Exhibit 99.1
 
Micronet Enertec Technologies, Inc. Reports Fourth Quarter and
Year End Results
 
·
Strong Q4 12.6% revenue growth over Q4 2013
 
·
82% growth in back half of 2014 compared to first six months of 2014
 
Montvale, NJ, March 31, 2015 -- Micronet Enertec Technologies, Inc. (NASDAQCM: MICT), a developer and manufacturer of rugged computers, tablets and computer-based systems for the commercial Mobile Resource Management (MRM) market and for the defense and aerospace markets, today announced financial results for the fourth quarter and year ended December 31, 2014.
 
David Lucatz, Chief Executive Officer of Micronet Enertec Technologies, Inc. stated, “Our fourth quarter results demonstrated continued momentum and progress toward our goal of becoming a major supplier of rugged tablets to the growing multibillion dollar MRM market.  We achieved solid 12.6% revenue growth compared to the prior year, met our gross margin target range and achieved non- GAAP net income for the last quarter of 2014 of $521,000. Moreover, during the last six months of 2014 our revenues were $22 million - achieving 26% revenue growth over the same period of 2013 and 82% growth over the first six months of 2014. This revenue growth from the first half of 2014 is mainly attributed to the June 2014 acquisition of the U.S.-based MRM division of Beijer Electronics. We are pleased to have gained continued traction diversifying and expanding our customer base, and we believe that progress, combined with our comprehensive product offerings, position us well to further penetrate the MRM market and establish Micronet Enertec as a leading supplier.”
 
“Our establishment of centralized MRM operations in the U.S. has provided us with a local presence and the addition of an experienced U.S.-based sales team which has enhanced our ability to further penetrate the local fleet vertical, the largest vertical in the MRM space.  During the fourth quarter we received a purchase order in the amount of $1.7 million for our TREQ fully portable, rugged mobile tablets from a leading U.S.-based bulk material supply chain solutions company.  This order demonstrates the market interest in our comprehensive product offerings and our ability to provide our solutions to many different applications.”
 
“The local fleet vertical represented 38% of MRM revenue in 2014 and with our increased customer diversity, our brand recognition in the marketplace is expanding.”
 
Fourth Quarter 2014 Review
 
           Total revenue increased by 12.6% to $10.7 million, as compared to $9.5 million in the fourth quarter of 2013, mainly due to the June 2014 acquisition of Beijer’s U.S. vehicle operation.
 
 
 

 
 
           Gross profit margin was 31%, as compared to 33% in the same quarter last year.  Sequentially, gross margin improved, as compared to 25% in the third quarter of 2014.
 
           Selling, General & Administrative (SG&A) expense was $2.8 million, or 26% of sales, as compared to $1.5 million, or 16% of sales, in the fourth quarter of 2013.  The increased SG&A expense is primarily related to costs associated with the reorganization of the Company’s MRM operations in the U.S. including the June 2014 acquisition.
 
           The Company reported an operating loss of $465,000, as compared to operating income of $1.0 million in the fourth quarter of 2013.
 
           Net loss attributable to Micronet Enertec for the fourth quarter was $28,000, or $0.00 per basic and diluted share.
 
           At December 31, 2014, the Company reported cash and marketable securities totaling $14.9 million and working capital of $16.4 million.
 
           Backlog at December 31, 2014 was $9.2 million.
 
Year-End 2014 Review
 
           Revenue decreased 3.7% to $34.2 million, as compared to $35.6 million for the year ended December 31, 2013, due primarily to a reduction in sales volume and pricing for a major customer in the MRM segment.
 
           Gross profit margin for the year decreased to 29% from gross margin of 37% last year.  This decrease was primarily due to a different product mix and a reduction in sales volume and pricing for a major customer.
 
           SG&A expense was $8.2 million, or 24% of sales, in 2014, as compared to $5.3 million, or 15% of sales, in 2013.  The increased SG&A expense for the year was primarily related to approximately $1.4 million of costs associated with the reorganization of our MRM operations in the U.S. following the June 2014 acquisition of Beijer’s U.S. vehicle operation.
 
           The Company reported an operating loss of $1.8 million, as compared to operating income of $4.6 million in 2013.
 
           Non-GAAP net loss for the year was $542,000, or $0.09 per share, compared to Non-GAAP net income of $1,617,000, or $0.31 per share, in 2013.
 
           Net loss attributable to Micronet Enertec for the year was $2.1 million or a loss of $0.37 per basic and diluted share.
 
Mr. Lucatz added, “Our defense and aerospace business had continuing demand for our sophisticated solutions for missile defense systems.  During the quarter we received $1.1 million in purchase orders from a global aerospace corporation.  The first award, valued at $500,000, is for the additional production of units of the fire control computer for the newest version of an advanced missile defense system.  The second award of $640,000 is for the development of a computer-based test and simulator system to ensure the combat readiness of a critical mission system.”
 
