ROSH HAAYIN, Israel,
May 23, 2019 /PRNewswire/ --
Pointer Telocation Ltd. (Nasdaq: PNTR) (TASE: PNTR), a
leading provider of telematic services and technology solutions for
Fleet Management, Mobile Asset Management and Internet of Vehicles,
announced its financial results for the first quarter of 2019.
Financial Highlights for the First Quarter of 2019 Compared
to the First Quarter of 2018
- Total revenues of $18.3 million,
down 13% as reported due an exceptional volume of product sales in
the same period a year ago and continued foreign currency exchange
devaluation. Total revenues were down 3% on a constant currency
basis
- Service revenues of $12.4
million, down 11% as reported, up 2% on a constant currency
basis
- Operating income of $1.2 million
(7% of revenue), down from $2.6
million from the same period a year ago
- Net income of $0.6 million, down
from $1.8 million from the same
period a year ago
- Non-GAAP net income of $1.7
million, down from $2.5
million from the same period a year ago
- EBITDA of $1.9 million, down from
$3.3 million from the same period a
year ago
- Adjusted EBITDA of $2.2 million
down from $3.4 million from the same
period a year ago
- Cash, net of debt, totaled $2.5
million
- Total subscribers reached 272,000, an increase of 3% year over
year
Management Commentary
David Mahlab, Pointer's Chief
Executive Officer, commented:
"Despite continued currency headwinds and difficult
comparability due to an exceptional volume of product sales a year
ago, we continued to deliver positive earnings on both a GAAP and
non-GAAP basis and reduced our long-term debt in the first quarter.
Also, we delivered positive EBITDA and Adjusted EBITDA while
maintaining elevated spending in R&D and Sales and Marketing to
support our North America market
expansion."
"Our Q1 2019 results also include approximately $0.5 million of cost associated with the
acquisition of Pointer by ID Systems, which we expect to close
during the third quarter 2019. During Q1 2019, we have
significantly reduced services to low margin customers, leading to
an increase in our Average Revenue Per Unit in constant currency,
and accelerating our operating efficiency."
"For the remainder of 2019, we continue to expect double-digit
growth in our overall business. We expect to see significant
revenues in the second quarter from product sales in North America, fulfilling our largest product
order ever, as announced earlier this year, and stable growth in
our service business supported by the recently announced service
orders in Brazil. These should accelerate growth on our top
and bottom lines in the second half of the year."
Yaniv Dorani, Pointer's Chief
Financial Officer, commented:
"In the first quarter, we generated $1.9
million in EBITDA and ended the quarter with $2.5 million in net cash. We reduced our debt by
$0.7 million, and we remain on track
for continued positive EBITDA and long-term debt reduction
throughout the remainder of 2019."
|
First Quarter of
2019 Financial Summary Compared to First Quarter of
2018
|
|
|
(in millions,
except per share amounts)
|
2019
|
2018
|
|
Total
Revenues
|
$18.3
|
$20.9
|
|
Service
Revenues
|
$12.4
|
$13.8
|
|
Operating Income (%
of Revenue)
|
$1.2 (7%)
|
$2.6 (12%)
|
|
Net Income
|
$0.6
|
$1.8
|
|
Diluted
EPS
|
$0.07
|
$0.21
|
|
Non-GAAP Diluted
EPS
|
$0.20
|
$0.30
|
|
EBITDA
|
$1.9
|
$3.3
|
|
Adjusted
EBITDA
|
$2.2
|
$3.4
|
In Q1 2019, revenues from services decreased 11% as reported to
$12.4 million as compared to
$13.8 million in Q1 2018. In local
currency terms, revenues from services increased by 2%.
Revenues from products decreased 17% as reported in Q1 2019 to
$5.9 million from $7.1 million in Q1 2018. In local currency terms,
revenues from products decreased by 14%. The currency exchange rate
impact on total revenues for the first quarter of 2019 compared to
the first quarter of 2018 was approximately $1.9 million. The currency exchange rate impact
on operating income for the first quarter of 2019 compared to the
first quarter of 2018 was approximately $0.1
million.
Conference Call Information
As previously announced, Pointer Telocation's management will
host a conference call today, at 9:00 a.m.
Eastern Time, 2:00 p.m. UK time, 4:00 p.m.
Israel time. On the call,
management will review and discuss the results. To listen to the
call, please dial in to one of the following teleconferencing
numbers. Please begin placing your call a few minutes before the
conference call commences.
