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Pointer Telocation Q3 2009 Net Income was $1.1 Million
$16.9M Revenue in Q3 2009, 8% Increase Compared to Q2 2009 ; EBITDA - $3.6M in Q3 2009, Compared to $2.6M in Q2 2009
ROSH HAAYIN,
Financial Highlights:
Revenues: Pointer's revenues for the third quarter of 2009 decreased by
18%, to
Gross Profit: For the third quarter of 2009, gross profit decreased 8% to
Operating Income: Pointer's operating income increased 9% to
Net Income: Pointer recorded net income attributable to Pointer
shareholders of
For the first nine months of 2009, Pointer recorded net loss attributable
to Pointer shareholders of
Non-GAAP net income attributable to Pointer: Pointer recorded non-GAAP
net income of
EBITDA: Pointer's EBITDA for the third quarter of 2009 and for the first
nine months of 2009 was
Mr. Stern concluded that Pointer expects to be able to leverage a market upturn as a result of its decreasing debt to equity ratio. He also noted that this reduction in debt is a key indicator of the group's strength.
Conference Call Information:
Pointer Telocation's management will host a conference call with the investment community to review and discuss the financial results:
Conference call will take place today,
To listen to the call, please dial in to one of the following teleconferencing numbers. Please begin placing your call at least 5 minutes before the conference call commences.
From USA: +1-888-407-2553
From Israel: 03-918-0609
International: +972-3-918-0609
A replay of the conference call will be available through
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 Interim Consolidated
Statements of Cash Flows. Non-GAAP net income consist of GAAP net income
adjusted to exclude amortization of acquired intangible assets, deferred
income tax, impairment of long-lived assets and a onetime non-cash expense
relating to a loan discount in the amount of
Our management regularly uses our supplemental non-GAAP financial measures internally to understand, manage and evaluate our business and make operating decisions. 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. These non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies. Reconciliation between results on a GAAP and non-GAAP basis is provided in a table immediately following the consolidated statements of cash flows in this press release.
Pointer uses EBITDA as a non-GAAP financial performance measurement. EBITDA is calculated by adding back to net income interest, taxes and 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. 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. A reconciliation of EBITDA to GAAP measures is provided in a table immediately following the consolidated statements of cash flows in this press release.
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.
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 400,000 vehicles
across the globe: the UK,
CONDENSED INTERIM CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands
September 30, December 31,
2009 2008
Unaudited
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 3,013 $ 2,708
Trade receivables, net 14,250 13,509
Other accounts receivable and prepaid
expenses 3,451 2,774
Inventories 2,642 3,999
Total current assets 23,356 22,990
LONG-TERM ASSETS:
Long-term accounts receivable and deferred
expenses 647 339
Severance pay fund 5,993 4,925
Property and equipment, net 8,838 7,998
Deferred income taxes 1,049 1,037
Other intangible assets, net 9,736 14,894
Goodwill 51,411 50,416
Total long-term assets 77,674 79,609
Total assets $ 101,030 $ 102,599
CONDENSED INTERIM CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands (except share and per share data)
September 30, December 31,
2009 2008
Unaudited
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term bank credit and current maturities
of long-term loans $ 10,698 $ 7,849
Trade payables 8,092 8,613
Deferred revenues and customer advances 9,792 8,701
Other accounts payable and accrued expenses 6,107 5,792
Total current liabilities 34,689 30,955
LONG-TERM LIABILITIES:
Long-term loans from banks 15,963 20,520
Long-term loans from shareholders and others 974 3,305
Other long-term liabilities 580 257
Accrued severance pay 7,036 6,375
Total long-term liabilities 24,553 30,457
Shareholders' equity *) 41,788 41,187
Total liabilities and shareholders' equity $ 101,030 $ 102,599
*) Reclassification due to the adoption of SFAS 160.
INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except share and per share data)
Nine months Three months Year
ended ended ended
December
September 30, September 30, 31,
2009 2008 2009 2008 2008
Unaudited
Revenues:
Products
$15,101 $24,029 $ 5,395 $ 8,708 $ 30,645
Services 33,354 34,567 11,500 12,003 46,010
Total revenues 48,455 58,596 16,895 20,711 76,655
Cost of revenues:
Products 7,974 12,837 2,555 4,725 16,392
Services 19,190 22,757 7,086 8,084 29,869
Amortization of
intangible assets 738 735 246 245 980
Total cost of
revenues 27,902 36,329 9,887 13,054 47,241
Gross profit 20,553 22,267 7,008 7,657 29,414
Operating expenses:
Research and
development, net 2,113 1,792 653 621 2,511
Selling and
marketing 4,461 5,408 1,482 1,931 6,934
General and
administrative 6,777 6,130 1,903 2,210 8,311
Amortization of
intangible assets 1,489 1,818 442 583 2,365
Impairment of
intangible assets 2,959 - - - -
Total operating
expenses 17,799 15,148 4,480 5,345 20,121
Operating income 2,754 7,119 2,528 2,312 9,293
Financial expenses,
net 1,574 3,252 477 1,077 4,054
Other( income)
expenses, net 15 (19) 3 - (22)
Income before taxes
on income 1,165 3,886 2,048 1,235 5,261
Taxes on income 79 320 38 90 640
Income after Income
taxes 1,086 3,566 2,010 1,145 4,621
Equity in losses of
affiliate 382 - 191 - -
Net income *)
$ 704 $3,566 $ 1,819 $ 1,145 $ 4,621
Less: net income
attributable to the
noncontrolling
interest *) $ 2,429 $1,303 $ 692 $ 431 $ 2,248
Net income (loss)
attributable to
Pointer's
shareholders $(1,725) $2,263 $ 1,127 $ 714 $ 2,373
Basic net earnings
(loss) per share $(0.36) $ 0.49 $ 0.24 $ 0.15 $ 0.51
Diluted net earnings
(loss) per share $(0.38) $ 0.48 $ 0.23 $ 0.15 $ 0.50
*) Reclassification due to the adoption of SFAS 160.
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
U.S. dollars in thousands
Three months Year
Nine months ended ended ended
December
September 30, September 30, 31,
2009 2008 2009 2008 2008
Unaudited
Cash flows from
operating
activities:
Net income *) $ 704 $ 3,566 $ 1,819 $ 1,145 $ 4,621
Adjustments
required to
reconcile net
income to net cash
provided by
operating
activities:
Depreciation
,amortization and
impairment 6,934 5,036 1,281 1,613 6,918
Accrued interest
and exchange rate
changes of
convertible
debenture and
long-term loans (113) 1,214 16 (30) 1,187
Accrued severance
pay, net (415) 365 (160) 198 619
Gain (loss) from
sale of property
and equipment, net (205) (133) (67) 25 (36)
Equity in losses of
affiliate 382 - 191 - -
Amortization of
deferred
stock-based
compensation 318 226 48 86 350
Decrease (increase)
in trade
receivables, net (568) (3,313) 91 (1,039) (1,773)
Decrease (increase)
in other accounts
receivable and
prepaid expenses (384) (551) (229) 175 (6)
Decrease (increase)
in inventories 156 (1,088) (150) (821) (2,088)
Decrease (increase)
in long-term
accounts receivable
and deferred
expenses (226) 49 (63) 1 23
Write-off of
inventories 39 75 75 112
Increase in
deferred income
taxes - - - - (178)
Increase (decrease)
in trade payables (339) 1,958 347 1,821 888
Increase (decrease)
in other accounts
payable and accrued
expenses 1,072 163 (820) (1,418) 379
Net cash provided
by operating
activities 7,355 7,567 2,304 1,831 11,016
Cash flows from
investing
activities:
Purchase of
property and
equipment (2,525) (2,537) (1,188) (761) (3,476)
Proceeds from sale
