Ituran Location and Control Ltd.

Ladies and gentlemen, thank you for standing by. Welcome to the Ituran third quarter 2023 results conference call. All participants are present in listen-only mode. Following management's formal presentation, instructions will be given for the question and answer session. For operator assistance during the conference, please press star zero. As a reminder, this conference is being recorded. You should have all received by now the company's press release. If you have not received it, please contact Ituron's investor relations team at EK Global Investor Relations at 1-212-378-8040 or view it in the news section of the company's website, www.ituron.co.il. I will now hand over the call to Mr. Kenny Green of EK Global Investor Relations. Mr. Green, would you like to begin?

Thank you. Good day to all of you and welcome to Iteron's conference call to discuss the third quarter 2023 results. I would like to thank Iteron's management for hosting this conference call. With me today on the line are Mr. Eyal Sharatsky, CEO, Mr. Udi Mizrahi, Deputy CEO and VP Finance, and Mr. Eli Kammer, CFO of Iteron. Eyal will begin with a summary of the quarter's results, followed by Eli with a summary of the financials. We will then open the call for the question and answer session. I'd like to remind everyone the safe harbor statement in the press release we issued earlier today also covers the contents of this conference call. And now, Eyal, would you like to begin, please?

Thank you, Kenny. I'd like to welcome all of you to our third quarter 2023 call, and I would like to thank you for joining us today. We are pleased with our results of the third quarter. To one, business remains strong and in a solid growth phase. Our subscriber base continues to show strong growth, adding 45,000 aftermarket subscribers, as well as 3,000 OEM subscribers, net which is well ahead of our long-term rate we had in 2021 and earlier of between 20,000 to 25,000 per quarter. The ongoing growth in our subscriber base continues to benefit our financial results, and Q3 subscription revenues grow at 12% year-over-year. For the past few quarters, our subscription fees have been constantly at new record levels and our profits, measured in either net income or EBITDA, have been at multi-year highs. As you can imagine, we are pleased with our results and the progress we have made in 2023. As we discuss our quarterly results, I would like to discuss the recent war in Israel. First and foremost, our thoughts are with those affected by these events. As I said a few weeks ago, Israel is a small country, such that everyone knows a family that has either had a son, daughter, parent or grandparent murdered or kidnapped by Hamas. We pray for the victims as well as their families, friends and loved ones. I stress that we are a resilient people and unfortunately have much experience in working and overcoming challenging times. Ituran is a globally diverse business with operations primarily in Israel and Brazil, but also in many other countries in Latin America, as well as elsewhere in the world. And therefore, any impact in one specific region will have a limited effect on Ituran's overall business. Any impact is obviously localized to Israel only currently. In Q4, we would expect the overall subscriber growth rate to slow somewhat to between 30,000 and 35,000. This will be due to the longer period of lower car sales in Israel in October, initially due to the holiday season, which seasonally recurs every year, and following that, an extended fast to the breakout of war. There will also be some additional expenses related to mitigating some of the negative effects of the war and in supporting our communities that have been affected. Overall, we expect that the impact from the war on our performance for the EU will not be significant at all. Naturally, the safety and well-being of our employees remains our highest priority. We continue to closely monitor the situation and we have in place measures to ensure the safety of our employees while maintaining global business continuity. I am very proud of the courage and commitment of the IT RAN team, both in Israel and globally. and wish to personally thank them for their resilience and dedication during these times. Given our ongoing cash generation and our strongly increasing net cash level, starting from the current quarter, we have decided to revert to our former dividend policy and increase our dividend from $3 million per quarter to $5 million per quarter. We are very pleased to share the fruits of our ongoing profitable growth and is a reward to our loyal shareholders for the long-term support of our company. In summary, 2023 continues to be a solid year of performance for Ituran in all respects. Solid performance in our traditional aftermarket business, as well as stability in the OEM business, and especially the growth engines we have seeded in the past year are all driving our strong subscriber growth and record revenue. While the war in Israel will have some marginal impact on it to run, our growing 2.2 million plus subscriber base globally paying us continuously on an ongoing monthly basis for our ongoing services provided us with significant results even in more challenging environment. As has been true throughout our long history and will continue ahead, Our constantly growing subscriber growth will continue to translate into increased revenues, with faster growing profitability over the long term due to the operating leverage inherent to our business. For the foreseeable future, we anticipate the overall growth trend that have characterized E2N over many years will continue. And with that, I hand over to Eli. Eli, please go ahead.