Ladies and gentlemen, thank you for standing by. My name is Kenny Green. I am part of the investor relations team at Ituran Location and Control Ltd. I would like to welcome all of you to Ituran Location and Control Ltd.'s Results Zoom webinar, and I would like to thank Ituran Location and Control Ltd.'s management for hosting this call. All participants other than the presenters are currently muted, and following the formal presentation, I will provide instructions for participating in the live Q&A session. I would like to remind everyone that this conference call is being recorded, and the recording will be available from the link in the earnings press release and on Ituran Location and Control Ltd.'s website from tomorrow. With me today on the call are Mr. Eyal Sheratzky, CEO, Mr. Udi Mizrahi, Deputy CEO and VP Finance, and Mr. Eli Kamer, CFO of Ituran Location and Control Ltd. Eyal will begin with a summary of the quarter's results, followed by Eli with a summary of the financials. We will open the call for the question and answer session. You should have all by now received the company's press release. If not, please view it on the company's website. I would like to remind everyone that the safe harbor statement in today's press release also covers the contents of this conference call and the associated presentation. Now, Eyal, would you like to begin, please?

Thank you, Kenny. I would like to welcome all of you to our fourth quarter and full year 2025 results call, and thank you for joining us today. Before I begin, I would first like to acknowledge the war between Israel and the United States against Iran. We honor the bravery of both the Israel Defense Forces and U.S. military personnel and their air forces, and we sincerely wish for their swift and safe return home. We hope the war will draw to a quick resolution and lead to lasting peace for all countries in the Middle East. Now to the results. We are very happy with the results of the fourth quarter as well as the full year of 2025, our best ever and record across all key parameters. For the quarter, overall revenue growth was 13% to almost $94 million, a record, with subscriber revenue growth at 15%. EBITDA grew to over $25 million, a record for us and puts our yearly EBITDA run rate in excess of the $100 million milestone for the first time. We generated a significant amount of cash in the quarter at $29.4 million, our highest ever, and as I will discuss later, given our very strong balance sheet, we have decided to share all the rewards of our success in 2025 with our shareholders through a special dividend and increased buyback in addition to the regular dividend. Our growth and success in 2025 continued to be driven by our long-term efforts in bringing new value-adding telematics and connected car products and services to both existing as well as new customers globally. Throughout the year, we were particularly successful at bringing additional new OEM partners to our growing roster. Examples during 2025 were Stellantis, Renault, Yamaha, and BMW. We are in active discussions…

Thanks, Eyal. I will provide a short summary of the financial results. You can find the more detailed results that we issued in the press release earlier today. Fourth quarter revenues were $93.5 million, a 13% increase year-over-year. Subscription revenues were $71.1 million, up 15% and representing 76% of total revenues. Product revenues were $22.4 million, up 5% year-over-year. Our subscriber base reached 2,630,000 at the end of 2025, an increase of 42,000 in the fourth quarter and 221,000 year-over-year. The geographic breakdown of revenues in the fourth quarter was as follows: Israel 55%, Brazil 23%, rest of world 22%. EBITDA in the fourth quarter was $25.3 million, representing 27.1% of revenues and a 12% increase year-over-year. Net income for the fourth quarter was $15.3 million, or diluted earnings per share of $0.77, an increase of 10% year-over-year and compared to $13.8 million or diluted earnings per share of $0.70 in the fourth quarter of last year. Cash flow from operations for the fourth quarter of 2025 was $29.4 million. Taking a look at the full year 2025 results. Revenues for 2025 were a record $359 million, a 7% increase over the $336.3 million reported in 2024. 74% of revenues were from location-based services subscription fees and 26% were from product revenues. Revenues from subscription fees were $264.6 million, representing an increase of 9% over 2024. Product revenues were $94.5 million, representing an increase of 1% compared with 2024. EBITDA for 2025 was $96.2 million, 26.8% of revenues, an increase of 5% year-over-year. Net income in 2025 was $58 million, 16.1% of revenues, or fully diluted earnings per share of $2.92, an increase of 8% compared with net income of $53.7 million, 16% of revenues, or fully diluted earnings per share of $2.70 in 2024. Cash flow from operations for the year was $88.6 million. As of December 31, 2025, net cash and marketable securities totaled $107.6 million. This is compared with net cash including marketable securities of $77.2 million as of year-end 2024. The board declared a $30 million dividend for the fourth quarter, including a $20 million special dividend and a $10 million dividend in line with our dividend policy. In addition, during the quarter, we purchased $1.6 million in shares under our buyback program. As of the end of the year, we had around $3.5 million remaining available under this program.

