Woodcliff Lake, NJ — October 27, 2023 – PowerFleet, Inc. (Nasdaq: PWFL) and MiX Telematics Limited (NYSE: MIXT, JSE: MIX) will host a joint Investor Day with financial analysts and institutional investors on Thursday, November 16 at The InterContinental New York Barclay hotel in New York, NY. Presentations are scheduled to begin at 2:00 p.m. Eastern time and end at approximately 5:00 p.m. Eastern time.

Powerfleet and MiX Telematics leadership teams will share the strategic rationale and expected benefits for the previously announced business combination, which will create one of the largest mobile asset Internet of Things (IoT) Software-as-a-Service (SaaS) providers in the world. Powerfleet CEO Steve Towe and CFO David Wilson, MiX CEO Stefan Joselowitz and CFO Paul Dell, along with other senior leaders from the Powerfleet and MiX organizations, will present the vision, integration strategy, growth drivers, go-to-market approach, Unity platform and AI roadmap, customer success stories, and financial targets for the combined business, followed by a live Q&A.

In-person attendance is by invitation only. For those who would like to attend the event in-person, please contact respectively Powerfleet’s investor relations team at PWFL@gateway-grp.com or MiX’s investor relations team at MiXT@gatewayir.com. A live webcast will be available on the investor relations section of each company’s website. A replay of the webcast will be available shortly after the event concludes. 

ABOUT POWERFLEET

Powerfleet (Nasdaq: PWFL; TASE: PWFL) is a global leader of internet of things (IoT) software-as-a-service (SaaS) solutions that optimize the performance of mobile assets and resources to unify business operations. Our data science insights and advanced modular software solutions help drive digital transformation through our customers’ and partners’ ecosystems to help save lives, time, and money. We help connect companies, enabling customers and their customers to realize more effective strategies and results. Powerfleet’s tenured and talented team is at the heart of our approach to partnership and tangible success. The company is headquartered in Woodcliff Lake, New Jersey, with our Pointer Innovation Center (PIC) in Israel and field offices around the globe. For more information, please visit www.powerfleet.com.

ABOUT MIX TELEMATICS

MiX Telematics is a leading global provider of fleet and mobile asset management solutions delivered as SaaS to over 1 million global subscribers spanning more than 120 countries. The company’s products and services provide enterprise fleets, small fleets, and consumers with efficiency, safety, compliance, and security solutions. MiX Telematics was founded in 1996 and has offices in South Africa, the United Kingdom, the United States, Uganda, Brazil, Mexico and Australasia as well as a network of more than 130 fleet partners worldwide. MiX Telematics shares are publicly traded on the Johannesburg Stock Exchange (“JSE”) (JSE: MIX) and the New York Stock Exchange (NYSE: MIXT). For more information, visit www.mixtelematics.com.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of federal securities laws. Powerfleet’s, MiX’s and the combined business’s actual results may differ from their expectations, estimates and projections and consequently, you should not rely on these forward-looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “continue,” and similar expressions are intended to identify such forward-looking statements.

These forward-looking statements include, without limitation, the parties’ expectations with respect to their beliefs, plans, goals, objectives, expectations, anticipations, assumptions, estimates, intentions and future performance, as well as anticipated financial impacts of the proposed transaction, the satisfaction of the closing conditions to the proposed transaction and the timing of the completion of the proposed transaction. Forward-looking statements involve significant known and unknown risks, uncertainties and other factors, which may cause their actual results, performance or achievements to be materially different from the future results, performance or achievements expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be forward-looking statements. Most of these factors are outside the parties’ control and are difficult to predict. The risks and uncertainties referred to above include, but are not limited to, risks related to: (i) the completion of the proposed transaction in the anticipated timeframe or at all; (ii) the satisfaction of the closing conditions to the proposed transaction including, but not limited to the ability to obtain approval of the stockholders of Powerfleet and shareholders of MiX and the ability to obtain financing; (iii) the failure to obtain necessary regulatory approvals; (iv) the ability to realize the anticipated benefits of the proposed transaction; (v) the ability to successfully integrate the businesses; (vi) disruption from the proposed transaction making it more difficult to maintain business and operational relationships; (vii) the negative effects of the announcement of the proposed transaction or the consummation of the proposed transaction on the market price of MiX’s or Powerfleet’s securities; (viii) significant transaction costs and unknown liabilities; (ix) litigation or regulatory actions related to the proposed transaction; and (x) such other factors as are set forth in the periodic reports filed by MiX and Powerfleet with the Securities and Exchange Commission (“SEC”), including but not limited to those described under the heading “Risk Factors” in their annual reports on Form 10-K, quarterly reports on Form 10-Q and any other filings made with the SEC from time to time, which are available via the SEC’s website at http://www.sec.gov. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by these forward-looking statements. Therefore, you should not rely on any of these forward-looking statements.

The forward-looking statements included in this press release are made only as of the date of this press release, and except as otherwise required by applicable securities law, neither MiX nor Powerfleet assumes any obligation nor do they intend to publicly update or revise any forward-looking statements to reflect subsequent events or circumstances.

