21 million, after 73% growth in sales in 2022 to $26 million for the full year.
Operating profit in the first half of 2023 almost doubled, to $10.7 million, and the company posted a net profit of $10.2 million, which compares with $3.9 million in the first half of 2022 and $11 million for the full year, which was double the net profit in 2021.
Compensation policy in dispute
Meanwhile, the shareholders meeting that was due to take place this week has been cancelled amid continuing negotiations between the company and the financial institutions invested in it. The latter are apparently dissatisfied at the proposed change in the company’s compensation policy. Prominent among the institutional investors are The Phoenix Holdings, Meitav, and More Mutual Funds Management.
The policy proposed was that the ceiling for the variable cash compensation for the CEO should be up to twice the fixed compensation ceiling, that is, up to NIS 6 million; the ceiling for the variable cash compensation for the chairperson and the CTO should be up to NIS 4 million, and that the ceiling for the variable cash compensation for company officers reporting to the CEO should be up to twelve times their monthly salary cost.
It was also proposed that the maximum annual cash bonus for these executives should be 2.5% of the company’s pre-tax profit, subject to the variable cash compensation ceiling. In the event that the company posted an annual loss, that would be deducted from the following year’s profit for the purposes of calculating that years bonuses.
Another change proposed is that liability insurance cover for company officers should be raised from NIS 20 million to NIS 50 million, and that professional liability insurance should be raised by a similar amount.
Approval of the proposed compensation policy requires a majority among the minority shareholders.
Published by Globes, Israel business news – en.globes.co.il – on September 20, 2023.
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