However, the board today approved a $10 million increase to the existing buyback authorization, which will be funded from available cash and executed in accordance with SEC Rule 10b-18. This means that as of today, there is $13.5 million available under the buyback program. The current dividend and buyback take into account the company's continuing strong profitability, ongoing positive cash flow, and strong balance sheet. With that, I would like to open the call for the question and answer session. Operator.

Thank you. At this time, we will begin the question and answer session. If you have a question, please raise your hand via the Zoom platform. I will introduce you and ask you to unmute, after which you may ask your question. We will now open the call for your questions. We will begin with Chris Reimer of Barclays. Chris, please go ahead.

My question.

Now can you repeat your question?

I am just writing on the chat.

Okay. We will move. The question will be from Sergey Glinyanov of Freedom Capital Markets. Sergey, go ahead.

Good day, gentlemen. Great results. Could you please add some color on ARPU and the EBITDA dynamics in 2026 and after your initiatives are fully deployed, I mean, carbon credits, et cetera?

Hi, Sergey. First of all, we are not providing any guidance as you know, but practically and in a general way, I think that the ARPU as it is today should continue. More than 2.6 million subscribers is a big ship of a customer base, so one year is not changing the total ARPU. Looking forward, we really believe that the ARPU is not going to go down because of things that I did not mention today; I said it in the past, we always have additional services to our current subscribers which allow us to provide a kind of upsell of services. This is regarding our traditional services, the fleet management, the stolen vehicle recovery, the UBI, et cetera. Regarding the new technologies and offers that we have, as I mentioned, and it is important to say again, those initiatives are after a few years of putting R&D development and making all the technological and regulatory infrastructure. For us commercially, it will be ready, as I said, mid to the end of 2026. I must say that the financial contribution in 2026 of those initiatives will be very low. The idea to put more color on those items was to show a little bit longer future from 2027, 2028, and of course ahead. We will see because we know some negotiations and we know some customer attractions in the Credit Carbon as well as in the rental solution. The main idea is to show it, to expose it, and the majority of the contribution will be in the next years. I believe that in the second half of 2026, we will be able to talk or discuss some deals and contribution.

Okay. Thank you. The next question about.

By the way, Sergey, regarding EBITDA, I did not answer you. We are not providing guidance, but all the things should leverage our EBITDA margins, of course.

Do you believe that new initiatives could change your margin profile in the long term?

First of all, if you look backwards, you will see that our margins are growing. We show the operating leverage dynamics happening in the margins. I totally believe that it will continue based on the new services and the upsells that we can do to the current customers. Yes.

Okay, great. The next question about the motorcycle market in Brazil. How is it going, and did you gain any additional market share in this market?

Can you repeat? There was some noise here. Can you repeat? Sorry.

The question about motorcycle.

Oh, okay.

And did you gain any additional portion of this market in Brazil?

First of all, this market in Brazil is very, very big, and we did not touch this segment until about a year ago, until the moment that we understood, or we developed the right device that can be very productive, and we can go then to motorcycles OEM distributors, as well as to insurance companies. As you remember, we already reported about two OEM deals, one with Yamaha Brazil, the second one with BMW Brazil. This year we will see along the year, or we already started, thousands of motorcycles, or maybe even closer to 10,000 subscribers from this segment in 2026. Now we expanded to the retail market after we gained more confidence and we have more to show to the retail market after Yamaha and BMW. As always, I also believe that we will add more motorcycle producers, international producers, during this year and the next year.

