Pointer Telocation Reports Record Results for Q3 2013

            Pointer Telocation Reports Record Results for Q3 2013

- Record revenues of $ 24.4 million, growing 21% year over year

- Non-GAAP net income of $ 1.9 million, an increase of 33% year-over-year

- Closed Brazil transaction in Q4 2013

- Annual revenues expected to exceed $ 100 million in 2014

PR Newswire

ROSH HAAYIN, Israel, Nov. 14, 2013

ROSH HAAYIN, Israel, Nov. 14, 2013 /PRNewswire/ -- Pointer Telocation Ltd.
(Nasdaq CM: PNTR) - a leading developer, manufacturer and operator of Mobile
Resource Management (MRM) and roadside assistance services for the automotive
industry, today announced its financial results for the third quarter of 2013.

Financial Highlights

Revenues: Revenues for the third quarter of 2013 increased 21% to $24.4
million as compared to $20.2 million in the third quarter of 2012.

International activities for the third quarter of 2013 were 27% of revenues,
at the same level as in the third quarter of 2012.

Pointer's revenues from services in the third quarter of 2013 increased 15% to
$ 15.2 million (62% of revenues) compared to $13.1 million (65% of revenues),
in the comparable period of 2012.

Revenues from products in the third quarter of 2013 increased 31% to $9.2
million (38% of revenues) compared to $7 million (35% of revenues) in the
same period in 2012.

Gross Profit: In the third quarter of 2013, gross profit was $7.6 million
(31.2 % of revenues) compared to $6.7 million (33 % of revenues) in the third
quarter of 2012.

Operating Income: Operating income increased 25.1 % to $1.5 million in the
third quarter of 2013 compared to $1.2 million in the third quarter of 2012.

Net Income: Net income from continuing operations attributable to Pointer's
shareholders was $0.8 million or $0.14 per share in the third quarter of 2013
compared to $0.5 million, or $0.09 per share, in the third quarter of 2012.

Non GAAP Net Income: Pointer recorded non-GAAP net income of $1.9 million in
the third quarter of 2013, an increase of 33% as compared to non-GAAP net
income of $1.4 million in the third quarter of 2012.

Adjusted EBITDA: Pointer's adjusted EBITDA for the third quarter of 2013 was
$2.6 million as compared to $2.5 million in the third quarter of 2012.

David Mahlab, Pointer's Chief Executive Officer, commented on the results:
"We are very pleased with our third quarter results, in which we presented
record revenue and continued year-over-year growth across all financial
metrics. Looking ahead, we are pursuing many exciting opportunities both in
Israel and internationally. We are continuing to devote a great deal of effort
to business development, pursuing new vertical markets and territories, while
developing and launching new products in order to enable us to sustain our
high end market position and to continue to improve our overall performance.
Despite price competition and challenging economic conditions in parts of the
territories where we are active, our results continue to improve. In
addition, in October 2013, we closed the transaction for the full
consolidation of our Brazilian subsidiary. As a result, we expect that full
year revenues in 2014 will exceed $100 million, a milestone which will mark
yet another remarkable achievement in the development of our company."

Conference Call Information:

Pointer Telocation's management will host today, Thursday, November 14^th,
2013 a conference call with the investment community to review and discuss the
financial results, and will also be available to answer questions.

The conference call will commence at 9:30 AM EST, 16:30 PM Israel time.

To participate in the call, please dial in to one of the teleconferencing
numbers below. Please begin placing your call at least 5 minutes before the
time set for the commencement of the conference call.

From USA: +1-888-281-1167, From Israel: 03-918-0650

A replay will be available from November 18th, 2013 at the company website:
www.pointer.com

Reconciliation between results on a GAAP and Non-GAAP basis.

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.

Pointer uses adjusted EBITDA and non-GAAP net income as a non-GAAP financial
performance measurement.

We calculate adjusted EBITDA by adding back to net income, net loss from
discontinued operations, financial expenses, taxes, depreciation, the effects
of non-cash stock-based compensation expense, amortization and non-cash
impairment of goodwill and intangible assets.

We calculate non-GAAP net income by adding back to net income, net loss from
discontinued operations, the effects of non-cash stock based compensation
expenses, amortization of intangibles related to acquisitions and non-cash tax
expenses resulting from timing differences relating to the amortization of
acquisition-related intangible assets and goodwill.

The purpose of such adjustments is to give an indication of our performance
exclusive of non-GAAP charges that are considered by management to be outside
of our core operating results.

Adjusted EBITDA and non-GAAP net income are 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. We believe that these non-GAAP measures
help investors to understand our current and future operating cash flow and
performance, especially as our acquisitions have resulted in amortization and
non-cash items that have had a material impact on our GAAP profits. Adjusted
EBITDA and non GAAP net income should not be considered in isolation or as a
substitute for comparable measures calculated and should be read in
conjunction with our consolidated financial statements prepared in accordance
with GAAP. These non-GAAP financial measures may differ materially from the
non-GAAP financial measures used by other companies.