Powerfleet, MiX and their respective directors, executive officers and certain employees and other persons may be deemed to be participants in the solicitation of proxies from the shareholders of Powerfleet and MiX in connection with the proposed transaction. Securityholders may obtain information regarding the names, affiliations and interests of Powerfleet’s directors and executive officers in its Annual Report on Form 10-K for the fiscal year ended December 31, 2022, which was filed with the SEC on March 31, 2023, its amended Annual Report on Form 10-K/A for the year ended December 31, 2022, which was filed with the SEC on May 1, 2023, and its definitive proxy statement for its 2023 annual meeting of stockholders, which was filed with the SEC on June 21, 2023. Securityholders may obtain information regarding the names, affiliations and interests of MiX’s directors and executive officers in its Annual Report on Form 10-K for the year ended March 31, 2023, which was filed with the SEC on June 22, 2023, and its definitive proxy statement for its 2023 annual general meeting of shareholders, which was filed with the SEC on July 28, 2023. Other information regarding the participants in the proxy solicitations and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the joint proxy statement/prospectus and other relevant materials to be filed with the SEC regarding the proposed transaction when such materials become available. Investors should read the joint proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions. You may obtain free copies of these documents from Powerfleet or MiX using the sources indicated above.

 

Powerfleet Investor Contact
Matt Glover
Gateway Group, Inc.
PWFL@gateway-grp.com
+1 (949) 574-3860

 

Powerfleet Media Contact
Andrea Hayton
ahayton@powerfleet.com
+1 (610) 401-1999

 

MiX Telematics Investor Contact
Cody Cree
Gateway Group, Inc.
+1 (949) 574-3860
MIXT@gateway-grp.com

 

MiX Telematics Media Contact
Jonathan Bates
jonathan.bates@mixtelematics.com
+44 7921 242892

 

Combination Expected to Create Top-Tier Global Provider in Mobile Asset IoT Industry with Unparalleled Artificial Intelligence Enhanced SaaS Solution Portfolio 

~1.7 Million Combined Subscriber Base Expected to Provide Immediate Scale

Expected to Create a Day One Business with Total Revenue of $279 Million, Including $210 Million of Recurring High-Margin SaaS Revenues and Combined Service Gross Margins of 67%

In Addition to Organic Growth, Combination is Expected to Unlock Significant Annual EBITDA Expansion Within First Two Years

Expected to Deliver Significant Cross-Sell and Upsell Opportunities for Powerfleet’s Unity Platform, Modular Software, and AI-Driven Data Solutions into Combined Base of 7,500 Enterprise Customers

Leadership Teams to Host Joint Conference Call Today, October 10, 2023 at 8:30 AM ET

Joint Investor Day Scheduled for Thursday, November 16, 2023 in New York City. Further Details Will Be Communicated Shortly

WOODCLIFF LAKE, NJ – October 10, 2023 – PowerFleet, Inc. (Nasdaq: PWFL) and MiX Telematics Limited (NYSE: MIXT, JSE: MIX) today announced that they have entered into a definitive agreement to form one of the largest mobile asset Internet of Things (IoT) Software-as-a-Service (SaaS) providers in the world. This powerful combination will form a scaled, global entity of choice focused on helping customers save lives, time, and money by solving mission-critical business challenges including safety and risk management, compliance, sustainability, and operational efficiency.

BUSINESS COMBINATION SUMMARY AND KEY DEVELOPMENTS

• Combined business with total revenue of $279 million, including $210 million in recurring high-margin SaaS revenue and $39 million of adjusted EBITDA for the trailing twelve-month (TTM) period ended June 30, 2023 (excluding selected non-cash and non-recurring items).
• The transaction is expected to close in the first quarter of calendar year 2024.
• Upon close, the combined business will be branded as Powerfleet, with its primary listing on Nasdaq.
  
  

MANAGEMENT COMMENTARY

“By leveraging our proven SaaS strategy across the combined business, spearheaded by our Unity platform and data highway, we firmly believe we will be extremely well positioned to drive incremental market consolidation. Realizing transformative scale, this transaction with MiX will provide the go-forward company with 1.7 million subscribers, and the ability to sell additive and accelerated AI and data-powered software solutions to a truly global set of customers,” said Steve Towe, Powerfleet’s Chief Executive Officer, who will continue serving as CEO of the combined Powerfleet company. “This combination is expected to achieve a number of strategic objectives including unlocking strong incremental value creation opportunities; a refinanced balance sheet for the combined company that will provide more flexibility to execute our strategic growth initiatives; and the ability to retain and attract an expanded portfolio of shareholders. Combining with MiX, an extremely well-run and profitable organization, will establish the combined entity as a world-class SaaS company, giving us the speed and capability to achieve improved growth in high quality recurring revenues and expanded profitability much sooner.”

Stefan Joselowitz, Chief Executive Officer at MiX Telematics, intends to retire at the conclusion of this transaction, but plans to continue to be a shareholder of the new combined entity. Joselowitz added, “I am extremely proud of our heritage and the high-quality business MiX is today, and I am delighted to have finally found an ideal partner that shares our values and strategic goals to take the company to the next level. We strongly believe that Powerfleet’s Unity strategy and our combined scale perfectly positions us to revolutionize the mobile asset IoT SaaS industry and drive transformative growth. As a shareholder I am very excited about how this combination will accelerate the achievement of our shared strategic goals.”

STRATEGIC RATIONALE

Compelling benefits expected from the transaction:

• Enhanced Shareholder Value: The transaction will immediately increase value to our existing and prospective shareholders with combined total revenue of $279 million and $39 million of adjusted EBITDA.The stronger balance sheet paired with the growth-centric capital structure is expected to propel the combined entity towards ambitious and achievable growth goals, including “Rule of 40” performance.
• Market Leadership: The combined company will create a top-tier mobile asset IoT SaaS organization with significant scale, serving all mobile asset types. The increased scale is expected to enable the combined entity to more efficiently serve our customers and create advantage to compete in an industry characterized by the need for high pace of development and innovation.
• Scale and Data Strategy: With a combined base of approximately 1.7 million subscribers following the transaction, the joint entity is expected to achieve significant scale as well as enhance our Unity platform strategy – including our AI-led data harmonization and integration capabilities.
• Research and Development Excellence: By integrating the Powerfleet and MiX world-class engineering and technology teams, the combined organization is expected to accelerate the delivery of top-class solutions with improved competitive advantage.
• Go-to-Market Acceleration and Increased Reach: Our combined geographical footprint, deep vertical expertise, and expanded software solution sets coupled with our extensive direct and indirect sales channel capabilities will enable us to maximize significant cross-sell and upsell opportunities within our impressive joint customer base.
• World-Class Talent: With more than 1,800 tenured and talented team members worldwide, the combined entity will focus on attracting and retaining top talent to deliver optimal value to our customers.
  
