Ituran Location And Control Ltd. Presents Results For The Second Quarter 2014 - KXNet.com - Bismarck/Minot/Williston/Dickinson-KXNEWS,ND

Ituran Location And Control Ltd. Presents Results For The Second Quarter 2014

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SOURCE Ituran Location and Control Ltd.

Record Revenue of $46.6m; Record operating profit of $12.1m

AZOUR, Israel, Aug. 11, 2014 /PRNewswire/ -- Ituran Location and Control Ltd. (NASDAQ: ITRN, TASE: ITRN), today announced its consolidated financial results for the second quarter ended June 30, 2014.

Highlights of the Second Quarter

  • Net subscribers adds in the quarter amounting to 17 thousand, to a record of 775 thousand as of June 30, 2014;
  • Record gross margins at 53.3%;
  • Record operating margin at 25.9%;
  • EBITDA of $14.6 million or 31.4% of revenues;
  • Generated $8.0 million in operating cash flow; ended the quarter with $44.0 million in net cash (including marketable securities);
  • Dividend of $4.0 million declared for the quarter;

Second Quarter 2014 Results
Revenues for the second quarter of 2014 were $46.6 million, representing an 8% growth from revenues of $43.2 million in the second quarter of 2013. 73% of revenues were from location based service subscription fees and 27% from product revenues.

Revenues from subscription fees increased 7% over the same period last year. The increase in subscription fees was primarily due to the growth in the subscriber base, which expanded from 702,000 as of June 30, 2013, to 775,000 as of June 30, 2014.

Product revenues increased by 12% compared with the same period last year.

Gross profit for the second quarter of 2014 was $24.8 million (53.3% of revenues), an increase of 13% compared with $22.0 million (50.9% of revenues) in the second quarter of 2013.

Operating profit for the second quarter of 2014 was $12.1 million (25.9% of revenues), an increase of 19% compared with an operating profit of $10.2 million (23.5% of revenues) in the second quarter of 2013.

EBITDA for the quarter was $14.6 million (31.4% of revenues), an increase of 7% compared to an EBITDA of $13.7 million (31.7% of revenues) in the second quarter of 2013.

Net profit was US$7.4 million in the second quarter of 2014 (15.9% of revenues) or fully diluted EPS of US$0.35. This is compared with a net profit of US$6.7 million (15.6% of revenues) or fully diluted EPS of US$0.32 in the second quarter of 2013.

Cash flow from operations during the quarter was $8.0 million.

As of June 30, 2014, the Company had net cash, including marketable securities, of $44.0 million or $2.10 per share. This is compared with $47.4 million or $2.26 per share as at March 30, 2014.

Dividend
For the second quarter of 2014, a dividend of $4.0 million 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.

Eyal Sheratzky, Co-CEO of Ituran said, "We are pleased with our second quarter 2014 results. Our results continue to benefit from the strong operating leverage inherent in our business model. As the revenue from our subscriber base continues to grow, we increasingly benefit through improving margins. We look forward to maintaining the growth trend and continue to improve our margins as we move through 2014. "

Conference Call Information

The Company will also be hosting a conference call later today, August 11, 2014 at 9am Eastern Time. 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 0644
CANADA Dial-in Number: 1 866 485 2399
INTERNATIONAL Dial-in Number:  +972 3 918 0644
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.

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 775,000 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

Udi Mizrahi

udi_m@ituran.com

VP Finance, Ituran

(Israel) +972 3 557 1348

International Investor Relations

Ehud Helft & Kenny Green

ituran@gkir.com  

GK  Investor Relations

(US) +1 646 201 9246 

 

ITURAN LOCATION AND CONTROL LTD.

CONSOLIDATED BALANCE SHEETS




US dollars
(except share data)


June 30,

December 31,

(in thousands)

2014

2013




Current assets



Cash and cash equivalents

41,767

41,697

Deposit in escrow

-

4,982

Investment in marketable securities

2,266

-

Accounts receivable (net of allowance for doubtful accounts)

34,718

29,239

Other current assets

21,289

18,437

Inventories

12,112

14,506


112,152

108,861







Long-term investments and other assets



Investments in affiliated company

1,234

1,423

Investments in other company

89

88

Other non-current assets

1,104

1,022

Deferred income taxes

3,445

3,781

Funds in respect of employee rights upon retirement

7,010

6,649


12,882

12,963




Property and equipment, net

36,782

32,546




Intangible assets, net

647

739




Goodwill

5,485

5,433

























Total assets

167,948

160,542







 

ITURAN LOCATION AND CONTROL LTD.

CONSOLIDATED BALANCE SHEETS




US dollars
(except share data)


June 30,

December 31,

(in thousands)

2014

2013




Current liabilities



Credit from banking institutions

1

38

Accounts payable

13,722

11,436

Deferred revenues

10,036

9,852

Other current liabilities

33,276

30,276


57,035

51,602







Long-term liabilities



Liability for employee rights upon retirement

10,634

9,607

Provision for contingencies

618

2,599

Deferred revenues

977

1,033

Deferred income taxes

194

216


12,423

13,455













Stockholders' equity

94,096

90,918

Non-controlling interests

4,394

4,567

Total equity

98,490

95,485






















Total liabilities and equity

167,948

160,542










 

ITURAN LOCATION AND CONTROL LTD.

