SECURITIES AND
EXCHANGE COMMISSION
Washington, D.C. 20549
F O R M 6-K
REPORT
OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE
ACT OF 1934
For the month of May, 2009
Commission File Number: 001-13138
POINTER TELOCATION LTD.
14 Hamelacha Street
Rosh Ha'ayin, 48091
Israel
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cover of Form 20-F or Form 40-F.
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Form, the registrant is also thereby furnishing the information to the Commission
pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
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connection with Rule 12g3-2(b): N/A
For Immediate Release
Pointer Telocation Announces Q1 2009 Results - EBITDA of
$3.1 million Supports Financial, Operational & Growth Needs
| — | Pointer Breakeven Net Income in Q1 2009 Compared with Net Income of $752 thousand in Q1 2008 |
| — | $3 million Decrease in Net Debt |
Rosh HaAyin, Israel May 19th, 2009 Pointer Telocation Ltd. (Nasdaq Capital Market: PNTR, Tel-Aviv Stock Exchange: PNTR) – a leading developer, manufacturer and operator of high-end technology and products for AVL (Automatic Vehicle Location) solutions for stolen vehicle retrieval, fleet management, car & driver safety, vehicle security and asset management, and a leading provider of RSA (Road Side Assistance) services, announced today its financial results for the first quarter of 2009.
Financial Highlights:
Revenues: Pointer’s revenues for the first quarter of 2009 decreased by 13.5%, to $16 million from $18.5 million in the comparable period in 2008. International activities consisted of 26% of total revenues compared with 28% in the comparable period in 2008. Revenues from products were $5.2 million, and consisted of 32% of total revenues, as compared to $7.6 million and 41%, respectively, in the first quarter of 2008. Revenues from services were $10.8 million, and consisted of 68% of total revenues, as compared to $10.9 million and 59%, respectively, in the first quarter of 2008.
Gross Profit: For the first quarter of 2009, gross profit decreased 3% to $6.9 million from $7.2 million in the first quarter of 2008. As a percentage of revenues, gross profit was approximately 43.3% in the first quarter of 2009, as compared to approximately 38.8% in the same period in 2008.
Operating Income: Pointer reported $1.8 million in operating income for the first quarter of 2009, compared to $2.3 million in operating income for the first quarter of 2008.
During the first quarter in accordance with applicable accounting rules, Pointer initially adopted Statement of Financial Accounting Standards No. 160, “Noncontrolling Interestin Consolidated Financial Statements” (“SFAS 160”) which establishes accounting and reporting standards for the non controlling interest (previously minority interest) in a subsidiary and for the deconsolidation of a subsidiary. The adoption of SFAS 160 affected, among others, Pointer ‘s accounting for allocation of losses to non controlling shareholders in its subsidiaries, which resulted in a decrease in Pointer’s share in its subsidiaries’ net losses.”
Net Income: Net income attributable to Pointer’s shareholders was $3 thousand or $0.00 per share in the first quarter of 2009, as compared to $0.8 million or $0.16 per share in the first quarter of 2008. Net income attributable to noncontrolling interest was $1.1 million in the first quarter of 2009 compared to $0.6 million in the first quarter of 2008.
For the first quarter of 2009 the net income, before giving effect to the exclusion of those earnings relating to non-controlling interest in accordance with SFAS 160, was $1.1 million, as compared to a net income of $1.3 million in the first quarter of 2008.
Non-GAAP net income attributable to Pointer: Pointer’s non-GAAP net income in Q1 2009 was $0.8 million, as compared to non-GAAP net income of $1.8 million in Q1 2008.
EBITDA: Pointer’s EBITDA decreased to $3.1 million in the first quarter of 2009, as compared to $3.8 million in Q1 2008. The EBITDA comfortably serves our debt.
