MONTVALE, N.J., Nov. 14, 2019 /PRNewswire/ -- MICT, Inc.
(Nasdaq: MICT), today announced financial results for the three
months ended September 30, 2019.
MICT's financial results for the three and nine months ended
September 30, 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
39.53%. Thus, based on U.S. GAAP, MICT no longer includes
Micronet's financial results in its consolidated financial
statements effective as of March 1,
2019. On September 5, 2019,
Micronet closed a public equity offering on the TASE. As a result,
MICT's ownership interest in Micronet was diluted from 33.88% to
30.48%, and MICT's current voting interest in Micronet stands at
37.79% of the issued and outstanding shares of Micronet.
"In the third quarter, we closed on a $7.25 million funding, as part of a $9 million funding agreement in support of our
planned business combination with BNN Technology and others. This
$7.25 million funding included a
$2 million investment from BNN into
MICT. We expect to close on the balance of the additional
$1.75 million in the near future,"
stated David Lucatz, Chief Executive Officer of MICT.
On November 7, 2019, MICT closed
on a $25 million private placement of
convertible notes, converting automatically at $1.41 per share of MICT common stock at the
closing of an acquisition by the Company of Global Fintech Holdings
Ltd (GFH), which acquired the ParagonEX Limited group of companies
and the trading companies of BNN Technology PLC. Through its newly
acquired subsidiaries, GFH is already a successful and profitable
business, providing its platforms within the financial trading and
Contracts for Difference (CFD) sectors in Europe, the Middle
East, and Asia. GFH expects
over the coming months to implement its program to acquire
substantial revenues through the acquisition of significant players
in the sector, resulting in rapid growth and the contribution of
significant profitability to the MICT group.
Upon closing of the merger, the combined MICT group is expected
to have a strong balance sheet with over $25
million in cash, enabling the Company to pursue a revenue
acquisition program and to materialize significant fintech
opportunities in China.
David Lucatz, CEO of MICT, said, "We strongly believe that our
strategic decision to change our business and enter into the
fintech space will contribute very positively to value creation for
our present and future shareholders. The funding enables us to
acquire GFH, a very exciting fintech company with world class
technological assets, operational management and significant
profitability. We expect the combination of strong
cash reserves and abundant opportunities will facilitate
substantial earnings growth potential for the Company.
Darren Mercer who recently joined
the Board of MICT and is a director and officer of GFH, added, "The
opportunity to be a part of the MICT group is a very exciting
proposition for us. The GFH group of companies brings to MICT a
suite of world-leading technology platforms that are
product-agnostic and can support all our new ventures within the
fintech space, be they through acquisition or through organic
growth, including in the very significant Chinese marketplace.
Supported by MICT's strong balance sheet and our combined cash
resources, we believe it is a very exciting time for all new and
existing MICT shareholders."
Q3 2019 Review
- Gross loss for MICT was $0 for three months
ended September 30, 2019, compared to gross profit
of $54,000 for the three months ended September 30,
2018.
- Research and development (R&D) expense for MICT for the
three months ended September 30, 2019 was $0,
compared to $425,000 for the three months
ended September 30, 2018.
- Selling, general and administrative (SG&A) expense for MICT
was $501,000 for the three months ended September
30, 2019, compared to $2.93 million for the three months
ended September 30, 2018.
- Net loss attributable to MICT was $1,210,000 for the
three months ended September 30, 2019, compared to a net loss
of $2.6 million for the three months ended September
30, 2019. On a per share basis, MICT reported a net loss
of $0.11 per basic and diluted share from continued
operations for the three months ended September 30, 2019,
compared to a net loss of $0.28 per basic and diluted
share from continued operations for the three months
ended September 30, 2018.
- As of September 30, 2019 MICT had
$5.77 million in cash and
equivalents
Nine Months 2019 Review
- Gross loss was $369,000 for the nine months
ended September 30, 2019, compared to a gross profit
of $3.31 million for the nine months ended September
30, 2018.
- R&D expense for the nine months ended September 30,
2019 was $261,000, compared to $1.46
million for the nine months ended September 30,
2018.
- SG&A expense was $2.36 million for the nine
months ended September 30, 2019, compared
to $6.28 million for the nine months
ended September 30, 2018.
- Net loss attributable to MICT was $3.22 million for
the nine months ended September 30, 2019 compared to a
net profit of $10,000 for the nine months
ended September 30, 2018. On a per share basis, MICT reported
a net loss of $0.30 per basic and diluted share from
continued operations for the nine months ended September 30,
2019, compared to a net loss of $0.54 per basic and
diluted share from continued operations and a net profit per share
of $0.54 from discontinued operations for the nine months
ended September 30, 2018.