CONSOLIDATED STATEMENTS OF INCOME





US dollars
(except share data)

US dollars
(except share data)


Six month period
ended June 30
,

Three month period
ended June 30
,

(in thousands except per share data)

2014

2013

2014

2013




Revenues:





Location-based services

66,295

63,422

34,115

32,029

Wireless communications products

25,795

20,732

12,515

11,150


92,090

84,154

46,630

43,179






Cost of revenues:





Location-based services

23,227

22,425

12,142

11,317

Wireless communications products

20,281

17,903

9,650

9,443


43,508

40,328

21,792

20,760






Gross profit

48,582

43,826

24,838

22,419

Research and development expenses

1,245

1,167

654

577

Selling and marketing expenses

4,437

4,972

2,152

2,582

General and administrative expenses

19,198

17,348

9,995

8,638

Other expenses, net

(54)

922

(19)

466

Operating income

23,756

19,417

12,056

10,156

Financing income, net

(44)

240

(169)

179

Income before income tax

23,712

19,657

11,887

10,335

Income tax expense

(7,478)

(6,234)

(3,558)

(3,150)

Share in losses of affiliated companies, net

(201)

(1)

(201)

(1)

Net income for the period

16,033

13,422

8,128

7,184

Less: Net income attributable to non-controlling interests

(1,295)

(690)

(718)

(454)

Net income attributable to the Company

14,738

12,732

7,410

6,730






Basic and diluted earnings per share attributable to Company's stockholders

0.70

0.61

0.35

0.32






Basic and diluted weighted average number of shares outstanding

20,968

20,968

20,968

20,968

 

ITURAN LOCATION AND CONTROL LTD.

STATEMENTS OF CASH FLOWS





US dollars

US dollars


Six month period
ended June 30
,

Three month period
ended June 30
,

(in thousands except per share data)

2014

2013

2014

2013




Cash flows from operating activities





Net income for the period

16,033

13,422

8,128

7,184

Adjustments to reconcile net income to net cash from operating activities:





Depreciation and amortization

5,268

6,694

2,575

3,531

Losses (gains) in respect of trading marketable securities

88

-

(17)

-

Exchange differences on principal of deposit and loans, net

(23)

130

-

33

Increase in liability for employee rights upon retirement

935

728

416

238

Share in losses of affiliated companies, net

201

1

201

1

Deferred income taxes

(898)

(452)

(426)

(63)

Capital losses (gains) on sale of property and equipment, net

20

9

66

(5)

Decrease (increase) in accounts receivable

(5,198)

(3,871)

(1,003)

665

Decrease (increase) in other current assets

(707)

1,174

1,300

952

Decrease (increase) in inventories

2,533

2,484

(106)

(188)

Decrease in accounts payable

(1,121)

(1,158)

(702)

899

Increase (decrease) in deferred revenues

24

518

(904)

(870)

Increase (decrease) in other current liabilities

518

1,094

(1,535)

(478)

Net cash provided by operating activities

17,673

20,773

7,993

11,899






Cash flows from investment activities





Increase in funds in respect of employee rights upon retirement, net of withdrawals

(297)

(329)

(139)

(187)

Capital expenditures

(6,527)

(5,660)

(3,505)

(3,091)

Investment in marketable securities

(2,771)

-

12

-

Deposit in escrow

5,005

-

5,005

-

Deposit

(156)

313

-

91

Proceeds from sale of property and equipment

628

223

398

79

Net cash used in investment activities

(4,118)

(5,453)

1,771

(3,108)






Cash flows from financing activities





Short term credit from banking institutions, net

(39)

(21)

(1,240)

(289)

Repayment of long term loans

-

(114)

-

(103)

Dividend paid

(11,459)

(9,585)

(7,843)

(7,015)

Dividend paid to non-controlling interests

(1,505)

(541)

(769)

(541)

Net cash provided by (used in) financing activities

(13,003)

(10,261)

(9,852)

(7,948)






Effect of exchange rate changes on cash and cash equivalents

(482)

(857)

504

(1,030)






Net increase in cash and cash equivalents

70

4,202

415

(187)

Balance of cash and cash equivalents at beginning of  period

41,697

29,453

41,352

33,842

Balance of cash and cash equivalents at end of the period

41,767

33,655

41,767

33,655






Supplementary information on investing activities not involving cash flows:
In May 2014, the Company declared a dividend in an amount of US$ 4 million. The dividend was paid in July 2014.
During the six month period ended June 30, 2014, the Company purchased property and equipment in an amount of US$ 3,384 thousand using a directly related liability.

 

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