Pointer Telocation Reports 2010 Financial Results
Yearly Revenues $74M, 13% Growth From $65M in 2009; 2010 EBITDA - $11M; $1.1M Net Income in 2010, vs. $2.1M Net Loss in 2009
ROSH HAAYIN, Israel, February 28, 2011 /PRNewswire-FirstCall/ -- Pointer Telocation Ltd. (Nasdaq CM: PNTR, TASE: PNTR) - a leading developer, manufacturer and operator of Mobile Resource Management (MRM) and roadside assistance services for the automotive industry, announced today its financial results for the fiscal year ended December 31, 2010.
Financial Highlights
Revenues: Pointer's total revenues for 2010 increased 13% to $73.9 million compared to $65.3 million in 2009.
International activities for 2010 were $20.1 million (27% of total revenues) compared to $14.8 million in 2009 (23% of total revenues).
Revenues from products in 2010 increased 26.8% to $25.4 million, (34.4% of revenues), as compared to $20 million (30.7% of revenues) in 2009.
Pointer's revenues from services in 2010 increased 6.9% to $48.4 million (65.6% of revenues), up from $45.3 million (69.3% of revenues), in 2009.
Gross Profit: In 2010, gross profit was $27.4 million up from $26.9 million in 2009.
Operating Income: Increased by 59% to $6.6 million in 2010 compared to $4.2 million in 2009.
Net Income (loss): Pointer recorded a net income attributable to Pointer's shareholders for the year ended December 31, 2010 of $1.1 million, or $0.24 per share, as compared to net loss of $2.1 million, or ($0.44) per share, in 2009. Net income attributable to a non-controlling interest in affiliates in 2010 was $0.8 million compared to $2.6 million in 2009.
EBITDA: Pointer's EBITDA in 2010 was $11 million as compared to $11.7 million in 2009.
David Mahlab, Pointer's Chief Executive Officer, commented on the results: "We are very pleased with the revenue growth in 2010 and with our return to profitability. Throughout 2010, Pointer invested efforts in sales, marketing and development of new products in order to penetrate new markets which support our business strategy. Our growth was accelerated by the growing awareness in the market of the economic benefits of mobile resource management.
Moving into 2011, we expect customers around the globe to continue looking for advanced services and technology. We expect to continue to introduce innovative products and services in the MRM and roadside assistance service sectors, which will provide further growth opportunities and further improve profitability."
Conference Call Information:
Pointer Telocation's management will host today, Monday, February 28th, 2010 a conference call with the investment community to review and discuss the financial results, and will also be available to answer questions.
The conference call will commence at 9:00 AM EST, 16:00 PM Israel time.
To participate in the call, please dial in to one of the teleconferencing numbers below. Please begin placing your call at least 5 minutes before the time set for the commencement of the conference call.
From USA: +1-888-668-9141 ,From Israel: 03-918-0610
A replay will be available from March 1th, 2010 at the company
website: http://www.pointer.com
Reconciliation between results on a GAAP and Non-GAAP basis.
Reconciliation between results on a GAAP and Non-GAAP basis is provided in a table immediately following the Condensed Consolidated Statements of Cash Flows. Pointer uses EBITDA as a non-GAAP financial performance measurement. EBITDA is calculated by adding back to net income financial expenses, taxes, depreciation and amortization including in respect of our non-cash impairment charge related to the fair market value of the business with certain customers from our acquisition of Cellocator. The purpose of such adjustments is to give an indication of our performance exclusive of non-GAAP charges that are considered by management to be outside of our core operating results.
EBITDA is provided to investors to complement results provided in accordance with GAAP, as management believes the measure helps illustrate underlying operating trends in the Company's business and uses the measure to establish internal budgets and goals, manage the business and evaluate performance. We believe that these non-GAAP measures help investors to understand our current and future operating cash flow and performance, especially as our three most recent acquisitions have resulted in amortization and non-cash items that have had a material impact on our GAAP profits. EBITDA should not be considered in isolation or as a substitute for comparable measures calculated and should be read in conjunction with our consolidated financial statements prepared in accordance with GAAP. These non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies.
About Pointer Telocation:
Pointer Telocation is a leading provider of technology and services to the automotive and insurance industries, offering a set of services including Road Side Assistance, Stolen Vehicle Recovery and Fleet Management. Pointer has a growing client list with products installed in over 30countires. Cellocator, a Pointer Products Division, is a leading MRM (Mobile Resource Management) technology developer and manufacturer.