 
 

 
 
“In view of the continuing trend to rely on missiles and missile defense systems as a significant factor in the defense strategy of armed forces worldwide, we expect growing demand for the unique and sophisticated technology we’ve developed for various advanced missile defense systems.”
 
Mr. Lucatz concluded, “Our team quickly and efficiently integrated our acquired U.S. business which contributed to record sales for the last six months of 2014. We are executing on our strategy to penetrate the fast growing local fleet segment of the MRM marketplace and we are focused on meeting the needs of our existing customers while also developing new customer relationships as we see increased interest for our products. Additionally, we look forward to introducing several new products during the course of 2015 which we believe will enhance our brand recognition in the MRM marketplace.  Likewise, our aerospace and defense business continues to show strength.  As we enhance our technology and deliver an expanded portfolio of unique products, we believe we are well positioned for future growth.”
 
Micronet Enertec will host a conference call today at 9:30 a.m. ET to discuss the Company's financial results for the fourth quarter and year ended December 31, 2014. The conference call number for U.S. based callers is (888) 668-9141, callers from outside of the U.S. should dial 972-3-918-0609.
 
Participants may also access a live webcast of the conference call through the Investor Relations section of our website by clicking here: http://micronet-enertec.com/IR-Events%20&%20Presentations.asp.
 
A telephone replay will be available for two weeks following the end of the call.  U.S. based callers can access the replay by dialing (888) 782-4291. Callers outside of the U.S. can access the replay by dialing  972-3-3-925-5941.
 
About Micronet Enertec Technologies, Inc.
 
Micronet Enertec Technologies, Inc. (NASDAQCM: MICT) operates through two primary companies, Enertec Systems 2001 Ltd its wholly-owned subsidiary, and Micronet Ltd , in which it has a controlling interest.  Micronet operates in the growing commercial MRM market, mainly in the United States. Micronet designs, develops, manufactures and sells rugged mobile computing devices that provide fleet operators and field workforces with computing solutions in challenging work environments. Enertec operates in the Defense and Aerospace markets and designs, develops, manufactures and supplies various customized military computer-based systems for missile defense systems, command and control and others.  The Company's products, solutions and services are designed to perform in severe environments and battlefield conditions. For more information please visit: www.micronet-enertec.com, the content of which is not incorporated by reference into this press release.

 
 

 
 
Forward-looking Statement
 
This press release contains express or implied forward-looking statements within the Private Securities Litigation Reform Act of 1995 and other U.S. Federal securities laws.  These forward-looking statements include, but are not limited to those statements regarding our future growth and demand in the markets we operate in, our strategy to become the major supplier of rugged tablets to the multibillion MRM growing market, our ability to diversify and expand our customer base, our ability to develop new customer relationships, our ability to meet the needs of our existing customers, market interest in our products, the introduction of new products and our ability to provide our solutions to  different applications. Such forward-looking statements and their implications involve known and unknown risks, uncertainties and other factors that may cause actual results or performance to differ materially from those projected. The forward-looking statements contained in this press release are subject to other risks and uncertainties, including those discussed in the "Risk Factors" section and elsewhere in the Company's annual report on Form 10-K for the year ended December 31, 2014 and in subsequent filings with the Securities and Exchange Commission. Except as otherwise required by law, the Company is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of new information, future events or otherwise.
 
Contact information:
John Nesbett or Jennifer Belodeau
Institutional Marketing Services (IMS)
(203) 972-9200
jnesbett@institutionalms.com/jbelodeau@institutionalms.com
 
Tables To Follow
 
 
 

 
 
 MICRONET ENERTEC TECHNOLOGIES, INC.
 CONSOLIDATED STATEMENTS OF INCOME
(In Thousands, Except Share and Earnings Per Share data)

   
Year ended December 31,
 
   
2014
   
2013
 
             
Revenues
  $ 34,238     $ 35,571  
Cost of revenues
    24,180       22,298  
     Gross profit
    10,058       13,273  
Operating expenses:
               
     Research and development
    2,807       2,675  
     Selling and marketing
    1,947       1,170  
     General and administrative
    6,290       4,179  
     Amortization of intangible assets
    850       657  
       Total operating expenses
    11,894       8,681  
      Income (loss) from operations
    (1,836 )     4,592  
                 