Danny Stern, Pointer CEO, said: “Our Q1 2009 results reflect the turbulence in the global economy and the slowdown in the car industry. The activity of our Products and Technology division suffered from the global slowdown while the activity of our services business remains stable, through maintaining our strong customer base and reputable wide array of services. Since the last quarter of 2008 we increased our R&D efforts, with the intention of introducing new products during 2010. Shagrir, Pointer’s Israeli subsidiary, recently acquired 51% of CAR2GO, a carsharing service provider. Carsharing is a rapidly expanding trend in urban areas worldwide, because of its significant contribution to the environment and its reduction in costs and time for the large urban population. Since we entered the slowdown from a relatively strong standpoint, we continue to search for M&A opportunities”, 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 cash flows in this press release.
Pointer uses EBITDA as a non-GAAP financial performance measurement. EBITDA is calculated by adding back to net income interest, taxes, depreciation and amortization. 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 today, May 19th, 2009 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: +1-866-527-8676
From Israel: 03-918-0685
A replay of the conference call will be available through May 20th, 2009 on the Company’s website at www.pointer.com.
About Pointer Telocation:
The Pointer Telocation Group,
publiclly traded on Nasdaq (PNTR) and on TASE (PNTR), develops, manufactures, provides and
operates advanced command and control technonogies for the automotive and cargo
industries. With 500,000 installations in 25 countries around the world, The Pointer Group
is Israel’s leading exporter of state-of-the-art solutions for managing vehicle
fleets. As a service provider, The Pointer Group operates through its subsidiary Shagrir
Systems Ltd., that provides comprehensive solutions for the automotive markets in Israel,
Argentina, Mexico and Romania.
The Pointer Telocation Group is headquartered in Rosh Ha’ayin, Israel. CEO is Danny Stern. For more information, please visit 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.
POINTER TELOCATION LTD. AND ITS SUBSIDIARIES
| CONDENSED INTERIM CONSOLIDATED BALANCE SHEETS |
| U.S. dollars in thousands |
| March 31, 2009 |
December 31, 2008 | |||||||
|---|---|---|---|---|---|---|---|---|
| Unaudited |
||||||||
| ASSETS | ||||||||
| CURRENT ASSETS: | ||||||||
| Cash and cash equivalents | $ | 1,339 | $ | 2,708 | ||||
| Trade receivables, net | 13,509 | 13,509 | ||||||
| Other accounts receivable and prepaid expenses | 3,314 | 2,774 | ||||||
| Inventories | 2,893 | 3,999 | ||||||
| Total current assets | 21,055 | 22,990 | ||||||
| LONG-TERM ASSETS: | ||||||||
| Long-term accounts receivable | 423 | 339 | ||||||
| Severance pay fund | 4,685 | 4,925 | ||||||
| Property and equipment, net | 7,311 | 7,998 | ||||||
| Deferred income taxes | 942 | 1,037 | ||||||
| Other intangible assets, net | 13,554 | 14,894 | ||||||
| Goodwill | 46,580 | 50,416 | ||||||
| Total long-term assets | 73,495 | 79,609 | ||||||
| Total assets | $ | 94,550 | $ | 102,599 | ||||
POINTER TELOCATION LTD. AND ITS SUBSIDIARIES
| CONDENSED INTERIM CONSOLIDATED BALANCE SHEETS |
| U.S. dollars in thousands |
| March 31, 2009 |
December 31, 2008 | |||||||
|---|---|---|---|---|---|---|---|---|
| Unaudited |
||||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
| CURRENT LIABILITIES: | ||||||||
| Short-term bank credit and current maturities of long-term loans | $ | 6,376 | $ | 7,849 | ||||
| Trade payables | 6,550 | 8,613 | ||||||
| Deferred revenues and customer advances | 9,665 | 8,701 | ||||||
| Other accounts payable and accrued expenses | 5,395 | 5,792 | ||||||