  

TRANSACTION TERMS AND FINANCING

MiX shareholders will exchange 100% of their outstanding MiX ordinary shares (including MiX ordinary shares represented by MiX American Depository Shares (ADSs), each of which represents 25 MiX ordinary shares) for consideration consisting of Powerfleet common shares, payable at closing. The number of Powerfleet common shares to be issued as consideration will be based on a post-transaction ownership structure, whereby current MiX shareholders will own approximately 65%, and current Powerfleet shareholders will own approximately 35% of the combined entity immediately following the closing of the transaction. This exchange ratio assumes all MiX issued ordinary shares (including those represented by MiX ADSs) are exchanged for common shares in Powerfleet.

In connection with the transaction, Powerfleet and MiX are positioned to secure $75 million in incremental debt which the companies anticipate will be fully executed at or before close. The proceeds from the refinancing of the combined company’s balance sheet will be used to redeem in full the outstanding convertible preferred stock held by affiliates of Abry Partners. Transaction-related expenses will be paid from cash on the balance sheet.

The closing of the transaction is subject to customary conditions, including required approvals of regulatory authorities and Powerfleet and MiX shareholders.

BOARD AND EXECUTIVE LEADERSHIP

Following the transaction, Steve Towe will remain CEO of Powerfleet and David Wilson will remain CFO. Stefan Joselowitz, current CEO of MiX, will be retiring.

A new board of directors of Powerfleet will be formed. Michael Brodsky will be Chairman. Steve Towe will be on the board. Ian Jacobs, MiX Telematics’ current Chairman, will be joining the board. MiX will appoint one additional board member and further board member appointments will be made by mutual consent.

CONFERENCE CALL AND WEBCAST

Powerfleet and MiX Telematics management will host a joint conference call to discuss the transaction today, October 10, 2023 at 8:30 a.m. Eastern time (5:30 a.m. Pacific time).

Toll Free: 888-506-0062
International: 973-528-0011
South Africa: 080-098-3458
Participant Access Code: 193766
Webcast

The conference call will be available for replay here.

If you have any difficulty connecting with the conference call, please contact Gateway Group at 949-574-3860.

A supplemental slide presentation regarding the transaction will be available on the investor relations section of each company’s website.

TRANSACTION ADVISORS

William Blair & Company L.L.C. is acting as financial advisor, and Olshan Frome Wolosky LLP and Webber Wentzel are acting as legal advisors to Powerfleet. Raymond James and Java Capital are acting as financial advisors to MiX Telematics, and DLA Piper LLP (US) and Java Capital are acting as legal advisors to MiX Telematics. Gateway Group is acting as investor relations advisor to Powerfleet and MiX Telematics.

RECONCILIATION OF EBITDA TO GAAP FINANCIAL MEASURE

ABOUT POWERFLEET

Powerfleet (Nasdaq: PWFL; TASE: PWFL) is a global leader of internet of things (IoT) software-as-a-service (SaaS) solutions that optimize the performance of mobile assets and resources to unify business operations. Our data science insights and advanced modular software solutions help drive digital transformation through our customers’ and partners’ ecosystems to help save lives, time, and money. We help connect companies, enabling customers and their customers to realize more effective strategies and results. Powerfleet’s tenured and talented team is at the heart of our approach to partnership and tangible success. The company is headquartered in Woodcliff Lake, New Jersey, with our Pointer Innovation Center (PIC) in Israel and field offices around the globe. For more information, please visit www.powerfleet.com.

ABOUT MIX TELEMATICS

MiX Telematics is a leading global provider of fleet and mobile asset management solutions delivered as SaaS to over 1 million global subscribers spanning more than 120 countries. The company’s products and services provide enterprise fleets, small fleets, and consumers with efficiency, safety, compliance, and security solutions. MiX Telematics was founded in 1996 and has offices in South Africa, the United Kingdom, the United States, Uganda, Brazil, Mexico and Australasia as well as a network of more than 130 fleet partners worldwide. MiX Telematics shares are publicly traded on the Johannesburg Stock Exchange (JSE: MIX) and the New York Stock Exchange (NYSE: MIXT). For more information, visit www.mixtelematics.com.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements within the meaning of federal securities laws. Powerfleet’s, MiX’s and the combined business’s actual results may differ from their expectations, estimates and projections and consequently, you should not rely on these forward-looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “continue,” and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, the parties’ expectations with respect to their beliefs, plans, goals, objectives, expectations, anticipations, assumptions, estimates, intentions and future performance, as well as anticipated financial impacts of the proposed transaction, the satisfaction of the closing conditions to the proposed transaction and the timing of the completion of the proposed transaction. Forward-looking statements involve significant known and unknown risks, uncertainties and other factors, which may cause their actual results, performance or achievements to be materially different from the future results, performance or achievements expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be forward-looking statements. Most of these factors are outside the parties’ control and are difficult to predict. The risks and uncertainties referred to above include, but are not limited to, risks related to: (i) the completion of the proposed transaction in the anticipated timeframe or at all; (ii) the satisfaction of the closing conditions to the proposed transaction including, but not limited to the ability to obtain approval of the stockholders of Powerfleet and shareholders of MiX and the ability to obtain financing; (iii) the failure to obtain necessary regulatory approvals; (iv) the ability to realize the anticipated benefits of the proposed transaction; (v) the ability to successfully integrate the businesses; (vi) disruption from the proposed transaction making it more difficult to maintain business and operational relationships; (vii) the negative effects of the announcement of the proposed transaction or the consummation of the proposed transaction on the market price of MiX’s or Powerfleet’s securities; (viii) significant transaction costs and unknown liabilities; (ix) litigation or regulatory actions related to the proposed transaction; and (x) such other factors as are set forth in the periodic reports filed by MiX and Powerfleet with the Securities and Exchange Commission (“SEC”), including but not limited to those described under the heading “Risk Factors” in their annual reports on Form 10-K, quarterly reports on Form 10-Q and any other filings made with the SEC from time to time, which are available via the SEC’s website at http://www.sec.gov. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by these forward-looking statements. Therefore, you should not rely on any of these forward-looking statements.