Dial in numbers are as follows:
From the USA +1-877-407-0789
or 1-201-689-8562
From Israel 1-809-406-247
From the UK
0-800-756-3429
A replay will be available a few hours following the call on the
company's website for one year.
The call will also be accompanied by a live webcast over the
Internet and accessible at
http://public.viavid.com/index.php?id=133125.
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.
Pointer uses EBITDA, adjusted EBITDA, Non-GAAP operating income,
Non-GAAP net income and presentation of results in a constant
currency based on the local currencies in which operations are
conducted prior to giving effect to exchange rates into U.S.
dollars as Non-GAAP financial performance measurements.
Pointer calculates EBITDA by adding back to net income financial
expenses, taxes and depreciation and amortization of intangible
assets. Pointer calculates adjusted EBITDA by adding back to EBITDA
Stock-based compensation expenses. Pointer calculates Non-GAAP
operating income by adding back to operating income the effects of
non-cash stock-based compensation expenses, amortization of
long-lived assets and losses and acquisition related one-time
costs. Pointer calculates Non-GAAP net income by adding back to net
income the effects of non-cash stock-based compensation expenses,
amortization of long lived assets, non-cash tax expenses and
acquisition related one-time costs.
Pointer calculates results on a constant currency based on the
local currencies on a nominal value, without giving effect to
conversion into U.S. dollar.
The purpose of such adjustments is to give an indication of the
Company's performance exclusive of Non-GAAP charges that are
considered by management to be outside of the Company's core
operating results and to neutralize fluctuations in local
currencies against the dollar.
EBITDA, Adjusted EBITDA, Non-GAAP operating and net income
and presentation of results on a constant currency basis are
provided to investors to complement the results provided in
accordance with GAAP, as management believes these measures help to
illustrate underlying operating trends in the Company's business
and uses these measures to establish internal budgets and goals,
manage the business and evaluate performance. Management believes
that these Non-GAAP measures help investors to understand the
Company's current and future operating cash flow and performance,
especially as the Company's acquisitions have resulted in
amortization and non-cash items that have had a material impact on
the Company's GAAP profits. EBITDA, adjusted EBITDA, Non-GAAP
operating and net income and presentation of results on a constant
currency basis should not be considered in isolation or as a
substitute for comparable measures calculated and should be read in
conjunction with the Company's 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
For over 20 years, Pointer has rewritten the rules for the
Mobile Resource Management (MRM) market and is a pioneer in
the Connected Car segment. Pointer has in-depth knowledge of
the needs of this market and has developed a full suite of tools,
technology and services to respond to them. The vehicles of the
future will be intimately networked with the outside world,
enhancing and optimizing the in-car experience.
Pointer's innovative and reliable cloud-based
software-as-a-service (SAAS) platform extracts and captures an
organization's critical mobility data points – from office,
drivers, routes, points-of-interest, logistic-network, vehicles,
trailers, containers and cargo. The SAAS platform analyzes the raw
data converting it into valuable information for Pointer's
customers providing them with actionable insights and thus enabling
the customers to improve their bottom line and increase their
profitability.
For more information, please visit http://www.pointer.com, the
content of which does not form a part of this press release.
Risks Regarding Forward Looking Statements
Certain statements made herein that use words such as
"estimate", "project", "intend", "expect", "believe", "may",
"might", "predict", "potential", "anticipate", "plan" or similar
expressions are intended to identify forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995 and other securities laws. For example, when the Company
discusses its expectations for growth and levels of revenues in the
remainder of 2019, and, in particular, in North America and Brazil, the Company's overall growth in terms
of revenues and profits in the second half of 2019, and the
expected closing of the merger with I.D. Systems it is using
forward-looking statements. These forward-looking statements
involve known and unknown risks and uncertainties that could cause
the actual results, performance or achievements of the Company to
be materially different from those that may be expressed or implied
by such statements, including, among others, changes in general
economic and business conditions. For additional information
regarding these and other risks and uncertainties associated with
the Company's business, reference is made to the Company's reports
filed from time to time with the U.S. Securities and Exchange
Commission. The Company does not undertake to revise or update any
forward-looking statements for any reason.