of property and
equipment 861 512 302 133 605
Investments in
affiliate (300) - (100) - -
Acquisition of
subsidiary (a) (38) - - - -
Increase in
long-term accounts
receivable - (247) - (19) (357)
Net cash used in
investing
activities (2,002) (2,272) (986) (647) (3,228)
Cash flows from
financing
activities:
Receipt of
long-term loans
from banks - 9,254 - 2,155 9,064
Repayment of
long-term loans
from banks (4,423) (2,727) (1,553) (639) (4,930)
Repayment of
long-term loans
from shareholders
and others (23) (10,394) (8) (1,526) (10,201)
Dividend paid to
the noncontrolling
interest (871) - (285) -
Proceeds from
issuance of shares
and exercise of
warrants, net - 1,000 - 1,000 1,000
Short-term bank
credit, net 414 (1,137) 848 (512) (970)
Net cash provided
by (used in)
financing
activities (4,903) (4,004) (998) 478 (6,037)
Effect of exchange
rate on cash and
cash equivalents (145) (44) (135) 247 (243)
Increase in cash
and cash
equivalents 305 1,247 185 1,909 1,508
Cash and cash
equivalents at the
beginning of the
period 2,708 1,200 2,828 538 1,200
Cash and cash
equivalents at the
end of the period $ 3,013 $ 2,447 $ 3,013 $ 2,447 $ 2,708
*) Reclassification due to the adoption of SFAS 160.
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
U.S. dollars in thousands
Nine months Three months
ended ended Year
ended
September 30, September December
30, 31,
2009 2008 2009 2008 2008
Unaudited
Acquisition of
(a) subsidiary
Fair value of assets
acquired and
liabilities assumed
at date of
acquisition:
Working capital (40) - - - -
Property and
equipment 60 - - - -
Customer list 24 - - - -
Goodwill 384 - - - -
Accrued severance
pay, net (12) - - - -
Shareholders loan (122) - - - -
Minority interest (256) - - - -
38 - - - -
Reconciliation Tables of Non-GAAP Measures
U.S. dollars in thousands
Reconciliation of GAAP net income to non-GAAP net income is as follows:
Year
Three months ended
Nine months ended ended
December
September 30 September 30 31
2009 2008 2009 2008 2008
Unaudited
GAAP Net income as
reported: $ 704 $ 3,566 $1,819 $1,145 $ 4,621
Net income
attributable to the
noncontrolling
interest (2,429) (1,303) (692) (431) (2,248)
Amortization of
intangible assets 2,227 2,553 688 828 3,345
Impairment of
long-lived assets 2,959 - - - -
Loan Discount - - - - 704
Tax on income 79 320 38 90 640
Non-GAAP Net income
$ 3,540 $ 5,136 $1,853 $1,632 $ 7,062
Reconciliation of GAAP net income to 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 interest, taxes, depreciation, amortization and minority interest. 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 of the GAAP to non-GAAP operating results is as follows:
CONDENSED EBITDA
US dollars in thousands
Year
ended
Nine months ended Three months ended
December
September 30 September 30 31
2009 2008 2009 2008 2008
Unaudited
GAAP Net income as
reported: $ 704 $3,566 $1,819 $ 1,145 $ 4,621
Financial
expenses, net 1,574 3,252 477 1,077 4,054
Tax on income 79 320 38 90 640
Depreciation
,amortization and
impairment 6,933 4,719 1,279 1,524 6,116
EBITDA
$ 9,290 $11,857 $ 3,613 $3,836 $15,431
Contact:
Zvi Fried, V.P. and Yael Nevat,
Chief Financial Officer Commitment-IR.com
Tel: +972-3-572-3111 Tel: +972-9-741-8866
E-mail: zvif@pointer.com E-mail: yael@commitment-IR.com
SOURCE Pointer Telocation Ltd
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