Awesome. Thank you. Thank you for taking my question. That is all from me.

Our next question is from Allen Klee of Maxim Group. Allen, please go ahead.

Hey, guys. Thanks for taking my questions. I know it is still a little early as you expect commercialization towards the end of the year, but I was wondering if you could help walk through what you would expect the economics to look like for the new big data and Credit Carbon products you are rolling out. Maybe in terms of big data, what deal sizing and contract terms could potentially look like. Then on Credit Carbon, maybe the economics for EV drivers in terms of the additional benefits they gain from the product.

Since we are very optimistic and we see the reaction, I would not come with any guidance because it can be not realistic or not serious that we will do it. It is like new startups among our business. It is a startup that is done by a very big, or the largest telematics company in the world. We will continue to use our connections, our brand, our infrastructure in every country that we work. I must say that, for example, the Credit Carbon, once we start to commercialize it, we are talking about a situation where, for example, taxi drivers or truck drivers or truck companies can get with Ituran Location and Control Ltd.’s solution additional revenues. They have a total interest to come and put our solution because, just as an example, if I can give a truck driver per truck on an average mileage something like €200, €250, €300 a month from emitters through a worldwide or European broker, why should he give up on it? If I am in Brazil, giving a kind of an Uber-type company the ability for the drivers to get additional income, an additional source of revenue that without me they cannot get while they are driving an electric vehicle. I think that the request is going to be tough; there are questions. First of all, it is new to the world. This is the first time, except in some smaller markets in the world where people get money for non-accurate information, not regulatory. The rest of the world requires very tough regulation to approve credit for emitters. In that case, I think that the request should be tough. No one up until now has shown to the world how EV drivers can get money just for driving. For example, take a…

Okay. Got it. That is really helpful. Could you quantify the FX impact you saw this year and maybe what you are expecting for next year?

Yes. I will ask Udi to answer it. He has the pages. Udi?

Yes. Can you repeat the question, please?

Just on the FX impact to the business in 2025, and then maybe expectations in 2026.

I will start with the future. It is really hard to say what will be the FX in 2026 due to all the parameters that can change or affect the FX. Regarding 2025, I would say that if we look on an annual basis, the FX in the EBIT, for example, was about between $1 million to $1.5 million. This is more or less.

Okay. Got it. My last question is, with everything that is going on, with geopolitics and the war, are you expecting any potential disruptions to your business or any supply chain issues, or how do you view the situation?

Since we, unfortunately, for many years, are used to this situation, I think I will divide my answer to two. First of all, there is a major part of our business revenues and profits that comes out of the Middle East. This has, of course, never been influenced by that. Regarding our operations in Israel, which of course is a major operation, it is not nothing. As you maybe heard from today, the market in Israel also already, I mean not the stock market, I mean the commercial life in Israel also, is back to get authorization to work half a day. Up until now, of course, the last three or four days, the market was shut down. Those were anyway a holiday, a Jewish holiday that in any case was in the diary, a day off for car dealers, insurance, et cetera. Currently, we do not see a damage or anything major. In the past, in June, for example, there were about 12 days in the last war where car dealers in Israel were shut down. After those 12 days, we covered the gap, or those dealers covered the gap in the next month or two. Overall, with our experience in the past, with what is happening in Israel today, and with the situation that we are used to, I do not believe there will be any major influence on the 2026 results. It might move one month or two weeks, from month-to-month kind of volatility, but no more than that, as I expect.

Great. Got it. That is helpful. All right. Well, thanks for taking my questions.

