MICT, Inc. (Nasdaq: MICT), today announced financial results for the three months ended March 31, 2020, as well as merger and acquisition developments subsequent to the end of the first quarter.

"As at March 31, 2020, MICT held an ownership interest in Micronet Limited of 30.48% of its issued and outstanding shares, the results of Micronet Limited are therefore not included within MICT's consolidated financial statements. The first quarter revenues and underlying mobile computing and telematics business of Micronet Limited were negatively impacted by the COVID-19 pandemic as all sales contracts were either deferred or cancelled. Micronet Limited is also seeing the impact continuing into the second quarter. These results notwithstanding, we believe in Micronet's world class product portfolio and the business' potential for growth in the second half of 2020, driven by its new video telematics devices and recent U.S. Federal Communications Commission authorizations. We have therefore significantly increased our stake in this business, with the aim of capitalizing from this investment when the telematics market is expected to come back online in the second half of 2020.

"Post quarter end, MICT signed an amended and restated agreement and plan for merger with Global Fintech Holdings, Ltd., or GFH, to move into its long-term aim of participating in the global fintech marketplace. GFH continues to make significant strides in its key core objectives, and we look forward to informing the market in the coming weeks not only on the major developments at GFH since the announcement on April 15, but also on outlining the synergistic benefits of our new strategy based on both existing and new products and platforms in high growth technology sectors.

"As a result of the above, we look forward to the second half of the year with confidence. We believe that shareholders will realize the benefits of the MICT Group's intended new strategy and approach, expanding from our foundation in the mobile computing and telematics business to encompass a global product platform that includes new geographic markets in Asia and new products in the fintech space," Mercer concluded.

On April 15, 2020, MICT (i) signed an amended and restated agreement and plan for merger with Global Fintech Holdings, Ltd., or GFH, pursuant to which, in connection with the transactions contemplated thereby, MICT shall diversify into the global fintech industry, and (ii) approved a private placement of convertible notes of up to $15 million, which shall be convertible into shares of MICT common stock at a conversion price of $1.10 per share, consisting of $11 million of committed funding, with the ability to raise an additional $4 million on the same terms.

MICT's financial results for the three months ended March 31, 2019 reflect Micronet, Ltd. revenues for the months of January 2019 and February 2019 only. On February 24, 2019, Micronet closed a public equity offering on the Tel Aviv Stock Exchange which resulted in a dilution of MICT's ownership interest in Micronet to below 50%. Thus, based on U.S. generally accepted accounting practices (GAAP), MICT no longer includes Micronet's financial results in its consolidated financial statements effective as of March 1, 2019.

On June 11, 2020, the Micronet shareholders have accepted a tender offer made by MICT, which, upon MICT's purchase of Micronet shares, will initially increase MICT's ownership to 45.53%. In addition, MICT informed Micronet that, assuming the acceptance of the tender offer, it plans to participate in a public offering of Micronet's ordinary shares, pursuant to which we plan to purchase 50% of Micronet's ordinary shares offered in such public offering, up to an amount of $900,000 in the aggregate.

Q1 2020 Review

• Total revenue in first quarter of 2020 was $0, compared to $477,000 in the first quarter of 2019.
• Gross loss for MICT was $0 in the first quarter of 2020, compared to $369,000 in the first quarter of 2019.
• Research and development (R&D) expense for MICT in the first quarter of 2020 was $0 compared to $261,000 in the first quarter of 2019.
• Selling, general and administrative (SG&A) expense for MICT was $770,000 in the first quarter of 2020, as compared to $1.18 million in the first quarter of 2019.
• Net loss attributable to MICT was $1,635,000 in the first quarter of 2020, as compared to $910,000 in the first quarter of 2019. The increase in net loss is primarily a result of share in investee losses of $640,000. On a per share basis, MICT reported a net loss of $0.15 per basic and diluted share from continued operations for the first quarter of 2020, as compared to a net loss of $0.09 per basic and diluted share from continued operations in the first quarter of 2019.
• As of March 31, 2020, MICT had $2.88 million in cash and equivalents, and no debt.

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.