The forward-looking statements included in this press release are made only as of the date of this press release, and except as otherwise required by applicable securities law, neither MiX nor Powerfleet assumes any obligation nor do they intend to publicly update or revise any forward-looking statements to reflect subsequent events or circumstances.

ADDITIONAL INFORMATION AND WHERE TO FIND IT

In connection with the proposed transaction, Powerfleet intends to file with the SEC a registration statement on Form S-4 that will include a joint proxy statement of Powerfleet and MiX and a prospectus of Powerfleet. Furthermore, Powerfleet intends to procure a secondary inward listing on the Johannesburg Stock Exchange to accommodate existing and future South African shareholders.

Additionally, MiX intends to prepare a scheme circular for MiX shareholders in accordance with the Companies Act of South Africa (including the Companies Act Regulations, 2011 thereunder) and the JSE’s listings requirements with respect to a shareholder meeting at which MiX shareholders will be asked to vote on the proposed transaction. The scheme circular will be issued to MiX shareholders together with the proxy statement/prospectus. If you hold MiX ordinary shares through an intermediary such as a broker/dealer or clearing agency, or if you hold MiX ADSs, you should consult with your intermediary or The Bank of New York Mellon, the depositary for the MiX ADSs, as applicable, about how to obtain information on the MiX shareholder meeting.

After Powerfleet’s registration statement has been filed and declared effective by the SEC, Powerfleet will send the definitive proxy statement/prospectus to the Powerfleet shareholders entitled to vote at the meeting relating to the proposed transaction, and MiX will send the scheme circular, together with the definitive proxy statement/prospectus, to MiX shareholders entitled to vote at the meeting relating to the proposed transaction. MiX and Powerfleet may file other relevant materials with the SEC in connection with the proposed transaction. INVESTORS AND SHAREHOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT, JOINT PROXY STATEMENT/PROSPECTUS (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO AND ANY DOCUMENTS INCORPORATED BY REFERENCE THEREIN), THE SCHEME CIRCULAR AND OTHER DOCUMENTS THAT MAY BE FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and shareholders will be able to obtain free copies of these documents (if and when available) and other documents containing important information about Powerfleet and MiX once such documents are filed with the SEC through the website maintained by the SEC at www.sec.gov. Powerfleet or MiX make available copies of materials they file with, or furnish to, the SEC free of charge at https://ir.powerfleet.com and http://investor.mixtelematics.com, respectively.

NO OFFER OR SOLICITATION

This communication shall not constitute an offer to buy or sell any securities, or the solicitation of an offer to buy or sell any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.

PARTICIPANTS IN THE SOLICITATION

Powerfleet, MiX and their respective directors, executive officers and certain employees and other persons may be deemed to be participants in the solicitation of proxies from the shareholders of Powerfleet and MiX in connection with the proposed transaction. Securityholders may obtain information regarding the names, affiliations and interests of Powerfleet’s directors and executive officers in its Annual Report on Form 10-K for the fiscal year ended December 31, 2022, which was filed with the SEC on March 31, 2023, its amended Annual Report on Form 10-K/A for the year ended December 31, 2022, which was filed with the SEC on May 1, 2023, and its definitive proxy statement for its 2023 annual meeting of stockholders, which was filed with the SEC on June 21, 2023. Securityholders may obtain information regarding the names, affiliations and interests of MiX’s directors and executive officers in its Annual Report on Form 10-K for the year ended March 31, 2023, which was filed with the SEC on June 22, 2023, and its definitive proxy statement for its 2023 annual general meeting of shareholders, which was filed with the SEC on July 28, 2023. Other information regarding the participants in the proxy solicitations and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the joint proxy statement/prospectus and other relevant materials to be filed with the SEC regarding the proposed transaction when such materials become available. Investors should read the joint proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions. You may obtain free copies of these documents from Powerfleet or MiX using the sources indicated above.

Powerfleet Investor Contact
Matt Glover
Gateway Group, Inc.
PWFL@gateway-grp.com
+1 (949) 574-3860

Powerfleet Media Contact
Andrea Hayton
ahayton@powerfleet.com
+1 (610) 401-1999

MiX Telematics Investor Contact
Cody Cree
Gateway Group, Inc.
+1 (949) 574-3860
MIXT@gateway-grp.com

MiX Telematics Media Contact
Jonathan Bates
jonathan.bates@mixtelematics.com
+44 7921 242892

###

WOODCLIFF LAKE, N.J., Aug 3, 2023 – PCS Civil, Inc. has deployed Powerfleet’s (Nasdaq: PWFL) SaaS-based, IoT device agnostic fleet intelligence platform, Unity. With Unity’s data insights for safety, maintenance, and fuel management, PCS Civil can make informed decisions to protect their drivers – while increasing productivity and reducing costs. PCS Civil can now capitalize on machine learning (ML) and artificial intelligence (AI) to build and maintain a culture of safety.