Next question is going to come from Eric Gregg of Foretree Advisory. Eric, please go ahead. I am going to ask you a question now. Are you there?

I am here.

Oh, great. Okay.

I am sorry. Do you hear me?

Yeah.

Okay, great. First of all, tremendous results. We hope you all stay safe through this situation. If you could tease out the big data initiative—it sounds very interesting. Can you tease out a little bit more there beyond just some of the use cases in terms of how you think your data could be used for various different initiatives? I understand the road accident, maybe the road repair, maybe for civic uses. Are there other things you think you could be using the big data for?

Yes.

I have another—

Okay. I will answer first, and then you can ask your second question. First of all, just to illustrate one deal that we already did in Israel. The road authorities want to know where most of the trucks arrive between specific hours along the evening to create parking lots for nights around the country. They wanted to get one month of movement of trucks in the country and find the most trafficked places. They asked to do it for a month, historically, of course. They paid for it, and of course, in less than one second we had this raw data converted into customized data for them. For that only, we charge a few hundreds of thousands of dollars, only for that. We have, for example now, potential fees for entering cities from highways, which is a nationwide project in Israel. For that, they need a lot of data for those movements, those traffic flows from highways to the gates of municipal and central cities. Like today, if you know in London, local British drivers pay money when they get with the car inside London. For that, there is a need for a lot of data, so this is something that we are almost the only one in the country that has such big and such accurate data. Of course, this will lead, I believe, to much larger deals with those governmental offices. This is from a governmental point of view. Let us think about an approach that we have from commercial malls that want to know, for example, at specific hours a day, how many cars valued more than $50,000 are driving in order to customize advertisement and coupons for specific high-end shops. They are willing to pay for that. Everything should be anonymous, of course, because we are…

That is tremendous. Thank you. That was very helpful. Second is on capital allocation. If you take consensus estimates that, based on these very strong Q4 results, I think are going to be going higher, net of your cash position, you trade at less than 13 times forward earnings, which is less than what your growth rate of services was in Q4. As your growth keeps on accelerating, it is kind of a PEG of less than 1, which is very inexpensive. The question is, it is great how generous you have been with shareholders in terms of dividends and the special dividend, but why are you not emphasizing stock repurchase more versus the dividends here, given how cheap you seem to be? Thank you.

Practically, when we do only this, investors ask why not that. You may be right, but Ituran Location and Control Ltd.’s volume, we grew in the last 12–15 months. The volume in the market is low, and we do not want, by going with $30 or $50 million to the market a year, to shrink the volume, because one of the interests for the shareholders is the volume. We find a balance between dividend and share repurchase. As you see in the past and even now, every quarter when we have a board discussion about it, we check it again and we take a new decision. I totally accept what you say, but we have to balance, and this is the current decision of the board. As we did in the past, this might grow. We look at the volume, we get advice with some brokers and bankers on how it can influence, and we do the best that we can at the moment.

Next question will go to Evan Tindell of Byron Capital. Evan, please go ahead.

Hi. Yes. Thanks for taking my question. Just a quick comment if you do not mind, one second, on the buyback issue and volume. My personal advice as a shareholder is, do not listen to the shareholders or the bankers that tell you that volume is a big problem, because there is research that shows that actually, if you have a buyback in place, it can increase the volume in the stock even though you are shrinking the float. If the price goes up and the valuation is more reasonable, that can actually bring volume and interest into the company. I would just say maybe do not listen to those people and go ahead and buy back the stock if that is what you think is the right thing to do based on the valuation. Sorry for that aside. Sorry for that.

Okay. No comment. No comment on the buyback. Thank you. Yeah. No comment. Okay. Okay. Okay.

Yeah, I would say just do based on what you think the value of the stock is in the open market versus the fair value. Okay. Can you talk about competition in both Brazil, and I know in Israel there is not much competition, but can you talk about the state of your competitors in both markets in terms of market share and pricing and competitive positioning?