Finance expense, net
    (296 )     (2,293 )
Other expense
    -       (2 )
Income  (loss) before provision for income taxes
    (2,132 )     2,297  
    Provision for income taxes
    242       496  
Net income (loss)
    (2,374 )     1,801  
Net loss (income) attributable to non-controlling interests
    235       (2,296 )
Net loss attributable to Micronet Enertec
  $ (2,139 )   $ (495 )
Loss per share attributable to Micronet Enertec:
               
Basic
  $ (0.37 )   $ (0.097 )
Diluted
  $ (0.37 )   $ (0.097
Weighted average common shares outstanding:
               
Basic
    5,834,371       5,089,122  
Diluted
    5,834,371       5,089,122  

 
 

 

 
MICRONET ENERTEC TECHNOLOGIES, INC.
 CONSOLIDATED STATEMENTS OF INCOME
(In Thousands, Except Share and Earnings Per Share data)
(Unaudited)
 
   
Three months ended December 31,
 
   
2014
   
2013
 
             
Revenues
  $ 10,670     $ 9,483  
Cost of revenues
    7,390       6,314  
     Gross profit
    3,280       3,169  
Operating expenses:
               
     Research and development
    643       531  
     Selling and marketing
    739       216  
     General and administrative
    2,070       1,306  
     Amortization of intangible assets
    293       93  
       Total operating expenses
    3,745       2,146  
      Income (loss) from operations
    (465 )     1,023  
                 
Finance expense, net
    515       (174 )
Other expense
    -       (2 )
Income  (loss) before provision for income taxes
    50       847  
    Provision for income taxes
    233       198  
Net income (loss)
    (183 )     649  
Net loss (income) attributable to non-controlling interests
    155       533  
Net loss attributable to Micronet Enertec
  $ (28 )   $ 116  
Loss per share attributable to Micronet Enertec:
               
Basic
  $ (0.0 )   $ (0.02 )
Diluted
  $ (0.0 )   $ (0.02
Weighted average common shares outstanding:
               
Basic
    5,843,746       5,831,247  
Diluted
    5,843,746       5,831,247  

 
 

 
 
MICRONET ENERTEC TECHNOLOGIES, INC.
 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In Thousands)
 
   
Year ended December 31,
 
   
2014
   
2013
 
Net income (loss)
  $ (2,374 )   $ 1,801  
Other comprehensive income, net of tax:
               
    Currency translation adjustment
    (1,086 )     1,742  
                 
Total comprehensive income (loss)
    (3,460 )     3,543  
                 
Comprehensive loss (income) attributable to the non-controlling interests
    825       (2,882 )
Comprehensive income (loss) attributable to Micronet Enertec
  $ (2,635 )   $ 661  

 
 

 
 
MICRONET ENERTEC TECHNOLOGIES, INC.
 CONSOLIDATED BALANCE SHEETS
(In Thousands, except Share and Par Value data)

   
December 31,
2014
   
December 31,
2013
 
ASSETS
           
Current assets:
           
   Cash and cash equivalents
  $ 8,592     $ 12,825  
   Marketable securities
    6,406       6,969  
   Trade account receivables, net
    14,152       13,467  
    Inventories
    6,658       4,324  
    Derivative asset - call options
    -       460  
    Other accounts receivable
    1,249       1,165  
       Total current assets
    37,057       39,210  
                 
Property and equipment, net
    1,948       2,440  
Intangible assets and others, net
    4,416       1,076  
Long term deposit
    46       103  
 Goodwill
    1,466       -  
       Total long term assets
    7,876       3,619  
                 
Total assets
  $ 44,933     $ 42,829  

 
 

 
 
MICRONET ENERTEC TECHNOLOGIES, INC.
  CONSOLIDATED BALANCE SHEETS
(In Thousands, except Share and Par Value data)

   
December 31,
2014
   
December 31,
2013
 
LIABILITIES AND EQUITY
           
             
Short term bank credit and current portion of long term bank loans
  $ 9,416     $ 5,058  
Current portion of long term notes
    1,000       -  
Trade accounts payable
    7,588       4,361  
Other accounts payable
    2,619       3,355  
       Total current liabilities
    20,623       12,774  
                 
Long term loans from banks
    3,919       3,130  
Long term notes, net of discount
    -       933  
Finance lease
    56       109  
Accrued severance pay, net
    29       172  
Deferred tax liabilities, net
    57       113  
       Total long term liabilities
    4,061       4,457  
                 
Stockholders’ Equity:
               
Preferred stock; $.001 par value, 5,000,000 shares authorized, none issued and outstanding
               
 Common stock; $.001 par value, 25,000,000 shares authorized, 5,856,246 and 5,831,246 shares issued and outstanding as of December 31, 2014 and 2013, respectively.
    6       6  
Additional paid in capital
    7,505       8,053  
Accumulated other comprehensive income
    325       1,389  
Retained earnings
    6,284       8,423  
Micronet Enertec stockholders' equity
    14,120       17,871  
                 
