MICT Reports Financial Results for the Second Quarter Ended June 30, 2020

MONTVALE, N.J., Aug. 14, 2020 /PRNewswire/ -- MICT, Inc. (Nasdaq: MICT), today announced financial results for the three months ended June 30, 2020.

"We are very pleased and excited to have recently closed the acquisition of Global Fintech Holdings (GFH) and increased our stake in Micronet to majority owner, which we believe positions MICT to grow revenues and earnings through operating businesses in the global fintech and telematics industries. Pending shareholder approval at our September 3, 2020 special meeting of stockholders, MICT will receive the balance of the $15 million that remains to be funded, which will enable MICT to execute on additional opportunities through organic growth and accretive acquisitions. We are currently evaluating acquisition candidates in our pipeline, and look forward to announcing the achievement of additional revenue-driving events in due course," stated MICT CEO Darren Mercer.

"The global logistics and transportation telematics industry, expected to be valued at $45 billion by 2022, is rapidly evolving and we have identified key opportunities for Micronet's suite of world class telematics technologies. Through GFH's deep experience and network in the Asian markets, we believe we are well positioned to expand Micronet's business beyond the U.S. and Europe, into Asia. We believe that the acquisition of GFH brings crossover benefits to the telematics business, and is a driving reason for MICT's decision to increase its stake in Micronet," Mercer concluded.

Between February 24, 2019 and June 23, 2020 MICT held less than 50% ownership of Micronet's outstanding ordinary shares, and therefore did not include Micronet's financial results during that time in its consolidated financial statements based on U.S. generally accepted accounting practices (GAAP). MICT will include Micronet's financial results in its consolidated statements in the third quarter of 2020.

Q2 2020 Review

Three Months Ended June 30, 2020 Review

    --  Total revenue in the second quarter of 2020 and 2019 was $0.
    --  Gross profit for MICT was $0 in the second quarter of 2020 and 2019.
    --  Research and development (R&D) expense for MICT in the second quarter of
        2020 and 2019 was $0.
    --  Selling, general and administrative (SG&A) expense for MICT was $668,000
        in the second quarter of 2020, as compared to $670,000 in the second
        quarter of 2019.
    --  Net income attributable to MICT was $227,000 in the second quarter of
        2020, as compared to a net loss of $1.1 million in the second quarter of
        2019. The net income reported in the second quarter of 2020 is primarily
        a result of a gain from starting to consolidate Micronet and financial
        income resulting from the cancellation of recorded impairment of
        Micronet. On a per share basis, MICT reported net income of $0.02 per
        basic and $0.00 per diluted share from continued operations for the
        second quarter of 2020, as compared to a net loss of $0.10 per basic and
        diluted share from continued operations in the second quarter of 2019.
    --  As of June 30, 2020, MICT had $9.7 million in cash and equivalents.

Six Months Ended June 20, 2020 Review

    --  Total revenue for six months ended June 30, 2020 was $0, compared to
        $477,000 in the same period of 2019.
    --  Gross loss for MICT was $0 in the six months ended June 30, 2020,
        compared to $369,000 in the same period of 2019.
    --  (R&D expense for MICT in the six months ended June 30, 2020 was $0
        compared to $261,000 in the same period of 2019.
    --  SG&A expense for MICT was $1.44 million in the six months ended June 30,
        2020, as compared to $1.86 million in the same period of 2019.
    --  Net loss attributable to MICT was $1.41 for the six months ended June
        30, 2020, as compared to $2.01 million in the same period of 2019. The
        decrease in net loss is primarily a result of reduced operating
        expenses, an increase in financing income, and a gain on previously held
        equity in Micronet. On a per share basis, MICT reported a net loss of
        $0.12 per basic and diluted share from continued operations for the six
        months ended June 30, 2020, as compared to a net loss of $0.19 per basic
        and diluted share from continued operations in the same period of 2019.

