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Published: 2021-05-25 06:31:18 ET
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EX-99.1 2 exhibit_99-1.htm EXHIBIT 99.1
Exhibit 99.1

ITURAN LOCATION AND CONTROL LTD. PRESENTS
RESULTS FOR THE FIRST QUARTER OF 2021

AZOUR, Israel – May 25, 2021 – Ituran Location and Control Ltd. (NASDAQ: ITRN), today announced its consolidated financial results for the first quarter of 2021.

Highlights of the first quarter of 2021
•
Continued growth as the Company continues to successfully overcome and exits the impacts of the Covid-19 pandemic;
•
Net increase in aftermarket subscribers of 25,000; net decrease in OEM subscribers of 5,000;
•
Revenue of $67.4 million at around the same level as in the first quarter of last year and  up 6% sequentially;
•
Net income of $8.3 million, up 30% year-over-year and adjusted EBITDA of $17.1 million, up 12% year-over-year;
•
Generated $9.2 million in quarterly operating cash flow;
•
Declared dividend of $3 million;

Management Comment

Eyal Sheratzky, Co-CEO of Ituran said, “We are happy with the continued improvement in our quarterly results with a solid increase in profitability. We are especially pleased with the strong growth in our after-market subscriber base which grew by 25,000, above our typically expected range.  While the pandemic continues to impact many people in many of the countries we operate in, we are pleased that we are successfully overcoming the challenges and moving through 2021, we have returned to growth and improving profitability.

Mr. Sheratzky concluded, “Our results demonstrate that Ituran is emerging from this period as a stronger company, with a platform for continued sustainable and profitable growth. We expect the positive trends in our results to continue throughout the year ahead.”

First Quarter 2021 Results

Revenues for the first quarter of 2021 were $67.4 million, a decrease of 1% compared with revenues of $68.4 million in the first quarter of 2020.

The higher average level of the US dollar exchange rate versus the Brazilian real during the quarter compared with the same period last year, reduced the overall revenue level in US dollar terms. In local currency terms, first quarter revenue were at the same level as those of the first quarter of last year.

68% of revenues were from location-based service subscription fees and 32% were from product revenues.

Revenues from subscription fees were $45.6 million, a decrease of 7% over first quarter 2020 revenues. In local currency terms, first quarter subscription fees decreased by 4% year-over-year.

The subscriber base amounted to 1,788,000 as of March 31, 2021.

This represents an increase of 20,000 net over that of the end of the prior quarter. During the quarter, there was an increase of 25,000 in the aftermarket subscriber base and a decline of 5,000 in the OEM subscriber base.

Product revenues were $21.7 million, an increase of 12% compared with that of the first quarter of 2020.

Gross profit for the quarter was $30.4 million (45.1% of revenues), a 2% decrease compared with gross profit of $31.0 million (45.3% of revenues) in the first quarter of 2020.

The gross margin in the quarter on subscription revenues was 54.5%, compared with 54.4% in the first quarter of 2020. The gross margin on products was 25.4%, compared with 22.3% in the first quarter of 2020.

Operating income for the quarter was $12.8 million (19.0% of revenues), an increase of 27% compared with an operating income of $10.1 million (14.7% of revenues), in the first quarter of last year. In local currency terms, the operating income would have grown by 30%.

EBITDA for the quarter was $17.1 million (25.4% of revenues), an increase of 12% compared with an EBITDA of $15.3 million (22.4% of revenues) in the first quarter of last year. In local currency terms, the EBITDA would have increased by 16% year over year.

Financial expense for the quarter was $1.0 million compared with a financial expense of $0.7 million in the first quarter of last year.

Net income for the first quarter of 2021 was $8.3 million (12.3% of revenues) or earnings per share of $0.40. This is an increase of 30% compared to a net income of $6.4 million and earnings per share of $0.31 in the first quarter of 2020.

Cash flow from operations for the first quarter of 2021 was $9.2 million.

As of March 31, 2021, the Company had cash, including marketable securities, of $70.1 million and debt of $41.8 million, amounting to a net cash of $28.3 million. This is compared with cash, including marketable securities, of $78.8 million and debt of $54.5 million, amounting to a net cash of $24.3 million, as of December 31, 2020.

Dividend

For the first quarter of 2021, a dividend of $3.0 million was declared. This is in line with the Board’s current policy of issuing at least $3 million on a quarterly basis.