For more information: http://www.pointer.com
Forward Looking Statements
This press release contains historical information and forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995 with respect to the business, financial condition and results of operations of the Company. The words "believe," "expect," "anticipate," "intend," "seems," "plan," "aim," "should" and similar expressions are intended to identify forward-looking statements. Such statements reflect the current views, assumptions and expectations of the Company with respect to future events and are subject to risks and uncertainties. Many factors could cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, changes in the markets in which the Company operates and in general economic and business conditions, loss or gain of key customers and unpredictable sales cycles, competitive pressures, market acceptance of new products, inability to meet efficiency and cost reduction objectives, changes in business strategy and various other factors, both referenced and not referenced in this press release. Various risks and uncertainties may affect the Company and its results of operations, as described in reports filed by the Company with the Securities and Exchange Commission from time to time. The Company does not assume any obligation to update these forward-looking statements.
CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands (except share and per share data)
December 31,
2010 2009
Unaudited
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 2,366 $ 3,209
Trade receivables 13,915 11,619
Other accounts receivable and prepaid expenses 2,981 3,033
Inventories 3,739 2,219
Total current assets 23,001 20,080
LONG-TERM ASSETS:
Long-term accounts receivable 832 673
Severance pay fund 7,624 6,070
Property and equipment, net 11,255 9,401
Investment in Affiliate 295 -
Deferred income taxes - 507
Other intangible assets, net 6,497 9,022
Goodwill 53,926 51,220
Total long-term assets 80,429 76,893
Total assets $ 103,430 $ 96,973
CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands (except share and per share data)
December 31,
2010 2009
Unaudited
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term bank credit and current maturities of
long-term loans $ 13,170 $ 9,146
Trade payables 10,064 8,639
Deferred revenues and customer advances 7,806 8,253
Other accounts payable and accrued expenses 7,054 6,211
Total current liabilities 38,094 32,249
LONG-TERM LIABILITIES:
Long-term loans from banks, shareholders and
others 12,483 15,456
Other long-term liabilities 842 658
Accrued severance pay 8,365 7,131
Total long term liabilities 21,690 23,245
SHAREHOLDERS' EQUITY:
Pointer Telocation Ltd. shareholders' equity 36,868 33,809
Non-controlling interest 6,778 7,670
Total shareholders' equity 43,646 41,479
Total liabilities and shareholders' equity $ 103,430 $ 96,973
CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except per share data)
Year ended December 31,
2010 2009 2008
Unaudited
Revenues:
Products $ 25,415 $ 20,038 $ 30,645
Services 48,448 45,287 46,010
Total revenues 73,863 65,325 76,655
Cost of revenues:
Products 14,175 10,774 16,392
Services 31,264 26,645 29,869
Amortization of intangible assets 978 976 980
Total cost of revenues 46,417 38,395 47,241
Gross profit 27,446 26,930 29,414
Operating expenses:
Research and development, net 2,532 2,817 2,511
Selling and marketing 7,441 6,249 6,934
General and administrative 9,062 8,788 8,311
Amortization of intangible assets 1,774 1,942 2,365
Impairment of intangible asset - 2,959 -
Total operating expenses 20,809 22,755 20,121
Operating income 6,637 4,175 9,293
Financial expenses, net 1,976 2,074 4,054
Other expenses (income), net 21 16 (22)
Income (loss) before taxes on income 4,640 2,085 5,261
Taxes on income 1,524 887 640
Income after Income taxes 3,116 1,198 4,621
Equity in losses of affiliate 1,158 677 -
Net income 1,958 521 4,621
Less: net income attributable to the
noncontrolling interest 828 2,632 2,248
Net income attributable to
Pointer's shareholders $ 1,130 $ (2,111) $ 2,373
Basic net earnings (loss) per share $ 0.24 $ (0.44) $ 0.51
Diluted net earnings (loss) per share $ 0.22 $ (0.47) $ 0.50
