Ituran Location and Control Ltd. Presents Results for the First Quarter of 2009

AZOUR, Israel, May 18 /PRNewswire-FirstCall/ -- Ituran Location and
Control Ltd. (NASDAQ: ITRN, TASE: ITRN), today announced its consolidated
financial results for the first quarter ended March 31, 2009.
Highlights of the Quarter

- Strong year over year growth in net income
- Improved year over year gross, Ebitda and net margins
- A 10,000 net subscriber increase to a record of 521,000 as
of March 31st, 2009

First quarter Results
Revenues for the first quarter of 2009 reached US$27.3 million. This is
17% below revenues of US$32.8 million in the first quarter of 2008. Since
Ituran generates revenues in local currencies, but report financial results
in US dollars, revenue levels were primarily affected by the strength of the
US dollar versus the Brazilian Real, the Israeli shekel and the Argentinean
pessos compared with the level in the first quarter of last year.
Operating profit for the first quarter of 2009 was US$5 million (18.4% of
revenues) compared with an operating profit of US$6.3 million (19.1% of
revenues) in the first quarter of 2008. Again, the operating profit was
negatively affected by the increase in the value of the dollar against the
other currencies in which Ituran operates.
EBITDA for the quarter was $7.7 million (28.1% of revenues) compared to
an EBITDA of $8.5 million (25.9% of revenues) in the first quarter of last
year.
A financial gain of US$4.2 million was recorded as a result of the strong
10% appreciation of the US dollar against the Israeli shekel during the
quarter, compared with the prior quarter. This, as previously explained, is
due to the fact that most of the Company's cash is held in US dollars for
strategic purposes, while Ituran's functional currency in Israel is the
Israeli Shekel. In the first quarter of 2008, Ituran had a financial expense
of $4.4 million.
Net profit was US$5.6 million in the first quarter of 2009 (20.5% of
revenues), compared with a a net profit of US$863 thousand (2.6% of
revenues), as reported in the first quarter of 2008. Fully diluted EPS in the
first quarter of 2009 was US$0.27, compared with fully diluted EPS of US$0.04
in the first quarter of 2008.
Cash flow from operations during the quarter generated US$7.7 million.
As of March 31st, 2009 the company had a net cash position (including
marketable securities) of US$58 million compared with US$55.3 million on
December 31st, 2008.
Eyal Sheratzky, Co-CEO of Ituran said, "Our bottom line results again
prove the defensive nature of our business demonstrated by continued strong
margins. Our business in Brazil continues to perform well, remaining a stable
growth engine for Ituran. This business has enabled us to continue to grow
our subscriber base despite the global recession."
"Our positive business performance in all market climates, capitalizes on
our firmly established customer base through its recurring revenue stream and
generation of cash. As we move through 2009, and even as the extent of the
global downturn is becoming clearer, we expect to continue to grow in our
subscriber base," concluded Mr. Sheratzky.
Conference Call Information
The Company will also be hosting a conference call later today, May 18th,
2009 at 10:00am ET. 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 at least 10 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: 1-888-723-3163
CANADA Dial-in Number: 1-866-958-6867
ISRAEL Dial-in Number: 03-918-0664
INTERNATIONAL Dial-in Number: +972-3-918-0664

At: 10:00am Eastern Time, 7:00am Pacific
Time, 5:00pm 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, at: http://www.ituran.com
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.
About Ituran
Ituran provides location-based services, consisting predominantly of
stolen vehicle recovery and tracking services, as well as wireless
communications products used in connection with its location-based services
and various other applications. Ituran offers mobile asset location, Stolen
Vehicle Recovery, management & control services for vehicles, cargo and
personal security. Ituran's subscriber base has been growing significantly
since the Company's inception to over 521,000 subscribers distributed
globally. Established in 1995, Ituran has approximately 1200 employees
worldwide, provides its location based services and has a market leading
position in Israel, Brazil, Argentina and the United States.
CONSOLIDATED INTERIM BALANCE SHEETS

US dollars
March 31, December 31,
(in thousands) 2009 2008

Current assets
Cash and cash equivalents 29,793 12,511
Cash deposit in escrow 13,023 12,998
Investments in trading marketable securities 15,548 30,159
Accounts receivable (net of allowance for
doubtful accounts) 23,634 26,729
Other current assets 5,485 5,487
Inventories 11,981 11,659
_______ ______
99,464 99,543
----------- ----------

Long-term investments and debit balances
Investments in affiliated companies 163 180
Investments in other companies 73 80
Available for sale securities 3,285 2,988
Other current assets 1,286 1,139
Loan to former employee 558 558
Deposit 439 304
Deferred income taxes 6,502 6,544
Funds in respect of employee rights upon
retirement 2,651 2,792
______ ______
14,957 14,585
---------- ----------

