MONTVALE, N.J., June 16, 2020 /PRNewswire/ -- MICT, Inc.
(Nasdaq: MICT), today announced financial results for the three
months ended March 31, 2020, as well
as merger and acquisition developments subsequent to the end of the
first quarter.
"As at March 31, 2020, MICT held
an ownership interest in Micronet Limited of 30.48% of its issued
and outstanding shares, the results of Micronet Limited are
therefore not included within MICT's consolidated financial
statements. The first quarter revenues and underlying mobile
computing and telematics business of Micronet Limited were
negatively impacted by the COVID-19 pandemic as all sales contracts
were either deferred or cancelled. Micronet Limited is also seeing
the impact continuing into the second quarter. These results
notwithstanding, we believe in Micronet's world class product
portfolio and the business' potential for growth in the second half
of 2020, driven by its new video telematics devices and recent U.S.
Federal Communications Commission authorizations. We have therefore
significantly increased our stake in this business, with the aim of
capitalizing from this investment when the telematics market is
expected to come back online in the second half of 2020.
"Post quarter end, MICT signed an amended and restated agreement
and plan for merger with Global Fintech Holdings, Ltd., or GFH, to
move into its long-term aim of participating in the global fintech
marketplace. GFH continues to make significant strides in its key
core objectives, and we look forward to informing the market in the
coming weeks not only on the major developments at GFH since the
announcement on April 15, but also on
outlining the synergistic benefits of our new strategy based on
both existing and new products and platforms in high growth
technology sectors.
"As a result of the above, we look forward to the second half of
the year with confidence. We believe that shareholders will realize
the benefits of the MICT Group's intended new strategy and
approach, expanding from our foundation in the mobile computing
and telematics business to encompass a global product platform
that includes new geographic markets in Asia and new products in the fintech space,"
Mercer concluded.
On April 15, 2020, MICT (i) signed
an amended and restated agreement and plan for merger with Global
Fintech Holdings, Ltd., or GFH, pursuant to which, in connection
with the transactions contemplated thereby, MICT shall diversify
into the global fintech industry, and (ii) approved a private
placement of convertible notes of up to $15
million, which shall be convertible into shares of MICT
common stock at a conversion price of $1.10 per share, consisting of $11 million of committed funding, with the
ability to raise an additional $4
million on the same terms.
MICT's financial results for the three months ended March 31, 2019 reflect Micronet, Ltd. revenues
for the months of January 2019 and
February 2019 only. On February 24, 2019, Micronet closed a public
equity offering on the Tel Aviv Stock Exchange which resulted in a
dilution of MICT's ownership interest in Micronet to below 50%.
Thus, based on U.S. generally accepted accounting practices (GAAP),
MICT no longer includes Micronet's financial results in its
consolidated financial statements effective as of March 1, 2019.
On June 11, 2020, the Micronet
shareholders have accepted a tender offer made by MICT, which, upon
MICT's purchase of Micronet shares, will initially increase MICT's
ownership to 45.53%. In addition, MICT informed Micronet that,
assuming the acceptance of the tender offer, it plans to
participate in a public offering of Micronet's ordinary shares,
pursuant to which we plan to purchase 50% of Micronet's ordinary
shares offered in such public offering, up to an amount of
$900,000 in the aggregate.
Q1 2020 Review
- Total revenue in first quarter of 2020 was $0, compared to $477,000 in the first quarter of 2019.
- Gross loss for MICT was $0 in the
first quarter of 2020, compared to $369,000 in the first quarter of 2019.
- Research and development (R&D) expense for MICT in the
first quarter of 2020 was $0 compared
to $261,000 in the first quarter of
2019.
- Selling, general and administrative (SG&A) expense for MICT
was $770,000 in the first quarter of
2020, as compared to $1.18 million in
the first quarter of 2019.
- Net loss attributable to MICT was $1,635,000 in the first quarter of 2020, as
compared to $910,000 in the first
quarter of 2019. The increase in net loss is primarily a result of
share in investee losses of $640,000.
On a per share basis, MICT reported a net loss
of $0.15 per basic and diluted share from continued
operations for the first quarter of 2020, as compared to a net loss
of $0.09 per basic and diluted share from continued
operations in the first quarter of 2019.
- As of March 31, 2020, MICT had
$2.88 million in cash and
equivalents, and no debt.
Conference Call
The Company invites all those interested in participating in the
call today, June 16, 2020 at
9:00 a.m. EDT, to dial 1-888 -298
5973. Callers from outside of the U.S. may access the call by
dialing: From Europe (including London) dial in +448 0818 90708 From Israel
+972 79-939 8931. user pin: 4444
Please dial in a few minutes before 9:00
a.m. EDT. Participants may also access a live webcast of the
conference call through the Investor Relations section of MICT's
website at: http://mixlr.com/servicesmict/
A telephone replay of the call will be available for two weeks
at: 1-888 -298 5973. Callers from outside of the U.S- may access
the call by dialing: From Europe (including London) dial in +448 0818 90708 From Israel
+972 79-939 8931. user pin: 3333
A slide presentation accompanying management's remarks can be
accessed at www.mict-inc.com.
