Ituran Location and Control Ltd.

Ladies and gentlemen, thank you for standing by. Welcome to the Ituran second quarter of 2024 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 Eturan'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.eturan.co.il. I will now hand the call over 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 Iteran's conference call to discuss the second quarter 2024 results. I would like to thank Iteran'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 Kamar, CFO of Iteran. 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 that the Safe Harbor Statement in today's press release 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 second quarter 2024 call, and I would like to thank you for joining us today. We are pleased with our second quarter results, especially the ongoing growth in revenue across the geographies in which we operate, with continued improvement in profits. We are also pleased with the solid level of additional nest subscribers we brought in the quarter, which came in at the high end of our expectations. These achievements come despite the negative impact of the sharp devaluation against the US dollar in the quarter, which lower our local currency denominated results presented in US dollars. In fact, we measured in local currencies, we have seen accelerated growth in most of the geographies in which we operate. Our results reflect ongoing solid demand growth for our broad location-based products and telematics services, and especially increased traction from many of our new initiatives. Our subscriber base added 38,000 subscribers in the quarter, at the high end of our expectations of between 35,000 and 40,000 net new subscribers per quarter. This is due both to our more diverse global footprint as well as the new services and initiative we are continuing to bring to our end markets. Over the past few years, we've launched a number of new initiatives and have seeded growth engines driving accelerated subscriber growth. We're actively engaged in new verticals adjustment to our core business of providing telematics services. At the same time, we are taking the successful initiatives which have been limited to one of our geographies and expanding them to our other geographies. You may remember that we signed a landmark agreement with Santander Bank a year ago, and we are actively looking to broaden our solution into new markets with existing and other finance customers. Our SaaS technology for all-in-one vehicle sharing helps fleet owners smartly and flexibly use shared vehicle fleets through efficient matching of unused vehicles with demand. We have been gaining solid traction and we are now leveraging the technology to other geographies including Israel and the United States. We see significant demand for this type of service from car rental businesses, leasing companies, as well as corporate fleets which are looking to more effectively and efficiently share the use of their fleets of vehicles. Also, as you may have seen, a few days ago, we put out a press release with regard to our collaboration with Porsche and Microsoft for the Porsche Carrera Cup in Brazil. And I encourage all of you to watch the video of our technology in action. We are incredibly proud to be part of this and associated with such industry leaders. Additionally, the fact that it runs telematic units is at the heart of the Porsche racing car telematry system under the most demanding conditions, demonstrates our technology leadership. One of our goals in being involved in a project such as this, apart from the honor of being associated with Porsche and Microsoft, is to bring these latest technologies used in motorsports down to it to run subscribers, and we are already looking to leverage the new capabilities developed for this project over the past year. throughout our business and make it more attractive to OEM players. I want to thank our team in Brazil for the exceptional work they are doing for the World Carrera Cup. We recently launched a new motorcycle telematics product with strong potential, given a very significant total addressable market throughout South America with a strong motorcycle culture. We are already seeing interest for OEMs and insurance companies and we are in active discussions. We are also in active discussions with a number of major OEM car manufacturers, in addition to the two major that we already work with. At the same time, we are looking to broaden the scope of services we provide to our existing OEM partners, which are focused on limited geographies, in order to broaden our service to additional countries in South America. The goal is to provide to the OEM manufacturers with a suite of telematics and stolen vehicle recovery services we see growth potential to bring in many new subscribers via this initiative. From a financial perspective, looking ahead to the remainder of 2024, earlier this year we provided EBITDA guidance in addition to the guidance on subscriber growth which we always used to do. We retweeted that for 2024, our guidance is full-year EBITDA of between $90 and $95 million. Looking further out, our short mid-term milestone is to cross the $100 million EBITDA landmark in 2025. We continue to expect subscriber growth at around 35,000 and 40,000 net new subscribers each quarter. Even with the currency headwind in this quarter, we remain on track to meet our targets. Given the strong net cash position of over $63 million, our ongoing cash generation and continuous solid profitability, we continue to share a strong quarterly dividend of $8 million with our shareholders. This dividend is in line with our current policy. It is at the same level that we issued last quarter and 60% increased over that of the year ago quarter. Our dividend yield on an analyzed basis represents a return of over 6%, which is a very solid return from a strong company. We see our ongoing dividend as a reward to our shareholders for their loyalty and long-term support of E2R. In summary, the second quarter of 2024 is another quarter of solid performance, which is especially clear when we remove the noise from FX and look at our results in local prices. We believe that we will continue this trend in 2024, and given the many growth initiatives highlighted, I would expect the growth to accelerate as time passes over the mid to long term. Our constantly growing subscriber growth will ultimately translate into increased revenue, increased gross profit, with faster growing profitability over the long term due to the operating leverage inherent to our business. I look forward to updating you further as some of our initiatives mature. And with that, I hand over to Eli. Eli, please go ahead.