Ituran Location and Control Ltd. Presents Results for the First Quarter of 2010
Revenues Reach $35 Million, Growing 28% YoY
AZOUR, Israel, May 25, 2010 /PRNewswire-FirstCall/ -- Ituran Location and Control Ltd. (NASDAQ: ITRN, TASE: ITRN), today announced its consolidated financial results for the first quarter ended March 31, 2010.
Highlights of the Quarter
- An 13,000 increase in net subscribers to a record of 575,000
as of March 31, 2010;
- Gross margin at 49% and operating margin at 21%;
- EBITDA of $11 million or 31.4% of revenues;
- Generated strong operating cash flow of $7.5 million; ended
the quarter with $81.5 million in net cash (including marketable
securities and deposits for short and long term );
First Quarter 2010 Results
Revenues for the first quarter of 2010 reached US$35.0 million, representing 28% growth over revenues of US$27.3 million in the first quarter of 2009. 73.5% of revenues were from location based service subscription fees and 26.5% from product revenues.
Revenues from subscription fees grew by 28% over the same period last year. The increase in subscription fees was mainly due to the increase in the subscriber base, which grew to 575,000 as of March 31, 2010, as compared with 521,000 at the end of March 31, 2009, and also as a result of the increase in value of the Brazilian Real and the Israeli shekel versus the US Dollar. Product revenues grew 30% compared with the same period last year, driven primarily by increased sales of products in Israel.
Gross profit for the first quarter of 2010 was US$ 17.2 million (49.1% of revenues) compared with US$13.5 million (49.7% of revenues) in the first quarter of last year.
Operating profit for the first quarter of 2010 was US$7.3 million (20.8% of revenues) compared with an operating profit of US$5.0 million (18.4% of revenues) in the first quarter of 2009.
Financial expenses for the first quarter of 2010 were US$0.1 million compared with a financial income of US$4.2 million in the first quarter of 2009. The high level of financial income in the first quarter of 2009 was due exchange rate changes affecting the value of Ituran's cash holdings.
EBITDA for the quarter was $11.0 million (31.4% of revenues) compared to an EBITDA of $7.7 million (28.1% of revenues) in the first quarter of last year.
Net profit was US$4.8 million in the first quarter of 2010 (13.7% of revenues), compared with a net profit of US$5.6 million (20.5% of revenues), as reported in the first quarter of 2009. Fully diluted EPS in the first quarter of 2010 was US$0.23, compared with fully diluted EPS of US$0.27 in the first quarter of 2009.
Cash flow from operations during the quarter was $7.5 million.
As of March 31, 2010, the Company had a net cash position, including marketable securities and deposits for short and long term, of US$81.5 million or $3.89 per share. This is compared with US$58 million on March 31, 2009, and US$78.1 million as of December 31, 2009.
Eyal Sheratzky, Co-CEO of Ituran said, "The results of the first quarter represent a solid start to 2010, with an increase in revenues built both on growth in product sales and an expansion of our subscriber base, generating growing subscription fees. Our business continues to generate a strong level of cash flow, continually strengthening our balance sheet, and enabling us to share the long-term fruits of efforts with our shareholders through dividend distribution. In fact, in April, we issued a large dividend to our shareholders, amounting to $32 million. "
Continued Mr. Sheratzky, "We start 2010 very well positioned, particularly in Brazil and Israel. We continue to advance our business as the market-leader in Brazil, gaining ever increasing traction and market penetration.. For Ituran as a whole, we look forward to building and unleashing our full potential throughout this year, and we expect to realize all the rewards of our past efforts."
Conference Call Information
The Company will also be hosting a conference call later today, May 25, 2010 at 10am EST. 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: 1-888-668-9141
CANADA Dial-in Number: 1-866-485-2399
ISRAEL Dial-in Number: 03-918-0644
INTERNATIONAL Dial-in Number: +972-3-918-0644
At: 10am Eastern Time, 7am Pacific Time, 5pm
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.
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 575,000 subscribers distributed globally. Established in 1995, Ituran has over 1400 employees worldwide, provides its location based services and has a market leading position in Israel, Brazil, Argentina and the United States.
