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 December, 2007
POINTER TELOCATION LTD.
1 Korazin Street
Givatayim, 53583
Israel
Indicate
by check mark whether the registrant files or will file annual reports under
cover of Form
20-F or Form 40-F.
Form 20-F x Form 40-F o
Indicate
by check mark whether by furnishing the information contained in this
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.
Yes o No x
If
“Yes” is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): 82-
For Immediate Release
| Pointer Telocation Reports another quarter with Record Revenues of Over $12 Million for the Third Quarter of 2007, In line with 2007 Guidance |
| — | $4.3 million Gross Profit, an annual increase of 6.2% |
| — | EBITDA of $1.9 million in Q3 2007 |
Givatayim, Israel – December 10th, 2007. Pointer Telocation Ltd. (Nasdaq Capital Market: PNTR; Tel-Aviv Stock Exchange: PNTR), a leading provider of technology and services to automotive industry, insurance companies and fleets, including road-side assistance, towing, stolen vehicle retrieval and fleet management services to customers in over 20 countries, today reports its financial results for the third quarter of 2007 and the first nine months ended September 30, 2007.
During the third quarter of 2007, Pointer’s increase in its internal revenues was in line with its growth plan. Following the completion of the acquisition of Cellocator’s activity, the company now targets more businesses and technologies and expands its activities into new territories. A key element in its growth strategy is to build a global sales infrastructure and to broaden the scope of its services. Pointer’s financial results for the third quarter of 2007 consolidate 12 days of Cellocator’s activities, include acquisition related expenses and certain non-cash expenses due to the financial structure of the deal.
Financial Highlights:
Revenues: Pointer’s revenues for the third quarter of 2007 increased by 10.3%, to $12.3 million from $11.2 million, in the comparable period in 2006. In the first nine months of 2007, revenues were $35.4 million, a 14% increase over the same period of 2006. Pointer’s revenues from services in the third quarter and the first nine months of 2007 were 72% and 74%, respectively, of total revenues, as compared with 73% and 77% in 2006. International activities for the third quarter of 2007 were 13.7% of total revenue compared to 13.8% in the comparable period in 2006.
Gross Profit: For the third quarter of 2007, gross profit increased 6.2% to $4.3 million from $4.1 million in Q3 2006. As a percentage of revenues, gross profit was approximately 35.3% in Q3 2007, as compared to approximately 36.6% in Q3 2006. In the first nine months of 2007, gross profit increased by 12% to $12.7 million from $11.4 million in the first nine months of 2006. Gross margin for the first nine months of 2007 was 36%, compared to 36.7% for the first nine months of 2006. In the third quarter of 2007 Pointer recorded $33 thousands amortization of intangible assets related to Cellocator acquisition which are non-cash expenses.
Operating income: Pointer’s operating income was $942 thousand for the third quarter of 2007, compared to operating income of $1.4 million for the third quarter of 2006. In the first nine months of 2007, operating income was $2.7 million, compared to $4 million for the same period of 2006.
In the first nine months of 2006 operating income included onetime other income of $1.3 million associated with an agreement signed with a Latin American customer, offset by a $350 thousand impairment of long-lived assets that were recorded in the second quarter of 2006.
Minority share: For the third quarter of 2007 and nine months ended September 30, 2007, Pointer reported a $178 thousand and $882 thousand minority share in the operations of Shagrir, compared to zero in both periods of 2006. Pointer currently holds 56.56% interest in Shagrir.
Net income: Pointer’s net income for the third quarter of 2007 was $3 thousand or $0.0 per share as compared to net income of $449 thousand or $0.14 per share in the third quarter of 2006. For the first nine months of 2007, Pointer recorded a net loss of $565 thousand or $0.14 per share, compared to net income of $1.1 million or $0.39 per share in the same period of 2006. The decrease in profitability is primarily attributable to the above mentioned one time net income of $0.95 million and to the 100% consolidating of Shagrir’s results, both in 2006.
