EX-99.1 2 v443234_ex99-1.htm EXHIBIT 99.1

Exhibit 99.1

 

UNAUDITED PRO FORMA FINANCIAL INFORMATION

 

On June 28, 2016 the Registrant consummated the previously announced spin-off of Shagrir Group Vehicle Services Ltd, (“Shagrir”).The unaudited pro forma financial statements have applied pro forma adjustments to the Registrant's historical consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America and give effect to the spin-off of Shagrir. The unaudited pro forma statements of operations for the fiscal years ended December 31, 2015, 2014 and 2013 assume that the spin-off occurred January 1, 2013. The unaudited pro forma balance sheet as of December 31, 2015, assumes the spin-off occurred on that date.

 

The unaudited pro forma financial statements are presented based on currently available information and are intended for informational purposes only. These unaudited pro forma financial statements are not necessarily indicative of what the Registrant's results of operations or financial condition would have been had the spin-off been completed on the dates assumed. In addition, they are not necessarily indicative of the Registrant's future results of operations or financial condition. Beginning in the second quarter of fiscal 2016, the historical financial results of the consolidated operations of Shagrir for the periods prior to the spin-off will be reflected in the Registrant's consolidated financial statements as discontinued operations.

 

The unaudited pro forma financial statements should be read in conjunction with (i) the accompanying notes to the unaudited pro forma financial statements, and (ii) the audited consolidated financial statements and accompanying notes and Item 5 - “Operating and Financial Review and Prospects” of the Registrant’s Annual Report on Form 20-F for the year ended December 31, 2015 filed with the SEC on March 29, 2016.

 

The unaudited pro forma financial information also excludes the effects of costs associated with spin-off, as they are currently not known, and to the extent they occur, are expected to be non-recurring and were not incurred as of the closing date of the spin-off. However, such costs could affect the Registrant following the spin-off in the period the costs are incurred or recorded.

 

 

 

Pointer Telocation Ltd.

Unaudited Pro Forma Statements of Operations (USD in thousands)

Year Ended December 31, 2015

 

   

Year ended

December 31, 2015

  
    Historical    

RSA spin-off

Pro Forma adjustments (a)

     Pro Forma  
Revenues:                  
Products     28,617       6,254       22,363  
Services     72,307       34,006       38,301  
                         
Total revenues     100,924       40,260       60,664  
                         
Cost of revenues:                        
Products     17,003       3,443       13,560  
Services     49,739       31,860       17,879  
                         
Total cost of revenues     66,742       35,303       31,439  
                         
Gross profit     34,182       4,957       29,225  
                         
Operating expenses:                        
Research and development     3,409       -       3,409  
Selling and marketing     12,063       1,595       10,468  
General and administrative     10,993       2,412       8,581  
Amortization of intangible assets     735       197       538  
Impairment of intangible and tangible assets     917       -       917  
                         
Total operating expenses     28,117       4,204       23,913  
                         
Operating income     6,065       753       5,312  
Financial expenses, net     869       226       643  
Other expenses (income)     (6 )     (18 )     12  
                         
Income before taxes on income     5,202       545       4,657  
Tax expenses     1,404       97       1,307  
                         
Net income from continuing operations   $ 3,798       448     $ 3,350  

 

 

 

 

Pointer Telocation Ltd.

Unaudited Pro Forma Statements of Operations (USD in thousands)

Year Ended December 31, 2014

 

   

Year ended

December 31, 2014

  
    Historical    

RSA spin-off

Pro Forma adjustments (a)

     Pro Forma  
Revenues:                  
Products     33,099       5,300       27,799  
Services     72,191       33,732       38,459  
                         
Total revenues     105,290       39,032       66,258  
                         
Cost of revenues:                        
Products     19,279       2,959       16,320  
Services     50,461       31,391       19,070  
                         
Total cost of revenues     69,740       34,350       35,390  
                         
Gross profit     35,550       4,682       30,868  
                         
Operating expenses:                        
Research and development     3,390       -       3,390  
Selling and marketing     11,219       1,636       9,583  
General and administrative     11,883       2,060       9,823  
Other general and administrative  expenses     683       683       -  
Other income     (288 )     -       (288 )
Amortization of intangible assets     994       254       740  
Impairment of intangible and tangible assets     1,122       1,122       -  
                         
Total operating expenses     29,003       5,755       23,248  
                         
Operating income (loss)     6,547       (1,073 )     7,620  
Financial expenses, net     2,424       215       2,209  
Other expenses     232       29       203  
                         
Income (loss) before taxes on income     3,891       (1,317 )     5,208  
Tax income     (8,849 )     -       (8,849 )
                         
Net income (loss) from continuing operations   $ 12,740       (1,317 )   $ 14,057  

 

 

 

 

Pointer Telocation Ltd.

