EX-99.1 2 exhibit_99-1.htm EXHIBIT 99.1 exhibit_99-1.htm
Exhibit 99.1
ITURAN LOCATION AND CONTROL LTD. AND ITS SUBSIDIARIES
 
ITURAN LOCATION AND CONTROL LTD. PRESENTS RESULTS
FOR THE FIRST QUARTER 2012

Revenues of $37.7 million and EPS of $0.24

AZOUR, Israel – May 30, 2012 – Ituran Location and Control Ltd. (NASDAQ: ITRN, TASE: ITRN), today announced its consolidated financial results for the first quarter ended March 31, 2012.

Highlights of the First quarter
·
A 5 thousand increase in net subscribers in the quarter, to a record of 628 thousand as of March 31, 2012;
·
Gross margin at 48.7% and operating margin at 19.7%;
·
EBITDA of $11.3 million or 29.8% of revenues;
·
Generated $3.9 million in operating cash flow; ended the quarter with $43.0 million in net cash (including marketable securities and deposits for short and long term);
·
Dividend of $2.6 million declared for the quarter;

First quarter 2012 Results
Revenues for the first quarter of 2012 were $37.7 million, representing a 6.6% decline from revenues of $40.4 million in the first quarter of 2011. 77% of revenues were from location based service subscription fees and 23% from product revenues.

Revenues from subscription fees declined 4% over the same period last year. The decrease in subscription fees was mainly due to the weakening of the various currencies in which the Company operates against the US dollar, as well a decrease in revenues from Mapa. Excluding currency impacts, revenues from subscriptions would have increased due to the growth in the subscriber base, which expanded from 615,000 as of March 31, 2011, to 628,000 as of March 31, 2012.

Product revenues declined by 15% compared with the same period last year. This decline was mainly due to a reduction in sales in Israel. This was primarily due to the product mix sold in the quarter and lower selling prices.

Gross profit for the first quarter of 2012 was $18.4 million (48.7% of revenues), a decrease of 8% compared with $19.9 million (49.3% of revenues) in the first quarter of last year.

Operating profit for the first quarter of 2012 was $7.5 million (19.7% of revenues), a decrease of 15% compared with an operating profit of $8.8 million (21.8% of revenues) in the first quarter of 2011. The decrease in operating profit was primarily due to the strengthening of the US dollar versus the Brazilian Real and Israeli Shekel, as well as lower operating profit from Mapa.

EBITDA for the quarter was $11.3 million (29.8% of revenues), a decrease of 16% compared to an EBITDA of $13.4 million (33.1% of revenues) in the first quarter of 2011.

Financial income in the first quarter of 2012 was $10 thousand compared with a financial income of $0.2 million in the first quarter of 2011.

 
 
 

 
ITURAN LOCATION AND CONTROL LTD. AND ITS SUBSIDIARIES
 
Net profit was US$5.1 million in the first quarter of 2012 (13.5% of revenues), compared with a net profit of US$6.5 million (16.0% of revenues), as reported in the first quarter of 2011.
 
Fully diluted EPS in the first quarter of 2012 was US$0.24, compared with fully diluted EPS of US$0.31 in the first quarter of 2011.

Cash flow from operations during the quarter was $3.9 million.

As of March 31, 2012, the Company had net cash, including marketable securities and deposits for short and long term, of $43.0 million or $2.04 per share. This is compared with $39.7 million or $1.89 per share as at December 31, 2011.

For the first quarter, a dividend of $2.6 million or 12 cents per share was declared in line with the Company’s stated policy of issuing at least 50% of net profits in a dividend, on a quarterly basis.
 
The dividend’s record date is June 12, 2012, and the dividend will be paid on June 27, 2012, net of taxes and levies, at the rate of 25%.

Eyal Sheratzky, Co-CEO of Ituran said, “While we continued to grow our subscriber base, our first quarter was affected by currency fluctuations compared with last year and lower sales at Mapa. We see continued growth potential, especially in Brazil. We believe that in the second quarter, the growth rate in our subscriber base in Brazil will improve back to the long-term growth rates that we have seen there in the past. We recently signed a an agreement with General Motors Brazil as we published on April 9th, in preparation for the new regulation 245 which is expected to come into force later this year. Overall, we continue to share the rewards of our success with our shareholders, recently distributing $25.8 million for our performance in 2011 and a further $3 million for the first quarter of 2012.”