EBITDA: Pointer’s EBITDA for the third quarter of 2007 and for the first nine months of 2007 was $1.9 million and $5.8 million, respectively, as compared to $2.3 million and $7 million in the comparable periods of 2006 in which periods the above mentioned one time net income of $0.95 million was included.
Pointer uses EBITDA as a non-GAAP financial performance measurement. EBITDA is calculated by adding back to net income interest, taxes, depreciation, amortization and minority interest. 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.
Balance Sheet Highlights: In consolidating Cellocator assets and liabilities, the following changes are notable:
Total Shareholder’s Equity increased during the first nine months of 2007 to $31.1 million.
Total long-term assets increased during the first nine months of 2007 from $59.4 million to $80.7 million, mainly as a result of Cellocator acquisition. The goodwill increase from $38.7 million to $49 million and the increase of other intangible assets, net from $8.6 million to $18.4 million due to Cellocator acquisition.
The purchase price allocation (PPA) for the Cellocator acquisition is preliminary and is subject to revision as more detailed analyses are completed and additional information on the fair value of assets and liabilities becomes available. Any change in the fair value of the net assets of Cellocator will change the amount of the PPA to goodwill. We anticipate finalizing the PPA process and updating the changes on the 2007 Annual results.
Danny Stern, Pointer CEO, said: “Internal revenue growth continues to be strong. Acquisition of Cellocator’s technology and customer relations opens a new era and positions us as a major global provider of solutions for the industry. We continue to build a global sales infrastructure and broaden the scope of our services, in order to reinforce further growth. Looking forward, Q4 2007 business continues to demonstrate strength in all markets, including those of Cellocator. We believe that our activities during 2007 will significantly contribute to the top and the bottom lines of our financial figures in 2008".
Conference Call Information:
Pointer’s management will host two conference calls with the investment community today, December 10th, 2007.
The Hebrew conference call will start at 15:30 Israel time (GMT +2, 8:30 EST)
The English conference call will start at 9:30 EST (16:30 Israel time)
To listen to the conference calls, please dial:
From USA: +1-888-642-5032
From Israel: 03-918-0688
A replay of the conference call will be available through December 11st, 2007 on the Company’s website at www.pointer.com.
About Pointer Telocation:
Pointer Telocation Ltd. www.pointer.com develops and supplies location based technologies and delivers a range of services to insurance companies and automobile owners, including road-side assistance, vehicle towing, stolen vehicle retrieval, fleet management and other value added services. Pointer Telocation provides services, for the most part, in Israel, through its subsidiary Shagrir and in Argentina and Mexico through its local subsidiaries. Independent operators provide similar services in Russia and Venezuela utilizing Pointer’s technology and operational know-how.
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