CONSOLIDATED STATEMENTS OF CASH FLOWS
U.S. dollars in thousands
Year ended December 31,
2010 2009 2008
Unaudited
Cash flows from operating activities:
Net income $ 1,958 $ 521 $ 4,621
Adjustments required to reconcile net
income to net cash provided by operating
activities:
Depreciation, amortization and
impairment 5,568 8,256 6,918
Accrued interest and exchange rate
changes of convertible debenture and
long-term loans 178 (85) 1,187
Accrued severance pay, net (364) (400) 619
Gain from sale of property and
equipment, net (93) (377) (36)
Equity in losses of affiliate 1,158 677 -
Amortization of deferred stock-based
compensation 121 367 350
Decrease (increase) in trade
receivables, net (1,618) 1,995 (1,773)
Increase in other accounts receivable
and prepaid expenses (436) (308) (6)
Decrease (increase) in inventories (1,934) 128 (2,088)
Write-off of inventories 155 124 112
Deferred income taxes 1,322 773 (178)
Decrease (increase) in long-term
accounts receivable and deferred
expenses (212) (493) 23
Increase (decrease) in trade payables 981 (413) 888
Increase (decrease) in other accounts
payable and accrued expenses (127) 461 379
Net cash provided by operating
activities 6,657 11,226 11,016
Cash flows from investing activities:
Decrease (increase) in other account
receivables - 279 (357)
Purchase of property and equipment (4,481) (3,442) (3,476)
Proceeds from sale of property and
equipment 641 1,215 605
Investments in affiliate (1,490) (640) -
Acquisition of subsidiary (a) - (38) -
Acquisition of other intangible assets - - -
Net cash used in investing activities (5,330) (2,626) (3,228)
Cash flows from financing activities:
Receipt of long-term loans from banks 5,090 - 9,064
Repayment of long-term loans from banks (7,016) (6,027) (4,930)
Repayment of long-term loans from others (1,122) (32) (10,201)
Dividend paid to the noncontrolling
interest (2,250) (871) -
Proceeds from issuance of shares and
exercise of warrants, net 57 - 1,000
Short-term bank credit, net 2,656 (983) (970)
Net cash used in financing activities (2,585) (7,913) (6,037)
Effect of exchange rate changes on cash
and cash equivalents 415 (186) (243)
Increase (decrease) in cash and cash
equivalents (843) 501 1,508
Cash and cash equivalents at the
beginning of the year 3,209 2,708 1,200
Cash and cash equivalents at the end of
the year $ 2,366 $ 3,209 $ 2,708
CONSOLIDATED STATEMENTS OF CASH FLOWS
U.S. dollars in thousands
Year ended December 31,
2010 2009 2008
Unaudited
(a) Acquisition of subsidiary:
Fair value of assets acquired and
liabilities assumed at date of
acquisition:
Working capital $ - (112) $ -
Property and equipment - 60 -
Customer list - 24 -
Goodwill - 456 -
Accrued severance pay, net - (12) -
Shareholders loan - (122) -
Minority interest - (256) -
$ - $ 38 $ -
Reconciliation of GAAP net income to NON-GAAP EBITDA
To supplement the consolidated financial statements presented in accordance with generally accepted accounting principles ("GAAP"), the Company uses EBITDA as a non-GAAP financial performance measurement. EBITDA is calculated by adding back to net income financial expenses, taxes, depreciation, amortization and impairment. EBITDA is provided to investors to complement results provided in accordance with GAAP, as management believes the measure helps illustrate underlying operating trends in the Company's business and uses the measure to establish internal budgets and goals, manage the business and evaluate performance. EBITDA should not be considered in isolation or as a substitute for comparable measures calculated and presented in accordance with GAAP.
Reconciliation the GAAP to non-GAAP EBITDA:
CONDENSED EBITDA
US dollars in thousands
Year ended December 31,
2010 2009 2008
Unaudited
Net income as $
reported $ 1,958 $ 521 4,621
Financial
expenses, net 1,976 2,074 4,054
Taxes on income 1,524 887 640
Depreciation,
amortization and
impairment 5,568 8,254 6,116
Non-GAAP EBITDA $ $
$ 11,026 11,736 15,431
Zvi Fried, V.P. and Chief Financial Officer
Tel.; +972-3-572-3111
E-mail: [email protected]
Chen Livne,Gelbart-Kahana Investor relations
Tel: +972-54-302-2983
E-mail: [email protected]
SOURCE Pointer Telocation Ltd
Share this article