Conference Call Information

The Company will also be hosting a conference call later today, May 30, 2012 at 9am ET. On the call, management will review and discuss the results, and will be available to answer investor questions.

To participate, please call one of the following teleconferencing numbers. Please begin placing your calls a few minutes before the conference call commences. If you are unable to connect using the toll-free numbers, please try the international dial-in number.

US Dial-in Number: 1 888 407 2553
ISRAEL Dial-in Number: 03 918 0650
CANADA Dial-in Number: 1 866 485 2399
INTERNATIONAL Dial-in Number:  +972 3 918 0650

At: 9:00am Eastern Time, 6:00am Pacific Time, 4:00pm Israel Time

For those unable to listen to the live call, a replay of the call will be available from the day after the call in the investor relations section of Ituran's website.

 
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ITURAN LOCATION AND CONTROL LTD. AND ITS SUBSIDIARIES
 
Certain statements in this press release are "forward-looking statements" within the meaning of the Securities Act of 1933, as amended.  These forward-looking statements include, but are not limited to, our plans, objectives, expectations and intentions and other statements contained in this report that are not historical facts as well as statements identified by words such as "expects", "anticipates", "intends", "plans", "believes", "seeks", "estimates" or words of similar meaning. These statements are based on our current beliefs or expectations and are inherently subject to significant uncertainties and changes in circumstances, many of which are beyond our control. Actual results may differ materially from these expectations due to changes in global political, economic, business, competitive, market and regulatory factors.

About Ituran
Ituran provides location-based services, consisting predominantly of stolen vehicle recovery and tracking services, as well as wireless communications products used in connection with its location-based services and various other applications. Ituran offers mobile asset location, Stolen Vehicle Recovery, management & control services for vehicles, cargo and personal security. Ituran’s subscriber base has been growing significantly since the Company’s inception to over 628,000 subscribers distributed globally. Established in 1995, Ituran has over 1,300 employees worldwide, provides its location based services and has a market leading position in Israel, Brazil, Argentina and the United States.

Company Contact
  
International Investor Relations
Udi Mizrahi
udi_m@ituran.com
VP Finance, Ituran
(Israel) +972 3 557 1348
  
Ehud Helft & Kenny Green
ituran@ccgisrael.com
CCG Investor Relations
(US) +1 646 201 9246

* Financial Tables to Follow **
 
 
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ITURAN LOCATION AND CONTROL LTD.
 
Consolidated Interim Financial Statements
as of March 31, 2012

 
 
 
 
 
ITURAN LOCATION AND CONTROL LTD.
 
Consolidated Financial Statements
as of March 31, 2012
 
Table of Contents
 
 
Page
   
Consolidated Financial Statements:
  
2 - 3
4
5
 
 
 
 

 
 
   
US dollars
(except share data)
  
   
March 31,
    
December 31,
  
(in thousands)
  
2012
    
2011
  
             
Current assets
            
Cash and cash equivalents
     38,946       35,270  
Investments in marketable securities
     74       68  
Accounts receivable (net of allowance for doubtful accounts)
     28,241       25,294  
Loan to former employee
     -       340  
Other current assets
     18,479       15,165  
Inventories
     12,434       10,881  
      98,174       87,018  
                 
Long-term investments and other assets
                
Deposit in escrow
     4,903       4,888  
Investments in affiliated company
     199       207  
Investments in other company
     82       80  
Other non-current assets
     1,922       2,216  
Deferred income taxes
     5,553       5,568  
Funds in respect of employee rights upon retirement
     5,067       4,741  
      17,726       17,700  
                 
Property and equipment, net
     38,464       40,870  
                 
Intangible assets, net
     3,113       3,355  
                 
Goodwill
     8,755       8,514  
                 
Total assets
     166,232       157,457  
 
 
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CONSOLIDATED BALANCE SHEETS
 
   
US dollars
(except share data)
  
