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.
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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.
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: +972 3 918 0609
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 49,168 45,390
doubtful accounts)
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 19,364 18,525
retirement
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 1.32 1.17 0.66 0.61
to Company's stockholders
Basic and diluted weighted average number of shares 19,894 20,097 19,894 20,045
outstanding (in thousands)
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, (1,515) (1,160) (808) (777)
net of withdrawals
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.
Logo: https://mma.prnewswire.com/media/1972820/Ituran_logo.jpg
Company Contact
Udi Mizrahi
udi_m@ituran.com
Deputy CEO & VP Finance, Ituran
(Israel) +972 3 557 1348
International Investor Relations
Ehud Helft
ituran@ekgir.com
EK Global Investor Relations
(US) +1 212 378 8040
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SOURCE Ituran Location and Control Ltd.
