Q4 2025 Ituran Location & Control Ltd Earnings Call

March 5, 2026

Yeah.

Deputy CEO and VP finance.

Ladies and gentlemen, thank you for standing by.

Speaker #1: In local currencies, net income grew 6% year over year. Cash flow from operation for the second quarter of 2025 was 22.4 million dollars, as of June 30, 2025.

My name is Kenny Green I'm part of the Investor Relations team at <unk> I would like to welcome all of you to each rums result, soon webinar and I would like to thank each one's management for hosting this call.

Speaker #2: We continue to see solid demand for our location-based product and telematics services, in all our regions, as well as traction from our new initiatives and services.

All participants other than the presenters are currently muted and following the formal presentation I'll provide some instructions for spacing in the live Q&A session I will now.

Speaker #2: As I mentioned earlier, the war with Iran and the second quarter had a short but intensive economic impact in the country, and the country came to economic standstill for about two weeks.

Speaker #1: The company had net cash, including multiple securities, of $88.7 million. This is compared with net cash, including multiple securities, of $77.3 million as of year-end 2024.

To remind everyone that this conference call is being recorded and accordingly will be available homelink in the earnings press release and on <unk> website from Tomorrow.

Speaker #2: This impacted new car sales, which led to a slight delay in product sales. A high car sales rate in Israel continued to provide strong demand for our services in the country, and we are reaching additional new sales from part of the market that were previously untapped by us, such as lower-priced new vehicles, or the second-hand car

With me today on the call on Mr. Al <unk> CEO, Mr. <unk>, Mr. <unk>, Deputy CEO, and VP finance and Mr. Elie camera CFO of each of them.

Speaker #1: The board of directors declared a dividend of 10 million dollars for the quarter. The current dividends take into account the company's continuing strong profitability, ongoing positive cash flow, and strong balance sheets, and with that, I'd like to open the call for the question-and-answer session.

A L will begin with a summary of the quarter's results followed by Eddie with a summary of the financials. We will then open the call for the question and answer session.

You should have all by now received the Companys press release, if not please view it on the company's website I'd like to remind everyone that the safe Harbor statement in today's press release also covers the contents of this conference call and the associated presentation and now <unk> would you like to begin. Please. Thank you Kenny I'd like to welcome all of you.

Speaker #2: At this time, we'll begin the question-and-answer session. If you have a question, please raise your hand via the Zoom platform. I will introduce you and ask you to unmute, after which you may ask your question.

Speaker #2: We'll take a few moments to answer your questions.

Fourth quarter and full year 2025 results call and thank you for joining us today.

Speaker #1: Our first question will be from Chris Rema of Barclays. Chris, please go ahead.

Before I begin I'd first like to acknowledge the war between Israel and the United States. It gives me Ron.

Speaker #3: Yeah, hi. You can hear me okay?

Speaker #4: Yeah.

Speaker #3: Well, thanks for taking my questions. First off, I'd like to ask how should we—

<unk> most of the Israeli defense forces and U S military personnel and their air forces and we sincerely wish for their Swift and safe return home.

Speaker #1: Chris? We lost you for a second. Please repeat the question.

Hope the world drove to a quick resolution.

Speaker #3: Hi, sorry. How should we be looking at growth into the second half, and would you say you've seen a bounce back in Israel?

And lead to lasting peace for all countries in the middle East and now to the results.

We're very happy with the results of the fourth quarter as well as the full year of 2025, our best ever and record across all key barometers.

Speaker #4: Actually, we're still on track with our forecast of 220 to 240 thousand subscribers. So if the decision will be the growth in subscribers, in the second, according to this, we'll have the growth in the second half of the year.

For the quarter overall revenue growth was 13% to almost $94 million a record we subscriber revenue growth at 15% EBITDA grew to over $25 million a record for us and puts our EBITDA run rate in excess of the 100.

Speaker #3: Right. Okay. And can you provide any more on the BMW? What potentials could the customer and when might we see impact?

Million dollar milestone for the first time.

In addition, we generated a significant amount of cash in the quarter at $29 4 million, our highest ever and as I will discuss later.

Speaker #4: Actually, we have an agreement, and they're going to install our motorcycle solution with their motorcycles, with the BMW motorcycle. It's a very strong brand in Brazil.

Given our very strong balance sheet, we have decided to share all the rewards of our success in 2025 with our shareholders through a special dividend and increased buyback.

In addition to the regular dividend.

Speaker #4: In terms of numbers, usually when we sign OEM contracts, we get kind of roughly projections for numbers, but they never commit. But based on the relationship, the negotiation, and the discussions, we are quite confident that we are talking about tens of thousands of new subscribers every year in the coming years.

Our growth and success in 2025 continued to be driven by <unk>.

Long term efforts in bringing new value, adding telematics and connected car products and services to both existing as well as new customers globally.

Throughout the year, we were particularly successful.

Bringing additional new OEM partners to our growing gross.

Examples during 2025, whereas the Atlantis, Reno, Yamaha and they invest in.

We are in active discussions with others.

Speaker #3: Okay. Thanks. It's helpful. And maybe for Eli, how should we be looking at the financial expenses going forward?

And our new partnership with Fiat between announced last week, we hope to bring additional ones.

In future.

Our results show an ongoing expansion in a large subscriber base, reaching at year end year over two 6 million subscribers.

Speaker #1: Hi, Chris. Financial expenses usually if you look at the past, our average is around break-even or a little bit positive, like up until half a million dollars.

In the fourth quarter, we added 42000 net subscribers adding to.

Speaker #1: But the financial expenses/income is really linked to the FX and our deposits of cash that we have. This quarter specifically, we had deposits linked to the US dollars here in Ituran, Israel, which were attributed to the dividend that we are going to pay.

221000, net new subscribers in 2025, a record year for subscriber growth for each run.

I remind you that in Q1, our new OEM agreement reached Atlantis module subscribers into to run which gave us a bump in net new subscriber adds in that quarter.

Speaker #1: And due to the fact that in the end of June, the shekel got stronger significantly, that affected our financial expenses. So basically, it's not in cash flow.

Our net adds in recent years has tended to be in the 40000 plus per quarter range.