“Our most valuable asset is our people, and their safety is the priority,” said Steve Borth, Director of Fleet Operations at PCS Civil. “Powerfleet provides the means to make this possible. We have real-world insights to make the right decisions for our fleet regardless of the challenges that come our way. We have already achieved safer driving performance, and we look forward to realizing additional results as our partnership continues.”

Powerfleet Unity ingests, processes, and harmonizes data from any asset, vehicle, and person within a single data hub. Coupled with Powerfleet’s dash cam product, PCS Civil can analyze and proactively manage risky driving situations across their mixed fleet of service and heavy-duty construction vehicles – all under a single pane of glass. Overall, PCS Civil achieves real-time alerts and driver scorecards to bolster safety programs, reduce accidents, increase security, reduce the risk of litigation, and achieve lower insurance costs.

“Safety is about people, and Powerfleet puts people first,” said Steve Towe, Chief Executive Officer at Powerfleet. “Through increased safety measures and real-time interactions, we enable construction companies to perform top-notch work while empowering their people to safely and efficiently do their jobs.”

Along with safety, PCS Civil also reaps benefits from Powerfleet’s proactive and preventative maintenance  and fuel consumption solutions. Access to utilization hours, as well as automating maintenance tasks, enhances the performance and longevity of resources. Furthermore, Powerfleet’s solutions allow PCS Civil to gain strategic insight into fuel usage from examining behaviors like excess idling and detecting unexpected fuel loss.

More information on Powerfleet’s solution for construction is available here.

###

ABOUT PCS CIVIL, INC.

PCS Civil, Inc. is a leader in Heavy Civil Construction services in Florida. Originally known as Pepper Contracting, PCS was incorporated on December 21, 1993 with the mission to set the bar higher for all roadway, utility, and concrete companies in the Tampa Bay area.

PCS Civil currently operates out of our 7-acre site on Asphalt Ave centrally located in Tampa, FL.

https://www.pcscivilinc.com/our-company/

ABOUT POWERFLEET

Powerfleet (Nasdaq: PWFL; TASE: PWFL) is a global leader of internet of things (IoT) software-as-a-service (SaaS) solutions that optimize the performance of mobile assets and resources to unify business operations. Our data science insights and advanced modular software solutions help drive digital transformation through our customers’ and partners’ ecosystems to help save lives, time, and money. We help connect companies, enabling customers and their customers to realize more effective strategies and results. Powerfleet’s tenured and talented team is at the heart of our approach to partnership and tangible success. The company is headquartered in Woodcliff Lake, New Jersey, with our Pointer Innovation Center (PIC) in Israel and field offices around the globe. For more information, please visit www.powerfleet.com.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements within the meaning of federal securities laws. Forward-looking statements include statements with respect to Powerfleet’s beliefs, plans, goals, objectives, expectations, anticipations, assumptions, estimates, intentions, and future performance, and involve known and unknown risks, uncertainties and other factors, which may be beyond Powerfleet’s control, and which may cause its actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be forward-looking statements. For example, forward-looking statements include statements regarding prospects for additional customers; potential contract values; market forecasts; projections of earnings, revenues, synergies, accretion, or other financial information; emerging new products; and plans, strategies, and objectives of management for future operations, including growing revenue, controlling operating costs, increasing production volumes, and expanding business with core customers. The risks and uncertainties referred to above include, but are not limited to, future economic and business conditions, the loss of key customers or reduction in the purchase of products by any such customers, the failure of the market for Powerfleet’s products to continue to develop, the inability to protect Powerfleet’s intellectual property, the inability to manage growth, the effects of competition from a variety of local, regional, national and other providers of wireless solutions, and other risks detailed from time to time in Powerfleet’s filings with the Securities and Exchange Commission, including Powerfleet’s most recent annual report on Form 10-KThese risks could cause actual results to differ materially from those expressed in any forward-looking statements made by, or on behalf of, Powerfleet. Unless otherwise required by applicable law, Powerfleet assumes no obligation to update the information contained in this press release, and expressly disclaims any obligation to do so, whether a result of new information, future events, or otherwise.

Powerfleet Investor Contact

Matt Glover
Gateway Group, Inc.
PWFL@gatewayir.com
(949) 574-3860

Powerfleet Media Contact

Heather K. Smith

hsmith@powerfleet.com

(605) 203-0605

WOODCLIFF LAKE, NJ – March 9, 2023 – Powerfleet, Inc. (Nasdaq: PWFL), a global leader of Internet of Things (IoT) software-as-a-service (SaaS) solutions that optimize the performance of mobile assets and resources to unify business operations, reported results for the first quarter ended March 31, 2023.

 

FIRST QUARTER 2023 AND RECENT OPERATIONAL MILESTONES

• Continued strong execution of SaaS growth strategy demonstrated by an increase in high-margin services revenue, which was up 9% on a GAAP basis and 17% on a constant currency basis compared to Q1 2022, led by impressive 20% recurring revenue growth in the U.S.
• Go-forward core business (excluding Argentina, Brazil, and South Africa business units, and third-party hardware only business) gross margin expanded to 53% and core business services gross margin increased to 71%.
• Launched phase two of cost optimization plan and expect to hit the $3 million annualized operating expense reduction target.
• Secured several strategic Unity sales deals in Q1, with H2 pipeline growing by 47%.
• Closed Movingdots acquisition, bringing solution advantage in the safety, insurance and sustainability strategic verticals, alongside increasing data science and AI talent.