No Offer or Solicitation
This communication is not intended to and does not constitute an
offer to sell or the solicitation of an offer to subscribe for or
buy or an invitation to purchase or subscribe for any securities or
the solicitation of any vote in any jurisdiction, nor shall there
be any sale, issuance or transfer of securities in any jurisdiction
in contravention of applicable law. No offer of securities shall be
made except by means of a prospectus meeting the requirements of
the Securities Act of 1933, as amended. Subject to certain
exceptions to be approved by the relevant regulators or certain
facts to be ascertained, no securities shall be sold in or into any
jurisdiction where to do so would constitute a violation of the
laws of such jurisdiction, or by use of the mails or by any means
or instrumentality (including without limitation, facsimile
transmission, telephone and the internet) of interstate or foreign
commerce, or any facility of a national securities exchange, of any
such jurisdiction.
Important Additional Information Will be Filed with the
SEC
MICT URGES INVESTORS AND STOCKHOLDERS TO READ ANY MATERIALS
RELATED TO THE MERGER WITH GFH CAREFULLY AND IN THEIR ENTIRETY
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT MICT, GFH,
AND OTHER PARTIES. Investors and stockholders may obtain free
copies of these materials with the SEC through the website
maintained by the SEC at www.sec.gov.
About MICT, Inc.
MICT, Inc. (MICT) operates through Micronet Ltd. ("Micronet"), a
former subsidiary, in which the Company previously held a majority
ownership interest that has since been diluted to a minority
ownership interest. Micronet operates in the growing commercial
Mobile Resource Management (MRM) market, mainly in the United States. Micronet designs, develops,
manufactures and sells rugged mobile computing devices that provide
fleet operators and field workforces with computing solutions in
challenging work environments.
Forward-looking Statements
This press release contains express or implied forward-looking
statements within the Private Securities Litigation Reform Act of
1995 and other U.S. Federal securities laws. These
forward-looking statements include, but are not limited to, those
statements regarding the proposed timing for the closing of the
transaction with GFH, the belief that the merger with GFH will
create synergies and advantages for both companies, the belief that
Micronet's deferred shipments of some previously placed orders and
decisions on potential new orders may crystallize by the end of the
second quarter, the belief that Micronet's world class product
portfolio and the business' potential for growth in the second half
of 2020, the belief that its investments today will result in
revenues in the balance of this calendar year, that GFH continues
to make significant strides in its key core objectives, MICT's
intention to informing the market in the coming weeks not only on
the major developments at GFH since the announcement on
April 15, but also on outlining the
synergistic benefits of its new strategy based on leading products
throughout the group from telematics to fintech, its belief that it
is looking forward to the second half of the year with considerable
confidence, its belief that shareholders will realize the benefits
of the MICT Group's intended new strategy and approach, expanding
from its foundation in the telematics business to encompass a
global product platform that includes new geographic markets in
Asia and new products in the
fintech space, MICT's intention to participate in a public offering
of Micronet's ordinary shares in an amount of up to $900,000 with the intention of regaining majority
control over Micronet, and the belief that a majority stake in
Micronet will leverage its global platform to grow the telematics
business as well as fintech. Such forward-looking statements and
their implications involve known and unknown risks, uncertainties
and other factors that may cause actual results or performance to
differ materially from those projected. The forward-looking
statements contained in this press release are subject to other
risks and uncertainties, including those discussed in the "Risk
Factors" section and elsewhere in the Company's annual report on
Form 10-K for the year ended December 31, 2019 and in
subsequent filings with the Securities and Exchange Commission.
Except as otherwise required by law, the Company is under no
obligation to (and expressly disclaims any such obligation to)
update or alter its forward-looking statements whether as a result
of new information, future events or otherwise.
