exhibit_99-1.htm

ITURAN LOCATION AND CONTROL LTD. PRESENTS RESULTS

FOR THE FOURTH QUARTER AND FULL YEAR 2012

Full Year Revenues of $150 million and EPS of $1.19

AZOUR, Israel – February 19, 2013 – Ituran Location and Control Ltd. (NASDAQ: ITRN, TASE: ITRN), today announced its consolidated financial results for the quarter and year ended December 31, 2012.

Highlights of the Fourth Quarter of 2012

·	Revenues of $38.2 million growing 3.4% year-over-year; in local currency term revenues grew 8.5% year-over-year;

·	A 14 thousand quarterly increase in net subscribers to a record of 667 thousand subscribers as of December 31, 2012;

·	Gross margin at 49.3% and operating margin at 21.0%;

·	EBITDA of $12.2 million at 31.8% of revenues;

·	Operating profit of $8.0 million growing 15% compared with $7.0 million in the fourth quarter of 2011 (excluding the legal expenses related to ICMS in Brazil);

·	Generated $9 million in operating cash flow; ended the quarter with $34.2 million in net cash and equivalents;

·	Dividend of $7.0 million declared for the quarter;

Fourth Quarter 2012 Results

Revenues for the fourth quarter of 2012 were $38.2 million, representing a 3.4% growth from revenues of $37.0 million in the fourth quarter of 2011. 76.2% of revenues were from location based service subscription fees and 23.8% from product revenues.

Revenues from subscription fees were $29.1 million, an increase of 2.4% over the same period last year. In local currency terms, subscription revenues grew by 8.5% compared with the fourth quarter of last year due to the increase in the subscriber base, which expanded from 623,000 as of December 31, 2011, to 667,000 as of December 31, 2012.

Product revenues were $9.1 million, an increase of 6.6% compared with the same period last year.

Gross profit for the fourth quarter of 2012 was $18.8 million (49.3% of revenues), an increase of 0.9% compared with $18.7 million (50.5% of revenues) in the fourth quarter of last year.

Operating profit for the fourth quarter of 2012 was $8.0 million (21.0% of revenues), compared with an operating loss of $0.3 million in the fourth quarter of 2011. In the fourth quarter of 2011, the Company made a provision for $7.3 million in legal expenses related to ICMS in Brazil.

EBITDA for the quarter was $12.2 million (31.8% of revenues), compared to an EBITDA of $3.7 million (9.9% of revenues) in the fourth quarter of 2011.

Financial expense in the fourth quarter of 2012 was $28 thousand compared with a financial income of $671 thousand in the fourth quarter of 2011.

Net profit was $4.4 million in the fourth quarter of 2012 (11.5% of revenues), compared with a net profit of $1.6 million (4.3% of revenues), as reported in the fourth quarter of 2011.

ITURAN LOCATION AND CONTROL LTD. AND ITS SUBSIDIARIES

Fully diluted EPS in the fourth quarter of 2012 was US$0.21, compared with fully diluted EPS of US$0.08 in the fourth quarter of 2011.

Cash flow from operations during the quarter was $9 million.

Full Year Results

Revenues for 2012 reached $150.3 million. This is an decrease of 6.1% over revenues of $160.2 million in 2011.In local currency terms, revenues grew by 4% compared with 2011, due to the increase in subscriber base.

Gross profit for 2012 was $74.2 (49.3% of revenues), compared with $79.4 million (49.6% of revenues) in 2011.

Operating profit for 2012 was $29.9 million (19.9% of revenues) compared with an operating profit of $26.6 million (16.6% of revenues) in 2011.

EBITDA for the year was $44.6 million (29.7% of revenues) compared to an EBITDA of $43.6 million (27.2% of revenues) in 2011.

Net income in 2012 was $24.9 million (16.6% of revenues) or fully diluted earnings per share of $1.19. This is compared with a net income in 2011 of $21.3 million (13.3% of revenues) or fully diluted earnings per share of $1.01.

Cash flow from operations for 2012 was $32.5million. As of December 31, 2012, the Company had net cash, including marketable securities and deposits for short and long term, of $34.2 million or $1.63 per share. This is compared with $39.7 million or $1.89 per share as of December 31, 2011.