| INTERIM CONSOLIDATED BALANCE SHEETS |
| U.S. dollars in thousands |
| September 30, 2007 |
December 31, 2006 | |||||||
|---|---|---|---|---|---|---|---|---|
| Unaudited |
||||||||
| ASSETS | ||||||||
| CURRENT ASSETS: | ||||||||
| Cash and cash equivalents | $ | 1,880 | $ | 5,850 | ||||
| Trade receivables, net | 11,850 | 8,315 | ||||||
| Other accounts receivable and prepaid expenses | 1,944 | 1,368 | ||||||
| Inventories | 2,583 | 1,447 | ||||||
| Total current assets | 18,257 | 16,980 | ||||||
| LONG-TERM ASSETS: | ||||||||
| Long-term accounts receivable | 165 | 183 | ||||||
| Severance pay fund | 4,439 | 3,794 | ||||||
| Property and equipment, net | 7,849 | 7,346 | ||||||
| Goodwill | 49,025 | 38,707 | ||||||
| Other intangible assets, net | 18,381 | 8,612 | ||||||
| Deferred income taxes | 850 | 777 | ||||||
| Total long-term assets | 80,709 | 59,419 | ||||||
| Total assets | $ | 98,966 | $ | 76,399 | ||||
POINTER TELOCATION LTD. AND ITS SUBSIDIARIES
| INTERIM CONSOLIDATED BALANCE SHEETS |
| U.S. dollars in thousands (except share and per share data) |
| September 30, 2007 |
December 31, 2006 | |||||||
|---|---|---|---|---|---|---|---|---|
| Unaudited |
||||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
| CURRENT LIABILITIES: | ||||||||
| Short-term bank credit and current maturities of long-term loans | $ | 11,721 | $ | 11,801 | ||||
| Trade payables | 7,869 | 5,378 | ||||||
| Deferred revenues | 8,064 | 6,584 | ||||||
| Other accounts payable and accrued expenses | 5,693 | 4,091 | ||||||
| Total current liabilities | 33,347 | 27,854 | ||||||
| LONG-TERM LIABILITIES: | ||||||||
| Long-term loans from banks | 18,797 | 15,833 | ||||||
| Long-term loans from shareholders & others | 5,993 | 7,490 | ||||||
| Accrued severance pay | 5,352 | 4,650 | ||||||
| 30,142 | 27,973 | |||||||
| CONVERTIBLE DEBENTURES | 1,951 | - | ||||||
| MINORITY INTEREST | 2,383 | 1,142 | ||||||
| SHAREHOLDERS' EQUITY: | ||||||||
| Share capital - | ||||||||
| Ordinary shares of NIS 3 par value: | ||||||||
| Authorized - 8,000,000 shares at September 30, 2007 and December 31, 2006, | ||||||||
| respectively; Issued and outstanding: 4,612,875 and 3,222,875 shares | ||||||||
| at September 30, 2007 and December 31, 2006, respectively | 3,137 | 2,140 | ||||||
| Additional paid-in capital | 116,851 | 103,880 | ||||||
| Receipt on account of shares | - | 2,586 | ||||||
| Accumulated other comprehensive income | 994 | 98 | ||||||
| Accumulated deficit | (89,839 | ) | (89,274 | ) | ||||
| Total shareholders' equity | 31,143 | 19,430 | ||||||
| Total liabilities and shareholders' equity | $ | 98,966 | $ | 76,399 | ||||
POINTER TELOCATION LTD. AND ITS SUBSIDIARIES
| INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS |
| U.S. dollars in thousands (except share and per share data |
| Nine months ended September 30, |
Three months ended September 30, |
Year ended December 31, 2006 | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2007 |
2006 |
2007 |
2006 |
||||||||||||||
| Unaudited |
|||||||||||||||||
| Revenues: | |||||||||||||||||
| Products | $ | 9,172 | $ | 7,167 | $ | 3,400 | 3,035 | $ | 9,701 | ||||||||
| Services | 26,184 | 23,795 | 8,921 | 8,133 | 32,211 | ||||||||||||
| Total revenues | 35,356 | 30,962 | 12,321 | 11,168 | 41,912 | ||||||||||||
| Cost of revenues: | |||||||||||||||||