| Total current liabilities | 27,986 | 30,955 | ||||||
| LONG-TERM LIABILITIES: | ||||||||
| Long-term loans from banks | 17,483 | 20,520 | ||||||
| Long-term loans from shareholders and others | 3,315 | 3,305 | ||||||
| Other long-term liabilities | 310 | 257 | ||||||
| Accrued severance pay | 5,908 | 6,375 | ||||||
| Total long term liabilities | 27,016 | 30,457 | ||||||
| Total shareholders' equity(*) | 39,548 | 41,187 | ||||||
| Total liabilities and shareholders' equity | $ | 94,550 | $ | 102,599 | ||||
(*) Reclassification due to the adoption of SFAS 160
POINTER TELOCATION LTD. AND ITS SUBSIDIARIES
| CONDENSED INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS |
| U.S. dollars in thousands (except share and per share data) |
| Three months ended March 31, |
Year ended December 31, 2008 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 2009 |
2008 |
||||||||||
| Unaudited |
|||||||||||
| Revenues: | |||||||||||
| Products | $ | 5,184 | $ | 7,607 | $ | 30,645 | |||||
| Services | 10,802 | 10,871 | 46,010 | ||||||||
| Total revenues | 15,986 | 18,478 | 76,655 | ||||||||
| Cost of revenues: | |||||||||||
| Products | 2,961 | 3,957 | 16,392 | ||||||||
| Services | 5,858 | 7,107 | 29,869 | ||||||||
| Amortization of intangible assets | 246 | 245 | 980 | ||||||||
| Total cost of revenues | 9,065 | 11,309 | 47,241 | ||||||||
| Gross profit | 6,921 | 7,169 | 29,414 | ||||||||
| Operating expenses: | |||||||||||
| Research and development, net | 754 | 673 | 2,511 | ||||||||
| Selling and marketing | 1,484 | 1,700 | 6,934 | ||||||||
| General and administrative | 2,386 | 1,925 | 8,311 | ||||||||
| Amortization of intangible assets | 524 | 606 | 2,365 | ||||||||
| Total operating expenses | 5,148 | 4,904 | 20,121 | ||||||||
| Operating income | 1,773 | 2,265 | 9,293 | ||||||||
| Financial expenses, net | 675 | 750 | 4,054 | ||||||||
| Other income (expenses), net | (12 | ) | 16 | 22 | |||||||
| Income before taxes on income | 1,086 | 1,531 | 5,261 | ||||||||
| Taxes on income | 19 | 218 | 640 | ||||||||
| Net income(*) | $ | 1,067 | $ | 1,313 | $ | 4,621 | |||||
| Less: Net income attributable to the non controlling interest | $ | 1,064 | (*)$ | 561 | (*)$ | 2,248 | |||||
| Net income attributable to Pointer's shareholders | $ | 3 | $ | 752 | $ | 2,373 | |||||
| Basic net earnings (loss) per share | $ | 0.00 | $ | 0.16 | $ | 0.51 | |||||
| Diluted net earnings (loss) per share | $ | 0.00 | $ | 0.16 | $ | 0.50 | |||||
(*) Reclassification due to the adoption of SFAS 160
POINTER TELOCATION LTD. AND ITS SUBSIDIARIES
| CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS |
| U.S. dollars in thousands |
| Three months ended March 31, |
Year ended December 31, 2008 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 2009 |
2008 |
||||||||||
| Unaudited |
|||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | 1,067 | (*)$ | 1,313 | (*)$ | 4,621 | |||||
| Adjustments required to reconcile net income to net cash | |||||||||||
| provided by operating activities: | |||||||||||
| Depreciation and amortization | 1,381 | 1,779 | 6,918 | ||||||||
| Accrued interest and exchange rate changes of convertible debenture | |||||||||||
| and long-term loans | (25 | ) | 185 | 1,187 | |||||||
| Accrued severance pay, net | (112 | ) | 345 | 619 | |||||||
| Gain from sale of property and equipment, net | (75 | ) | (88 | ) | (36 | ) | |||||
| Amortization of deferred stock-based compensation | 144 | 71 | 350 | ||||||||
| Increase in trade receivables, net | (942 | ) | (2,443 | ) | (1,773 | ) | |||||
| Increase in other accounts receivable and prepaid expenses | (727 | ) | (843 | ) | (6 | ) | |||||
| Decrease (increase) in inventories | 321 | 68 | (2,088 | ) | |||||||
| Write-off of inventories | - | - | 112 | ||||||||