Conference Call Information

The Company will also be hosting a conference call later today, March 25, 2021 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: 1 866 860 9642
ISRAEL Dial-in Number: 03 918 0609
INTERNATIONAL Dial-in Number:  +972 3 918 0609
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, as well as factors related to the global COVID-19 pandemic.

About Ituran

Ituran is a leader in the emerging mobility technology field, providing value-added location-based services, including a full suite of services for the connected-car. Ituran offers Stolen Vehicle Recovery, fleet management as well as mobile asset location, management & control services for vehicles, cargo and personal security for the retail, insurance industry and car manufacturers. Ituran is the largest OEM telematics provider in Latin America. Its products and applications are used by customers in over 20 countries. Ituran is also the founder of the Tel-Aviv based DRIVE startup incubator to promote the development of smart mobility technology.

Ituran's subscriber base has been growing significantly since the Company's inception to approaching 2 million subscribers using its location based services with a market leading position in Israel and Latin America. Established in 1995, Ituran has approximately 3,000 employees worldwide, with offices in Israel, Brazil, Argentina, Mexico, Ecuador, Columbia, India, Canada and the United States.

For more information, please visit Ituran’s website, at: www.ituran.com

Company Contact
  
International Investor Relations
Udi Mizrahi
udi_m@ituran.com
Deputy CEO & VP Finance, Ituran
(Israel) +972 3 557 1348
  
Ehud Helft
ituran@gkir.com
GK  Investor & Public Relations
(US) +1 646 201 9246
 

 
 ITURAN LOCATION AND CONTROL LTD.
 
Condensed Consolidated Financial Statements
as of March 31, 2021


ITURAN LOCATION AND CONTROL LTD.
 
Condensed Consolidated Financial Statements
as of March 31, 2021

Table of Contents
 
 
Page
   
Condensed Consolidated Interim Financial Statements:
  
2-3
4
5
 
=======================
=============

ITURAN LOCATION AND CONTROL LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS

   
US dollars
  
   
March 31,
    
Decmber 31,
  
(in thousands)
  
2021
    
2020
  
   
(unaudited)
        
             
Current assets
            
             
Cash and cash equivalents
    
64,133
      
72,183
  
Investments in marketable securities
    
5,967
      
6,663
  
Accounts receivable (net of allowance for doubtful accounts)
    
43,336
      
39,343
  
Other current assets
    
36,377
      
38,624
  
Inventories
    
20,442
      
22,622
  
     
170,255
      
179,435
  
                 
Non- Current investments and other assets
                
                 
Investments in affiliated companies
    
900
      
908
  
Investments in other companies
    
1,495
      
1,263
  
Other non-current assets
    
3,396
      
2,953
  
Deferred income taxes
    
12,268
      
11,910
  
Funds in respect of employee rights upon retirement
    
13,798
      
13,558
  
     
31,857
      
30,592
  
                 
Property and equipment, net
    
35,099
      
37,653
  
                 
Operating lease right-of-use assets, net
    
4,942
      
5,548
  
                 
Intangible assets, net
    
18,460
      
19,382
  
                 
Goodwill
    
39,716
      
39,862
  
                 
Total assets
    
300,329
      
312,472
  

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ITURAN LOCATION AND CONTROL LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS (cont.)

   
US dollars
  
   
March 31,
    
December 31,
  
(in thousands)
  
2021
    
2020
  
   
(unaudited)
        
Current liabilities
            
             
Credit from banking institutions
    
17,220
      
20,388
  
Accounts payable
    
17,753
      
19,716
  
Deferred revenues
    
25,445
      
24,351
  
Obligation to purchase non-controlling interests
    
10,595
      
10,595
  
Other current liabilities
    
45,520
      
37,677
  
     
116,533
      
112,727
  
                 
Non- Current liabilities
                
                 
Long term loan
    
24,568
      
34,068
  
Liability for employee rights upon retirement
    
19,515
      
19,715
  
Deferred income taxes
    
2,356
      
2,494
  
Deferred revenues
    
8,773
      
8,536
  
Others non-current liabilities
    
2,261
      
2,692
  
Operating lease liabilities, non-current
    
2,078
      
2,341
  
     
59,551
      
69,846
  
                 
Stockholders’ equity
    
121,024
      
127,192
  
Non-controlling interests
    
3,221
      
2,707
  
Total equity
    
124,245
      
129,899
  
                 
Total liabilities and equity
    
300,329
      
312,472
  

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ITURAN LOCATION AND CONTROL LTD.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