Looking ahead, while the rate can vary between quarters, we expect to maintain this overall current <unk> subscribers at the run rate, which means for 2026, we would expect to add between 160 to 180000 net during the year.

Speaker #1: But this is so going forward, it's hard to say.

Speaker #3: Got it. Okay, thanks. That's helpful. That's it for me.

Speaker #1: That looks like that's all the questions we have in the queue. So I'll hand it back to Eli for the closing statement. Eli, please go ahead.

I want to summarize some of our new activities, which we believe will contribute to our growth and success in the midterm over the coming years.

Speaker #4: Thank you, Kenny. On behalf of the management of Ituran, I would like to thank you, our shareholders, for your continued interest and long-term support of our business.

This all have the potential to completely transform the company.

First our each run more smart mobility platform is differentiated solution, enabling remote vehicular access real time, telematics and efficient management for shared mobility rental fleet and specialized vehicle application. Its one more since launching in Brazil and Israel.

Speaker #4: We look forward to continuing our accomplishments over the next decade. If you are interested in meeting or speaking with us, feel free to reach out to our investor relations team, and with that, we end our call.

Where it has gained solid traction amongst fleet operators and rental companies building on this success. We recently introduced the platform to the U S market and recently.

Stablish dedicated E to run more operations do we see a clear opportunity amongst small and mid sized car rental companies seeking to improve operational efficiency and the end user rental experience. This is the first time, we are coming to the U S market the largest rental market in.

The world with over 17000 small to mid sized car rental companies with a solution that is unique is a real need in the market and therefore has the potential to gain significant market share.

In addition, it run mob is expanding into new verticals.

Last few weeks, we announced partnerships with leading Israel based models for data analytics company Greek.

Under this agreement is to run mob becomes Griep official Iot technology provider combining to run real time telemetry was group.

AI powered analytics platform for racing drivers.

Based on industry estimates there are over 60000 tracing event each year was closer to 1 million participants representing a large addressable market for our technology. Our goal is that this partnership will already connect.

Eyal: You can find the more detailed results that we issued in the press release earlier today. Q2 revenues were a record $86.8 million, a 2% increase compared with revenues of $84.9 million in Q2 of last year. The overall strengthening of the US dollar in Q2 versus some of the various local currencies in which Ituran operates in impacted the revenues when translated into US dollars. In local currencies, revenues grew by 4% year-over-year. Revenues from subscription fees in Q2 were $63.8 million, an increase of 6% year-over-year, and in local currencies, an increase of 7%. Product revenues in Q2 were $23 million, a decrease of 6% year-over-year.

Eli Kamer: You can find the more detailed results that we issued in the press release earlier today. Q2 revenues were a record $86.8 million, a 2% increase compared with revenues of $84.9 million in Q2 of last year. The overall strengthening of the US dollar in Q2 versus some of the various local currencies in which Ituran operates in impacted the revenues when translated into US dollars. In local currencies, revenues grew by 4% year-over-year. Revenues from subscription fees in Q2 were $63.8 million, an increase of 6% year-over-year, and in local currencies, an increase of 7%. Product revenues in Q2 were $23 million, a decrease of 6% year-over-year.

Of new vehicles in 2026.

As you may have seen in the video we published together with the press release. The technology is deployed in some of the most demanding operating environments professional racing and track day driving.

Demonstrating the robustness precession and scalability of our solution.

The higher complexity of this technology allows us to generate a high ARPA for this cycle services it.

To run more represent another new long term growth Avenue, alongside our core telematics and subscribers base businesses.

Credit collarbone.

Is a new and unique initiative being developed by to run that enabled drivers of electric and other zero emission vehicles.

To participate economically in the global transition to low carbon transportation.

Eyal: Product sales were impacted due to a cessation of new sales during the 12-day war between Israel and Iran during the Q2. The subscriber base expanded to 2,548,000 by the end of the Q2, an increase of 40,000 from the end of the Q1. The geographic breakdown of revenues in the Q2 was as follow: Israel 54%, Brazil 23%, rest of world 23%. EBITDA for the Q2 was $22.9 million or 26.4% of revenues, a decrease of 1% compared with EBITDA of $23.1 million or 27.2% of revenues in the Q2 of last year. In local currencies, EBITDA grew 2% year-over-year.

Eli Kamer: Product sales were impacted due to a cessation of new sales during the 12-day war between Israel and Iran during the Q2. The subscriber base expanded to 2,548,000 by the end of the Q2, an increase of 40,000 from the end of the Q1. The geographic breakdown of revenues in the Q2 was as follow: Israel 54%, Brazil 23%, rest of world 23%. EBITDA for the Q2 was $22.9 million or 26.4% of revenues, a decrease of 1% compared with EBITDA of $23.1 million or 27.2% of revenues in the Q2 of last year. In local currencies, EBITDA grew 2% year-over-year.

Something that has not previously been accessible to individual drivers today, while companies that meet carbon dioxide can purchase carbon credits to offset their emissions.

There has been no efficient scalable mechanism for individuals work actively reduce emissions such as <unk>.

Electric vehicle drivers too.

Generate and monetize verified carbon savings.

This solution will create a new incentive for EV adoption, while opening an additional revenue stream for it to run by providing the platform that connect carbon emitters with carbon savers.

Leveraging our existing technology.

Scriber base and infrastructure with minimal incremental cost.

<unk> has been developed internally over years, leveraging our regulatory technological and dump expertise. The solution is highly differentiated and is currently.

Undergoing testing and validation we are in advanced stages and have received encouraging early feedback.

Eyal: Operating expenses in the quarter were slightly higher due to a one-time operating expense in Q2 related to the company-wide celebration of our 30 years milestone. In Q2, finance expenses were $1.3 million compared with finance income of $0.1 million in Q2 of last year. The expenses this quarter was due to the strongly increased level of the Israeli shekel compared to the US dollar at the end of the quarter, which led to a lowering in value of US dollar-linked deposits in Israel, which caused a non-cash finance expenses on those deposits.