 

FIRST QUARTER 2023 FINANCIAL HIGHLIGHTS (COMPARED TO FIRST QUARTER 2022)

• High-margin services revenue increased 9% to $20.4 million. On a constant currency basis, the year-over-year increase was 17%.
• Gross profit increased 15% to $16.6 million, with gross margin expanding from 43% to 51%.
• Product gross margin expanded from 17% to 27% with deal discipline and product re-engineering being the key drivers.
• Loss from operations improved by 49%, or $9 million.
• Adjusted EBITDA, a non-GAAP metric, improved by $2.0 million to $1.4 million, compared to $(0.6) million.
• Ended the quarter with $25.1 million in cash and cash equivalents and a working capital position of $41.8 million.

 

MANAGEMENT COMMENTARY

“Our positive start to the new year reflects our unwavering focus on driving profitable growth and SaaS recurring revenue expansion despite the challenging macroeconomic pressures and highly significant FX headwinds,” said Steve Towe, CEO at Powerfleet. “On a constant currency basis, total revenue increased by 4% year-over-year, with high-margin services revenue increasing by an impressive 17% year-over-year.

“Our transformation strategy involves divesting low-margin, low-growth, and sub-scale business units, allowing us to focus on our high quality, profitable business segments. We’re making good progress in exploring strategic alternatives for our Argentina, Brazil, and South Africa business units while also ruthlessly rationalizing hardware-only revenue from the Cellocator sales channel and diminishing other loss-making contracts. This exercise naturally moderates our overall total revenue growth in the short term but allows us to focus on value enhancing recurring revenue expansion, which drives attractive gross margin expansion, improved cash flow and EBITDA.

“This was demonstrated with the Q1 performance of our go-forward core markets, which exclude non-core territories and third party Cellocator sales. We are proud to report a total gross margin performance of 53% with services gross margin of 71%. These strong and exciting numbers, combined with the successful launch of new software modules on our Unity platform, strengthened by the capabilities of the Movingdots technology and talent, provide an excellent platform to drive significant shareholder value in the future.

“From a sales perspective, our new prospect engagement levels are much improved, and we are aggressively ramping up our cross and upsell activity to scale Powerfleet into a faster-growing SaaS company. We are confident that the growing Unity customer wins and increased pipeline proof points, through the shift to compelling data led integrated solutions, are key indicators of compelling growth opportunities for the business.

“As we integrate Movingdots, we expect incremental transitional investments in Opex, particularly to accelerate research and development. Although this will result in some fluctuation in our short-term combined cost base, we expect revenue growth and EBITDA expansion in Q2 from our core business, with an even stronger performance in the second half of 2023. We remain on track executing our transformation plan to deliver our strategic foundational pillars – sustainable top-line growth, increased profitability, and cash flow.”

 

FIRST QUARTER 2023 FINANCIAL RESULTS

Total revenue was $32.8 million, compared to $33.2 million in the same year-ago period, with growth in services revenue offsetting lower product sales. On a constant currency basis, total revenue would have been $34.6 million, an increase of $1.4 million, or 4%, compared to the prior year.

Services revenues totaled $20.4 million, up $1.7 million year-over-year, accounting for 62% of total revenue. On a constant currency basis, services revenue grew by 17%, reflecting the company’s successful execution of its SaaS growth strategy.

Products revenue declined by $2.0 million to $12.4 million, or 38% of total revenue, with deal discipline being the key driver.

Gross profit margin expanded to 51% in Q1 2023 from 43% in the prior year, driven by an improved mix of high-margin services revenue versus product revenue, deal discipline for product sales, and lower purchase price variances.

Operating expenses increased to $18.5 million from $18.1 million in the same year-ago period with deal costs associated with the acquisition of Movingdots being the key driver.

Net income attributable to common stockholders, inclusive of a $7.2 million gain on bargain purchase for Movingdots, totaled $3.5 million, or $0.10 per basic share (based on 35.5 million weighted average shares outstanding), and $0.08 per fully diluted share (based on 43.7 million weighted average shares outstanding), compared to net loss attributable to common stockholders of $4.1 million, or $(0.12) per basic and diluted share, in the same year-ago period.

Adjusted EBITDA, a non-GAAP metric, improved significantly to $1.4 million, benefiting from a $2.2 million expansion in gross margin. See the section below titled “Non-GAAP Financial Measures” for more information about adjusted EBITDA and its reconciliation to GAAP net income (loss).

Powerfleet had $25.1 million in cash and cash equivalents and a working capital position of $41.8 million at quarter-end, benefiting from $8.7 million in net proceeds from the acquisition of Movingdots.

 

INVESTOR CONFERENCE CALL

Powerfleet management will discuss these results and business outlook on a conference call today (Tuesday, May 9, 2023) at 8:30 a.m. Eastern time (5:30 a.m. Pacific time).

Powerfleet management will host the presentation, followed by a question-and-answer session.

Toll Free: 888-506-0062

International: 973-528-0011

Participant Access Code: 351317

The conference call will be broadcast simultaneously and available for replay here and in via the investor section of the company’s website at ir.powerfleet.com.

If you have any difficulty connecting with the conference call, please contact Powerfleet’s investor relations team at 949-574-3860.