About Pointer Telocation:

Pointer Telocation is a leading provider of technology and services to the
automotive and insurance industries, offering a set of services including Road
Side Assistance, Stolen Vehicle Recovery and Fleet Management. Pointer has a
growing list of customers and products installed in more than 45 countries.
Cellocator, a Pointer Products Division, is a leading AVL (Automatic Vehicle
Location) solutions provider for stolen vehicle retrieval, fleet management,
car & driver safety, public safety, vehicle security and more. The Company's
top management and the development center are located in the Afek Industrial
Area of Rosh Ha'ayin, Israel.

For more information:http://www.pointer.com

Forward Looking Statements

This press release contains historical information and forward-looking
statements within the meaning of The Private Securities Litigation Reform Act
of 1995 with respect to the business, financial condition and results of
operations of the Company. The words "believe," "expect," "anticipate,"
"intend," "seems," "plan," "aim," "should" and similar expressions are
intended to identify forward-looking statements. Such statements reflect the
current views, assumptions and expectations of the Company with respect to
future events and are subject to risks and uncertainties. Many factors could
cause the actual results, performance or achievements of the Company to be
materially different from any future results, performance or achievements that
may be expressed or implied by such forward-looking statements, including,
among others, changes in the markets in which the Company operates and in
general economic and business conditions, loss or gain of key customers and
unpredictable sales cycles, competitive pressures, market acceptance of new
products, inability to meet efficiency and cost reduction objectives, changes
in business strategy and various other factors, both referenced and not
referenced in this press release. Various risks and uncertainties may affect
the Company and its results of operations, as described in reports filed by
the Company with the Securities and Exchange Commission from time to time. The
Company does not assume any obligation to update these forward-looking
statements.

Contact:

Zvi Fried, V.P. and Chief Financial OfficerKenny Green/Ehud
Helft, CCG Investor Relations
Tel.: +972-3-572 3111Tel: +1
646 201 9246
E-mail: zvif@pointer.comE-mail:
pointer@ccgisrael.com



INTERIM CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands



                                              September 30,    December 31,
                                              2013             2012
                                              Unaudited
ASSETS
CURRENT ASSETS:
Cash and cash equivalents                     $     2,697  $     3,685
Restricted cash                               91               108
Trade receivables                             19,732           16,215
Other accounts receivable and prepaid         2,352            2,069
expenses
Inventories                                   5,124            3,982
Total current assets                          29,996           26,059
LONG-TERM ASSETS:
Long-term accounts receivable                 556              582
Severance pay fund                            10,189           9,034
Property and equipment, net                   11,233           10,364
Investment and long term loans to affiliate   1,003            814
Other intangible assets, net                  1,665            2,242
Goodwill                                      49,665           47,190
Total long-term assets                        74,311           70,226
Total assets                                  $   104,307   $    96,285

The accompanying notes are an integral part of the interim consolidated
financial statements.



INTERIM CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands (except share and per share data)



                                              September 30,    December 31,
                                              2013             2012
                                              Unaudited
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term bank credit and current            $     9,308  $    11,129
maturities of long-term loans
Trade payables                                13,986           11,248
Deferred revenues and customer advances       8,526            6,954
Other accounts payable and accrued expenses   7,484            7,251
Total current liabilities                     39,304           36,582
LONG-TERM LIABILITIES:
Long-term loans from banks                    7,531            9,339
Long-term loans from shareholders and others  1,083            925
Other long-term liabilities                   5,021            3,765
Accrued severance pay                         11,432           10,328
                                              25,067           24,357
COMMITMENTS AND CONTINGENT LIABILITIES
EQUITY:
Pointer Telocation Ltd's shareholders'
equity:
Share capital -
Ordinary shares of NIS 3 par value -
Authorized: 8,000,000 shares at September
30, 2013 and
December31, 2012; Issued and
outstanding: 5,561,558                        3,876            3,871
shares at September30, 2013
and 5,555,558 at
December 31, 2012
Additional paid-in capital                    120,776          120,290
Accumulated other comprehensive income        1,762            1,127
Accumulated deficit                           (92,975)         (95,540)
Total Pointer Telocation Ltd's shareholders'  33,439           29,748
equity
Non-controlling interest                      6,497            5,598
Total equity                                  39,936           35,346
Total liabilities and shareholders' equity    $   104,307   $    96,285

The accompanying notes are an integral part of the interim consolidated
financial statements.



INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except per share data)



                             Nine months ended  Three months ended  Year ended

                             September 30,      September 30,       December
                                                                    31,
                             2013      2012     2013        2012    2012
                             Unaudited
Revenues:
Products                     $        $       $  9,206   $     $   
                             25,022    22,525               7,009   30,402
Services                     44,756    40,421   15,192      13,162  54,430
Total revenues               69,778    62,946   24,398      20,171  84,832
Cost of revenues:
Products                     14,799    13,406   5,602       4,126   17,988
Services                     32,510    28,391   11,167      9,317   38,573
Amortization of intangible   -         181      -           60      181
assets
Total cost of revenues       47,309    41,978   16,769      13,503  56,742
Gross profit                 22,470    20,968   7,629       6,668   28,090
Operating expenses:
Research and development     2,296     2,036    826         647     2,716
Selling and marketing        7,524     6,583    2,629       2,138   9,067
General and administrative   7,165     6,986    2,512       2,177   9,232
Amortization of intangible   639       1,486    129         481     1,987
assets
Total operating expenses     17,624    17,091   6,096       5,443   23,002
Operating income             4,846     3,877    1,533       1,225   5,088
Financial expenses, net      785       1,285    187         357     1,628
Other income (expenses),     -         12       -           3       (5)
net
Income before taxes on       4,061     2,580    1,339       865     3,455
income
Taxes on income (Note 6)     1,054     738      591         192     861
Income after taxes on        3,007     1,842    748         673     2,594
income
Equity in gains of           340       106      158         25      38
affiliate
Income from continuing       3,347     1,736    906         648     2,632
operations
Loss from discontinued       -         995      -           296     995
operations, net
Net income                   3,347     741      906         352     $    
                                                                    1,637



INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except per share data)



                          Nine months ended       Three months     Year ended
                                                  ended
                          September 30,                            December
                                                  September 30,    31,
                          2013         2012       2013    2012     2012
                          Unaudited
Other comprehensive
income (loss):
Currency translation                                               $     
adjustments of foreign    1,104        (960)      516     (35)         
operations                                                         299
Realized losses on
derivatives designated    (24)         237        -       76       224
as cash flow hedges
Unrealized losses on
derivatives designated    -            (31)       -       (5)      14
as cash flow hedges
Total comprehensive                                                $     
income (loss)             4,427        (13)       1,422   388         
                                                                   2,174
Profit (loss) from
continuing operations
attributable to:
Equity holders of the     2,565        1,224      780     503      1,833
parent
Non-controlling           782          512        126     145      799
interests
                          3,347        1,736      906     648      2,632
Loss from discontinued
operations attributable
to:
Equity holders of the     -            630        -       274      630
parent
Non-controlling           -            365        -       22       365
interests
                                                                   $     
                          -            995        -       296          
                                                                   995
Total comprehensive
income (loss)
attributable to:
Equity holders of the     3,200        (110)      1,119   229      1,493
parent
Non-controlling           1,227        97         303     159      681
interests
                                                                   $     
                          4,427        (13)       1,224   388        
                                                                   2,174
Earnings per share from
continuing operations
attributable to Pointer
Telocation Ltd's
shareholders:
Basic net earnings per    $       $              $     $     
share                        0.46          0.14             
                                       0.24                0.09   0.35
Diluted net earnings per  $       $              $     $     
share                        0.46          0.14             
                                       0.24                0.09   0.35

The accompanying notes are an integral part of the interim consolidated
financial statements.



INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
U.S. dollars in thousands



                                                                     Year
                        Nine months ended     Three months ended     ended

                        September 30,         September 30,          December
                                                                     31,
                        2013       2012       2013       2012        2012
                        Unaudited
Cash flows from
operating activities:
                        $      $      $      $       $    
Net income                                         1,637
                         3,347      741      906     352
Adjustments required
to reconcile
consolidated net
income to