MICT, INC. AND
SUBSIDIARY
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(USD In Thousands,
Except Share and Par Value Data)
|
|
|
|
March 31,
2020
|
|
|
December 31,
2019
|
|
ASSETS
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
2,826
|
|
|
$
|
3,154
|
|
Restricted
cash
|
|
|
45
|
|
|
|
45
|
|
Trade accounts
receivable, net
|
|
|
-
|
|
|
|
-
|
|
Short-term loan to
related party Micronet Ltd., net
|
|
|
-
|
|
|
|
281
|
|
Inventories
|
|
|
-
|
|
|
|
-
|
|
Other current
assets
|
|
|
1,132
|
|
|
|
937
|
|
Total current
assets
|
|
|
4,003
|
|
|
|
4,417
|
|
|
|
|
|
|
|
|
|
|
Property and
equipment, net
|
|
|
26
|
|
|
|
29
|
|
Long-term loan to
related party Micronet Ltd., net
|
|
|
134
|
|
|
|
-
|
|
Restricted cash
escrow
|
|
|
477
|
|
|
|
477
|
|
Micronet Ltd. equity
method investment
|
|
|
354
|
|
|
|
994
|
|
Total long-term
assets
|
|
|
991
|
|
|
|
1,500
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
4,994
|
|
|
$
|
5,917
|
|
MICT, INC. AND
SUBSIDIARIES
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(USD In Thousands,
Except Share and Par Value Data)
|
|
|
|
March 31,
2020
|
|
|
December 31,
2019
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Short term bank
credit and current portion of long term bank loans
|
|
$
|
-
|
|
|
$
|
-
|
|
Short term credit
from others and current portion of long term loans from
others
|
|
|
-
|
|
|
|
-
|
|
Trade accounts
payable
|
|
|
-
|
|
|
|
-
|
|
Other current
liabilities
|
|
|
540
|
|
|
|
290
|
|
Total current
liabilities
|
|
|
540
|
|
|
|
290
|
|
|
|
|
|
|
|
|
|
|
Long term loans from
others
|
|
|
-
|
|
|
|
1,856
|
|
Long term
escrow
|
|
|
477
|
|
|
|
477
|
|
Accrued severance
pay
|
|
|
50
|
|
|
|
50
|
|
Total long term
liabilities
|
|
|
527
|
|
|
|
2,383
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
Equity:
|
|
|
|
|
|
|
|
|
Series A Convertible
Preferred stock; $0.001 par value, 3,181,818 and 2,386,363 shares
authorized, issued and outstanding as of March 31, 2020 and
December 31, 2019, respectively
|
|
|
3
|
|
|
|
2
|
|
Series B Convertible
Preferred stock; $0.001 par value, 1,818,182 and 0 shares
authorized, issued and outstanding as of March 31, 2020 and
December 31, 2019, respectively
|
|
|
2
|
|
|
|
0
|
|
Common stock; $0.001
par value, 25,000,000 shares authorized, 11,089,532 shares
issued and outstanding as of March 31, 2020 and December 31, 2019,
respectively
|
|
|
11
|
|
|
|
11
|
|
Additional paid in
capital
|
|
|
14,169
|
|
|
|
14,107
|
|
Additional paid in
capital – convertible preferred stock series A
|
|
|
6,437
|
|
|
|
6,028
|
|
Additional paid in
capital – convertible preferred stock series B
|
|
|
1,914
|
|
|
|
|
|
Accumulated other
comprehensive (loss)
|
|
|
-
|
|
|
|
70
|
|
Accumulated
loss
|
|
|
(18,609)
|
|
|
|
(16,974)
|
|
MICT, Inc.
stockholders' equity
|
|
|
3,927
|
|
|
|
3,244
|
|
|
|
|
|
|
|
|
|
|
Non-controlling
interests
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Total
equity
|
|
|
3,927
|
|
|
|
3,244
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
and equity
|
|
$
|
4,994
|
|
|
$
|
5,917
|
|
MICT, INC. AND
SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
|
(USD In Thousands,
Except Share and Earnings Per Share Data)
|
(Unaudited)
|
|
|
|
Three months
ended
March 31,
|
|
|
|
2020
|
|
|
2019
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
-
|
|
|
$
|
477
|
|
Cost of
revenues
|
|
|
-
|
|
|
|
846
|
|
Gross
profit
|
|
|
-
|
|
|
|
(369)
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Research and
development
|
|
|
-
|
|
|
|
261
|
|
Selling and
marketing
|
|
|
-
|
|
|
|
198
|
|
General and
administrative
|
|
|
770
|
|
|
|
990
|
|
Amortization of
intangible assets
|
|
|
-
|
|
|
|
20
|
|
Total operating
expenses
|
|
|
770
|
|
|
|
1,469
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations
|
|
|
(770)
|
|
|
|
(1,838)
|
|
Share in investee
losses
|
|
|
(640)
|
|
|
|
-
|
|
Net profit from loss
of control
|
|
|
-
|
|
|
|
299
|
|
Financial (expenses) income, net
|
|
|
(224)
|
|
|
|
76
|
|
Loss before provision
for income taxes
|
|
|
(1,634)
|
|
|
|
(1,463)
|
|
Taxes on income
(benefit)
|
|
|
1
|
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
Net loss from
continued operation
|
|
|
(1,635)
|
|
|
|
(1,466)
|
|
Net profit (loss)
from discontinued operation
|
|
|
-
|
|
|
|
-
|
|
Total net
loss
|
|
|
(1,635)
|
|
|
|
(1,466)
|
|
Net loss attributable
to non-controlling interests
|
|
|
-
|
|
|
|
(556)
|
|
Net loss attributable
to MICT, Inc.
|
|
|
(1,635)
|
|
|
|
(910)
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted
loss per share from continued operation
|
|
|
(0.15)
|
|
|
|
(0.09)
|
|
Basic and diluted
loss per share from discontinued operation
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
11,089,532
|
|
|
|
9,707,831
|
|
View original
content:http://www.prnewswire.com/news-releases/mict-reports-financial-results-for-the-first-quarter-ended-march-31-2020-301077554.html
SOURCE MICT, Inc.