Eli Kamer: Operating expenses in the quarter were slightly higher due to a one-time operating expense in Q2 related to the company-wide celebration of our 30 years milestone. In Q2, finance expenses were $1.3 million compared with finance income of $0.1 million in Q2 of last year. The expenses this quarter was due to the strongly increased level of the Israeli shekel compared to the US dollar at the end of the quarter, which led to a lowering in value of US dollar-linked deposits in Israel, which caused a non-cash finance expenses on those deposits.

We expect initial commercial deployment.

The year end 2026, the timing is favorable right now as global awareness and regulatory pressure to reduce carbon emissions around the world continue to accelerate expanding that addressable market.

Another new initiative is leveraging our big data capabilities over many years. It ran has built one of the largest and richest vehicle telematics.

Data sets in our markets.

Im comparison.

<unk> of driving behavior.

Usage patterns location data and vehicle performance across millions of connected vehicles.

Eyal: Net income for Q2 was $13.5 million, or diluted earnings per share of $0.68, an increase of 2% compared to $13.1 million, or diluted earnings per share of $0.66 in Q2 of last year. In local currencies, net income grew 6% year-over-year. Cash flow from operation for Q2 2025 was $22.4 million. As of 30 June 2025, the company had net cash, including marketable securities, of $88.7 million. This is compared with net cash, including marketable securities, of $77.3 million as of year-end 2024. The board of directors declared a dividend of $10 million for the quarter. The current dividend takes into account the company's continuing strong profitability, ongoing positive cash flow, and strong balance sheet.

Eli Kamer: Net income for Q2 was $13.5 million, or diluted earnings per share of $0.68, an increase of 2% compared to $13.1 million, or diluted earnings per share of $0.66 in Q2 of last year. In local currencies, net income grew 6% year-over-year. Cash flow from operation for Q2 2025 was $22.4 million. As of 30 June 2025, the company had net cash, including marketable securities, of $88.7 million. This is compared with net cash, including marketable securities, of $77.3 million as of year-end 2024. The board of directors declared a dividend of $10 million for the quarter. The current dividend takes into account the company's continuing strong profitability, ongoing positive cash flow, and strong balance sheet.

Anonymize and aggregate insight derived from our extensive road use driver behavior and transportation, that's offset with decades of that can support governments transport ministries, and local authorities in optimizing traffic slow improving growth safety and <unk>.

Informing infrastructure planning.

Our data can also support leading vehicle Oems in advancing driver assistance and on to noninterest driving capabilities, providing deep understanding of actual road usage and training systems to better reflect real world driving behavior.

<unk> actively exploring multiple event.

Avenues to monetize these significant assets.

Overall, our big data capabilities strengthen customer retention support margin expansion and provide a highly scalable platform for future growth beyond traditional subscription revenues.

Eyal: With that, I'd like to open the call for the question and answer session.

And finally as I discussed earlier 2025 was the most successful <unk> story.

Eli Kamer: With that, I'd like to open the call for the question and answer session.

Kenny: At this time, we'll begin the question and answer session. If you have a question, please raise your hand via the Zoom platform. I will introduce you and ask you to unmute, after which you may ask your question. We'll take a few moments to poll for your questions. Our first question will be from Tavy Rosner of Barclays. Chris, please go ahead.

Operator: At this time, we'll begin the question and answer session. If you have a question, please raise your hand via the Zoom platform. I will introduce you and ask you to unmute, after which you may ask your question. We'll take a few moments to poll for your questions. Our first question will be from Tavy Rosner of Barclays. Chris, please go ahead.

Such given our strong profitability very strong cash generation and balance sheet with well over $100 million in cash and no debt.

The board declared a total dividend of $30 million for the fourth quarter, consisting of our regular $10 million quarterly dividend and an additional $20 million special dividend.

Tavy Rosner: Yeah. Hi. You can hear me okay?

Therefore.

For the full year, we will have shared a total of $60 million in dividends, representing approximately 100% of our net income which amounts to dividend yield of around 7% based on our year end share price.

Eyal: Yeah.

Eyal Sheratzky: Yeah.

Tavy Rosner: Well, thanks for taking my questions. First off, I'd like to ask, how should we be-?

Kenny: Chris, we lost you for a second. Please repeat your question.

Operator: Chris, we lost you for a second. Please repeat your question.

Tavy Rosner: Hi. Sorry. How should we be looking at growth into the second half? Would you say you've seen a bounce back in Israel?

This is an excellent dividend eight.

For a strong stable and continually growing company demonstrating record results.

In year out.

Eyal: Actually, we're still on track with our with our forecast of 220 to 240,000 subscribers. I believe that this will be the growth in subscribers in the second. According to this, we will have the growth in the second half of the year.

Eyal Sheratzky: Actually, we're still on track with our with our forecast of 220 to 240,000 subscribers. I believe that this will be the growth in subscribers in the second. According to this, we will have the growth in the second half of the year.

Beyond all these and in line with the feedback we hear from many of our investors. We also declared an addition to a buyback of up to $10 million during.

During 2025, we bought back $3 1 million in shares or a total of $85000. Each run shares. We believe all this reflects our commitment to creating value and generating capital for our shareholders. While at the same time continuing to.

Tavy Rosner: Right. Okay. Can you provide any more color on the BMW deal? What's the potential scope of customers, and when might we see impact?

<unk>, new products and services and invest in long term growth at <unk>.

Eyal: actually, BMW in Brazil are signed with us a kind of a partnership agreement, they're going to install

We see our ongoing dividend and share buyback as a reward to our shareholders for their loyalty and long term support of our company.

Eyal Sheratzky: actually, BMW in Brazil are signed with us a kind of a partnership agreement, they're going to install

In summary.

We remain very pleased with <unk> performance in the fourth quarter and more generally it runs longterm and ongoing performance from 2025.

Eli: Our motorcycle solution with their with their motorcycle, with the BMW motorcycle. It's a very strong brand in Brazil. In terms of numbers, usually when we sign OEM contracts, we get kind of roughly projections for numbers, but they never commit. Based on the relationship, the negotiation, and the discussions, we are quite confident that we are talking about tens of thousands of new subscribers every year in the coming years.