net cash provided by
operating activities:
Depreciation,
amortization and        2,768      4,270      855        1,211       5,546
impairment
Accrued interest and    (37)       19         (18)       16          118
exchange rate
Changes of long-term    -          34         -          6           -
loans to affiliate
Accrued severance pay,  (114)      103        (47)       148         91
net
Gain from sale of
property and            (169)      (228)      (2)        (104)       (271)
equipment, net
Equity in losses        (340)      106        (158)      25          (38)
(gains) of affiliate
Amortization of
stock-based             163        222        106        55          265
compensation
Decrease (increase) in  17         10         7          4           15
restricted cash
Increase in trade       (2,852)    (2,872)    (1,374)    (555)       (1,572)
receivables, net
Decrease (increase) in
other accounts          (363)      (460)      (107)      182         46
receivable and prepaid
expenses
Decrease (increase) in  (945)      467        (851)      (416)       732
inventories
Deferred income taxes,  671        738        240        274         847
net
Decrease (increase) in
long-term accounts      12         269        (20)       36          234
receivable
Increase (decrease)    1,531      386        1,959      (587)       965
in trade payables
Increase (decrease) in
other accounts payable  1,718      383        458        (558)       (274)
and accrued expenses
Net cash provided by    5,407      4,188      1,954      89          8,341
operating activities
Cash flows from
investing activities:
Purchase of property    (3188)     (3,215)    (752)      (818)       (4,033)
and equipment
Proceeds from sale of   1,458      1,194      660        448         1,733
property and equipment
Investment and
loans/Repayments in     101        (694)      35         23          (669)
affiliate, net
Acquisition of          -          (251)      -          -           (251)
subsidiary (a)
Purchase of business    -          (3,125)    -          -           (3,125)
activity (b)
Net cash used in        (1,629)    (6,091)    (57)       (347)       (6,345)
investing activities
Cash flows from
financing activities:
Receipt of long-term    3,710      9,324      29         1,687       11,670
loans from banks
Repayment of long-term  (7,859)    (9,397)    (2,261)    (3,740)     (12,253)
loans from banks
Dividend paid to
non-controlling         -          -          -          -           (1,215)
interest
Proceeds from issuance  -          1,945      -          1,803       1,945
of shares
Short-term bank         (387)      (39)       659        (302)       (345)
credit, net
Net cash provided by
(used in) financing     (4,536)    1,833      (1,573)    (552)       (198)
activities
Effect of exchange
rate changes on cash    (230)      676        (32)       549         419
and cash equivalents
Increase (decrease) in
cash and cash           (988)      606        292        (261)       2,217
equivalents
Cash and cash
equivalents at the      3,685      1,468      2,405      2,335       1,468
beginning of the
period
Cash and cash           $      $                 $      $    
equivalents at the end              2,697       2,074     3,685
of the period            2,697    2,074



INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
U.S. dollars in thousands



                        Nine months ended     Three months ended  Year ended

                        September 30,         September 30,       December 31,
                        2013       2012       2013       2012     2012
                        Unaudited
(a) Acquisition of
    subsidiary:
    Property and        $      $      $      $     $     
    equipment              -     22         -            22
                                                         -
    Technology          -          58         -          -        58
    Goodwill            -          304        -          -        304
    Non controlling     -          (133)      -          -        (133)
    Interest
                        $      $      $      $     $     
                           -    251          -           251
                                                         -
(b) Purchase of
    business activity:
                        $      $      $      $     $     
    Working capital        -     27         -            27
                                                         -
    Property and        -          112        -          -        112
    equipment
    Customer list       -          1,364      -          -        1,364
    Goodwill            -          1,669      -          -        1,669
    Accrued severance   -          (23)       -          -        (23)
    pay, net
    Employees accruals  -          (24)       -          -        (24)
                        $      $       $      $     $     
                           -    3,125         -         3,125
                                                         -
    The accompanying notes are an integral part of the interim consolidated
    financial statements.

    



ADDITIONAL INFORMATION
U.S. dollars in thousands

The following table reconciles the GAAP to non-GAAP operating results:

Non GAAP Net income

                              Nine months ended   Three months      Year ended
                                                  ended
                              September 30                          December
                                                  September 30      31
                              2013       2012     2013     2012     2012
                              Unaudited
                              $      $     $     $   
GAAP Net income as reported                        $    
                               3,347                      1,637
                                         741     906     352
Amortization and impairment   639        1,670    129      541      2,168
of intangible assets
Loss from discontinued        -          995      -        296      995
operations, net
Stock based compensation     163        222      106      55       265
expenses
Non-cash tax expenses
resulting from timing
differences relating to the
amortization of               1,350      619      787      200      819
acquisition-related
intangible assets and
goodwill
                              $      $     $     $   
Non-GAAP Net income                                $    
                               5,499                         5,884
                                         4,247    1,928   1,444



Adjusted EBITDA

                         Nine months ended     Three months ended  Year ended

                         September 30          September 30        December 31
                         2013       2012       2013       2012     2012
                         Unaudited
GAAP Net income (loss)   $       $      $      $     $     
as reported:             3,347      741       906        352   1,637
Loss from discontinued   -          995        -          296      995
operations, net
Financial expenses, net  785        1,285      187        357      1,628
Tax on income            1,054      738        591        192      861
Stock based              163        222        106        55       265
compensation expenses
Depreciation ,
amortization and
impairment               2,768      3,922      855        1,216    5,198

of goodwill and
intangible assets
Non-GAAP Adjusted        $      $      $      $     $     
EBITDA                   8,117      7,903      2,645       2,468  10,584

SOURCE Pointer Telocation Ltd.

Website: http://www.pointer.com
 
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