 

NON-GAAP FINANCIAL MEASURES

To supplement its financial statements presented in accordance with Generally Accepted Accounting Principles (GAAP), Powerfleet provides certain non-GAAP measures of financial performance. These non-GAAP measures include non-GAAP net income (loss), non-GAAP net income (loss) per basic and diluted share, adjusted EBITDA and total revenue and services revenue excluding foreign exchange effect. Reference to these non-GAAP measures should be considered in addition to results prepared under current accounting standards, but are not a substitute for, or superior to, GAAP results. These non-GAAP measures are provided to enhance investors’ overall understanding of Powerfleet’s current financial performance. Specifically, Powerfleet believes the non-GAAP measures provide useful information to both management and investors by excluding certain expenses, gains and losses that may not be indicative of its core operating results and business outlook. These non-GAAP measures are not measures of financial performance or liquidity under GAAP and, accordingly, should not be considered as an alternate to net income or cash flow from operating activities as an indicator of operating performance or liquidity. Because Powerfleet’s method for calculating the non-GAAP measures may differ from other companies’ methods, the non-GAAP measures may not be comparable to similarly titled measures reported by other companies. Reconciliation of all non-GAAP measures included in this press release to the nearest GAAP measures can be found in the financial tables included in this press release.

 

POWERFLEET, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO ADJUSTED EBITDA FINANCIAL MEASURES

 

POWERFLEET, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP NET INCOME (LOSS) FINANCIAL MEASURES

(Unaudited)

 

ABOUT POWERFLEET

Powerfleet (Nasdaq: PWFL; TASE: PWFL) is a global leader of internet of things (IoT) software-as-a-service (SaaS) solutions that optimize the performance of mobile assets and resources to unify business operations. Our data science insights and advanced modular software solutions help drive digital transformation through our customers’ and partners’ ecosystems to help save lives, time, and money. We help connect companies, enabling customers and their customers to realize more effective strategies and results. Powerfleet’s tenured and talented team is at the heart of our approach to partnership and tangible success. The company is headquartered in Woodcliff Lake, New Jersey, with our Pointer Innovation Center (PIC) in Israel and field offices around the globe. For more information, please visit www.powerfleet.com.

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements within the meaning of federal securities laws. Forward-looking statements include statements with respect to Powerfleet’s beliefs, plans, goals, objectives, expectations, anticipations, assumptions, estimates, intentions, and future performance, and involve known and unknown risks, uncertainties and other factors, which may be beyond Powerfleet’s control, and which may cause its actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be forward-looking statements. For example, forward-looking statements include statements regarding prospects for additional customers; potential contract values; market forecasts; projections of earnings, revenues, synergies, accretion, or other financial information; emerging new products; and plans, strategies, and objectives of management for future operations, including growing revenue, controlling operating costs, increasing production volumes, and expanding business with core customers. The risks and uncertainties referred to above include, but are not limited to, future economic and business conditions, the ability to recognize the anticipated benefits of the acquisition of Movingdots, the loss of key customers or reduction in the purchase of products by any such customers, the failure of the market for Powerfleet’s products to continue to develop, the inability to protect Powerfleet’s intellectual property, the inability to manage growth, the effects of competition from a variety of local, regional, national and other providers of wireless solutions, and other risks detailed from time to time in Powerfleet’s filings with the Securities and Exchange Commission, including Powerfleet’s most recent annual report on Form 10-K. These risks could cause actual results to differ materially from those expressed in any forward-looking statements made by, or on behalf of, Powerfleet. Unless otherwise required by applicable law, Powerfleet assumes no obligation to update the information contained in this press release, and expressly disclaims any obligation to do so, whether a result of new information, future events, or otherwise.

 

Powerfleet Investor Contact

Matt Glover

Gateway Group, Inc.

PWFL@gatewayir.com

(949) 574-3860

 

Powerfleet Media Contact

Heather Smith

hsmith@powerfleet.com

(605) 203-0605

 

POWERFLEET, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS DATA

 

POWERFLEET, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEET DATA

 

POWERFLEET, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW DATA

 

POWERFLEET, INC. CORE BUSINESS

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS DATA

 

CONSTANT CURRENCY

Constant currency information has been presented to illustrate the impact of changes in currency rates on the company’s results. The constant currency information has been determined by adjusting the current financial reporting period results to the prior period average exchange rates, determined as the average of the monthly exchange rates applicable to the period. The measurement has been performed for each of the company’s currencies. The constant currency growth percentage has been calculated by utilizing the constant currency results compared to the prior period results.

The constant currency information represents non-GAAP information. The company believes this provides a useful basis to measure the performance of its business as it removes distortion from the effects of foreign currency movements during the period; however, this information should be considered as supplemental in nature and should not be considered in isolation or as a substitute for the related financial information prepared in accordance with GAAP. See the section above titled “Non-GAAP Financial Measures” for more information.

Due to a portion of the company’s customers who are invoiced in non-U.S. Dollar denominated currencies, the company also calculates subscription revenue growth rate on a constant currency basis, thereby removing the effect of currency fluctuation on results of operations.

 

WOODCLIFF LAKE, NJ – March 09, 2023 – Powerfleet, Inc. (Nasdaq: PWFL), a global leader of Internet of Things (IoT) software-as-a-service (SaaS) solutions that optimize the performance of mobile assets and resources to unify business operations, has signed a definitive agreement to acquire Movingdots, a leading provider of insurance telematics and sustainable mobility solutions based in Bremen, Germany, and a subsidiary of one of the world’s leading re-insurers, Swiss Re.

Movingdots, in partnership with Swiss Re’s Automotive and Mobility unit, has spent nearly a decade designing and perfecting data science algorithms with primary insurers to provide risk-based drive style analytics for fleets and personal auto risk. Backed with actuarial insights, Movingdots enables data-driven insurance propositions for insurers, car manufacturers, and mobility platform players worldwide. By focusing on customers’ safety and security needs, and by providing transparent and comprehensive monitoring, Movingdots combines insurance analytics with artificial intelligence (AI) technology to derive an individual risk assessment. Movingdots has been looking for the right strategic growth partner to deliver these precisely architected insurance solutions to the global market in a sustainable, profitable, and scalable way.