Dividend

For the fourth quarter of 2012, a dividend of $7.0 million was declared in line with the Company’s stated policy of issuing at least 50% of net profits in a dividend, on yearly basis. For the full year of 2012, Ituran has declared a cumulative $17.2 million in dividends, amounting to 69% of net income for 2012.

Eyal Sheratzky, Co-CEO of Ituran said, “Overall, we are happy with our performance in 2012. Following the changes we implemented in Brazil, the second half of 2012 has demonstrated that this strategy was successful. Our subscriber base is now growing at a rate in line with our long-term targets and our operating margins have been steadily improving throughout the year. In fact, these results make apparent the operating leverage in our model, which enables a large portion of our increase in revenue to fall straight to the operating profit line. Over 2012, we continued to share the fruits of our success and reward the support of our shareholders, distributing a total of $17.2 million. ”

ITURAN LOCATION AND CONTROL LTD. AND ITS SUBSIDIARIES

Conference Call Information

The Company will also be hosting a conference call later today, February 19, 2013 at 9am 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 a few 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: 1 888 407 2553

ISRAEL Dial-in Number: 03 918 0610

CANADA Dial-in Number: 1 866 485 2399

INTERNATIONAL Dial-in Number: +972 3 918 0610

At: 9:00am Eastern Time, 6:00am Pacific Time, 4:00pm 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.

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 667,000 subscribers distributed globally. Established in 1995, Ituran has over 1,300 employees worldwide, provides its location based services and has a market leading position in Israel, Brazil, Argentina and the United States.

Company Contact		International Investor Relations
Udi Mizrahi udi_m@ituran.com VP Finance, Ituran (Israel) +972 3 557 1348		Ehud Helft & Kenny Green ituran@ccgisrael.com CCG Investor Relations (US) +1 646 201 9246

Financial Tables to Follow **

ITURAN LOCATION AND CONTROL LTD. AND ITS SUBSIDIARIES

Consolidated Financial Statements

as of December 31, 2012

ITURAN LOCATION AND CONTROL LTD. AND ITS SUBSIDIARIES

Consolidated Financial Statements

as of December 31, 2012

Table of Contents

	Page
Consolidated Financial Statements:
Balance Sheets	2 – 3
Statements of Income	4
Statements of Cash Flows	5

CONSOLIDATED BALANCE SHEETS

	US dollars
	December 31,
(in thousands)	2012		2011

Current assets
Cash and cash equivalents		29,453		35,270
Investments in marketable securities		-		68
Accounts receivable (net of allowance for doubtful accounts)		26,190		25,294
Loan to former employee		-		340
Other current assets		15,399		15,165
Inventories		14,747		10,881
		85,789		87,018

Long-term investments and debit balances
Deposit in escrow		4,939		4,888
Investments in affiliated company		160		207
Investments in other company		82		80
Other non-current assets		1,890		2,216
Deferred income taxes		4,174		5,568
Funds in respect of employee rights upon retirement		5,515		4,741
		16,760		17,700

Property and equipment, net		34,156		40,870

Intangible assets, net		2,591		3,355

Goodwill		8,043		8,514

Total assets		147,339		157,457

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CONSOLIDATED BALANCE SHEETS

	US dollars
	December 31,
(in thousands)	2012		2011

Current liabilities
Credit from banking institutions		221		390
Accounts payable		9,524		9,319
Deferred revenues		9,526		7,869
Other current liabilities		22,373		20,966
		41,644		38,544

Long-term liabilities
Long term loans		-		173
Liability for employee rights upon retirement		7,915		6,865
Provision for contingencies		3,864		4,250
Other current liabilities		460		753
Deferred revenues		806		728
Deferred income taxes		643		792
		13,688		13,561
Equity:
Stockholders' equity		88,027		101,194
Non - controlling interest		3,980		4,158
Total equity		92,007		105,352

Total liabilities and shareholders’ equity		147,339		157,457

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CONSOLIDATED STATEMENTS OF INCOME

	US dollars						US dollars
(in thousands	Year ended December 31,						Three month period ended December 31,
except per share data)	2012			2011			2012			2011

Revenues:
Location-based services		114,565			120,410			29,128			28,442
Wireless communications products		35,753			39,757			9,099			8,534
		150,318			160,167			38,227			36,976

Cost of revenues:
Location-based services		46,371			50,977	(*)		13,077			11,967	(*)
Wireless communications products		29,786			29,758	(*)		6,312			6,345	(*)
		76,157			80,735			19,389			18,312