Eyal Sheratzky: Our motorcycle solution with their with their motorcycle, with the BMW motorcycle. It's a very strong brand in Brazil. In terms of numbers, usually when we sign OEM contracts, we get kind of roughly projections for numbers, but they never commit. Based on the relationship, the negotiation, and the discussions, we are quite confident that we are talking about tens of thousands of new subscribers every year in the coming years.

The same time, we look for more revenues.

To bring further growth for our business across all our regions and the recent product launches I spoke about earlier. Our example for these additionally.

We will continue to partner with the new Oems as we have successfully done.

Throughout 2025, as well as new financing companies in other lending companies.

2025, Mark 20 years as a public company in 30 years as a company. We look forward to continued success over the next decade and I. Thank our shareholders for their long term support of our business and with that I am over to Ellie Ellie. Please go ahead. Thanks.

Tavy Rosner: Got it. Thanks. That's helpful. Maybe for Eli, how should we be looking at the financial expenses going forward?

I will provide a short summary of the financial results you can find a more detailed result that we issued in a press release earlier today.

Eli: Hi, Chris. Financial expenses, usually, you know, if you look at the past, our average is, you know, around break even or a little bit positive, like up until half a million dollars. The financial expenses/income is really linked to the FX and our deposits of cash that we have. This quarter specifically, we had a deposit linked to the US dollars here in Ituran Israel, which were attributed to the dividend that we are going to pay. Due to the fact that in the end of June, the shekel got stronger significantly, that affected our financial expenses. Basically, it's not in cash flow. Going forward, it's hard to say.

Eli Kamer: Hi, Chris. Financial expenses, usually, you know, if you look at the past, our average is, you know, around break even or a little bit positive, like up until half a million dollars. The financial expenses/income is really linked to the FX and our deposits of cash that we have. This quarter specifically, we had a deposit linked to the US dollars here in Ituran Israel, which were attributed to the dividend that we are going to pay. Due to the fact that in the end of June, the shekel got stronger significantly, that affected our financial expenses. Basically, it's not in cash flow. Going forward, it's hard to say.

Fourth quarter revenues were 93 $5 million at 13% increase year over year.

Subscription revenues were $71 1 million up 15% and representing 76% of total revenues.

Product revenues were at $2012 $4 million up 5% year over year.

Our subscriber base reached 2.650 million at the end of 2025, an increase of 42000 in the fourth quarter and 221 of them year over year.

The geographic breakdown of revenues in the fourth quarter was as follows Israel, 55%, Brazil, 23% rest of world 22%.

Tavy Rosner: Got it. Okay. Thanks. That's helpful. That's it for me.

EBITDA in the fourth quarter was $25 $3 million.

Representing 27, 1% of revenues and a 12% increase year over year.

Kenny: That looks like that's all the questions we have in the queue. I'll hand it back to Eyal for the closing statement. Eyal, please go ahead.

Operator: That looks like that's all the questions we have in the queue. I'll hand it back to Eyal for the closing statement. Eyal, please go ahead.

Net income for the fourth quarter was $15 $3 million or diluted earnings per share of 77.

Eli: Thank you, Kenny. On behalf of the management of Ituran, I would like to thank you, our shareholders, for your continued interest and long-term support of our business. We look forward to continuing our accomplishments over the next decade. If you are interested in meeting or speaking with us, feel free to reach out to our investor relations team. With that, we end our call. Thank you and have a good day.

Eyal Sheratzky: Thank you, Kenny. On behalf of the management of Ituran, I would like to thank you, our shareholders, for your continued interest and long-term support of our business. We look forward to continuing our accomplishments over the next decade. If you are interested in meeting or speaking with us, feel free to reach out to our investor relations team. With that, we end our call. Thank you and have a good day.

An increase of 10% year over year, and compared to $13 8 million or diluted earnings per share of <unk> 70 in the fourth quarter of last year.

Cash flow from operations for the fourth quarter of 2025 was $29 4 million bullets.

Now taking a look at the full year 2025 results.

Revenues for 2025 were a record $369 million.

Dollar a 7% increase over the $336 3 million.

Reported in 2024.

74% of revenues were from location based services sufficient fees and 26% were from product revenues.

Revenue from subscription fees were 264 point.

6 million.

Representing an increase of 9%.

2024.

Product revenues were $94 $5 million.

Representing an increase of 1% compared with 2024.

EBITDA for 2025.

$96 2 million 26, 8% of revenues, an increase of 5% compared year over year.

Net income in 2025 was $58 million 16, 1% of revenues or fully diluted earnings per share of $2 92.

An increase of 8% compared with net income of $53 7 million fixed.

16% of revenues or fully diluted earnings per share of $2 70 in 2024.

Cash flow from operations for the year was $88 $6 million.

As of December 31, 2025, net cash and marketable securities totaled $107 6 million.

This is compared with net cash, including marketable securities of $77 2 million as of year end 2024.

The board declared a $30 million dividend for the fourth quarter, including a $20 million special dividend and a $10 million dividend in line with our dividend policy.

In addition, during the quarter, we purchased one $6 million in shares under our buyback program.

As of the end of the we had around $3 5 million remaining available under this program.

However, the board.

Today approved a $10 million increase to the existing buyback authorization, which will be funded from our valuable costs and execute them.

In accordance with SEC rule <unk> 18.

This means that as of today, there is $13 $5 million of valuable under the buyback program.

The current dividend and buyback takes into account the company's continuing strong profitability ongoing positive cash flow and strong balance sheet.

And with that.

I'd like to open the call for the question and answer session operator.

Thank you at this time, we will begin the question and answer session. If you have a question. Please raise your hand by the same platform I would introduce you and ask you to on mute after which you may ask your question.

We'll now open the call for your questions.

Ken will be from Chris Reimer of Barclays. Please go ahead.

Okay.

Thank you my question Kevin.

Now can you repeat your question looking.

Yes.

I'm, sorry, Ryan Omni channel.

Pete.

Okay.

Okay well.

Is that.

Question will be from Sergey <unk>.

<unk> of <unk> capital markets. Okay go ahead.

So good day to implement great results.

Yeah. Good it believes some.

Some color sonar buoy in the EBITDA dynamic scene painted many disease and after you initiatives are fully deployed I mean the.

