ITURAN PRESENTS SECOND QUARTER 2024 RESULTS

Continued strong profitability and reiterates guidance; Declares an $8 million dividend for the second quarter of 2024

AZOUR, Israel, Aug. 19, 2024 /PRNewswire/ -- Ituran Location and Control Ltd. (NASDAQ: ITRN) today announced its consolidated financial results for the second quarter 2024.

Highlights of the Second Quarter of 2024

• Number of subscribers reached 2,329,000, adding a net 38,000 in the second quarter.
• Revenue of $84.9 million, an increase of 4% year-over-year.
• Net income increased to $13.1 million, up by 7% year-over-year.
• EBITDA grew to $23.1 million, a 6% increase year-over-year.
• Operating cash flow of $22.9 million.
• The Board declared a dividend of $8 million or $0.39 per share, in line with the Company's dividend policy.

Guidance for 2024

Overall, looking ahead to 2024, management reiterates its expectations for continued revenue and profit growth, adding approximately 35,000 to 40,000, net new subscribers per each quarter throughout 2024.

From a financial perspective, full-year 2024 EBITDA expectations continue to be between $90-95 million and 2025 EBITDA is targeted to surpass $100 million. The current guidance assumes that the exchange rates in the geographies in which Ituran operate do not worsen against the US dollar, and the current global macro-economic situation and the political situation in Israel do not materially deteriorate.

Management Comment

Eyal Sheratzky, Co-CEO of Ituran, said, "We are pleased with our second quarter results with continued solid growth in the subscriber base and ongoing strong financial performance. Our business remains fundamentally strong and showed accelerated growth in our geographies, when measured in local currency terms. The strong dollar appreciation in the quarter prevented these solid growth rates from being reflected fully in our financial results. Overall, our performance show ongoing solid demand growth for our broad location-based products and telematic services, and especially increased traction from many of our new initiatives."

Continued Mr. Sheratzky, "Looking ahead, we remain on track for 2024. Given our ongoing success, we are happy to reward our shareholders with a high level of dividend for their ongoing support of our company."

Second Quarter 2024 Results

Revenues for the second quarter of 2024 were $84.9 million, a 4% increase compared with revenues of $81.6 million in the second quarter of 2023.

It is noted that the strengthening of the US dollar in the second quarter versus the various local currencies in which Ituran operates in, impacted the revenues when translated into US dollars. In local currencies, revenues grew by 6% year-over-year.

71% of revenues were from location-based service subscription fees and 29% were from product revenues.

Revenues from subscription fees were $60.4 million, an increase of 2% over the second quarter 2023 revenues. In local currencies, subscription revenues grew by 5% year-over-year.

The subscriber base expanded to 2,329,000 by the end of June 2024, marking an increase of 38,000 from the previous quarter.

Product revenues were $24.5 million, an increase of 9% year-over-year. In local currencies, product revenue grew by 10% year-over-year.

Gross profit for the quarter was $39.8 million (46.9% of revenues), a 3% increase compared with gross profit of $38.7 million (47.4% of revenues) in the second quarter of last year. In local currencies, gross profit grew by 5% year-over-year.

The gross margin in the quarter on subscription revenues improved to 58.2%, compared to 57.3% in the second quarter of last year. The gross margin on products was 18.9% in the quarter, compared with 21.0% in the second quarter of last year. The variance in the gross margin on products between quarters was due to the change in product mix sold between the quarters.

Operating income for the quarter was $17.7 million (20.9% of revenues), representing a 7% increase compared to $16.6 million (20.4% of revenues) in the second quarter of last year. In local currencies, operating income grew 10% year-over-year.

EBITDA for the quarter was $23.1 million (27.2% of revenues), an increase of 6% compared with EBITDA of $21.8 million (26.7% of revenues) in the second quarter of last year. In local currencies, EBITDA grew 9% year-over-year.

Financial income for the quarter was $0.1 million, compared with $0.3 million in the second quarter of last year.