| Products | 5,850 | 4,114 | 2,184 | 1,632 | 5,602 | ||||||||||||
| Services | 16,759 | 15,497 | 5,759 | 5,446 | 20,786 | ||||||||||||
| Amortization of intangible assets | 33 | - | 33 | - | - | ||||||||||||
| Total cost of revenues | 22,642 | 19,611 | 7,976 | 7,078 | 26,388 | ||||||||||||
| Gross profit | 12,714 | 11,351 | 4,345 | 4,090 | 15,524 | ||||||||||||
| Operating expenses: | |||||||||||||||||
| Research and development, net | 1,126 | 826 | 451 | 282 | 1,170 | ||||||||||||
| Selling and marketing | 3,360 | 2,753 | 1,117 | 964 | 3,927 | ||||||||||||
| General and administrative | 4,255 | 3,361 | 1,444 | 1,086 | 4,749 | ||||||||||||
| Amortization of intangible assets | 1,238 | 1,330 | 391 | 400 | 1,740 | ||||||||||||
| Other income, net | - | (1,292 | ) | - | - | (1,292 | ) | ||||||||||
| Impairment of long lived assets | - | 350 | - | - | 372 | ||||||||||||
| Total operating expenses | 9,979 | 8,270 | 3,403 | 2,732 | 10,666 | ||||||||||||
| Operating income | 2,735 | 4,023 | 942 | 1,358 | 4,858 | ||||||||||||
| Financial expenses, net | 2,044 | 2,234 | 659 | 653 | 2,577 | ||||||||||||
| Other income (expenses), net | (17 | ) | (15 | ) | (32 | ) | (10 | ) | 14 | ||||||||
| Income before taxes on income | 674 | 1,774 | 251 | 695 | 2,295 | ||||||||||||
| Taxes on income | 357 | 639 | 70 | 246 | 82 | ||||||||||||
| Net income (loss) before minority interest | 317 | 1,135 | 181 | 449 | 2,213 | ||||||||||||
| Minority interest | 882 | - | 178 | - | 1,044 | ||||||||||||
| Net income (loss) | $ | (565 | ) | $ | 1,135 | $ | 3 | $ | 449 | $ | 1,169 | ||||||
| Basic net Diluted earnings (loss) per share | $ | (0.14 | ) | $ | 0.39 | $ | 0.00 | $ | 0.14 | $ | 0.39 | ||||||
POINTER TELOCATION LTD. AND ITS SUBSIDIARIES
| INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY |
| U.S. dollars in thousands |
| Number of shares |
Share capital |
Additional paid-in capital |
Deferred stock-based compensation |
Receipts on account of shares |
Accumulated other comprehensive income (loss) |
Accumulated deficit |
Total comprehensive income (loss) |
Total shareholders' equity | |||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Balance as of January 1, 2006 | 2,479,020 | $ | 1,680 | $ | 100,707 | $ | (1 | ) | $ | - | $ | (1,138 | ) | $ | (90,443 | ) | $ | 10,805 | |||||||||||
| Deferred stock-based compensation | - | - | (1 | ) | 1 | - | - | - | - | ||||||||||||||||||||
| Stock-based compensation expanses | - | - | 153 | - | - | - | - | 153 | |||||||||||||||||||||
| Exercise of warrants and stock options | 743,855 | 460 | 3,021 | - | - | - | - | 3,481 | |||||||||||||||||||||
| Receipt on account of shares | - | - | - | - | 2,586 | - | - | 2,586 | |||||||||||||||||||||
| Comprehensive income: | |||||||||||||||||||||||||||||
| Foreign currency translation adjustments | - | - | - | - | - | 1,236 | - | $ | 1,236 | 1,236 | |||||||||||||||||||
| Net income | - | - | - | - | - | - | 1,169 | 1,169 | 1,169 | ||||||||||||||||||||
| Total comprehensive income | $ | 2,405 | |||||||||||||||||||||||||||
| Balance as of December 31, 2006 | 3,222,875 | 2,140 | 103,880 | - | 2,586 | 98 | (89,274 | ) | 19,430 | ||||||||||||||||||||
| Issuance of shares | 1,390,000 | 997 | 10,019 | - | - | - | - | 11,016 | |||||||||||||||||||||