Conference Call

The Company invites all those interested in participating in a conference call on Monday, August 17, 2020 at 9:00 a.m. EDT, to dial 1-888 -298 5973. Callers from outside of the U.S. may access the call by dialing: From Europe (including London) dial in +448 0818 90708 From Israel +972 79-939 8931. user pin: 4444

Please dial in a few minutes before 9:00 a.m. EDT. Participants may also access a live webcast of the conference call through the Investor Relations section of MICT's website at: http://mixlr.com/servicesmict/

A telephone replay of the call will be available for two weeks at: 1-888 -298 5973. Callers from outside of the U.S- may access the call by dialing: From Europe (including London) dial in +448 0818 90708 From Israel +972 79-939 8931. user pin: 3333

A slide presentation accompanying management's remarks can be accessed at www.mict-inc.com.

About MICT, Inc.

MICT, Inc. (NasdaqCM: MICT) operates through its subsidiaries, Global Fintech Holdings Intermediate Ltd. ("GFH") and Micronet Ltd. ("Micronet"). GFH's versatile proprietary trading technology platform is designed to serve a large number of high growth sectors in the global fintech space. Primary areas of focus include online brokerage for equities trading and sales of insurance products in several high-growth foreign markets including Asia where GFH owns a substantial propriety database of users. Micronet operates in the growing commercial Mobile Resource Management (MRM) market, mainly in the United States. Micronet designs, develops, manufactures and sells rugged mobile computing devices that provide fleet operators and field workforces with computing solutions in challenging work environments.

Forward-looking Statement

This press release contains express or implied forward-looking statements within the Private Securities Litigation Reform Act of 1995 and other U.S. Federal securities laws. These forward-looking statements include, but are not limited to, those statements regarding the belief that the merger with GFH and recent investments in Micronet will create synergies and advantages for all companies involved, our expectations regarding the global logistics and transportation telematics industry growth, and the belief that a majority stake in Micronet will leverage our global platform to grow the telematics business. Such forward-looking statements and their implications involve known and unknown risks, uncertainties and other factors that may cause actual results or performance to differ materially from those projected. The forward-looking statements contained in this press release are subject to other risks and uncertainties, including those discussed in the "Risk Factors" section and elsewhere in the Company's annual report on Form 10-K for the year ended December 31, 2019 and in subsequent filings with the Securities and Exchange Commission. Except as otherwise required by law, the Company is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of new information, future events or otherwise.


                                              
           
              MICT, INC. AND SUBSIDIARIES


                                          
          
              CONDENSED CONSOLIDATED BALANCE SHEETS


                                        
       
            (USD In Thousands, Except Share and Par Value Data)






                                                       June 30,                                          December 31,
                                                           2020                                                   2019



                                                (Unaudited)



                 ASSETS



     Current assets:


      Cash and cash
       equivalents                                                 $
            9,707                                     $
     3,154



     Restricted cash                                                                                                       45


      Trade accounts
       receivable, net                                                         305


      Short-term loan to
       related party Micronet
       Ltd., net                                                                                                           281


      Inventories, net                                                       1,852


      Other current assets                                                   1,541                                          937



                 Total current assets                                       13,405                                        4,417





      Property and equipment,
       net                                                                     689                                           29


      Long term deposit                                                         26


      Right of use assets                                                      310



     Goodwill                                                               2,618


      Intangible assets and
       others, net                                                           2,475


      Restricted cash escrow                                                   477                                          477


      Micronet Ltd. equity
       method investment                                                                                                   994



                 Total long-term assets                                      6,595                                        1,500





                 Total assets                                     $
            20,000                                     $
     5,917


                                                                                       
       
                MICT, INC. AND SUBSIDIARIES


                                                                                    
        
             CONDENSED CONSOLIDATED BALANCE SHEETS


                                                                                  
       
         (USD In Thousands, Except Share and Par Value Data)




                                                                                                                                           June 30,              December 31,
                                                                                                                                               2020                       2019



                                                                                                                                   (Unaudited)




              
                LIABILITIES AND EQUITY





              Short term bank credit and current portion of long term bank loans                                                                    $
        1,186               
     $



              Short term credit from others                                                                                                               8,151



              Trade accounts payable                                                                                                                      1,193



              Other current liabilities                                                                                                                   1,865                            290




