August 14, 2015

Mict


Micronet Enertec Technologies, Inc. Reports Second Quarter Results

Montvale, NJ, August 14, 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 second quarter ended June 30, 2015.

David Lucatz, Chief Executive Officer of Micronet Enertec Technologies, Inc. stated, “During the second quarter we made continued progress with the roll out of our new All-In-One wireless platforms for the MRM  sector.  The company has already started to ship units of the All-In-One and has generated revenues by this new product line, driving the 3% increase in MRM sales in the first six months of 2015. Moreover, 77% of our sales in the first six months were to the Local Fleet vertical, the largest and most promising MRM vertical. We are seeing strong marketplace interest for this solution, which offers our customers real-time connectivity using 3.5G/4G LTE, Blue Tooth and Wi-Fi applications in an All-In-One rugged platform. Approximately 4,000 unit orders have been received to date, and currently we have a very strong order pipeline. During the quarter we entered into a memorandum of understanding, valued at a minimum of $950,000 initially, with expected follow on orders to exclusively supply rugged tablets and other telematics equipment to a leading MRM solution provider.  Additionally, following the close of the quarter, we announced a $1.4 million purchase order from a leading U.S. provider of solutions for the Public Transportation market for our All-in-One rugged tablet.  We expect to see continued demand for our products as the trucking industry prepares to comply with the Electronic Logging Device (ELD) mandate expected to be effective beginning in September 2015, given our products’ ability to capture the required logging data set forth in the mandate.” 

“Revenues for the second quarter increased as compared to the first quarter of 2015.  Gross margin of 32% was within our target gross margin range and demonstrates an improvement as compared to the second quarter of 2014. While  research and development (R&D) expenses slightly declined in the quarter, our investment in R&D remains significantly higher related to the intensive efforts around the development of our new All-In-One unique product line. There is typically a longer sales cycle as the market transitions to a newer technology, and we are well positioned for a strong second half of 2015 with an improvement in all parameters as we complete most of our intensive development efforts, save costs following integration of operations  and the industry adopts our new solutions.” 

Second Quarter 2015 Review

  • Total revenue decreased 13% to $5.7 million, as compared to $6.6 million in the second quarter of 2014. The decline was mainly due to a decrease of $736,000 in our aerospace and defense division. MRM increased 5% sequentially as compared to the first quarter of 2015.
  • Gross profit margin was 32%, as compared to gross margin of 28% in the second quarter of 2014. This is mainly due to an increase in the MRM gross margin.
  • R&D expenses for the quarter were  $723,000, or 12.6% of sales, compared to $874,000, or 13.2% of sales, in the second quarter of 2014
  • Selling, General & Administrative (SG&A) expense was $1.5 million, or 26% of sales, as compared to $2.0 million, or 30% of sales, in the second quarter of 2014.
  • Net loss attributed to MICT for the second quarter was $588,000, or a loss of $0.10 per basic and diluted share, as compared to a net loss of $1.274 million, or $0.22 per basic and diluted share, for the second quarter of 2014.
  • The Company reported an operating loss of $671,000, as compared to an operating loss of $1.1 million in the second quarter of 2014.
  • At June 30, 2015, the Company reported cash and marketable securities totaling $12.6 million and working capital of $15.3 million.


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