Carbon grades and Sichuan.

Oh, Hi, Sergey so first of all.

We're not providing any guidance as you know about.

Practically and in general our ways, we are not I think that they are pool as it today should continue.

Two point more than $2 6 million subscribers.

These are big shape of our customer base.

So one year is not changing the total ARPA, but looking forward.

Uh huh.

We really believe that the our pool is not going to go down because things that I didn't mention today.

I said it in the past, we always having additional service to our current subscribers, which allow us to provide kind of upsell services. So this is regard our traditional.

Traditional services the fleet management.

And Vicki recovery, the UBI et cetera, but.

Regarding new <unk>.

Technologies and the offers that we have.

As I mentioned is it's important to say again.

Those initiate Tvs are.

After a few years of putting R&D development and making all the.

In a logical and regulatory infrastructure.

For Us <unk>.

Commercially it will be ready as I said mid to the end of 2026, so we get so I'm.

Must say that.

Contribution to financial contribution in 2026 of those initiated will be very low the I did too.

Put more colors on those.

Items was.

To show a little bit longer future from 27 28 and of course ahead, we will see because we know.

Some are in negotiations and we know some customer attractions in the cob.

Kabul created carbon as well as in the rental solution.

But.

The main idea.

Is to show it to.

To expose it and the.

The the majority of the contribution will be in the next few years.

But I believe that we will show at the second half of 2026, we will be able to talk or discuss about some deals and contribution.

Okay. Thank you and then.

And then installation about the model and by the way Sergey regarding your EBITDA I didn't answer we are not providing guidance, but yes.

All these things should their leverage over ebitdas.

Margins of course.

So they believe that new initiatives geared to change your margin profile in the long term.

Absolutely first of all.

If you look backwards you will see that our margins are.

Growing I mean, we show the operating leverage dynamics happen in the a.

And margins.

I'm.

Totally believe that it will continue.

Based on the new services and the options that we can do to the current customers.

Yes.

Okay great.

And the next question about the motorcycle market in Brazil, So how is going on and the.

Did you give us any additional market share in this market.

Yeah.

Can you repeat there were some noises here so can you repeat sorry.

The question about motorcycle market.

Did you gain any additional portion of this market in Brazil.

So first of all this market this market in Brazil is very very big and we Didnt touch this segment until about a year ago.

Until the moment that we are.

Understood or we develop the right.

A device that can be a very productive and we can go then to our motorcycles a OEM.

Distributors as realized to insurance companies as you remember we already reports about two OEM deals one with Yamaha, Brazil, the second one with <unk>.

BMW, Brazil and D. C. We will see a longer year or already started.

<unk> thousand.

<unk> thousands of motorcycles or may be even closer to 10000.

Subscribers.

DSA segment in 'twenty or 'twenty, six we start with the OEM, but now we expanded to the retail market. After we get you know more a confidence and we have more to show to the retail market. After your mind BMW and as always I also believe that we will add.

More model cycle producer International producers during this year into next year.

Awesome. Thank you Dan and thank you for taking my question that's all for me.

Our next question is from Derek Green bag of Maxim Group Derek. Please go ahead.

Hey, guys. Thanks for taking my questions.

I know its still little early as you expect commercialization towards the end of the year, but I was wondering if.

If you could help just walk through maybe what you would expect the economics to look like for the new.

Big data and credit carbon products are rolling out maybe just in terms of on the data maybe what Dr. Sizing and contract terms could potentially look like and then on credit card then.

Maybe just the economics trained drivers EV drivers from change of the additional.

Benefits they gain from the product.

Since we are very optimistic and we see the reaction I wouldn't come in any guidance.

Because it can be.

Not a realistic or not serious that we will do it it's like a new startups among our.

Business.

But at the start ups that are done by a very big or the largest telematics company in the world. So we will continue to use our connections our brand our.

The infrastructure in every country that reward and I must say that.

For example, the credit Cobham.

Once we start to commercialize deep we are talking about situation where for example.

Oxy drivers or a truck drivers or truck companies.

Can get.

With the two ran solution additional.

Revenues so dara.

Have it totally interest to come and put our solution because just as an example.

If I can give a truck driver.

Baird.

On an average mileage.

Something like 200, and 250 to 302 a month.

From Amy destroy a worldwide or European broker.

Why should we give up for at a refinery in Brazil.

Giving kind of a overt type of a company.

The drivers to get additional income additional resource of revenue.

That without me they cannot get it while the driving EV.

Electric vehicles.

So I think that the request is going to be tough.

Bob There is questions first of all it's new to the World. This is the first time accepting some smaller market in the world where people get money for non accurate information not regulatory the rest of the world required a very very tough regulatory to approve.

Created from for amateurs. So of that case, I think that their request should be tough no. One no. One in particular now didn't show it to the world how easy drivers.

Can get money just.

Four drive.

Not at night for example, they could taxi driver that doesn't have a client and he just dry from place to place you get money. So I think that is something that can be big but still it's on it's not yet on the commercialized.

Uh huh.

Yeah.

Place, so I don't want just to common and through numbers, but it can be.

Something.

It was a.

Hi contribution, but again it will take time it will take time to market. The two stabilized deep et cetera. The same is the rent a remote rental company in the U S. U S is a huge market.

But we are not as it Ron we are conservative we are not starting with tens of millions dollars of marketing et cetera, We go step by step.

With strategic partners in the U S and I believe that will do it regardless big that that we already start to sell data in Israel, mainly to governmental like road. The road the operate doors like Uh Huh.

Road accident authorities et cetera, we up until now we charge few Ah.

Let's say a few hundreds of thousands of dollar for pilot.

Only one vital but I believe that this will continue and will support our results, but again.

I don't want anyone to wait for.

A major contribution in 2026.

Okay got it that's really helpful.

And then in terms of could you maybe just quantify.

The FX impact you saw this year and maybe when.

What you're expecting for next year.

And yes, I will ask Judy to answer it is the the pages.

Rudy.

Yes can you repeat the question please.

Just on the FX impact.

Yes, and 25, and then maybe expectations in 'twenty six.

