Revenue Increased 63% to Record $18.5 Million Over the First
Quarter of 2007 ROSH HAAYIN, Israel, May 15 /PRNewswire-FirstCall/
-- Pointer Telocation Ltd. (Nasdaq Capital Market: PNTR, Tel-Aviv
Stock Exchange: PNTR) - a leading provider of Automatic Vehicle
Location (AVL) technology, stolen vehicle retrieval services, fleet
management, car & driver safety, public safety, vehicle
security, asset management and road side assistance, announced
today its financial results for the first quarter of 2008. The
successful merger of Cellocator's business together with strong
internal growth has resulted in an exceedingly good quarter.
Following first indications in the fourth quarter of 2007, Q1 2008
presents the second consecutive quarter of improved profits.
Pointer's technologies and services businesses continue to attract
more companies worldwide and increase their business and financial
strength. Financial Highlights: Revenues: Pointer's revenues for
the first quarter of 2008 increased by 63%, to $18.5 million from
$11.3 million, in the comparable period in 2007. International
activities consist of 28% of total revenues compared with 10% in
the comparable period in 2007. Revenues from products were $7.6
million and consist of 41% of total revenues, as compared to $2.9
million in the first quarter of 2007 - which indicate growth of
158%. Revenues from services increased 30% to $10.9 million and 59%
of total revenue, compared to $8.4 million and 74%, respectively,
in the first quarter of 2007. Gross Profit: For the first quarter
of 2008, gross profit increased 76% to $7.2 million from $4.1
million in the first quarter of 2007. As a percentage of revenues,
gross profit is approximately 39% in the first quarter of 2008, as
compared to approximately 36% in the same period in 2007. Gross
margin increased mainly as a result of increased portion of
products contribution of total revenue. Operating Income: Pointer
reported a $2.3 million operating income for the first quarter of
2008, compared to an operating income of $0.95 million for the
first quarter of 2007. Minority share: For the first quarter of
2008, Pointer reported a $561 thousand minority share, compared to
$434 thousands in the first quarter of 2007. Net Income: Pointer
recorded a net income of $752 thousand, or $0.16 per share during
the first quarter of 2008, as compared to a net loss of $180
thousand, or $(0.06) per share in the first quarter of 2007.
Improved bottom line is in line with internal growth and the
successful merger of Cellocator business into Pointer Telocation,
taking place from September 2007. Non-GAAP net income: Pointer's
non-GAAP net income in the first quarter of 2008 was $1.8 million,
as compared to non-GAAP net income of $0.4 million in the first
quarter of 2007. The non-GAAP net income in the first quarter of
2008 excludes amortization of $ 0.85 million and non-cash taxes on
income of $ 218 thousand. EBITDA: Pointer's EBITDA increased to
$3.8 million in the first quarter of 2008, as compared to $2
million in the comparable period in 2007. Danny Stern, Pointer CEO,
said: "We are proud to present the 12th consecutive quarter of
revenue growth and a second consecutive quarter of improved profits
following our Cellocator acquisition. Our operating parameters
continue to improve as a result of both internal growth and the
successful merger of Cellocator's business. International revenue
was responsible for 28% of revenue in Q1 2008 and was derived from
exports and activities in over 25 countries. 41% of revenue was
generated from our technology and products sales. In addition, all
our subsidiaries presented improved operating results, which
further provides evidence that internal growth is a major business
driver. Pointer's technology, know-how and stronger market presence
continue to draw an increased number of business partners from
additional countries and from various sectors - car dealers, fleet
operators as well as insurance companies - who are motivated by an
increase in the demand for high-quality technology and services",
concluded Mr. Stern. 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
financial measures consist of GAAP financial measures adjusted to
exclude amortization of acquired intangible assets and deferred
income tax, as well as certain business combination accounting
entries. The purpose of such adjustments is to give an indication
of our performance exclusive of non-GAAP charges and other items
that are considered by management to be outside of our core
operating results. Our non-GAAP financial measures are not meant to
be considered in isolation or as a substitute for comparable GAAP
measures, and should be read in conjunction with our consolidated
financial statements prepared in accordance with GAAP. 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 operations.
Pointer 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. A reconciliation
of EBITDA to GAAP measures is included in the financial tables
accompanying this press release. 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 on 9:30 AM EST, 16:30
Israel time. 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:
+1-800-994-4498 From Israel: 03-918-0688 A replay of the conference
call will be available through May 16th, 2008 on the Company's
website at http://www.pointer.com/. 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, Greece, Mexico, Argentina, Russia, Croatia, Germany, Czech
Republic, Latvia, Turkey, Hong Kong, Singapore, India, Costa Rica,
Norway, Venezuela, Hungary, Israel and more. Cellocator, a Pointer
Products Division, is a leading AVL (Automatic Vehicle Location)
solutions provider for stolen vehicle retrieval, fleet management,
car & driver safety, public safety, vehicle security and more.
