Nexus Telocation Systems Ltd. Announces its Financial Results for the First Six Months of 2003;
Expects to Secure up to $1.4 Million in Equity Financing
GIVATAYIM, Israel, Sept. 2 -- Nexus Telocation Systems Ltd. (BULLETIN BOARD: NXUS) , a leading provider of Stolen Vehicle Retrieval services, announced today its consolidated financial results for the first six months of 2003.
Nexus' net income in the first six months of 2003 was $7.7 million or $0.10 per share as compared to a net loss of $3.9 million or $0.35 per share for the same period in 2002. Nexus' net loss from continuing activities in the first six months of 2003 reduced to $791,000 or $0.01 per share as compared to a net loss from continuing activities of $1.6 million or $0.14 per share for the same period in 2002.
Nexus' results in the first six months of 2003 were mainly affected by a one-time, non-cash capital gain resulting from the sale in February 2003 of NexusData Inc., through which Nexus was formerly engaged in the automated meter reading industry, as well as from overall slow-down and political uncertainties in Venezuela. However, Nexus' operations in Argentina significantly improved in the first six months of 2003 as compared to the same period in 2002.
During the reported period, Nexus significantly improved its shareholders' equity as a result of the net income of $7.7 million and the last fund raising of $3.2 million from a group of investors led by DBSI Investments Ltd., Nexus' controlling shareholder, and from the conversion of a convertible debenture by AMS Electronics Ltd. Subsequent to the reported period, Nexus is currently completing the raising of up to $1.4 million from the sale of shares and warrants to DBSI Investments Ltd., certain other minority shareholders, and new investors, under the same terms and conditions set forth in the investment agreement between Nexus, DBSI and other investors dated March 13, 2003. This transaction received all of the requisite corporate approvals for the execution of this investment.
Nexus Telocation Systems Ltd. develops, manufactures and markets low energy and cost effective wireless communications and location based information systems through the application of digital spread spectrum technologies deployed in Stolen Vehicle Retrieval applications.
This press release contains forward-looking statements with respect to the business, financial condition and results of operations of Nexus and its affiliates. These forward-looking statements are based on the current expectations of the management of Nexus, only, and are subject to risk and uncertainties relating to changes in technology and market requirements, the company's concentration on one industry in limited territories, decline in demand for the company's products and those of its affiliates, inability to timely develop and introduce new technologies, products and applications, and loss of market share and pressure on pricing resulting from competition, which could cause the actual results or performance of the company to differ materially from those contemplated in such forward-looking statements. Nexus undertakes no obligation to publicly release any revisions to these forward- looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. For a more detailed description of the risks and uncertainties affecting the company, reference is made to the company's reports filed from time to time with the Securities and Exchange Commission.
CONDENSED CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands
June 30, December 31,
2003 2002 2002
Unaudited Audited
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $445 $155 $71
Short-term bank deposits 30 40 64
Trade receivables
(net of allowance for
doubtful accounts) 1,608 2,686 1,134
Other accounts receivable
and prepaid expenses 485 729 661
Inventories 839 1,385 1,264
Total current assets 3,407 4,995 3,194
LONG-TERM INVESTMENTS:
Severance pay fund 524 487 510
Investment in affiliate 2,018 2,014 2,007
2,542 2,501 2,517
PROPERTY AND EQUIPMENT, NET 1,899 791 1,535
INTANGIBLE ASSETS, NET 187 253 210
ASSETS ATTRIBUTED TO
DISCONTINUED OPERATIONS -- 2,627 2,642
Total assets $ 8,035 $ 11,167 $ 10,098
LIABILITIES AND
SHAREHOLDERS' EQUITY
(DEFICIENCY)
CURRENT LIABILITIES:
Short-term bank credit $1,151 $3,482 $848
Trade payables 1,030 1,482 1,913
Other accounts payable and
accrued expenses 1,750 1,547 1,887
Total current liabilities 3,931 6,511 4,648
LONG-TERM LIABILITIES:
Long-term loan 3,000 -- 3,000
Accrued severance pay 720 833 845
Convertible debentures -- 1,010 1,020
3,720 1,843 4,865
LIABILITIES ATTRIBUTED TO
DISCONTINUED OPERATIONS -- 9,748 11,166
SHAREHOLDERS' EQUITY (DEFICIENCY): 384 (6,935) (10,581)
Total liabilities and
shareholders' equity
(deficiency) $ 8,035 $ 11,167 $ 10,098
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except share and per share data)
Six months ended Year ended
June 30, December 31,
2003 2002 2002
Unaudited Audited
Revenues:
Sales $ 1,357 $ 4,213 $ 5,196
Services 1,263 224 1,165
Total revenues 2,620 4,437 6,361
Cost of revenues:
Sales 880 2,304 3,528
Services 869 322 948
Total cost of revenues 1,749 2,626 4,476
Gross profit 871 1,811 1,885
Operating expenses:
Research and development, net 343 650 1,377
Sales and marketing 358 679 1,107
General and administrative 656 1,311 2,284
Total operating expenses 1,357 2,640 4,768
Operating loss (486) (829) (2,883)
Financial income (expenses),
net (305) (50) (266)
Other expenses -- (680) (440)
Loss from continuing activities (791) (1,559) (3,589)
Income (loss) from discontinued
operations, net 8,524 (2,384) (4,000)
Net income (loss) $7,733 $(3,943) $(7,589)
Basic and diluted loss per
share from continuing
operations (in U.S. $) $(0.01) $(0.14) $(0.32)
Basic and diluted loss per
share from discontinued
operations (in U.S. $) 0.11 (0.21) (0.35)
Total basic and diluted income
(loss) per share (in U.S. $) $0.10 $(0.35) $(0.67)
Weighted average number of
shares outstanding
(in thousands) 74,928 11,289 11,289
Contact:
Ronen Stein, V.P. and Chief Financial Officer
Tel.; 972-3-572 3111
ronens@nexus.co.il