| Stock-based compensation expanses | - | - | 366 | - | - | - | - | 366 | |||||||||||||||||||||
| Receipt on account of shares | - | - | 2,586 | - | (2,586 | ) | - | - | - | ||||||||||||||||||||
| Comprehensive income: | |||||||||||||||||||||||||||||
| Foreign currency translation adjustments | - | - | - | - | - | 896 | - | 896 | 896 | ||||||||||||||||||||
| Net loss | - | - | - | - | - | - | (565 | ) | (565 | ) | (565 | ) | |||||||||||||||||
| Total comprehensive loss | $ | 331 | |||||||||||||||||||||||||||
| Balance as of September 30, 2007 (unaudited) | 4,612,875 | $ | 3,137 | $ | 116,851 | $ | - | $ | - | $ | 994 | $ | (89,839 | ) | $ | 31,143 | |||||||||||||
| Balance as of December 31, 2005 | 2,479,020 | 1,680 | 100,707 | (1 | ) | (1,138 | ) | (90,443 | ) | 10,805 | |||||||||||||||||||
| Deferred stock-based compensation | - | - | (1 | ) | 1 | - | - | - | |||||||||||||||||||||
| Amortization of deferred stock-based compensation | - | - | 100 | - | - | - | 100 | ||||||||||||||||||||||
| Exercise of warrants and options | 692,214 | 425 | 2,479 | - | - | - | 2,904 | ||||||||||||||||||||||
| Comprehensive income: | |||||||||||||||||||||||||||||
| Foreign currency translation adjustments | - | - | - | - | 979 | - | $ | 979 | 979 | ||||||||||||||||||||
| Net income | - | - | - | - | - | 1,135 | 1,135 | 1,135 | |||||||||||||||||||||
| Total comprehensive income | $ | 2,114 | |||||||||||||||||||||||||||
| Balance as of September 30, 2006 (unaudited) | 3,171,234 | $ | 2,105 | $ | 103,285 | $ | - | $ | (159 | ) | $ | (89,308 | ) | $ | 15,923 | ||||||||||||||
POINTER TELOCATION LTD. AND ITS SUBSIDIARIES
| INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY |
| U.S. dollars in thousands |
| Number of shares |
Share capital |
Additional paid-in capital |
Deferred stock-based compensation |
Receipts on account of shares |
Accumulated other comprehensive income (loss) |
Accumulated deficit |
Total comprehensive income (loss) |
Total shareholders' equity | |||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Balance as of July 1, 2007 | 4,452,875 | $ | 3,021 | $ | 115,484 | $ | - | $ | - | $ | 6 | $ | (89,842 | ) | - | $ | 28,669 | ||||||||||||
| Issuance of shares | 160,000 | 116 | 1,307 | - | - | - | - | - | 1,423 | ||||||||||||||||||||
| Stock-based compensation expanses | - | - | 60 | - | - | - | - | - | 60 | ||||||||||||||||||||
| Comprehensive loss: | |||||||||||||||||||||||||||||
| Foreign currency translation adjustments | - | - | - | - | - | 988 | - | $ | 988 | 988 | |||||||||||||||||||
| Net loss | - | - | - | - | - | - | 3 | 3 | 3 | ||||||||||||||||||||
| Total comprehensive loss | $ | 991 | |||||||||||||||||||||||||||
| Balance as of September 30, 2007 (unaudited) | 4,612,875 | $ | 3,137 | $ | 116,851 | $ | - | $ | - | $ | 994 | $ | (89,839 | ) | $ | 31,143 | |||||||||||||
| Balance as of July 1, 2006 (unaudited) | 3,095,124 | $ | 2,076 | $ | 103,091 | $ | - | $ | - | $ | (635 | ) | $ | (89,757 | ) | $ | 14,775 | ||||||||||||
| Amortization of deferred stock-based compensation | - | - | 31 | - | - | - | - | 31 | |||||||||||||||||||||
| Exercise of warrants | 76,110 | 29 | 163 | - | - | - | - | 192 | |||||||||||||||||||||
| Comprehensive loss: | |||||||||||||||||||||||||||||
| Foreign currency translation adjustments | - | - | - | - | - | 476 | - | $ | 476 | 476 | |||||||||||||||||||