Okay. First of all, as you said regarding shares, I will tell you regarding competition. We have a very strong competition also in Israel, but we win it, and this is totally different than no competition. Pointer is in the market more or before Ituran Location and Control Ltd.; this is the main competitor, and along the years we succeeded to gain more and more market share, and that is what we do today. In order to keep and gain this market share more and more, in Israel we have to be the best every day, and this is why we develop more and more technology, why we have to have more recovery rates, a better recovery rate, et cetera. For insurance companies and for car dealers, to change is one day, because they want better results, they want better solutions, they want their customers to be satisfied. We have everyday competition, but for 30 years we have succeeded to win and gain market share. This is regarding Israel. Regarding Brazil, I think that it is almost the same. The market is much bigger. The size of Brazil is much bigger. There are specific geographies in Brazil, in the north, in the Amazonas area, where there are some small companies that might have some subscribers. When you talk about the main commercial area in Brazil, which is São Paulo State, Rio de Janeiro, Brasília, and all the main urban areas, we are also, I think, controlling the telematics market; we are the main provider. What has happened in the last two years, and I believe that we will show it this year and later, is we also see in the B2B market customers like leasing companies, like big fleets, that even if they tried our competitor, now they change their supplier to Ituran Location and Control Ltd. The situation in Brazil is that we are also gaining more and more market share. In the telematics business, I think that we are the largest, and the situation is very close to Israel. The competitive landscape is bigger. There are more competitors than in Israel; the geography is bigger. I think that overall, in the ongoing new subscribers in the telematics industry, we are the one adding the major portion of those subscribers.

Okay, thanks. I have one more question. On the fleet business, I know you also have a fleet business, where you sell to fleets. It seems like the leaders in that business, whether it is Samsara or Geotab—I am thinking of Geotab mostly—they really have built out their software suite and the integration with other providers and things like that to go with the telematics platform for fleet owners. I am just wondering how much thought and effort you put into trying to match that capability over time to make your product more competitive in the fleet segment, because it seems like that is going to be a really big market over time.

The main difference, if you mention Samsara and Geotab, is the market that we choose to go to. If I put aside Samsara with their video solution that we are adding from third parties today or in the last two years, Geotab is mainly focused in the European market and other markets, but in Latin America, specifically in Mexico and Brazil, when we consider market share, Ituran Location and Control Ltd. has a larger market share in fleet management. In Israel, this is totally right. I think that the most differentiated issue is that Samsara is mainly in the U.S. Ituran Location and Control Ltd., from the beginning, did not start to go to lion caves to fight with companies that put billions of dollars in order to penetrate markets. We went to the markets where we are strong, where we have brand, where we have relationships. From a technological point of view, if you judge our technology as a fleet manager, I am totally sure that you will see a state-of-the-art solution, not a single point under a Geotab or Samsara. It is only the markets. We did not go to Europe. We did not go to the U.S. We are very focused on Israel and Latin America. Currently, that is what we do. In the future, if we decide to go to other geographies, probably we will do it based on acquisition. We will not start from scratch.

We will now try and go back to Chris Reimer from Barclays. Chris, are you able to talk? Looks like Chris.

Yeah, I think—

Oh, great. Continue.

Thank you. Question answered. About larger.

We cannot hear you, Chris.

We cannot actually hear you.

Maybe you will approach us not in this platform. I cannot hear you, sorry.

Chris, we will speak to you offline. That ends our question and answer session. The call will be available on Ituran Location and Control Ltd.'s website in the next day for download. Other than that, Eyal, please make your concluding statements.

Thank you, Kenny. On behalf of the management of Ituran Location and Control Ltd., I would like to thank you, our shareholders, for your continued interest and long-term support for our business. We look forward to continuing our accomplishments over the next decade. If you are interested in meeting or speaking with us, feel free to reach out to our investor relations team. With that, we end our call. Have a good and safe day. Thank you very much.