Conference Call
The Company invites all those interested in participating in the
call tomorrow, November 15, 2019 at
9:00 a.m. EST, to dial 1-888 -298
5973. Callers from outside of the U.S. may access the call by
dialing: From London (and Europe)
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. EST. 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 London (&Europe) 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 pursuant to the
proposed transaction or otherwise, 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, the public offer will not be made directly
or indirectly, 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
In connection with the proposed acquisition, MICT intends to
file a proxy statement on Schedule 14A and other relevant materials
with the Securities and Exchange Commission, or SEC.
Stockholders of MICT are urged to read MICT's proxy statement
and all other relevant documents filed with the sec when they
become available, as they will contain important information about
the proposed transaction. A definitive proxy statement will be
sent to MICT's stockholders seeking their approval of the proposed
transaction. MICT's stockholders will be able to obtain these
documents (when available) free of charge at the SEC's web site,
http://www.sec.gov. In addition, they may obtain free copies of
these by contacting MICT's Secretary, 28 West Grand Avenue, Suite
3, Montvale, NJ 07645.
Participants in Solicitation
MICT and its directors and executive officers, may be deemed to
be participants in the solicitation of proxies for the special
meeting of MICT's stockholders to be held to approve the proposed
business combination. Information regarding the persons who may,
under the rules of the SEC, be deemed participants in the
solicitation of MICT's stockholders in connection with the proposed
business combination will be set forth in the proxy statement. You
can find information about MICT's executive officers and directors
in its Annual Report on Form 10-K for the year ended December 31, 2018.
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 Statement
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 of the closing of the
balance of the $1.75 million funding,
the expected timing of the closing and perceived benefits of the
transaction with GFH Intermediate Holdings Ltd., Global Fintech
Holding Ltd. and other third parties, the expectation that
following the merger, the company will have a strong balance sheet
which will enable the Company to pursue a revenue acquisition
program and to materialize significant fintech opportunities in
China, that GFH expects over the
coming months to implement its program to acquire substantial
revenues through the acquisition of significant players in the
sector, resulting in rapid growth and the contribution of
significant profitability to the MICT group, the belief that the
Company's strategic decision to change its business will contribute
very positively to value creation for its present and future
shareholders, the expectation that, following the merger, and that
the combination of strong cash reserves and abundant opportunities
will facilitate substantial earnings growth potential for the
Company.. 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, 2018 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.
CONDENSED CONSOLIDATED BALANCE SHEETS (USD In
Thousands, Except Share and Par Value Data)
|
|
|
|
September 30,
2019
|
|
December 31,
2018
|
ASSETS
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
5,767
|
|
|
$
|
2,174
|
|
Trade accounts
receivable, net
|
|
|
—
|
|
|
|
1,010
|
|
Short term loan to
Micronet Ltd.
|
|
|
190
|
|
|
|
—
|
|
Inventories
|
|
|
—
|
|
|
|
4,345
|
|
Other accounts
receivable
|
|
|
110
|
|
|
|
339
|
|
Total current
assets
|
|
|
6,067
|
|
|
|
7,868
|
|
|
|
|
|
|
|
|
|
|
Property and
equipment, net
|
|
|
26
|
|
|
|
661
|
|
Intangible assets,
net and others
|
|
|
—
|
|
|
|
434
|
|
Long-term deposit and
prepaid expenses
|
|
|
—
|
|
|
|
703
|
|
Restricted cash
escrow
|
|
|
477
|
|
|
|
477
|
|
Micronet Ltd.
investment
|
|
|
1,058
|
|
|
|
—
|
|
Total long-term
assets
|
|
|
1,561
|
|
|
|
2,275
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
7,628
|
|
|
$
|
10,143
|
|
MICT, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (USD In
Thousands, Except Share and Par Value Data)
|
|
|
|
September 30,
2019
|
|
|
December 31,
2018
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Short term bank
credit and current portion of long term bank loans
|
|
$
|
-
|
|
|
$
|
2,806
|
|
Short term credit
from others and current portion of long term loans from
others
|
|
|
2,057
|
|
|
|
3,004
|
|
Trade accounts
payable
|
|
|
-
|
|
|
|
1,531
|
|
Other accounts
payable
|
|
|
269
|
|
|
|
1,211
|
|
Total current
liabilities
|
|
|
2,326
|
|
|
|
8,552
|
|
|
|
|
|
|
|
|
|
|
Long term loans from
others
|
|
|
1,834
|
|
|
|
-
|
|
Long term
escrow
|
|
|
477
|
|
|
|
477
|
|
Accrued severance
pay, net
|
|
|
50
|
|
|
|
110
|
|
Total long term
liabilities
|
|
|
2,361
|
|
|
|
587
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
Equity:
|
|
|
|
|
|
|
|
|
Convertible Preferred stock; $0.001 par value, 2,386,363 and 0
shares authorized, issued and outstanding as of September 30, 2019
and December 31, 2018, respectively
|
|
|
2
|
|
|
|
-
|
|
Common
stock; $0.001 par value, 25,000,000 shares authorized,
11,009,532 and 9,342,088 shares issued and outstanding as
of September 30, 2019 and December 31, 2018,
respectively
|
|
|
11
|
|
|
|
9
|
|
Additional paid in
capital
|
|
|
14,022
|
|
|
|
11,905
|
|
Additional paid in
capital - preferred stock
|
|
|
4,827
|
|
|
|
-
|
|
Accumulated other
comprehensive (loss)
|
|
|
58
|
|
|
|
(117)
|
|
Accumulated
loss
|
|
|
(15,979)
|
|
|
|
(12,757)
|
|
MICT, Inc.