| Net income | - | - | - | - | - | - | 449 | 449 | 449 | ||||||||||||||||||||
| Total comprehensive income | $ | 925 | |||||||||||||||||||||||||||
| Balance as of September 30, 2006 (unaudited) | 3,171,234 | $ | 2,105 | $ | 103,285 | $ | - | $ | - | $ | (159 | ) | $ | (89,308 | ) | $ | 15,923 | ||||||||||||
POINTER TELOCATION LTD. AND ITS SUBSIDIARIES
| INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS |
| U.S. dollars in thousands |
| Nine months ended September 30, |
Three months ended September 30, |
Year ended December 31, 2006 |
|||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2007 |
2006 |
2007 |
2006 |
||||||||||||||
| Unaudited |
|||||||||||||||||
| Cash flows from operating activities: | |||||||||||||||||
| Net income (loss) | $ | (565 | ) | $ | 1,135 | $ | 3 | $ | 449 | $ | 1,169 | ||||||
| Adjustments required to reconcile net income (loss) to net | |||||||||||||||||
| cash provided by operating activities: | |||||||||||||||||
| Depreciation ,amortization and impairment | 3,415 | 3,498 | 1,096 | 1,147 | 4,490 | ||||||||||||
| Accrued interest and exchange rate changes of convertible | |||||||||||||||||
| debenture and long-term loans | 694 | 451 | 509 | 69 | 137 | ||||||||||||
| Accrued severance pay, net | (80 | ) | (46 | ) | (89 | ) | (23 | ) | (166 | ) | |||||||
| Gain from sale of property and equipment, net | (149 | ) | (39 | ) | (10 | ) | (113 | ) | (563 | ) | |||||||
| Amortization of deferred stock-based compensation | 366 | 100 | 60 | 31 | 251 | ||||||||||||
| Minority interest in earning of subsidiary | 1,241 | - | 387 | - | 1,044 | ||||||||||||
| Increase in trade receivables, net | (1,648 | ) | (1,589 | ) | 346 | (980 | ) | (1,167 | ) | ||||||||
| Increase in other accounts receivable and prepaid expenses | (559 | ) | (203 | ) | (11 | ) | (51 | ) | (36 | ) | |||||||
| Decrease (increase) in inventories | (317 | ) | 200 | (448 | ) | 145 | (490 | ) | |||||||||
| Decrease (increase) in long-term accounts receivable | 31 | 48 | 33 | (3 | ) | 60 | |||||||||||
| Write-off of inventories | 150 | 69 | 135 | - | 127 | ||||||||||||
| Increase in deferred income taxes | - | - | - | - | (99 | ) | |||||||||||
| Increase in trade payables | 756 | 683 | 293 | 398 | 1,049 | ||||||||||||
| Increase (decrease) in other accounts | |||||||||||||||||
| payable and accrued expenses | 1, 839 | 491 | 276 | (512 | ) | (400 | ) | ||||||||||
| Net cash provided by operating activities | 5,174 | 4,798 | 2,580 | 557 | 5,406 | ||||||||||||
| Cash flows from investing activities: | |||||||||||||||||
| Purchase of property and equipment | (2,106 | ) | (2,118 | ) | (336 | ) | (1,244 | ) | (2,277 | ) | |||||||
| Proceeds from sale of property and equipment | 759 | 779 | 258 | 353 | 1,026 | ||||||||||||
| Acquisition of Cellocator (a) | (16,332 | ) | (16,332 | ) | |||||||||||||
| Acquisition of other intangible assets | (135 | ) | - | - | - | - | |||||||||||
| Net cash used in investing activities | (17,814 | ) | (1,339 | ) | (16,410 | ) | (891 | ) | (1,251 | ) | |||||||
| Cash flows from financing activities: | |||||||||||||||||
| Receipt of long-term loans from banks | 5,000 | - | 5,000 | - | 2,243 | ||||||||||||
| Repayment of long-term loans from banks | (3,392 | ) | (1,628 | ) | (1,446 | ) | (401 | ) | (2,949 | ) | |||||||