| Increase in deferred income taxes | - | - | (178 | ) | |||||||
| Decrease (increase) in other long-term accounts receivable | (114 | ) | - | 23 | |||||||
| Increase (Decrease) in trade payables | (1,523 | ) | 36 | 888 | |||||||
| Increase (decrease) in other accounts payable and accrued expenses | 1,792 | 1,241 | 379 | ||||||||
| Net cash provided by operating activities | 1,187 | 1,664 | 11,016 | ||||||||
| Cash flows from investing activities: | |||||||||||
| Purchase of property and equipment | (469 | ) | (719 | ) | (3,476 | ) | |||||
| Proceeds from sale of property and equipment | 222 | 242 | 605 | ||||||||
| Increase in other accounts receivable | - | (102 | ) | (357 | ) | ||||||
| Net cash used in investing activities | (247 | ) | (579 | ) | (3,228 | ) | |||||
| Cash flows from financing activities: | |||||||||||
| Receipt of long-term loans from banks | - | - | 9,064 | ||||||||
| Repayment of long-term loans from banks | (1,424 | ) | (1,012 | ) | (4,930 | ) | |||||
| Receipt of long-term loans from shareholders and others | 48 | - | - | ||||||||
| Repayment of long-term loans from others | (7 | ) | (823 | ) | (10,201 | ) | |||||
| Proceeds from issuance of shares and exercise of warrants, net | - | - | 1,000 | ||||||||
| Short-term bank credit, net | (947 | ) | 226 | (970 | ) | ||||||
| Net cash used in financing activities | (2,330 | ) | (1,609 | ) | (6,037 | ) | |||||
| Effect of exchange rate on cash and cash equivalents | 21 | (28 | ) | (243 | ) | ||||||
| Increase (decreased) in cash and cash equivalents | (1,369 | ) | (552 | ) | 1,508 | ||||||
| Cash and cash equivalents at the beginning of the period | 2,708 | 1,200 | 1,200 | ||||||||
| Cash and cash equivalents at the end of the period | $ | 1,339 | $ | 648 | $ | 2,708 | |||||
(*) Reclassification due to the adoption of SFAS 160
POINTER TELOCATION LTD. AND ITS SUBSIDIARIES
| Reconciliation Table of Non-GAAP Measures |
| U.S. dollars in thousands |
Reconciliation of GAAP net income to non-GAAP net income is as follows:
| Three months ended March 31, |
Year ended December 31, 2008 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 2009 |
2008 |
||||||||||
| Unaudited |
|||||||||||
| Net income attributable to Pointer and the non controlling | |||||||||||
| interest | $ | 1,067 | $ | 1,313 | $ | 4,621 | |||||
| Net income attributable to the non controlling interest | (1,064 | ) | (561 | ) | (2,248 | ) | |||||
| Amortization of intangible assets and impairment of long-lived | |||||||||||
| assets | 770 | 851 | 3,345 | ||||||||
| Loan Discount | - | - | 704 | ||||||||
| Tax on income | 218 | 640 | |||||||||
| Non-GAAP Net income attributable to Pointer's shareholders | 773 | 1,821 | 7,062 | ||||||||
POINTER TELOCATION LTD. AND ITS SUBSIDIARIES
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 and depreciation amortization. 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 March 31, |
Year ended December 31, 2008 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 2009 |
2008 |
||||||||||
| Unaudited |
|||||||||||
| Net income attributable to Pointer and the non controlling | |||||||||||
| interest: | $ | 1,067 | $ | 1,313 | $ | 4,621 | |||||
| Financial expenses, net | 675 | 750 | 4,054 | ||||||||
| Tax on income | 19 | 218 | 640 | ||||||||
| Depreciation and amortization | 1,379 | 1,562 | 6,116 | ||||||||
| EBITDA | 3,140 | 3,843 | 15,431 | ||||||||
This Form 6-K is being incorporated by reference in all effective registration statements filed by the Registrant under the Securities Act of 1933, to the extent not superseded by documents or reports subsequently filed or furnished.
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| POINTER TELOCATION LTD. By: /s/ Yossi Ben Shalom —————————————— Yossi Ben Shalom Chairman of the Board of Directors |
Date: May 19, 2009