Net income for the second quarter of 2024 was $13.1 million (15.5% of revenues) or diluted earnings per share of $0.66, an increase of 7% compared to $12.2 million (15.0% of revenues) or diluted earnings per share of $0.61 in the second quarter of last year. In local currencies, net income grew 10% year-over-year.

Cash flow from operations for the second quarter of 2024 was $22.9 million.

On the balance sheet, as of June 30, 2024, the Company had cash, including marketable securities, of $63.3 million and debt of $0.2 million, amounting to a net cash position of $63.1 million. This is compared with cash, including marketable securities, of $53.6 million and debt of $0.6 million, amounting to a net cash position of $53.0 million, as of year-end 2023.

Dividend

The Board of Directors declared a dividend for the quarter of $8 million, in line with the Company's dividend policy. This dividend is the same as that of the prior quarter and 60% increased over that of the year-ago quarter.

The current dividend takes into account the Company's continuing strong profitability, ongoing positive cash flow and strong balance sheet.

Conference Call Information

The Company will also be hosting a conference call later today, Monday, August 19, 2024 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: [phone] 
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, financing industries 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 over 2.3 million subscribers using its location-based services with a market leading position in Israel and Latin America. Established in 1995, Ituran has approximately 2,800 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.

 

 

 

Ituran Location and Control LTD. CONDENSED CONSOLIDATION BALANCE SHEETS
		US dollars
		June 30,		December 31,
(in thousands)		2024		2023
		(unaudited)
Current assets:
Cash and cash equivalents		63,210		53,434
Investments in marketable securities		81		119
Accounts receivable (net of allowance for doubtful accounts)		49,168		45,390
Other current assets		50,146		52,724
Inventories		24,806		26,872
		187,411		178,539
Long-term investments and other assets
Investments in affiliated companies		736		714
Investments in other companies		2,060		2,213
Other non-current assets		3,431		3,989
Deferred income taxes		14,121		14,452
Funds in respect of employee rights upon retirement		19,364		18,525
		39,712		39,893
Property and equipment, net		35,582		41,955
Operating lease right of use assets, net		7,342		8,071
Intangible assets, net		9,488		10,830
Goodwill		39,219		39,400
Total assets		318,754		318,688

 

 

 

Ituran Location and Control LTD. CONDENSED CONSOLIDATION BALANCE SHEETS (cont.)
		US dollars
		June 30,		December  31,
(in thousands)		2024		2023
		(unaudited)
Current liabilities
Credit from banking institutions		236		355
Accounts payable		20,913		20,842
Deferred revenues		25,557		27,117
Other current liabilities		45,215		44,150
		91,921		92,464
Long-term liabilities
Loan from bank institutions		-		237
Liability for employee rights upon retirement		25,317		24,562
Deferred income taxes		703		1,116
Deferred revenues		12,636		13,259
Others non-current liabilities		2,058		2,027
Operating lease liabilities, non-current		4,458		4,774
		45,172		45,975
Stockholders' equity		175,512		174,454
Non-controlling interests		6,149		5,795
Total equity		181,661		180,249
Total liabilities and equity		318,754		318,688

 

 

 

Ituran Location and Control LTD. CONDENSED CONSOLIDATED STATEMENTS OF INCOME
		US dollars				US dollars
		Six months period				Three months period
(in thousands		ended June  30,				ended June  30,
except per share data)		2024		2023		2024		2023
		(unaudited)				(unaudited)
Revenues:
Telematics services		121,352		114,963		60,417		59,186
Telematics products		48,543		46,154		24,452		22,459
		169,895		161,117		84,869		81,645
Cost of Revenues:
Telematics services		50,746		48,642		25,225		25,250
Telematics products		39,802		37,124		19,840		17,733
		90,548		85,766		45,065		42,983
Gross profit		79,347		75,351		39,804		38,662
Research and Development expenses		9,117		8,354		4,594		4,216
Selling and Marketing expenses		7,272		6,606		3,698		3,283
General and Administrative expenses		28,307		27,716		13,851		14,443
Other expenses (income), net		(123)		118		(84)		75
Operating income		34,774		32,557		17,745		16,645
Other expenses, net		-		(3)		0		(24)
Financing income, net		131		154		56		349
Income before income tax		34,905		32,708		17,801		16,970
Income tax expenses		(7,205)		(7,220)		(3,775)		(3,801)
Share in losses of affiliated companies, net		(122)		(627)		(41)		(261)
Net income for the period		27,578		24,861		13,985		12,908
Less: Net income attributable to non-controlling interest		(1,415)		(1,257)		(858)		(659)
Net income attributable to the Company		26,163		23,604		13,127		12,249
Basic and diluted earnings per share attributable to Company's stockholders		1.32		1.17		0.66		0.61
Basic and diluted weighted average number of shares outstanding (in thousands)		19,894		20,097		19,894		20,045