|
INTERIM
CONSOLIDATED BALANCE SHEETS
|
|
U.S. dollars in
thousands
|
|
|
|
March
31,
2019
|
|
December
31,
2018
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
6,875
|
|
8,528
|
|
Trade and unbilled
receivables
|
|
14,954
|
|
13,902
|
|
Other accounts
receivable and prepaid expenses
|
|
3,966
|
|
3,362
|
|
Inventories
|
|
7,141
|
|
6,432
|
|
|
|
|
|
|
Total current
assets
|
|
32,936
|
|
32,224
|
|
|
|
|
|
|
|
|
|
|
|
LONG-TERM
ASSETS:
|
|
|
|
|
|
Long-term loan to
related party
|
|
991
|
|
948
|
|
Long-term unbilled and
other accounts receivable
|
|
1,257
|
|
1,258
|
|
Severance pay
fund
|
|
3,250
|
|
3,038
|
|
Property and
equipment, net
|
|
6,417
|
|
5,915
|
|
Other intangible
assets, net
|
|
1,130
|
|
1,229
|
|
Goodwill
|
|
38,404
|
|
37,538
|
|
Deferred tax
asset
|
|
7,987
|
|
7,934
|
|
Operating lease
right-of-use asset
|
|
3,702
|
|
-
|
|
|
|
|
|
|
Total long-term
assets
|
|
63,138
|
|
57,860
|
|
|
|
|
|
|
Total assets
|
|
96,074
|
|
90,084
|
|
|
|
|
|
|
INTERIM
COLSOLIDATED BALANCE SHEETS
|
|
U.S. dollars in
thousands
|
|
|
|
March
31,
|
|
December
31,
|
|
|
2019
|
|
2018
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
|
Short-term bank credit
and current maturities of
long-term loans
|
|
2,022
|
|
2,354
|
|
Trade
payables
|
|
5,497
|
|
5,743
|
|
Deferred revenues and
customer advances
|
|
1,097
|
|
785
|
|
Other accounts payable
and accrued expenses
|
|
9,015
|
|
8,490
|
|
|
|
|
|
|
Total current
liabilities
|
|
17,631
|
|
17,372
|
|
|
|
|
|
|
|
|
|
|
|
LONG-TERM
LIABILITIES:
|
|
|
|
|
|
Long-term loans from
banks
|
|
2,308
|
|
2,685
|
|
Deferred taxes and
other long-term liabilities
|
|
434
|
|
360
|
|
Accrued severance
pay
|
|
3,640
|
|
3,531
|
|
Operating lease
liability
|
|
3,714
|
|
-
|
|
|
|
|
|
|
Total long term
liabilities
|
|
10,096
|
|
6,576
|
|
|
|
|
|
|
COMMITMENTS AND
CONTINGENT LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
EQUITY:
|
|
|
|
|
|
Pointer Telocation
Ltd.'s shareholders' equity:
|
|
|
|
|
|
Share
capital
|
|
6,050
|
|
6,050
|
|
Additional paid-in
capital
|
|
130,659
|
|
130,309
|
|
Accumulated other
comprehensive income
|
|
(6,842)
|
|
(8,151)
|
|
Accumulated
deficit
|
|
(61,650)
|
|
(62,278)
|
|
|
|
|
|
|
Total Pointer
Telocation Ltd.'s shareholders' equity
|
|
68,217
|
|
65,930
|
|
|
|
|
|
|
Non-controlling
interest
|
|
130
|
|
206
|
|
|
|
|
|
|
Total
equity
|
|
68,347
|
|
66,136
|
|
|
|
|
|
|
Total liabilities and
equity
|
|
96,074
|
|
90,084
|
|
INTERIM
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
U.S. dollars in
thousands, except for share and per share
information
|
|
|
|
|
|
Three Months
ended
March
31,
|
|
Year
ended
December
31,
|
|
|
|
2019
|
|
2018
|
|
2018
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
Products
|
|
5,892
|
|
7,059
|
|
25,243
|
|
|
Services
|
|
12,366
|
|
13,824
|
|
52,543
|
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
18,258
|
|
20,883
|
|
77,786
|
|
|
|
|
|
|
|
|
|
|
Cost of
revenues:
|
|
|
|
|
|
|
|
|
Products
|
|
3,783
|
|
4,224
|
|
15,104
|
|
|
Services
|
|
5,216
|
|
5,711
|
|
21,674
|
|
|
|
|
|
|
|
|
|
|
Total cost of
revenues
|
|
8,999
|
|
9,935
|
|
36,778
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
|
9,259
|
|
10,948
|
|
41,008
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Research and
development
|
|
1,271
|
|
1,237
|
|
4,707
|
|
|