   
March 31,
    
December 31,
  
(in thousands)
  
2012
    
2011
  
             
Current liabilities
            
Credit from banking institutions
     800       390  
Accounts payable
     10,681       9,319  
Deferred revenues
     9,090       7,869  
Other current liabilities
     44,237       20,966  
      64,808       38,544  
                 
Long-term liabilities
                
Long term loans
     167       173  
Liability for employee rights upon retirement
     7,313       6,865  
Provision for contingencies
     4,703       4,250  
Other non-current liabilities
     934       753  
Deferred revenues
     718       728  
Deferred income taxes
     772       792  
      14,607       13,561  
                 
Stockholders’ equity
     82,656       101,194  
Non-controlling interests
     4,161       4,158  
Total equity
     86,817       105,352  
                 
Total liabilities and equity
     166,232       157,457  

 
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US dollars
(except share data)
  
   
Three month period
ended March 31,
  
(in thousands except per share data)
  
2012
    
2011
  
       
Revenues:
            
Location-based services
     29,215       30,338  
Wireless communications products
     8,520       10,051  
      37,735       40,389  
                 
Cost of revenues:
                
Location-based services
     11,478       12,211  
Wireless communications products
     7,878       8,279  
      19,356       20,490  
                 
Gross profit
     18,379       19,899  
Research and development expenses
     183       139  
Selling and marketing expenses
     2,141       1,878  
General and administrative expenses
     8,615       9,064  
Other income, net
     (17 )     -  
Operating income
     7,457       8,818  
Financing income, net
     10       239  
Income before income tax
     7,467       9,057  
Income tax
     (2,192 )     (2,282 )
Share in losses of affiliated companies, net
     (14 )     -  
Net income for the period
     5,261       6,775  
Less: Net income attributable to non-controlling interest
     (161 )     (297 )
Net income attributable to the Company
     5,100       6,478  
                 
Basic and diluted earnings per share attributable to Company’s stockholders
     0.24       0.31  
                 
Weighted average number of shares outstanding (in thousands):
            
Basic
     20,968       20,968  
Diluted
     20,968       20,977  

 
- 4 -
 



   
US dollars
  
   
Three month period
ended March 31,
  
(in thousands)
  
2012
    
2011
  
       
Cash flows from operating activities
            
Net income for the period
     5,261       6,775  
Adjustments to reconcile net income to net cash from operating activities:
                
Depreciation and amortization
     3,810       4,554  
Exchange differences on principal of deposit and loans, net
     126       255  
Gains in respect of trading marketable securities
     (4 )     (12 )
Increase in liability for employee rights upon retirement
     252       154  
Share in losses of affiliated companies, net
     14       -  
Deferred income taxes
     618       (374 )
Capital gains on sale of property and equipment, net
     (7 )     -  
Increase in accounts receivable
     (2,225 )     (1,654 )
Increase in other current assets
     (2,054 )     (2,270 )
Decrease (increase) in inventories
     (1,243 )     816  
Increase (decrease) in accounts payable
     1,096       (166 )
Increase in deferred revenues
     966       1,137  
Increase (decrease) in other current liabilities
     (2,690 )     837  
Net cash provided by operating activities
     3,920       10,052  
Cash flows from investment activities
                
Increase in funds in respect of employee rights upon retirement, net of withdrawals
     (191 )     (116 )
Capital expenditures
     (998 )     (5,615 )
Deposit in escrow
     -       603  
Deposit
     25       144  
Proceeds from sale of property and equipment
     109       20  
Repayment of loan to a former employee
     355       -  
Net cash used in investment activities
     (700 )     (4,964 )
Cash flows from financing activities
                
Short term credit from banking institutions, net
     398       (10 )
Repayment of long term loans
     (11 )     (5 )
Dividend paid to non-controlling interest
     (268 )     -  
Net cash provided by (used in) financing activities
     119       (15 )
Effect of exchange rate changes on cash and cash equivalents
     337       655  
Net increase in cash and cash equivalents
     3,676       5,728  
Balance of cash and cash equivalents at beginning of the period
     35,270       46,674  
Balance of cash and cash equivalents at end of the period
     38,946       52,402  
 
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