Gross profit		74,161			79,432			18,838			18,664
Research and development expenses		669			631			169			151
Selling and marketing expenses		8,489			8,543			2,016			2,156
General and administrative expenses		33,439			34,984			7,997			7,919
Other expenses (income), net		1,617			8,691			632			8,704
Operating income		29,947			26,583			8,024			(266	)
Other (expenses) income		6,755			(819	)		-			(13	)
Financing income (expenses) , net		987			2,100			(28	)		671
Income (loss) before income taxes		37,689			27,864			7,996			392
Income tax		(11,690	)		(5,655	)		(3,326	)		1,341
Share in income (losses) of affiliated
companies, net		(39	)		(23	)		(10	)		(23	)
Net income (loss) for the period		25,960			22,186			4,660			1,710
Less :Net income attributable To non-controlling interest		(1,080	)		(908	)		(250	)		(126	)

Net income attributable to the company		24,880			21,278			4,410			1,584

Basic and diluted earnings per Share of attributable to company’s Stockholders		1.19			1.01			0.21			0.07

Basic and diluted weighted average Number of shares outstanding		20,968			20,968			20,968			20,968

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CONSOLIDATED STATEMENTS OF CASH FLOWS

	US dollars						US dollars
	Year ended December 31,						Three months period ended December 31 ,
(in thousands)	2012			2011			2012			2011
Cash flows from operating activities
Net income for the year		25,960			22,186			4,660			1,710
Adjustments to reconcile net income to net cash from operating activities:
Depreciation, amortization and impairment of goodwill		14,671			17,801			4,151			4,692
Exchange differences on principal of deposit and loans, net		55			(429	)		233			24
Gains in respect of trading marketable securities		(2	)		(27	)		-			(27	)
Increase in liability for employee rights upon retirement		888			854			185			173
Share in losses of affiliated companies, net		39			23			10			23
Deferred income taxes		4,075			(2,224	)		2,789			(858	)
Capital losses on sale of property and equipment, net		23			63			2			87
Decrease (increase) in accounts receivable		(300	)		3,649			2,165			2,890
Increase in other current assets		(7,974	)		(1,784	)		(1,202	)		(1,849	)
increase in inventories		(3,609	)		(2,985	)		(962	)		(1,781	)
Increase (decrease) in accounts payable		(372	)		(180	)		(956	)		527
Increase in deferred revenues		1,532			1,550			339			182
Increase (decrease) in other current liabilities		(2,445	)		7,355			(2,427	)		7,063
Litigation obligation		-			-			-			(237	)
Net cash (provided by)operating activities		32,541			45,852			8,987			12,619

Cash flows from investment activities
Increase in funds in respect of employee rights upon retirement,
net of withdrawals		(662	)		(563	)		(164	)		(152	)
Capital expenditures		(9,676	)		(16,161	)		(4,854	)		(2,822	)
Intangible assets expenditures		-			(74	)		-			(16	)
Deposit in escrow		-			8,223			-			7,620
Deposit		(291	)		384			(10	)		(26	)
Proceeds from sale of property and equipment		319			614			43			65
Sale of marketable securities		70			1,418			-			1,418
Repayment of loan to former employee		355			-			-			-
Adjustment of proceeds received from sale of subsidiary		-			(4,650	)		-			(4,650	)
Net cash(provided by) investment activities		(9,885	)		(10,809	)		(4,985	)		1,437

Cash flows from financing activities
Short term credit from banking institutions, net		(310	)		299			(363	)		(264	)
Repayment of long term loans		(44	)		(46	)		(11	)		(11	)
Dividend paid		(33,308	)		(21,782	)		(5,192	)		-
Dividend paid to non-controlling interest		(1,141	)		(767	)		(122	)		(261	)
Settlements of litigation obligation in connection with financial transaction		7,462			(22,419	)		7,462			(22,419	)
Net cash(provided by) financing activities		(27,341	)		(44,715	)		1,774			(22,955	)
Effect of exchange rate changes on cash and cash equivalents		(1,132	)		( 1,732	)		(15	)		430
Net Increase(decrease) in cash and cash equivalents		(5,817	)		(11,404	)		5,761			(8,469	)
Balance of cash and cash equivalents at beginning of year		35,270			46,674			23,692			43,739
Balance of cash and cash equivalents at end of year		29,453			35,270			29,453			35,270

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