Property and equipment, net 26,697 27,074
--------- ----------

Intangible assets, net 5,918 6,967
--------- ---------

Goodwill 8,871 9,730
--------- ---------
______ ______

Total assets 155,907 157,899
_______ _______
_______ _______

CONSOLIDATED INTERIM BALANCE SHEETS

US dollars
March 31, December 31,
(in thousands) 2009 2008

Current liabilities
Credit from banking institutions 404 320
Accounts payable 12,670 11,642
Deferred revenues 4,889 4,821
Other current liabilities 15,387 16,333
______ ______
33,350 33,116
---------- ----------

Long-term liabilities
Liability for employee rights upon retirement 4,386 4,747
Deferred income taxes 1,268 1,463
______ ______
5,654 6,210
---------- ----------

Minority interest 2,917 3,124
--------- ----------

Capital Notes 5,894 5,894
--------- ---------

Total shareholders' equity 108,092 109,555
---------- ----------

______ ______
Total liabilities and shareholders' equity 155,907 157,899
_______ _______
_______ _______

CONSOLIDATED INTERIM STATEMENTS OF INCOME

Three months period
ended March 31,
(in thousands except per share data) 2009 2008

Revenues:
Location-based services 20,134 19,828
Wireless communications products 7,118 12,986
______ ______
27,252 32,814
---------- ---------

Cost of revenues:
Location-based services 7,596 7,191
Wireless communications products 6,348 10,482
______ ______
13,944 17,673
---------- ---------
______ _______

Gross profit 13,308 15,141
Research and development expenses 90 106
Selling and marketing expenses 1,704 2,641
General and administrative expenses 6,511 6,082
Other (income) expenses, net (10) 35
_______ ______
Operating income 5,013 6,277
Financing income (expenses),net 4,154 (4,371)
______ ______
Income before taxes on income 9,167 1,906
Taxes on income (3,362) (781)
______ ______
5,805 1,125
Share in losses of affiliated companies, net - (16)
Minority interests in income of subsidiaries (210) (247)
______ ______
Net income for the period 5,595 862
______ ______
______ ______

Earnings per share:
Basic 0.27 0.04
______ ______
______ ______

Diluted 0.27 0.04
______ ______
______ ______

Weighted average number of shares outstanding (in
thousands):
Basic 20,968 22,107
______ ______
______ ______

Diluted 20,976 22,116
______ ______
______ ______

CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS

US dollars
Three months period
ended March 31,
(in thousands) 2009 2008

Cash flows from operating activities
Net income for the period 5,595 862

Adjustments to reconcile net income to
net cash from operating activities:
Depreciation and amortization 2,637 2,219

Exchange differences on principal of
deposit and loan, net (51) 48

Exchange differences on principal of
trading marketable securities (1,888) (43)

Increase in liability for employee
rights upon retirement 77 111

Share in losses of affiliated companies,
net - 16

Deferred income taxes (315) (579)
Capital loses (gains) on sale of
property and equipment, net (10) 33
Minority interests in profits of
subsidiaries, net 210 247

Increase in accounts receivable (246) (3,633)
Decrease (increase) in other current
assets 224 (199)

Increase in inventories (1,397) (946)

Increase in accounts payable 2,101 1,953

Increase in deferred revenues 512 311

Increase in other current liabilities 237 1,393
_______ ______
Net cash provided by operating
activities 7,686 1,793
---------- ----------
Cash flows from investing activities
Increase in funds in respect of employee
rights upon retirement, net of
withdrawals (116) (67)

Capital expenditures (2,491) (2,751)

Proceeds from sale of property and
equipment 26 132

Deposit (163) -

Investment in trading marketable
securities (15,497) (1,673)

Sale of marketable securities 30,100 1,652

Proceeds from sale of subsidiary - 58,720
_______ ______
Net cash provided by investment
activities 11,859 56,013
------------ ----------
Cash flows from financing activities
Short-term credit from banking
institutions, net 113 10,817

Purchase of shares from treasury - (13,212)
_______ ______
Net cash provided by (used in) financing
activities 113 (2,395)
----------- ----------
Effect of exchange rate changes on cash
and cash equivalents (2,351) 2,364
------------ ---------
_______ ______
Net increase in cash and cash
equivalents 17,307 57,775

Balance of cash and cash equivalents at
beginning of period 25,509 28,669
_______ ______
Balance of cash and cash equivalents at
end of period 42,816 86,444
_______ ______
_______ ______

Company Contact

Udi Mizrahi (udi_m@ituran.com)
VP Finance, Ituran
(Israel) +972-3-557-1348

International Investor Relations
Ehud Helft
Kenny Green
info@gkir.com
GK Investor Relations
(US) +1-646-201-9246

Investor Relations in Israel
Oded Ben Chorin (oded@km-ir.co.il)
KM Investor Relations
(Israel) +972-3-5167620

SOURCE Ituran Location and Control Ltd

Company Contact: Udi Mizrahi (udi_m@ituran.com), VP Finance, Ituran, (Israel)
+972-3-557-1348; International Investor Relations: Ehud Helft, Kenny Green,
info@gkir.com, GK Investor Relations, (US) +1-646-201-9246; Investor Relations
in Israel: Oded Ben Chorin (oded@km-ir.co.il), KM Investor Relations, (Israel)
+972-3-5167620