Ituran Location And Control ltd. Presents Results for the Second Quarter of 2010
Revenues Reach $35 Million, Growing 23% YoY
AZOUR, Israel, August 25, 2010 /PRNewswire-FirstCall/ -- Ituran Location and Control Ltd. (NASDAQ: ITRN, TASE: ITRN), today announced its consolidated financial results for the second quarter ended June 30, 2010.
Highlights of the Quarter
- An 12,000 increase in net subscribers to a record of 587,000
as of June 30, 2010;
- Gross margin at 49.5% and operating margin at 21%;
- EBITDA of $11.1 million or 31.8% of revenues;
- Generated $6.6 million in operating cash flow; ended the
quarter with $50 million in net cash (including marketable securities
and deposits for short and long term);
Second Quarter 2010 Results
Revenues for the second quarter of 2010 reached US$35.0 million, representing 23% growth over revenues of US$28.4 million in the second quarter of 2010. 75% of revenues were from location based service subscription fees and 25% from product revenues.
Revenues from subscription fees grew by 22% over the same period last year. The increase in subscription fees was mainly due to the increase in the subscriber base, which grew to 587,000 as of June 30, 2010, as compared with 533,000 at the end of June 30, 2009. Product revenues grew 26% compared with the same period last year, driven primarily by increased sales of products in Israel.
Gross profit for the second quarter of 2010 was US$ 17.3 million (49.5% of revenues) compared with US$14.3 million (50.3% of revenues) in the second quarter of last year.
Operating profit for the second quarter of 2010 was US$7.3 million (21.0% of revenues) compared with an operating profit of US$6.0 million (21.1% of revenues) in the second quarter of 2009.
Financial income for the second quarter of 2010 was US$0.2 million compared with a financial expense of US$2.5 million in the second quarter of 2009.
EBITDA for the quarter was $11.1 million (31.8% of revenues) compared to an EBITDA of $8.9 million (31.2% of revenues) in the second quarter of last year.
Net profit was US$4.8 million in the second quarter of 2010 (13.6% of revenues), compared with a net profit of US$2.4 million (8.6% of revenues), as reported in the second quarter of 2009. Fully diluted EPS in the second quarter of 2010 was US$0.23, compared with fully diluted EPS of US$0.12 in the second quarter of 2009.
Cash flow from operations during the quarter was $6.6 million.
As of June 30, 2010, the Company had net cash, including marketable securities and deposits for short and long term, of US$50 million or $2.38 per share. This is compared with US$81.5 million or $3.89 per share as on March 31, 2010, and US$78.1 million as of December 31, 2009.
Ituran distributed a dividend to shareholders in the amount of $31.6 million or $1.50 per share during the second quarter.
Eyal Sheratzky, Co-CEO of Ituran said, "The second quarter was another solid of growth and expansion in our subscriber base, particularly in Brazil, as well as a strong level revenues and profitability. We continue to generate a strong level of cash flow, enabling us to share the long-term fruits of efforts with our shareholders through our continued dividend distribution. We continue to build our business globally, while realizing the rewards of our past efforts."
Conference Call Information
The Company will also be hosting a conference call later today, August 25, 2010 at 10am 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: 1-888-668-9141
CANADA Dial-in Number: 1-866-485-2399
ISRAEL Dial-in Number: 03-918-0685
INTERNATIONAL Dial-in Number: +972-3-918-0685
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 587,000 subscribers distributed globally. Established in 1995, Ituran has over 1,400 employees worldwide, provides its location based services and has a market leading position in Israel, Brazil, Argentina and the United States.
CONSOLIDATED INTERIM BALANCE SHEETS
US dollars
June 30, December 31,
(in thousands) 2010 2009
Current assets
Cash and cash equivalents 35,773 60,813
Deposit in escrow 5,230 5,227
Investments in trading marketable securities 1,359 4,213
Accounts receivable (net of allowance for doubtful
accounts) 28,301 24,906
Other current assets 6,944 6,136
Inventories 10,440 11,096
______ _______
88,047 112,391
------ -------
Long-term investments and other assets
Deposit in Escrow 7,846 7,840
Investments in affiliated companies 203 205
Investments in other companies 79 80
Other assets 1,874 1,742
Loan to former employee 558 558
Deferred income taxes 5,117 5,653
Funds in respect of employee rights upon retirement 3,859 3,606
______ _______
19,536 19,684
------ -------
Property and equipment, net 39,744 39,090
------ -------
Intangible assets, net 4,384 5,064
------ -------
Goodwill 9,327 9,639
------ -------
Total assets 161,038 185,868
====== =======
CONSOLIDATED INTERIM BALANCE SHEETS
US dollars
June 30, December 31,
(in thousands) 2010 2009
Current liabilities
Credit from banking institutions 214 6
Accounts payable 13,585 13,459
Deferred revenues 4,878 5,486
Other current liabilities 15,868 17,443
_______ _______
34,545 36,394
------- -------
Long-term liabilities
Long term Loans 139 -
Liability for employee rights upon retirement 5,758 5,457
Provision for contingencies 3,515 3,071