In 2004, Cellocator was selected as the official security and
location equipment supplier for the Olympic Games in Athens. For
more information: http://www.pointer.com/ Safe Harbor Statement
This press release contains forward-looking statements with respect
to the business, financial condition and results of operations of
Pointer and its affiliates. These forward-looking statements are
based on the current expectations of the management of Pointer,
only, and are subject to risk and uncertainties relating to changes
in technology and market requirements, the company's concentration
on one industry in limited territories, decline in demand for the
company's products and those of its affiliates, inability to timely
develop and introduce new technologies, products and applications,
and loss of market share and pressure on pricing resulting from
competition, which could cause the actual results or performance of
the company to differ materially from those contemplated in such
forward-looking statements. Pointer undertakes no obligation to
publicly release any revisions to these forward-looking statements
to reflect events or circumstances after the date hereof or to
reflect the occurrence of unanticipated events. For a more detailed
description of the risks and uncertainties affecting the company,
reference is made to the company's reports filed from time to time
with the Securities and Exchange Commission. CONDENSED INTERIM
CONSOLIDATED BALANCE SHEETS U.S. dollars in thousands March 31,
December 31, 2008 2007 _________ ____________ Unaudited _________
ASSETS CURRENT ASSETS: Cash and cash equivalents $ 648 $ 1,200
Trade receivables, net 14,973 11,756 Other accounts receivable and
prepaid expenses 2,937 2,001 Inventories 2,542 2,657 _________
_________ Total current assets 21,100 17,614 _________ _________
LONG-TERM ASSETS: Long-term accounts receivable 465 337 Severance
pay fund 5,300 4,866 Property and equipment, net 8,208 7,708
Deferred income taxes 1,019 941 Other intangible assets, net 17,835
18,058 Goodwill 53,954 50,712 _________ _________ Total long-term
assets 86,781 82,622 _________ _________ Total assets $ 107,881 $
100,236 _________ _________ _________ _________ CONDENSED INTERIM
CONSOLIDATED BALANCE SHEETS U.S. dollars in thousands (except share
and per share data) March 31, December 31, 2008 2007 __________
____________ Unaudited __________ LIABILITIES AND SHAREHOLDERS'
EQUITY CURRENT LIABILITIES: Short-term bank credit and current
maturities of long-term loans $ 11,383 $ 10,564 Trade payables
8,540 8,001 Deferred revenues and customer advances 11,326 8,253
Other accounts payable and accrued expenses 5,182 6,123 _________
_________ Total current liabilities 36,431 32,941 _________
_________ LONG-TERM LIABILITIES: Long-term loans from banks 18,610
18,460 Long-term loans from shareholders and others 5,665 5,767
Other long-term liabilities 112 89 Accrued severance pay 6,565
5,730 Convertible debentures 1,995 1,979 _________ _________ 32,947
32,025 _________ _________ MINORITY INTEREST 3,911 3,067 _________
_________ SHAREHOLDERS' EQUITY: Share capital - Ordinary shares of
NIS 3 par value: Authorized - 8,000,000 shares at March 31, 2008
and December 31, 2007, respectively; Issued and outstanding -
4,612,875 shares at March 31, 2008 and December 31, 2007,
respectively 3,139 3,139 Additional paid-in capital 116,981 116,910
Accumulated other comprehensive income 3,332 1,766 Accumulated
deficit (88,860) (89,612) _________ _________ Total shareholders'
equity 34,592 32,203 _________ _________ Total liabilities and
shareholders' equity $ 107,881 $ 100,236 _________ _________
_________ _________ CONDENSED INTERIM CONSOLIDATED STATEMENTS OF
OPERATIONS U.S. dollars in thousands (except share and per share
data) Three months ended Year ended March 31, December 31,
___________________ 2008 2007 2007 ______ ______ ____________
Unaudited ___________________ Revenues: Products $ 7,607 $ 2,949 $
15,821 Services 10,871 8,396 35,806 _______ _______ ________ Total
revenues 18,478 11,345 51,627 _______ _______ ________ Cost of
revenues: Products 3,957 1,906 9,414 Services 7,107 5,369 23,034
Amortization of intangible assets 245 - 277 _______ _______
________ Total cost of revenues 11,309 7,275 32,725 _______ _______
________ Gross profit 7,169 4,070 18,902 _______ _______ ________
Operating expenses: Research and development, net 673 332 1,675
Selling and marketing 1,700 1,112 4,934 General and administrative
1,925 1,260 6,209 Amortization of intangible assets 606 415 1,877
_______ _______ ________ Total operating expenses 4,904 3,119
14,695 Operating income 2,265 951 4,207 Financial expenses, net 750
525 2,814 Other income, net 16 10 (12) _______ _______ ________
Income before taxes on income 1,531 436 1,381 Taxes on income 218
182 353 _______ _______ ________ Net income before minority
interest 1,313 254 1,028 Minority interest 561 434 1,366 _______