Selling and
marketing
|
|
3,658
|
|
3,868
|
|
14,560
|
|
|
General and
administrative
|
|
2,586
|
|
2,886
|
|
11,169
|
|
|
Amortization of
intangible assets
|
|
95
|
|
127
|
|
456
|
|
|
One-time acquisition
related costs
|
|
451
|
|
262
|
|
300
|
|
|
|
|
|
|
|
|
|
|
Total operating
expenses
|
|
8,061
|
|
8,380
|
|
31,192
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
1,198
|
|
2,568
|
|
9,816
|
|
|
Financial expenses,
net
|
|
221
|
|
334
|
|
1,133
|
|
|
Other
expenses
|
|
-
|
|
16
|
|
3
|
|
|
|
|
|
|
|
|
|
|
Income before taxes on
income
|
|
977
|
|
2,218
|
|
8,680
|
|
|
Taxes on
income
|
|
376
|
|
449
|
|
1,753
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
601
|
|
1,769
|
|
6,927
|
|
|
|
|
|
|
|
|
|
|
Earnings per share from
continuing
operations attributable to Pointer
Telocation Ltd.'s shareholders:
|
|
|
|
|
|
|
|
|
Basic net earnings per
share
|
|
0.07
|
|
0.22
|
|
0.85
|
|
|
|
|
|
|
|
|
|
|
Diluted net earnings
per share
|
|
0.07
|
|
0.21
|
|
0.84
|
|
|
|
|
|
|
|
|
|
|
Weighted average -Basic
number of shares
|
|
8,139,584
|
|
8,059,654
|
|
8,099,952
|
|
|
|
|
|
|
|
|
|
|
Weighted average –
fully diluted number of shares
|
|
8,326,391
|
|
8,294,562
|
|
8,279,562
|
|
|
INTERIM
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
U.S. dollars in
thousands
|
|
|
|
Three Months
ended
March
31,
|
|
Year
ended
December
31,
|
|
|
2019
|
|
2018
|
|
2018
|
|
|
|
|
|
|
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
601
|
|
1,769
|
|
6,927
|
|
Adjustments required
to reconcile net
income to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
679
|
|
718
|
|
2,571
|
|
Accrued interest and
exchange rate
changes of debenture and long-term loans
|
|
(62)
|
|
1
|
|
(20)
|
|
Accrued severance pay,
net
|
|
(115)
|
|
78
|
|
71
|
|
Gain from sale of
property and equipment, net
|
|
(16)
|
|
(27)
|
|
(101)
|
|
Stock-based
compensation
|
|
349
|
|
142
|
|
1,198
|
|
Increase in trade and
unbilled receivables, net
|
|
(793)
|
|
(988)
|
|
(1,121)
|
|
Increase in other
accounts receivable
and prepaid expenses
|
|
(853)
|
|
(620)
|
|
(855)
|
|
Decrease (increase) in
inventories
|
|
(802)
|
|
210
|
|
(56)
|
|
Decrease (increase) in
deferred income
taxes
|
|
120
|
|
154
|
|
779
|
|
Decrease in long-term
unbilled and
other accounts receivable
|
|
555
|
|
157
|
|
220
|
|
Decrease
(increase) in trade payables
|
|
(796)
|
|
(111)
|
|
48
|
|
Increase (decrease) in
other accounts
payable and accrued expenses
|
|
867
|
|
836
|
|
(1,064)
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
|
(266)
|
|
2,319
|
|
8,597
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
Purchase of property
and equipment
|
|
(530)
|
|
(958)
|
|
(2,721)
|
|
Proceeds from sale of
property and equipment
|
|
16
|
|
27
|
|
101
|
|
|
|
|
|
|
|
|
Net cash used in
investing activities
|
|
(514)
|
|
(931)
|
|
(2,620)
|
|
|
|
|
|
|
|
|
|
INTERIM
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
U.S. dollars in
thousands
|
|
|
|
|
|
Three months
ended
March
31,
|
|
Year
ended
December
31,
|
|
|
|
2019
|
|
2018
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Repayment of long-term
loans from banks
|
|
(1,218)
|
|
(1,351)
|
|
(5,078)
|
|
|
Proceeds from
issuance of shares and exercise of
options, net of issuance costs
|
|
-
|
|
4
|
|
89
|
|
|
Short-term bank
credit, net
|
|
514
|
|
58
|
|
32
|
|
|
|
|
