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On May 18, 2009,
Ituran Location & Control
reported that its Q1 FY09 earnings grew 549.1%, reflecting a financial gain due to the stronger US dollar against the Israeli Shekel. Net income for the quarter surged to $5.60 million or $0.27 per share from $862,000 or $0.04 per share in Q1 FY08. A financial gain of $4.15 million was recorded due to a 10.0% appreciation of the dollar against the Israeli Shekel. The latest quarterly earnings beat the most recent consensus estimate of $0.19 per share.
Revenue declined 17.0% to $27.25 million from $32.81 million a year ago, mainly due to a slump in the revenue of wireless communications products and the appreciation of the dollar against the Brazilian and Argentinean currencies. Revenue from location-based services edged up 1.5% to $20.13 million from $19.83 million in prior year's quarter, while revenue from wireless communications products' revenue declined 45.2% to $7.12 million from $12.99 million a year ago. Furthermore, Ituran's net subscriber base for the quarter increased by 10, 000 to 521,000.
Cost of revenue decreased 21.1% to $13.94 million from $17.67 million, thereby improving the gross profit margin by 269 basis points to 48.83% as compared to 46.14% in the same quarter a year ago. Meanwhile, research and development expenses decreased 15.1% to $90,000 from $106,000, and selling and marketing expenses slumped 35.5% to $1.70 million from $2.64 million. However, general and administrative expenses escalated 7.1% to $6.51 million. Additionally, net cash flow provided by operating activities surged 328.7% to $7.69 million from $1.79 million in the prior year's quarter.
Looking ahead, the company expects to grow its subscriber base through 2009.