So I'll start with the future I mean, it's really hard to say what will be the effects seen in 26 June to all day.

That can change all effect the effects regarding 25.

I would say that.

About if we look at the annual basis, I mean, the FX and the EBIT for example was about between one to one $5 million.

This is Molly.

Got it.

And then my last question is just with.

With everything that's going on I was wondering with with Geopolitically and award.

Are you expecting any potential disruptions.

To your business or any maybe supply chain issues or just how you view.

The situation.

Since we.

Unfortunately for many years, we get used to this situation. So there is I think I will divide my answer into two first of all.

There is a major.

The power of our business revenues and profits comes out of the Middle East. So this is of course never was influenced by that.

In regard to our operation in Israel, which of course is.

It's a major operation its not nothing.

As you all may be heard from today the market in Israel also already I mean, not the stock market I mean, the commercial life in Israel also.

Back to get authorization to work half a day, but the up until now of course, the last three or four days.

The market will shut down but.

Those was anyway holiday Jewish holiday that are in any case. It was a in the diary if they offer for car dealers insurance et cetera. So currently we don't see.

Damage.

Nothing majority in.

In the past in June for example of course, there was about 12 days in the last war, where car dealers in Israel or shut down so.

After those 12 days, we cover the gap all those dealers covered the gap in the next months or two so overall with our experience in the past with what's happening in Israel today.

And with the situation that we get to use to Ah I don't believe there will be any.

A major influence on the 2026 results it's might move one months.

Two weeks from a month to month kind of volatility, but no more than that as I expect.

Okay got it that's helpful.

Thanks for taking my questions.

Jen is going to come from Eric Greg or for Tree Advisory Eric. Please go ahead.

The last question now.

Who are you vas.

Okay.

Back to your Oh, great Okay.

Sorry, do you hear me.

Okay great.

First of all tremendous results and we hope we hope you all stay safe through this.

The situation.

If you could tease out the big data initiatives sounds very interesting.

Can you tease out a little bit more there beyond.

Just some of the use cases in terms of how you think.

Your data can be used for.

Various different initiatives.

They understand the road accident, maybe the road.

Repair me for civic users, but are there other things you think you'd be using the big data or yes.

Yes, and I have another.

Okay.

So I will answer first and then you ask your second question. So first of all just to.

To illustrate one deal that we already did in Israel.

Uh huh.

Yeah.

The road authorities want to know.

Where most of the trucks.

Arriving.

Between.

Specific hours, along the evening to create parking loads for nights around the country.

So they wanted to get the one months.

One months of.

Movement of trucks in the space in the country and find the most and traffic places.

And they asked to greet four months historically of course, so they paid for it and of course in less than one second we had this rolled data get into a customized data for them and for debt only.

We charge a few hundreds of thousands of dollars only four that now we have for example, now.

Potential fees for entering cities from highways and this which is a.

Nationwide project in Israel.

And for that they need a lot of data for those movements those traffic from highways to the gates of municipal and our central cities like today, If you know in London.

Local British they paid money when they get with the car inside London. So for debt there is need for a lot of data. So this is something that we.

The almost the only one in the country that has so big and so accurate data and of course this will lead to I believe to much more larger deal with those.

Governmental.

Office.

This is a form of governmental point of view.

But let's think about.

Our approach that we have from a commercial malls, but want to know for example specific hours a day, how many cars valued more than $50000 are driving in order to customize.

<unk> has been in a coupon for specific high end.

<unk>.

They're willing to pay for that everything should be anonymous of course, because we are according to the eye.

Regulation.

But.

They're willing to pay for that. Everything should be anonymous, of course, because we are, according to the, uh, all the regulation of anonymous. But

The data itself is something that for us.

<unk> almost for 30 years up until a year ago, we didnt do anything with it because the market and that technology in our AIE.

Yeah.

<unk> capabilities was not enough to customize it but to customize it.

With low cost today.

What we developed and that's what we offer and really did the day potential customers are across all the segments as I said governmental commercial cloud they want to know in which area in the country.

The data itself is something that for us exists almost for 30 years up until a year ago, we didn't do anything with that because the market and the technology and our AI capabilities was not enough to customize it, but to to customize it, uh, uh, uh, with low cost today, that's what we developed. And that's what we offer. And really the, the, the potential customers are across all the segments, as I said, governmental commercial how dealers they want to know in which area in the country.

Because people sell their characteristic and in and then they buy again.

because people sell their car to a second in and then they buy again,

We realized for one of the car dealers in Israel. It only third of the people that sell the car come back to it you want to issue to all of his client.

A campaign and sales on a specific time that they sell their car and he doesn't know.

We realize for one of the car dealers in Israel that only a third of the people that sell the car come back to him. He wants to issue to all of his clients a campaign and sales at the specific time that they sell their car. And he doesn't know

Any more after this all at once so there are many many aspects. We have is a technology with today is software that know how to get the raw data in and bring out customized data upon any request any request. So this is an example for our big data.

And it's a product that we're going to charge for it and.

Any more after the solid once. So there are many, many aspects we have a, a technology we have today, a software that know how to get the raw data in and bring out customized data upon any requests any requests. So, this is an example for a big data product that we going to charge for

And we talk with everybody today.

That's tremendous thank you.

The.

And that was very helpful.

Second is on capital allocation.

You. If you take consensus estimates are based on these very strong Q4 results I think are going to be going higher.

None of your cash position you trade at less than 13 times.

Foreign earnings, which is less than what your growth rate of services was in Q4.

And it's very helpful. Um second is on Capital allocation, um you if you take consensus estimates that based on these very strong Q4 results, I think are going to be going higher, um, net of your cash position, you trade, it less than 13 times. Um, forward earnings, Which is less than what your growth rate of services was in Q4. Um, uh,

And as your growth keeps on accelerating so kind of a pack of less than one which is very inexpensive so.

The question is it's great how generous with you've been renewed shareholders in terms of dividends.

Dividends on the special dividend, but why aren't you emphasizing stock repurchase more.

Versus the dividends here.

Given how cheap you seem to be thank you.