Deferred income taxes 1,051 1,209
_______ _______
10,463 9,737
------- -------
Capital Notes 5,894 5,894
------- -------
Shareholders' equity 105,877 130,126
Non- controlling interests 4,259 3,717
_______ _______
Total equity 110,136 133,843
------- -------
Total liabilities and shareholders' equity 161,038 185,868
======= =======
CONSOLIDATED INTERIM STATEMENTS OF INCOME
Six month Three month
(in thousands Period ended June 30 , Period ended June 30,
except per share data) 2010 2009 2010 2009
Revenues:
Location-based services 51,866 41,528 26,142 21,394
Wireless communications
products 18,138 14,148 8,869 7,030
_______ _______ _______ _______
70,004 55,676 35,011 28,424
------- ------- ------- -------
Cost of revenues:
Location-based services 19,397 15,158 (*) 9,762 7,789 (*)
Wireless communications
products 16,103 12,685 7,915 6,337
_______ _______ _______ _______
35,500 27,843 17,677 14,126
------- ------- ------- -------
Gross profit 34,504 27,833 17,334 14,298
Research and development
expenses 222 180 116 90
Selling and marketing
expenses 4,295 3,537 2,078 1,833
General and administrative
expenses 15,382 12,673 7,808 6,162
Other expenses (income),
net 3 444 (*) - 227 (*)
_______ _______ _______ _______
Operating income 14,602 10,999 7,332 5,986
Other expenses (81) - (17) -
Financing income
(expenses) , net 71 1,610 198 (2,544)
_______ _______ _______ _______
Income before taxes on
income 14,592 12,609 7,513 3,442
Taxes on income (4,441) (4,306) (2,512) (944)
Share in gains (losses) of
affiliated companies, net (2) 15 (14) 15
_______ _______ _______ _______
Net income for the period 10,149 8,318 4,987 2,513
Less :Net income
attributable to
Non-controlling interest (600) (285) (238) (75)
_______ _______ _______ _______
Net income attributable to
company shareholders 9,549 8,033 4,749 2,438
======= ======= ======= =======
Earnings per share
attributable to company
shareholders
Basic 0.46 0.38 0.23 0.12
======= ======= ======= =======
Diluted 0.46 0.38 0.23 0.12
======= ======= ======= =======
Weighted average number of
shares outstanding (in
thousands):
Basic 20,968 20,968 20,968 20,968
======= ======= ======= =======
Diluted 20,977 20,977 20,977 20,977
======= ======= ======= =======
(*) Reclassified
CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
US dollars US dollars
Six months Three months
period ended period ended
June 30 , June 30 ,
(in thousands) 2010 2009 2010 2009
Cash flows from operating activities
Net income for the period 10,149 8,318 4,987 2,513
Adjustments to reconcile net income to
net cash from operating activities:
Depreciation and amortization and
impairment of Goodwill 7,515 5,545 3,792 2,908
Exchange differences on principal of
deposit and loan, net (364) (448) (589) (397)
Losses (gain) in respect of trading
marketable securities - (908) 14 980
Increase in liability for employee
rights upon retirement 442 297 276 220
Share in losses (gains) of affiliated
companies, net 2 (15) 14 (15)
Deferred income taxes 242 (556) 68 (241)
Capital loses (gains) on sale of
property and equipment, net 21 (10) 18 -
Decrease (increase) in accounts
receivable (2,693) 1,932 (788) 2,178
Increase in other current assets (967) (481) (257) (705)
Decrease (increase) in inventories and
contracts in process, net 370 (2,335) (288) (938)
Increase (decrease) in accounts
payable 473 1,745 226 (356)
Increase (decrease) in deferred
revenues (466) 416 (499) (96)
Decrease in other current liabilities
and provision for contingencies (603) (730) (378) (967)
______ ______ _____ _____
Net cash provided by operating
activities 14,121 12,770 6,596 5,084
------ ------ ----- -----
Cash flows from investing activities
Increase in funds in respect of
employee rights upon retirement, net
of withdrawals (346) (352) (229) (236)
Capital expenditures (9,304) (5,752) (4,051) (3,261)
Deposit (32) (261) (297) (98)
Proceeds from sale of property and
equipment 479 37 484 11
Investment in marketable securities (1,326)(30,490) - (14,993)
Sale of marketable securities 4,214 45,600 - 15,500
______ ______ _____ _____
Net cash used in investment activities (6,315) 8,782 (4,093) (3,077)
------ ------ ----- -----
Cash flows from financing activities
Short-term credit from banking
institutions, net 182 42 (326) (71)
Receipt of long term loans from baking
institutions 165 - 165 -
Dividend paid (31,621) (3,566) (31,621) (3,566)
Dividend paid to non-controlling
interest - (169) - (169)
______ ______ _____ _____
Net cash used in financing activities (31,274) (3,693) (31,782) (3,806)
------ ------ ----- -----
Effect of exchange rate changes on
cash and cash equivalents (1,572) (374) (2,467) 2,002
------ ------ ----- -----
______ ______ _____ _____
Net increase (decrease) in cash and
cash equivalents (25,040) 17,485 (31,746) 203
Balance of cash and cash equivalents
at beginning of period 60,813 12,511 67,519 29,793
Balance of cash and cash equivalents
at end of period 35,773 29,996 35,773 29,996
====== ====== ====== ======
Company Contact International Investor Relations
Udi Mizrahi Ehud Helft & Kenny Green
[email protected] [email protected]
VP Finance, Ituran CCG Investor Relations
(Israel) +972-3-557-1348 (US) +1-646-201-9246
SOURCE Ituran Location and Control Ltd
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