   
US dollars
  
(in thousands
  
Three months period
ended March 31,
  
except per share data)
  
2021
    
2020
  
   
(unaudited)
  
Revenues:
            
Telematics services
    
45,619
      
48,976
  
Telematics products
    
21,746
      
19,398
  
     
67,365
      
68,374
  
                 
Cost of revenues:
                
Telematics services
    
20,770
      
22,342
  
Telematics products
    
16,231
      
15,063
  
     
37,001
      
37,405
  
                 
Gross profit
    
30,364
      
30,969
  
Research and development expenses
    
3,546
      
3,886
  
Selling and marketing expenses
    
2,957
      
3,059
  
General and administrative expenses
    
11,098
      
13,923
  
Other expenses (income), net
    
(12
)
    
27
  
Operating income
    
12,775
      
10,074
  
Other expenses, net
    
(3
)
    
(10
)
Financing expenses, net
    
(993
)
    
(654
)
Income before income tax
    
11,779
      
9,410
  
Income tax expenses
    
(2,813
)
    
(1,926
)
Share in losses of affiliated companies ,net
    
(11
)
    
(903
)
Net income for the period
    
8,955
      
6,581
  
Less: Net income attributable to non-controlling interest
    
(694
)
    
(214
)
Net income attributable to the Company
    
8,261
      
6,367
  
                 
Basic and diluted earnings per share attributable to Company’s stockholders
    
0.40
      
0.31
  
                 
Basic and diluted weighted average number of shares outstanding (in thousands)
    
20,813
      
20,813
  

- 4 -

ITURAN LOCATION AND CONTROL LTD.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

   
US dollars
  
   
Three months period
ended March 31,
  
(in thousands)
  
2021
    
2020
  
   
(unaudited)
  
Cash flows from operating activities
            
Net income for the period
    
8,955
      
6,581
  
Adjustments to reconcile net income to net cash from operating activities:
                
Depreciation and  amortization
    
4,352
      
5,223
  
Interest and exchange rate on short and long term credit
    
(29
)
    
(598
)
Loss in respect of trading marketable securities
    
481
      
90
  
Increase in liability for employee rights upon retirement, net
    
462
      
834
  
Share in losses of affiliated company, net
    
11
      
903
  
Deferred income taxes
    
(921
)
    
798
  
Capital losses (gain) from sale of property and equipment, net
    
(4
)
    
60
  
Increase in accounts receivable
    
(5,588
)
    
(4,491
)
Increase in other current and non-current assets
    
(520
)
    
(528
)
Decrease (increase) in inventories
    
1,660
      
(378
)
Increase (decrease) in accounts payable
    
(956
)
    
190
  
Increase (decrease) in deferred revenues
    
1,821
      
(1,403
)
Increase (decrease) in other current and non-current liabilities
    
(521
)
    
3,380
  
Increase in obligation for purchase non-controlling interests
    
-
      
51
  
Net cash provided by operating activities
    
9,203
      
10,712
  
                 
Cash flows from investment activities
                
Increase in funds in respect of employee rights upon retirement, net of withdrawals
    
(739
)
    
(108
)
Capital expenditures
    
(2,717
)
    
(3,451
)
Investments in affiliated and other companies
    
(282
)
    
(496
)
Investment in long term deposit
    
(79
)
    
(22
)
Proceeds from sale of property and equipment
    
221
      
166
  
Net cash used in investment activities
    
(3,596
)
    
(3,911
)
                 
Cash flows from financing activities
                
Short term credit from banking institutions, net
    
(49
)
    
2,660
  
Repayment of long term loan
    
(10,771
)
    
(4,285
)
Dividend paid
    
-
      
(5,050
)
Dividend paid to non-controlling interest
    
(29
)
    
-
  
Net cash used in  in financing activities
    
(10,849
)
    
(6,675
)
Effect of exchange rate changes on cash and cash equivalents
    
(2,808
)
    
(4,232
)
Net decrease in cash and cash equivalents
    
(8,050
)
    
(4,106
)
Balance of cash and cash equivalents at beginning of period
    
72,183
      
53,964
  
Balance of cash and cash equivalents at end of period
    
64,133
      
49,858
  

Supplementary information on financing and investing activities not involving cash flows:
In March 2021, the Company declared a dividend in the amount of US$ 10 million.  The dividend was paid on April 2021
 
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