And and as your growth keeps on accelerating so kind of a peg of less than 1, which is very inexpensive. So um the the question is it's great how generous have you been when the shareholders in terms of um dividends and the special dividends? But why aren't you emphasizing stock or purchase more um versus the dividends here? Um given how cheap these seem to be. Thank you

So practically a when we do only this.

So investors ask why not this you may you may be right, but it runs volume.

We're grow.

So practically, uh, when we do only this, as so investors ask, why not this? You may—you may be right. But it runs volume. Uh, we grow, uh,

Uh huh.

Lee in the last 12 15 months the volume in the market is low and we don't want by going with the 30 or $50 million to the market the ear to a create a.

To shrink the volume because more one of the interesting for the shareholders is the volume.

In the last 12, 15 months, the volume in the market is low, and we don't want, by going with a $30 or $50 million to the market a year, to, uh, create, uh, to shrink the volume, because one of the interesting things for the shareholders is the volume.

So this is kind of a we we find a balance between dividend and a.

Shares repurchased.

The project.

And <unk>.

As you see in the past and even though.

so, this is kind of, uh, we, we find the balance between dividend and, uh, shares repurchase project, and as you see in the past, and even now,

Every months or better to say every quarter. When we have a discussion board discussion about it we check it again and we've taken your decision, but I totally accept what.

What you say, but we have to balance and this is the current decision of the board and as we did in the past is might grow we look on the volume we get the advisory some brokers and bankers how it can influence and we do it as best as at the moment at the weekend.

Every month or better to say every quarter. When we have a discussion board discussion about it. We, we check it again and we take a new decision, but I'm totally accept, uh, what you say, but we have to to balance. And, uh, this is the current decision of the board. And uh, as we did in the past, it might grow. We look on the volume, we get advice with some, uh, Brokers and bankers, how it can influence, and we do as best as at the moment that we can.

Thank you for the clarity I appreciate it.

Thank you for that clarity. I appreciate it.

Next question, we'll go to Evan can Dell of Bireme capital Evan. Please go ahead.

Next question will go to Evenson Dealt of Byron Capital. Evan, please go ahead.

Hi, yes, thanks for thanks for taking my question.

Just a quick comment if you don't mind, one one second on the on the buyback issue and volume.

My personal advice as a shareholder is.

Don't listen to the shareholders or the bankers that tell you that volume is a big problem because I think the Theres research that shows that actually.

If you have a buyback in place that actually.

Hi, yeah, thanks for. Thanks for taking my question. Um, just a quick comment. If if you don't mind 1 1, second on the, on the buyback issue and volume my my personal advice, as a shareholder is uh don't listen to the shareholders or the bankers that tell you that the volume is a big problem. Because I think the there there's research that shows that actually. Um, if you have a buyback in place that actually

Can increase the volume and the stock, even though you're shrinking the float.

You know if the price goes up and the valuation is more reasonable that can actually bring volume and interest into the into the company. So I would just say maybe you don't they don't listen to those people and go ahead and buy back the stock. If that's what you think is the right thing to do based on the valuation so sorry, sorry for that aside.

Sure.

Sorry for that no comment no comment no comment okay. Okay.

I said just based on what you think of the value of the stock in the open market versus the versus the fair value. Okay.

Can you talk about.

Uh, can increase the volume in the stock, even though you're shrinking the float. Um, you know, if the price goes up and the valuation is more reasonable, that can actually bring volume and interest into the into the company. So, I would just say, maybe don't, maybe don't listen to those people and go ahead and buy back the stock if that's what you think, is the right thing to do based on the valuation. So sorry, sorry for that aside um sorry for that. Um okay well no comment, no comment. Okay, okay. Okay, okay, yeah, I'd say just just do based on what you think. The value of the stock is in the open market versus the versus the fair value. But okay. Um, Can can you talk about? Um,

Competition in both Brazil, and I know in Israel Theres not much competition, but can you just talk about the the state of your competitors in in both markets in terms of market share and pricing and kind of competitive positioning and things like that.

Okay. So first of all.

As you said, regardless shares I would tell you with regard to competition, we have a very strong competition also in Israel.

We we need and this is totally different that no competition pointer is in the market more or before it around this is the main competitor.

And along they usually succeed to gain more and more market share.

Then what's what we do today, but in order to keep and gained this market share more and more.

In Israel, its a very oh, we have to be the best every day and this is why we develop more and more technology why we have to have more recovery rates, a better recovery rates et cetera, because for insurance companies and for Caldolor to change is the one day.

Competition in both, um, Brazil and I know and is Israel. There's not much competition, but can you just talk about the, the, the state of your competitors in, um, in in both markets, in terms of, you know, market share and pricing and kind of, you know, competitive positioning and things like that? Okay? So first of all, uh, as you said, regard the shares, I would tell you regard the competition. We have a very strong competition also in Israel, but we win it and this is totally different that no competition pointer is in the market more, or before it run. This is the main competitor. And, uh, along the years we succeed to gain more and more market share. And then what's what we do today. But in order to keep and gain these markets, you're more and more in Israel. It's a very uh, we have to be the best every day and this is why we develop

More and more technology—why do we have to have higher recovery rates, a better recovery rate, etc.? Because for insurance companies and for car dealers to make a change, it can be just one day.

Because they want better results they want better solution they want their customers to be satisfied. So we have an everyday of competition, but 30 as we succeed to win and gain market share. This is regard Israel regard, Brazil, I think the day and it's almost the same the market is much bigger.

The size of Brazil is much bigger there are specific geographies in Brazil in the North sea in the Amazonia Amazonas area, where there are some small companies that might have some subscribers, but when you talk about the main.

Commercial area in Brazil, which is a sao.

Sao Paolo State Rio.

Rio de Janeiro, Brasilia and all that the main orben areas. We are also.

I think controlling the telematics and market. We are the main provider and what's happened in the last two years and I believe that we would show it DCU and later, we also see in the B to B market.

The size of Brazil is much bigger. There are specific geographies in Brazil in the North, in the amazona, amazona area where there are some small companies that might have some subscribers. But when you talk about the main uh, commercial area in Brazil, which is uh uh Sao Paulo State Rio de Janeiro Brasilia and all the the main urban areas. We are also I think controlling the telematics market. We are the main provider and what's happening in the last 2 years. And I believe that we will show it this year. And later, we also see in the B2B Market,

Our customers like leasing companies like our fleet big fleets that even they try our competitor now they are changed their supplier to eat to run so the situation in Brazil is that.