Non-controlling interests
    6,129       7,727  
                 
      Total equity
    20,249       25,598  
                 
      Total Liabilities and equity
  $ 44,933     $ 42,829  
 
 
 

 
 
Non-GAAP Financial Measures
 
In addition to providing financial measurements based on generally accepted accounting principles in the United States, or GAAP, the Company provides additional financial metrics that are not prepared in accordance with GAAP, or non-GAAP financial measures. Management uses non-GAAP financial measures, in addition to GAAP financial measures, to understand and compare operating results across accounting periods, for financial and operational decision making, for planning and forecasting purposes and to evaluate the Company’s financial performance.
 
Management believes that these non-GAAP financial measures reflect the Company’s ongoing business in a manner that allows for meaningful comparisons and analysis of trends in its business, as they exclude expenses and gains that are not reflective of the Company’s ongoing operating results. Management also believes that these non-GAAP financial measures provide useful information to investors in understanding and evaluating our operating results and future prospects in the same manner as management and in comparing financial results across accounting periods and to those of peer companies.
 
The non-GAAP financial measures do not replace the presentation of our GAAP financial results and should only be used as a supplement to, not as a substitute for, the Company’s financial results presented in accordance with GAAP.
 
The non-GAAP adjustments, and the basis for excluding them from non-GAAP financial measures, are outlined below:
 
 
·
Amortization of acquired intangible assets - The Company is required to amortize the intangible assets, included in our GAAP financial statements, related to the acquisition of the Beijer’s U.S. vehicle operation and the purchase of controlling shares of Micronet.  The amount of an acquisition’s purchase price allocated to intangible assets and term of its related amortization are unique to these transactions. The amortization of acquired intangible assets are non-cash charges. The Company believes that such changes do not reflect its operational performance. Therefore, it excludes amortization of acquired intangible assets to provide investors with a consistent basis for comparing pre- and post-transaction operating results.
 
 
·
Amortization of note discount and related expenses - These interest expenses are non-cash and are related to amortization of discount of notes issued by us to UTA Capital LLC, the last of which was paid in January 2015. Such expenses do not reflect the Company’s on-going operations and all of them were incurred up to the end of fiscal 2014.
 
 
·
Change in fair value of call options and warrants – The change in fair value of the call options relating to the acquisition of Micronet is recorded as interest expense. The change in fair value is derived primarily from Micronet’s share price and does not reflect the Company’s on-going operations.
 
 
·
Stock-based compensation  - Share based awards granted to certain individuals are non-cash and affected by the Company’s historical stock prices which are irrelevant to forward-looking analyses and are not necessarily linked to the Company’s operational performance.
 
 
·
Expenses related to the purchase of a business - These expenses relate directly to the June 2014 purchase of Beijer’s U.S. vehicle operation and consist mainly of legal and accounting fees, finder’s fees and travel expenses. The Company believes that these expenses do not reflect its operational performance. Therefore, it excludes them to provide investors with a consistent basis for comparing pre-and post-vehicle operation purchase operating results.
 
 
 

 
 
The following table reconciles, for the periods presented, GAAP net loss attributable to Micronet Enertec to non-GAAP net income attributable to Micronet Enertec and GAAP loss per diluted share attributable to Micronet Enertec to non-GAAP net income per diluted share attributable to Micronet Enertec:
 
   
Year ended
 December 31,
 
   
(Dollars in Thousands, other than share and per share amounts)
 
   
2014
   
2013
 
GAAP net loss attributable to Micronet Enertec Technologies, Inc.
 
$
(2,139
 
$
(495
Amortization of acquired intangible assets
   
492
     
332
 
Change in fair value of call options and warrants
   
299
     
170
 
Amortization of note discount and related expenses
   
67
     
1,641
 
Stock-based compensation
   
402
     
19
 
Expenses related to the purchase of a business
   
369
     
-
 
Income tax-effect of above non-GAAP adjustments
   
(32
   
(50
Total Non-GAAP net income (loss) attributable to Micronet Enertec Technologies, Inc.
 
$
(542
 
$
1,617
 
Non-GAAP net income (loss) per diluted share attributable to Micronet Enertec Technologies, Inc.
 
 $
(0.09
 
 $
0.31
 
Shares used in per share calculations
   
5,834,371
     
5,192,485
 
GAAP net income (loss)  per diluted share attributable to Micronet Enertec Technologies, Inc.
 
 $
(0.37
 
$
(0.097
Shares used in per share calculations
   
5,834,371
     
5,089,122
 



 

The following information was filed by Mict, Inc. (MICT) on Tuesday, March 31, 2015 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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