 

 

 

Ituran Location and Control LTD. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
		US dollars				US dollars
		Six months period				Three months period
		ended June  30,				ended June  30,
(in thousands)		2024		2023		2024		2023
		(unaudited)				(unaudited)
Cash flows from operating activities
Net income for the period		27,578		24,861		13,985		12,908
Adjustments to reconcile net income to net cash from operating activities:
Depreciation and amortization		10,651		10,051		5,353		5,146
Loss (gain) in respect of trading marketable securities		35		(53)		139		(54)
Increase in liability for employee rights upon retirement		1,680		1,590		918		729
Share in losses of affiliated companies, net		122		627		41		261
Deferred income taxes		(1,237)		(1,394)		(447)		(791)
Capital loss (gain) from sale of property and equipment, net		(95)		46		(131)		53
Increase in accounts receivable		(6,544)		(2,952)		(1,704)		(172)
Increase in other current and non-current assets		(4,371)		(6,975)		(886)		(2,399)
Decrease (increase) in inventories		1,529		(609)		1,008		(450)
Increase (decrease) in accounts payable		1,816		939		2,286		(2,726)
Increase (decrease) in deferred revenues		372		5,227		(892)		2,498
Increase in other current and non-current liabilities		2,803		3,544		3,268		2,504
Net cash provided by operating activities		34,339		34,902		22,938		17,507
Cash flows from investment activities
Increase in funds in respect of employee rights upon retirement, net of withdrawals		(1,515)		(1,160)		(808)		(777)
Capital expenditures		(6,309)		(6,282)		(3,178)		(3,379)
Return of (investments in) affiliated and other companies, net		57		(607)		(81)		(312)
Return of (investments in) long term deposit		23		(45)		(41)		(45)
Sale of marketable securities		-		99		-		-
Proceeds from sale of property and equipment		293		58		137		40
Net cash used in investment activities		(7,451)		(7,937)		(3,971)		(4,473)
Cash flows from financing activities
Short term credit from banking institutions, net		(331)		185		(58)		(954)
Repayment of long term loan		-		(7,907)		-		(3,765)
Dividend paid		(12,533)		(5,617)		(7,759)		(2,820)
Acquisition of company shares		-		(4,717)		-		(3,517)
Dividend paid to non-controlling interest		(1,630)		(1,687)		-		(892)
Net cash used in financing activities		(14,494)		(19,743)		(7,817)		(11,948)
Effect of exchange rate changes on cash and cash equivalents		(2,619)		(867)		(1,975)		(157)
Net increase in cash and cash equivalents		9,776		6,355		9,175		929
Balance of cash and cash equivalents at beginning of the period		53,434		27,850		54,035		33,276
Balance of cash and cash equivalents at end of the period		63,210		34,205		63,210		34,205
Supplementary information on financing and investing activities not involving cash flows:
In May 2024, the Company declared a dividend in an amount of approximately US$ 8 million. The dividend was paid in July 2024.

 

 

 

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Company Contact
Udi Mizrahi
[e-mail]
Deputy CEO & VP Finance, Ituran
(Israel) [phone]

International Investor Relations
Ehud Helft
[e-mail]
EK Global Investor Relations
(US) [phone]

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SOURCE Ituran Location and Control Ltd.

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