| Receipt of long-term loans from shareholders and others | - | 131 | - | - | 131 | ||||||||||||
| Repayment of long-term loans from shareholders and others | (2,024 | ) | (3,447 | ) | (684 | ) | (450 | ) | (4,529 | ) | |||||||
| Proceeds from issuance of shares and exercise of warrants, net | 9,588 | 2,904 | (5 | ) | 192 | 3,481 | |||||||||||
| Receipt on account of shares | - | - | 2,586 | ||||||||||||||
| Short-term bank credit, net | (441 | ) | (174 | ) | 406 | 418 | (973 | ) | |||||||||
| Net cash provided by (used in) financing activities | 8,731 | (2,214 | ) | 3,271 | (241 | ) | (10 | ) | |||||||||
| Effect of exchange rate on cash and cash equivalents | (61 | ) | (13 | ) | (113 | ) | 17 | 9 | |||||||||
| Increase in cash and cash equivalents | (3,970 | ) | 1,232 | (10,672 | ) | (558 | ) | 4,154 | |||||||||
| Cash and cash equivalents at the beginning of the period | 5,850 | 1,696 | 12,552 | 3,486 | 1,696 | ||||||||||||
| Cash and cash equivalents at the end of the period | $ | 1,880 | $ | 2,928 | $ | 1,880 | $ | 2,928 | $ | 5,850 | |||||||
POINTER TELOCATION LTD. AND ITS SUBSIDIARIES
| INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS |
| U.S. dollars in thousands |
| Nine months ended September 30, |
Three months ended September 30, |
Year ended December 31, 2006 |
|||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2007 |
2006 |
2007 |
2006 |
||||||||||||||
| Unaudited |
|||||||||||||||||
| (a) Acquisition of Cellocator | |||||||||||||||||
| Fair value of assets acquired and liabilities assumed at date | |||||||||||||||||
| of acquisition: | |||||||||||||||||
| Working capital | 1,220 | - | 1,220 | - | - | ||||||||||||
| Property and equipment | 151 | - | 151 | - | - | ||||||||||||
| Customer Relationships | 3,876 | - | 3,876 | - | - | ||||||||||||
| Brand name | 1,749 | - | 1,749 | - | - | ||||||||||||
| Developed Technology | 4,886 | - | 4,886 | - | - | ||||||||||||
| Goodwill | 8,645 | - | 8,645 | - | - | ||||||||||||
| Accrued severance pay, net | (107 | ) | - | (107 | ) | - | - | ||||||||||
| 20,420 | - | 20,420 | - | - | |||||||||||||
| Fair value of shares issued | (1,428 | ) | - | (1,428 | ) | - | - | ||||||||||
| Fair value of Convertible debentures | (1,952 | ) | - | (1,952 | ) | - | - | ||||||||||
| Accrued expenses | (708 | ) | - | (708 | ) | - | - | ||||||||||
| (4,088 | ) | - | (4,088 | ) | - | - | |||||||||||
| 16,332 | - | 16,332 | - | - | |||||||||||||
Reconciliation of GAAP to NON-GAAP Operating Results
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, depreciation, amortization and minority interest. 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
| Nine months ended September 30, |
Three months ended September 30, |
|||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2007 |
2006 |
2007 |
2006 | |||||||||||
| Unaudited |
||||||||||||||
| Net income (loss) GAAP results (as reported) | (565 | ) | 1,135 | 3 | 449 | |||||||||
| Non GAAP adjustment: | ||||||||||||||
| Financial expenses, net | 2,044 | 2,234 | 659 | 653 | ||||||||||
| Taxes on income | 357 | 639 | 70 | 246 | ||||||||||
| Deprecation and amortization | 3,061 | 3,068 | 1,002 | 912 | ||||||||||
| Minority interest | 882 | - | 178 | - | ||||||||||
| EBITDA | 5,779 | 7,076 | 1,912 | 2,260 | ||||||||||
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: December 10, 2007