_______ ________ Net income (loss) $ 752 $ (180) $ (338) _______
_______ ________ _______ _______ ________ Basic and Diluted net
earnings (loss) per share $ 0.16 $ (0.06) $ (0.08) _______ _______
________ _______ _______ ________ CONDENSED INTERIM CONSOLIDATED
STATEMENTS OF CASH FLOWS INTERIM CONSOLIDATED STATEMENTS OF CASH
FLOWS U.S. dollars in thousands Three months ended Year ended March
31, December 31, _______________ 2008 2007 2007 ____ ____
____________ Unaudited Cash flows from operating activities: Net
income (loss) $ 752 $ (180) $ (338) Adjustments required to
reconcile net income (loss) to net cash provided by operating
activities: Depreciation and amortization 1,779 1,194 5,273 Accrued
interest and exchange rate changes of convertible debenture and
long-term loans 185 (14) 750 Accrued severance pay, net 345 (54)
(70) Gain from sale of property and equipment, net (88) (80) (182)
Amortization of deferred stock-based compensation 71 172 783
Increase in minority interest 561 543 1,366 Increase in trade
receivables, net (2,443) (1,334) (1,172) Inecrease in other
accounts receivable and prepaid expenses (843) (536) (421) Decrease
(increase) in inventories 68 118 (395) Write-off of inventories - -
150 Increase in deferred income taxes - - (174) Increase in other
long-term accounts receivable - - (141) Increase in trade payables
36 324 730 Increase in other accounts payable and accrued expenses
1,241 1,558 1,855 _______ _______ _______ Net cash provided by
operating activities 1,664 1,711 8,014 _______ _______ _______ Cash
flows from investing activities: Purchase of property and equipment
(719) (820) (2,638) Proceeds from sale of property and equipment
242 254 860 Increase in long-term accounts receivable, net (102) -
- Acquisition of Cellocator (a) - (16,571) Acquisition of other
intangible assets - - (117) _______ _______ _______ Net cash used
in investing activities (579) (566) (18,466) _______ _______
_______ Cash flows from financing activities: Receipt of long-term
loans from banks - - 5,000 Repayment of long-term loans from banks
(1,012) (500) (4,347) Repayment of long-term loans from others
(823) (656) (2,767) Proceeds from issuance of shares and exercise
of warrants, net - 1,853 9,588 Short-term bank credit, net 226
(1,350) (1,752) _______ _______ _______ Net cash provided by (used
in) financing activities (1,609) (653) 5,722 _______ _______
_______ Effect of exchange rate on cash and cash equivalents (28)
19 80 _______ _______ _______ Increase(decrease) in cash and cash
equivalents (552) 511 (4,650) Cash and cash equivalents at the
beginning of the period 1,200 5,850 5,850 _______ _______ _______
Cash and cash equivalents at the end of the period $ 648 $ 6361 $
1,200 _______ _______ _______ _______ _______ _______ CONDENSED
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS U.S. dollars in
thousands Year ended Three months ended December March 31, 31,
__________________ 2008 2007 2007 ____ ____ __________ Unaudited
__________________ (a) Acquisition of Cellocator and Matan
activities: Fair value of assets acquired and liabilities assumed
at date of acquisition: Working capital $ - $ - $ (1,323) Property
and equipment - - (151) Customer related intangibles - - (3,943)
Brand name (1,775) Developed technology - - (4,890) Goodwill - -
(8,750) Accrued severance pay, net - - 20 _________ _________
_________ - - (20,812) Fair value of shares issued - - 1,430 Fair
value of convertible debentures - - 1,951 Accrued expenses - - 860
_________ _________ _________ 4,241 _________ _________ _________ $
- $ - $ (16,571) _________ _________ _________ _________ _________
_________ Reconciliation Table of Non-GAAP Measures U.S. dollars in
thousands Three months ended Year ended March 31, December 31,
__________________ _____________ 2008 2007 2007
________________________________ Net income (loss) as reported $
752 $ (180) $ (338) Amortization of intangible assets and
impairment of long-lived assets 851 415 2,154 Taxes on income 218
182 353 Non-GAAP Net income (loss) $ 1,821 $ 417 $ 2,169
Reconciliation of GAAP to NON-GAAP Operating Results 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 the GAAP to
non-GAAP operating results: CONDENSED EBITDA US dollars in
thousands Three months ended Year ended March 31, December 31,
__________________ ____________ 2008 2007 2007
_______________________________ Net income (loss) as reported $ 752
$ (180) $ (338) Non GAAP adjustment: Financial expenses, net 750
525 2,814 Taxes on income 218 182 353 Depreciation and amortization
1,562 1,016 4,787 Minority interest 561 434 1,366 _______ _______
_______ EBITDA $ 3,843 $ 1,977 $ 8,982 _______ _______ _______
_______ _______ _______ Contact: Zvi Fried, V.P. and Chief
Financial Officer Tel.; +972-3-572-3111 E-mail: Yael
Nevat,Commitment-IR.com Tel: +972-9-741-8866 E-mail: DATASOURCE:
Pointer Telocation Ltd CONTACT: Contact: Zvi Fried, V.P. and Chief
Financial Officer, Tel.; +972-3-572-3111, E-mail: ; Yael
Nevat,Commitment-IR.com, Tel: +972-9-741-8866, E-mail:
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