stockholders' equity
|
|
|
2,941
|
|
|
|
(960)
|
|
|
|
|
|
|
|
|
|
|
Non-controlling
interests
|
|
|
-
|
|
|
|
1,964
|
|
|
|
|
|
|
|
|
|
|
Total
equity
|
|
|
2,941
|
|
|
|
1,004
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
and equity
|
|
$
|
7,628
|
|
|
$
|
10,143
|
|
MICT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (USD In
Thousands, Except Share and Earnings Per Share
Data) (Unaudited)
|
|
|
|
Nine months
ended
September 30,
|
|
|
Three months
ended
September 30,
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
477
|
|
|
$
|
12,897
|
|
|
$
|
-
|
|
|
$
|
2,216
|
|
Cost of
revenues
|
|
|
846
|
|
|
|
9,589
|
|
|
|
-
|
|
|
|
2,162
|
|
Gross profit
(loss)
|
|
|
(369)
|
|
|
|
3,308
|
|
|
|
-
|
|
|
|
54
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
|
|
261
|
|
|
|
1,457
|
|
|
|
-
|
|
|
|
425
|
|
Selling and
marketing
|
|
|
198
|
|
|
|
1,217
|
|
|
|
-
|
|
|
|
383
|
|
General and
administrative
|
|
|
2,161
|
|
|
|
5,070
|
|
|
|
501
|
|
|
|
2,544
|
|
Amortization of
intangible assets
|
|
|
20
|
|
|
|
652
|
|
|
|
-
|
|
|
|
214
|
|
Total operating
expenses
|
|
|
2,640
|
|
|
|
8,396
|
|
|
|
501
|
|
|
|
3,566
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations
|
|
|
(3,009)
|
|
|
|
(5,088)
|
|
|
|
(501)
|
|
|
|
(3,512)
|
|
Share in investee
losses
|
|
|
(771)
|
|
|
|
-
|
|
|
|
(366)
|
|
|
|
-
|
|
Net profit from loss
of control
|
|
|
299
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
Financial expenses,
net
|
|
|
(292)
|
|
|
|
(956)
|
|
|
|
(346)
|
|
|
|
(104)
|
|
Loss before provision
for income taxes
|
|
|
(3,773)
|
|
|
|
(6,044)
|
|
|
|
(1,213)
|
|
|
|
(3,616)
|
|
Income (provision for
taxes)
|
|
|
(5)
|
|
|
|
(566)
|
|
|
|
3
|
|
|
|
(562)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss from
continued operation
|
|
|
(3,778)
|
|
|
|
(6,610)
|
|
|
|
(1,210)
|
|
|
|
(4,178)
|
|
Net profit from
discontinued operation (includes capital gain from disposal
amounting to $6,844)
|
|
|
-
|
|
|
|
4,894
|
|
|
|
-
|
|
|
|
|
|
Total net
loss
|
|
|
(3,778)
|
|
|
|
(1,716)
|
|
|
|
(1,210)
|
|
|
|
(4,178)
|
|
Net loss attributable
to non-controlling interests
|
|
|
(556)
|
|
|
|
(1,726)
|
|
|
|
-
|
|
|
|
(1,542)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net profit (loss)
attributable to MICT, Inc.
|
|
|
(3,222)
|
|
|
|
10
|
|
|
|
(1,210)
|
|
|
|
(2,636)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per
share attributable to MICT, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted
loss per share from continued operation
|
|
$
|
(0.30)
|
|
|
$
|
(0.54)
|
|
|
$
|
(0.11)
|
|
|
$
|
(0.28)
|
|
Basic and diluted
earnings per share from discontinued operation
|
|
|
-
|
|
|
|
0.54
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding:
|
|
|
10,583,496
|
|
|
|
9,107,034
|
|
|
|
11,009,532
|
|
|
|
9,342,155
|
|
View original
content:http://www.prnewswire.com/news-releases/mict-reports-financial-results-for-the-third-quarter-ended-september-30-2019-300958298.html
SOURCE MICT, Inc.