|
|
|
|
|
|
Net cash used in
financing activities
|
|
(704)
|
|
(1,289)
|
|
(4,957)
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate
on cash and cash equivalents
|
|
(169)
|
|
292
|
|
133
|
|
|
|
|
|
|
|
|
|
|
Increase in cash and
cash equivalents
|
|
(1,653)
|
|
391
|
|
1,153
|
|
|
Cash and cash
equivalents at the beginning of the
period
|
|
8,528
|
|
7,375
|
|
7,375
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents at the end of the period
|
|
6,875
|
|
7,766
|
|
8,528
|
|
|
|
|
|
|
|
|
|
|
Supplemental
disclosure for non-cash activities:
|
|
|
|
|
|
|
|
|
Operating lease
right-of-use asset
|
|
4,096
|
|
-
|
|
-
|
|
|
ADDITIONAL
INFORMATION
|
|
|
U.S. dollars in
thousands, except share and per share data
|
|
|
|
|
The following table
reconciles GAAP to non-GAAP operating results:
|
|
|
|
|
|
Three months
ended
March
31,
|
|
Year
ended
December
31,
|
|
|
|
2019
|
|
2018
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
GAAP gross
profit
|
|
9,259
|
|
10,948
|
|
41,008
|
|
|
Stock-based
compensation expenses
|
|
34
|
|
9
|
|
104
|
|
|
Non-GAAP gross
profit
|
|
9,293
|
|
10,957
|
|
41,112
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
income
|
|
1,198
|
|
2,568
|
|
9,816
|
|
|
Stock-based
compensation expenses
|
|
349
|
|
142
|
|
1,198
|
|
|
Amortization and
impairment of long lived assets
|
|
95
|
|
127
|
|
456
|
|
|
Acquisition related
one-time costs
|
|
451
|
|
262
|
|
300
|
|
|
Non-GAAP operating
income
|
|
2,093
|
|
3,099
|
|
11,770
|
|
|
|
|
|
|
|
|
|
|
GAAP net
income
|
|
601
|
|
1,769
|
|
6,927
|
|
|
Stock-based
compensation expenses
|
|
349
|
|
142
|
|
1,198
|
|
|
Amortization and
impairment of long lived assets
|
|
95
|
|
127
|
|
456
|
|
|
Non cash tax
expenses
|
|
166
|
|
171
|
|
759
|
|
|
Acquisition related
one-time costs
|
|
451
|
|
262
|
|
300
|
|
|
Non-GAAP net
income
|
|
1,662
|
|
2,471
|
|
9,640
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income
per share from continuing
operations - Diluted
|
|
0.20
|
|
0.30
|
|
1.16
|
|
|
Non-GAAP weighted
average number of shares -
Diluted*
|
|
8,326,391
|
|
8,294,562
|
|
8,279,562
|
|
|
|
|
|
|
|
|
|
|
* In calculating
diluted non-GAAP net income per share, the diluted weighted average
number of shares
outstanding excludes the effects of stock-based compensation
expenses in accordance with FASB ASC 718.
|
|
|
EBITDA and
Adjusted EBITDA
|
|
U.S. dollars in
thousands
|
|
|
|
Three months
ended
March
31,
|
|
Year
ended
December
31,
|
|
|
2019
|
|
2018
|
|
2018
|
|
|
|
|
|
|
|
|
GAAP Net income as
reported:
|
|
601
|
|
1,769
|
|
6,927
|
|
|
|
|
|
|
|
|
Financial expenses,
net
|
|
221
|
|
334
|
|
1,133
|
|
Tax on
income
|
|
376
|
|
449
|
|
1,753
|
|
Depreciation and
amortization of goodwill and
intangible assets
|
|
679
|
|
718
|
|
2,571
|
|
|
|
|
|
|
|
|
EBITDA
|
|
1,877
|
|
3,270
|
|
12,384
|
|
|
|
|
|
|
|
|
Stock-based
compensation expenses
|
|
349
|
|
142
|
|
1,198
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
2,226
|
|
3,412
|
|
13,582
|
|
|
|
|
|
|
|
Company contact:
Yaniv Dorani, CFO
Tel:
+972-3-5723111
E-mail: yanivd@pointer.com
Investor Relations Contact at Hayden IR, LLC:
Brett
Maas
Tel: +1-646-536-7331
E-mail: brett@haydenir.com
Dave Fore
Tel:
+1-206-395-2711
E-mail: dave@haydenir.com
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SOURCE Pointer Telocation Ltd