“I look forward to welcoming Movingdots’ exceptional team and great customers to Powerfleet,” said Steve Towe, Chief Executive Officer at Powerfleet. “World-class insurance telematics solutions as well as ESG reporting are core to Movingdots’ business and are highly aligned and complementary to Powerfleet’s strategic focus on safety and sustainability. We look forward to the partnership as we bring these industry-leading solutions to an expanded market through Powerfleet’s customer base and global go-to-market channels.”

Hendrik Todte, Managing Director at Movingdots, added: “We pride ourselves on the accuracy and reliability of our data and solutions. Achieving safer and more sustainable mobility requires engineering excellence and I am proud of the dedicated team we have built in Europe. We look forward to joining forces with Powerfleet to embrace opportunities in the corporate and commercial fleet space and to deliver innovation in mobility through cutting edge technology.”

Compelling benefits from the acquisition that are expected to support Powerfleet’s organic growth include:

• Insurance-approved solutions: Movingdots is currently owned by Swiss Re, one of the world’s leading providers of reinsurance, insurance, and other forms of insurance-based risk transfer. The insurance risk insights from Swiss Re have contributed to the creation of Movingdots’ end-to-end telematics app solution, Coloride. This adds credibility to the suite Powerfleet will offer its customers and partners.
• Enhanced Powerfleet Unity platform: Powerfleet launched its new fleet intelligence platform, Unity, at the end of 2022. Unity unites people, assets, and IoT device data together on a single platform to transform the way its customers do business. Unity is made up of six data-powered solutions, including safety and sustainability. Movingdots’ focus on delivering innovative automotive and mobility safety solutions and ESG reporting will enhance Powerfleet’s SaaS enterprise applications.
• Increased global reach and total addressable market: Movingdots’ footprint and customer base will strengthen Powerfleet’s global reach and ability to penetrate EMEA markets with wider international leadership and expanded solution offerings.
• Investment in talent: Movingdots has built a hub of excellence in Germany and beyond. Movingdots employees will strengthen Powerfleet’s current tenured and talented team, all striving to deliver on the promise of People Powered IoT.

“We are excited that we have found Powerfleet, a strong buyer for Movingdots, who has the scale and footprint to further grow the business,” said Andrea Keller, Head Automotive and Mobility, Reinsurance Solutions, at Swiss Re. “We are looking forward to continuing with Powerfleet and Movingdots in partnership.”

The acquisition is expected to close in the first quarter of 2023. Following the completion of the acquisition, all Movingdots customers will continue to receive exceptional service from the Movingdots team.

ABOUT POWERFLEET

Powerfleet (Nasdaq: PWFL; TASE: PWFL) is a global leader of internet of things (IoT) software-as-a-service (SaaS) solutions that optimize the performance of mobile assets and resources to unify business operations. Our data science insights and advanced modular software solutions help drive digital transformation through our customers’ and partners’ ecosystems to help save lives, time, and money. We help connect companies, enabling customers and their customers to realize more effective strategies and results. Powerfleet’s tenured and talented team is at the heart of our approach to partnership and tangible success. The company is headquartered in Woodcliff Lake, New Jersey, with our Pointer Innovation Center (PIC) in Israel and field offices around the globe. For more information, please visit www.powerfleet.com.

ABOUT MOVINGDOTS

Founded in 1999 and headquartered in Bremen, Germany, Movingdots GmbH is a subsidiary of Swiss Re, one of the world’s leading providers of reinsurance, insurance and other forms of insurance-based risk transfer. The automotive industry and customer needs are changing quickly with vehicles becoming electric, shared, connected and autonomous. Movingdots develops data-driven mobility solutions for insurers, car manufacturers and platform providers worldwide to succeed through these trends. The modular, end-to-end telematics app solution Coloride and a fleet telematics solution are part of Movingdots’ offering. In 2022 Movingdots is listed among the top 250 insurtechs worldwide to watch by Digital Insurance Agenda. Find out more on www.movingdots.com and on LinkedIn.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements within the meaning of federal securities laws. Forward-looking statements include statements with respect to Powerfleet’s beliefs, plans, goals, objectives, expectations, anticipations, assumptions, estimates, intentions, and future performance, and involve known and unknown risks, uncertainties and other factors, which may be beyond Powerfleet’s control, and which may cause its actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be forward-looking statements. For example, forward-looking statements include statements regarding the expected benefits of the acquisition, the timing of the transaction and prospects for additional customers. The risks and uncertainties referred to above include, but are not limited to, future economic and business conditions, the ability to recognize the anticipated benefits of the acquisition, which may be affected by, among other things, the loss of key customers or reduction in the purchase of products by any such customers, the failure of the market for Powerfleet’s products to develop as anticipated, the inability to manage growth, the effects of competition from a variety of local, regional, national and other providers of wireless solutions, and other risks detailed from time to time in Powerfleet’s filings with the Securities and Exchange Commission, including Powerfleet’s most recent annual report on Form 10-K. These risks could cause actual results to differ materially from those expressed in any forward-looking statements made by, or on behalf of, Powerfleet. Unless otherwise required by applicable law, Powerfleet assumes no obligation to update the information contained in this press release, and expressly disclaims any obligation to do so, whether a result of new information, future events, or otherwise.

 

Powerfleet Investor Contact

Matt Glover

Gateway Group, Inc.

PWFL@gatewayir.com

(949) 574-3860

Powerfleet Media Contact

Heather Smith

hsmith@powerfleet.com

(605) 203-0605