Unaudited Pro Forma Statements of Operations (USD in thousands)

Year Ended December 31, 2013

 

   

Year ended

December 31, 2013

  
    Historical    

RSA spin-off

Pro Forma adjustments (a)

     Pro Forma  
Revenues:                        
Products     34,662       4,528       30,134  
Services     63,195       33,978       29,217  
                         
Total revenues     97,857       38,506       59,351  
                         
Cost of revenues:                        
Products     20,763       2,431       18,332  
Services     45,497       31,552       13,945  
                         
Total cost of revenues     66,260       33,983       32,277  
                         
Gross profit     31,597       4,523       27,074  
                         
Operating expenses:                        
Research and development     3,244       -       3,244  
Selling and marketing     10,398       1,535       8,863  
General and administrative     10,539       1,857       8,682  
Other general and administrative  expenses     403       403       -  
Amortization of intangible assets     967       548       419  
                         
Total operating expenses     25,551       4,343       21,208  
                         
Operating income     6,046       180       5,866  
Financial expenses, net     1,077       216       861  
Other income     (3,299 )     -       (3,299 )
                         
Income (loss) before taxes on income     8,268       (36 )     8,304  
Tax expenses     1,337       -       1,337  
                         
Income (loss) after taxes on income     6,931       (36 )     6,967  
Equity in gains of affiliate     340       -       340  
                         
Net income (loss) from continuing operations   $ 7,271     $ (36 )   $ 7,307  

 

 

 

 

Pointer Telocation Ltd.

Unaudited Pro Forma Balance Sheet (USD in thousands)

Year Ended December 31, 2015

 

   December 31, 2015 
   Historical   RSA Spin-off Pro Forma adjustments  

 

 

Pro Forma

 
ASSETS               
CURRENT ASSETS:               
Cash and cash equivalents  $9,347   $(2,095)  $7,252 
Trade receivables, net   18,402    (8,876)   9,526 
Other accounts receivable and prepaid expenses   2,040    (449)   1,591 
Inventories   4,866    (169)   4,697 
Property and equipment held for sale   282    (282)   - 
Total current assets   34,937    (11,871)   23,066 
                
LONG-TERM ASSETS:               
Long-term accounts receivable   490    -    490 
Long term loan to others   -    789    789 
Severance pay fund   8,186    (5,215)   2,971 
Property and equipment, net   9,112    (5,834)   3,278 
Other intangible assets, net   816    (373)   443 
Goodwill   46,753    (15,365)   31,388 
Deferred tax asset   3,144    (54)   3,090 
Total long-term assets   68,501    (25,052)   42,631 
Total assets  $103,438   $(37,923)  $66,515 

 

LIABILITIES AND SHAREHOLDERS' EQUITY               
CURRENT LIABILITIES:               
Short-term bank credit and current maturities of long-term loans  $4,905   $(85)  $4,820 
Trade payables   11,776    (7,127)   4,649 
Deferred revenues and customer advances   5,843    (5,172)   671 
Other accounts payable and accrued expenses   7,928    (2,759)   5,169 
Total current liabilities   30,452    (15,143)   15,309 
                
LONG-TERM LIABILITIES:               
Long-term loans from banks   8,385    -    8,385 
Long-term loans from shareholders and others   180    (180)   - 
Other long-term liabilities   258    -    258 
Accrued severance pay   9,128    (5,783)   3,345 
Total long term liabilities   17,951    (5,963)   11,988 
                
COMMITMENTS AND CONTINGENT LIABILITIES:               
EQUITY:               
Share capital   5,770    -    5,770 
Additional paid-in capital   128,410    -    128,410 
Accumulated other comprehensive income   (6,254)   -    (6,254)
Accumulated deficit   (71,822)   (18,050)   (89,872)
Total Pointer Telocation Ltd's shareholders' equity   56,104    (18,050)   38,054 
                
Non-controlling interest   (1,069)   1,233    164 
Total equity   55,035    (16,817)   38,218 
                
Total liabilities and equity  $103,438   $(37,923)  $65,515 

 

 

 

  

Notes to the Unaudited Pro Forma Financial Statements

 

The unaudited pro forma financial statements give effect to the spin-off of Shagrir, to be accounted for as a discontinued operation. The unaudited pro forma Statements of Operations for the years ended December 31, 2015, 2014 and 2013 are presented as if the spin-off occurred as of January 1, 2013. The unaudited pro forma Balance Sheet as of December 31, 2015 is presented as if the spin-off occurred on that date.

 

a.The Shagrir spin-off Pro Forma Adjustments columns in the unaudited pro forma information represent the historical financial results of the operations of Shagrir.
b.The pro forma adjustments represent the elimination of the assets and liabilities of the business of Shagrir.