              
                Total current liabilities                                                                                                     12,395                            290






              Long term loans from others                                                                                                                                               1,856



              Lease liability                                                                                                                               102



              Deferred tax liabilities                                                                                                                      362



              Long term escrow                                                                                                                              477                            477



              Accrued severance pay                                                                                                                         145                             50




              
                Total long term liabilities                                                                                                    1,086                          2,383






              Stockholders' Equity:



              Series A Convertible Preferred Stock; $0.001 par value,                                                                                         3                              2
     3,181,818 and 2,386,363 shares authorized, issued and
     outstanding as of June 30, 2020 and December 31, 2019,
     respectively



              Series B Convertible Preferred Stock; $0.001 par value,                                                                                         2                              0
     1,818,182 and 0 shares authorized, issued and outstanding as
     of June 30, 2020 and December 31, 2019, respectively



              Common stock; $0.001 par value, 25,000,000 shares authorized,                                                                                  11                             11
     11,107,714 shares issued and outstanding as of June 30, 2020
     and 11,089,532 shares issued and outstanding as of
     December 31, 2019, respectively



              Additional paid in capital                                                                                                                 14,198                         14,107



              Additional paid in capital - Series A Convertible Preferred Stock                                                                           6,437                          6,028



              Additional paid in capital - Series B Convertible Preferred Stock                                                                           1,914



              Accumulated other comprehensive (loss)                                                                                                        164                             70



              Accumulated loss                                                                                                                         (18,382)                      (16,974)




              MICT, Inc. stockholders' equity                                                                                                             4,347                          3,244






              Non-controlling interests                                                                                                                   2,172






              
                Total equity                                                                                                                   6,519                          3,244






              
                Total liabilities and equity                                                                                            $
        20,000                   $
         5,917


                                                                                       
          
                MICT, INC. AND SUBSIDIARIES


                                                                               
             
             CONDENSED CONSOLIDATED STATEMENTS OF INCOME


                                                                       
              
            (USD In Thousands, Except Share and Earnings Per Share Data)


                                                                                           
              
                (Unaudited)




                                                           
     
             Six months ended                                                                    Three months ended
                                                               June 30,                                                                            June 30,



                                                                                   2020                                                  2019                                   2020               2019






     Revenues                                                             
              $                                                                        $
              477       
     $                
     $



     Cost of revenues                                                                                                                                                     846




     Gross profit (loss)                                                                                                                                                (369)






     Operating expenses:



     Research and development                                                                                                                                             261



     Selling and marketing                                                                                                                                                198



     General and administrative                                                                               1,438                                                      1,660                    668                670



     Amortization of intangible assets                                                                                                                                     20




     Total operating expenses                                                                                 1,438                                                      2,139                    668                670






     Loss from operations                                                                                   (1,438)                                                   (2,508)                 (668)             (670)



     Share in investee losses                                                                                 (786)                                                     (405)                 (146)             (405)



     Net profit from loss of control                                                                                                                                      299



     Gain on previously held equity in Micronet                                                                 665                                                                              665




     Financial (income) expenses, net                                                                           157                                                       (54)                   381                 22




     Income (loss) before provision for income taxes                                                        (1,402)                                                   (2,560)                   232            (1,097)



     Provision for income taxes                                                                                   6                                                          8                      5                  5






     Total net profit (loss)                                                                                (1,408)                                                   (2,568)                   227            (1,102)




     Net loss attributable to non-controlling interests                                                                                                                 (556)






     Net profit (loss) attributable to MICT, Inc.                                                           (1,408)                                                   (2,012)                   227            (1,102)






     Earnings (loss) per share attributable to MICT, Inc.



     Basic                                                                                       $
              (0.12)                                        $
              (0.19)           $
         0.02        $
       (0.10)




     Diluted                                                                                                                                                                                   0.00






     Weighted average common shares outstanding:



     Basic                                                                                               11,092,144                                                 10,365,744             11,094,784         11,009,199




     Diluted                                                                                             11,092,144                                                 10,365,744             19,901,263         11,009,199

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SOURCE MICT