We also gaining more and more market share in a telematics business I think that we are the largest and the situation is very close to Israel. The competitive landscape is big I mean, there are more competitors than in Israel, but the big but the the market is also a more the geography is bigger but there.

That overall in the.

Ongoing gain new subscribers in the telematics industry, we all are.

Uh, customers like leasing companies like, uh, flea big fleets that even they try our competitor now, they uh, change their supplier to it to run. So the situation in Brazil is that, uh, we also gaining more and more market share in the telematics business. I think that we are the largest and the situation is very close to Israel. The competitive landscape is bigger, I mean, there are more competitors than in Israel, but the big. But the, the the the market is also more, the geography is bigger, but I think that overall in the uh, ongoing new subscribers in the telematics industry, we are

And we are the one that ending the major portion of those subscribers.

And we are the 1 that adding The major portion of those subscribers.

Okay. Thanks.

One more question.

Okay, thanks and I have 1 more question. Um,

On the on the fleet business I know you also have a fleet a fleet business.

Were result of fleets it seems like the.

The leaders in that business, whether it's samsara hour or G. O tab I'm thinking of G O tab, mostly.

They really have built out there kind of the software suites.

On the on the fleet business, I know you also have a fleet, a fleet business um, where where you sell to fleets? It seems like the um, the, the leaders in that business, um, whether it's, you know, samsara or or or geotab like I'm thinking of geotab mostly, um, they they've really have built out their kind of, the, the software.

And the integration with other providers and things like that to go with their the telematics platform for our fleet owners and I'm just wondering like how much thought and effort you guys put into thinking about trying to to match that capability over time to make your product more.

Suite and the integration with other providers and and and things like that to go with their the talat platform for for Fleet owners.

More competitive in the in the in the fleet segment, because it seems like that could be a pretty that's going to be a really big market over time.

And, um, I'm just wondering like how much thought and effort you guys put into, um, you know, thinking about trying to, to match that capability over time to to make your product more, um, more competitive in the, in the, in the fleet segment because it seems like that could be a pretty, that's going to be a really big Market over time.

The main difference if you mentioned some sovereigns youth of the main difference is the market that we choose to go to.

If I put aside some sama samsara always their video solution that are we adding it from third parties today or in the last two years, but.

<unk>.

Is it mainly focusing in the European market and other markets in Latin America, specifically in Mexico and Brazil.

the the main difference, if you mentioned some software and YouTube, the main difference is the market that we choose to to go to uh if I put aside some, some Sara with their video solution that uh we adding it from a third party is today or in the last 2 years but geotab is a mainly focus in in the European market and other markets but in Latin America specifically in Mexico and Brazil uh when

When we consider our market share it run as a larger market share in fleet management in Israel totally.

This is totally right.

So I think that the most differentiated the issue is that some sarah mainly in the U S. It run from beginning we didn't see.

Start to go to lie on caves to fight with Saar companies that put billions of dollars in order to penetrate markets and we went to the market where we are strong when we have brand when we have relationship. So from the Colo technological point of view and if you will a judge our technology as a fleet manager.

I'm totally sure that you will see a state of the art solution.

Not to my one.

One single point under geared tab or some Sara it's only the markets. We didnt went to Europe, we didn't want to the U S. We are very focused on the on Israel and Latin America and the currently that's what we do in the future. If we will decide to go to other geographies.

We consider market share it run as larger market share in Fleet Management in Israel. Totally, this is totally, right. So, I think that the most differentiated issue is that samsara mainly in the US, it run from beginning. We didn't start to go to Lion Caves to fight with companies that uh, put billions of dollars in order to penetrate markets, and we went to the market where we are strong when we have brand when we have relationship. So, from the technological point of view and if you will, uh, judge our technology as a fleet manager, I'm totally sure that you will see, uh, state-of-the-art solution. Uh, not a m 1 single point under uh, GUI or samsara. It's only the markets. We didn't went to Europe, we didn't want to the us. We are very focused on the

Probably we will do it based on acquisition, we will not start off from Scritch.

On Israel and Latin America. And, uh, currently, that's what we do. In the future, if we decide to go to other geographies, we will probably do it based on acquisition; we will not start from scratch.

Okay. Thank you.

Okay, thank you.

We will now try and go back to Chris Reimer from Barclays Press are you able to talk.

We'll now try and go back to Chris Rama from Barclays Briefs. Are you able to talk?

Yeah, Likewise up great.

Continue.

Oh, great continue.

Thank you.

Yes.

And Scott.

Good morning.

Yeah.

Um,

All right.

Larger.

Yes.

So.

We can't hear you very nicely, maybe you will our approach us.

We can't hear you, so maybe you will approach us. Uh,

you know, uh,

No.

Not in this platform icon to you sorry.

Not on this platform. I can't hear you, sorry.

Great Chris, we'll we'll speak to you offline.

Chris will uh, will will speak to you offline.

Okay no problem.

Okay, no problem.

And a question and answer session.

The call will be available on <unk> website in the next day for downloads.

Other than that Oh.

Now please make your concluding statements.

And our question and answer session, um, the call will be available on iTunes website uh, in the next day for downloads. Um, other than that, uh, yeah, please make your concluding statements

Thank you Kenny on behalf of the management of it to run I would like to thank you our shareholders for your continued interest and long term support for our business. We look forward to continuing our accomplishments over the next decade. If you are interested in meeting or speaking with us feel free to reach out or Investor relations team and who is that.

We end our call have a good and save the day. Thank you very much.

Uh, thank you. On behalf of the management of Ituran, I would like to thank you, our shareholders, for your continued interest and long-term support for our business. We look forward to continuing our accomplishments over the next decade. If you are interested in meeting or speaking with us, feel free to reach out to our investor relations team. And with that, we end our call. Have a good and safe day. Thank you very much.

Q4 2025 Ituran Location & Control Ltd Earnings Call

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