1. CONSOLIDATED INTERIM BALANCE SHEETS
US dollars
_________________________________________________________________________
March December
31 31
_________________________________________________________________________
(in thousands) 2010 2009
_________________________________________________________________________
Current assets
Cash and cash equivalents 67,519 60,813
Deposit in escrow 5,227 5,227
Investments in trading marketable securities 1,428 4,213
Accounts receivable (net of allowance for doubtful
accounts) 27,268 24,906
Other current assets 6,926 6,136
Inventories 10,623 11,096
_______ _______
118,991 112,391
------- -------
Long-term investments and debit balances
Deposit in escrow 7,842 7,840
Investments in affiliated company 225 205
Investments in other company 82 80
Other assets 1,932 1,742
Loan to former employee 558 558
Deferred income taxes 5,497 5,653
Funds in respect of employee rights upon retirement 3,783 3,606
_______ _______
19,919 19,684
------- -------
Property and equipment, net 40,147 39,090
------- -------
Intangible assets, net 4,859 5,064
------- -------
Goodwill 9,760 9,639
_______ _______
Total assets 193,676 185,868
_______ _______
2. CONSOLIDATED INTERIM BALANCE SHEETS
US dollars
__________________________________________________________________________
March 31, December 31,
__________________________________________________________________________
(in thousands) 2010 2009
__________________________________________________________________________
Current liabilities
Credit from banking institutions 514 6
Accounts payable 13,931 13,459
Deferred revenues 5,611 5,486
Other current liabilities 17,358 17,443
_______ _______
37,414 36,394
------- -------
Long-term liabilities
Liability for employee rights upon retirement 5,714 5,457
Provision for contingencies 3,272 3,071
Deferred income taxes 1,163 1,209
_______ _______
10,149 9,737
------- -------
Capital Notes 5,894 5,894
------- -------
Shareholders' equity 136,057 130,126
Non-controlling interest 4,162 3,717
_______ _______
Total equity 140,219 133,843
------- -------
Total liabilities and shareholders' equity 193,676 185,868
_______ _______
CONSOLIDATED INTERIM STATEMENTS OF INCOME
__________________________________________________________________________
Three months
period
ended March 31 ,
(in thousands except per share data) 2010 2009
__________________________________________________________________________
Revenues:
Location-based services 25,724 20,134
Wireless communications products 9,269 7,118
_______ _______
34,993 27,252
------- -------
Cost of revenues:
Location-based services 9,635 7,369
Wireless communications products 8,188 6,348
_______ _______
17,823 13,717
_______ _______
Gross profit 17,170 13,535
Research and development expenses 106 90
Selling and marketing expenses 2,217 1,704
General and administrative expenses 7,574 6,511
Other ( income) expenses, net 3 217
_______ _______
Operating income 7,270 5,013
Other expenses (64) -
Financing income ( expenses ) , net (127) 4,154
_______ _______
Income before taxes on income 7,079 9,167
Taxes on income (1,929) (3,362)
Share in gains of affiliated companies, net 12 -
_______ _______
Net income for the period 5,162 5,805
Less: net income attributable to non-controlling
interest (362) (210)
_______ _______
Net income attributable to company shareholders 4,800 5,595
_______ _______
Earnings per share:
Basic 0.23 0.27
_______ _______
Diluted 0.23 0.27
_______ _______
Weighted average number of shares outstanding (in
thousands):
Basic 20,968 20,968
_______ _______
Diluted 20,977 20,976
_______ _______
CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
__________________________________________________________________________
US dollars
__________________________________________________________________________
Three months period
ended March 31 ,
(in thousands) 2010 2009
__________________________________________________________________________
Cash flows from operating activities
Net income for the period 5,162 5,805
Adjustments to reconcile net income to net cash from
operating activities:
Depreciation and amortization 3,723 2,637
Exchange differences on principal of deposit and
loan, net 225 (51)
Gains in respect of trading marketable securities (14) (1,888)
Increase in liability for employee rights upon
retirement 166 77
Share in gains of affiliated companies, net (12) -
Deferred income taxes 174 (315)
Capital loses (gains) on sale of property and
equipment, net 3 (10)
Increase in accounts receivable (1,905) (246)
Decrease (increase) in other current assets (710) 224
Decrease (increase)in inventories 658 (1,397)
Increase in accounts payable 247 2,101
Increase in deferred revenues 33 512
Increase(decrease) in other current liabilities (225) 237
_______ _______
Net cash provided by operating activities 7,525 7,686
------- -------
Cash flows from investing activities
Increase in funds in respect of employee rights upon
retirement, net of withdrawals (117) (116)
Capital expenditures (5,253) (2,491)
Proceeds from sale of property and equipment 265 26
Deposit (5) (163)
Investment in trading marketable securities (1,326) (15,497)
Sale of marketable securities 4,214 30,100
Net cash provided by investment activities (2,222) 11,859
------- -------
Cash flows from financing activities
Short-term credit from banking institutions, net 508 113
_______ _______
Net cash provided by (used in) financing activities 508 113
------- -------
Effect of exchange rate changes on cash and cash
equivalents 895 (2,376)
_______ _______
Net increase in cash and cash equivalents 6,706 17,282
Balance of cash and cash equivalents at beginning of
period 60,813 12,511
_______ _______
Balance of cash and cash equivalents at end of
period 67,519 29,793
_______ _______
Company Contact
Udi Mizrahi
[email protected]
VP Finance, Ituran
(Israel) +972-3-557-1348
International Investor Relations
Ehud Helft & Kenny Green
[email protected]
CCG Investor Relations
(US) +1-646-201-9246
SOURCE Ituran Location and Control Ltd
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