Sensys Traffic AB (publ) Interim Report January–September 2014

CEO COMMENTARY: DELIVERIES LAY THE FOUNDATIONS FOR THE FUTURE
Net sales continued to increase in the third quarter compared with Q3 2013, amounting to SEK 43.0m, and were consistent with the strong net sales in the second quarter of 2014. In Q3, growth was persistently fuelled by deliveries to the Swedish Transport Administration. Operating income for the quarter amounted to SEK 12.5m, compared with SEK -6.6m in the same period last year, which corresponded to an operating margin of 28.9 percent.
Production and service are now coordinated following restructuring in the second quarter, which means that the gross margin amounted to 48.5 percent, a significant improvement on 20.9 percent for the same period in 2013. The gross margin also saw a sequential improvement compared with Q2 2014, when it amounted to 40.7 percent.

The contract with the Swedish Transport Administration, which currently totals SEK 128m, has now entered a new phase, with replacements and new installations being continually carried out in the Swedish road network. The contract is evidence of Sensys’ capacity to deliver large volumes, which is an important competitive factor when it comes to getting established on markets outside Sweden. Internationalisation is a significant element of our growth strategy. Sensys intends to increase its presence on the key markets in the Middle East and Southeast Asia via the establishment of local companies providing sales and service, with the aim of bringing our offering closer to the customer. The local companies will enable us to market our products more effectively to both existing and new customers, thus increasing opportunities for add-on and new sales.

We are continuing to market potential customers in the railway market with our pantograph monitoring systems on trains (APMS), and we are seeing a rise in interest in Sensys’ solutions among the major European railway operators. In Q3 we continued our APMS partnership with the Finnish Transport Agency.

Our objective is to continue to outpace the market in terms of growth. Competitive products, an established delivery and service organisation, effective customer relationships, strong reference projects and in particular, a stable financial position, all combine to give Sensys excellent opportunities for continued organic growth. The regional markets are fragmented, with high entry barriers, which is why we are also continuing to examine opportunities to grow via acquisitions.

Johan Frilund

CEO, Sensys Traffic AB 

Invitation to presentation for press and analysts
On 29 October at 9.30 a.m., CEO Johan Frilund will present the report and respond to questions in an audiocast. The presentation can be followed online via the link on Sensys’ website: www.sensys.se. You can also listen to the presentation and ask questions over the telephone, using the following numbers:
Sweden: 08 505 20 114
US: +1 334 323 6203
UK: +44 (0) 207 1620 177

Password: Sensys.
Please call 10 minutes prior to the specified time.

This information is such that Sensys Traffic AB (publ) is required to publish in accordance with the Securities Market Act
and/or the Swedish Financial instruments Act. This information was submitted for publication at 8.30 a.m. on 29 October.

For further information, please contact:
Johan Frilund, CEO
Mobil: +46 (0)73-274 28 23

Sensys Traffic is a leading supplier of system solutions for traffic safety within the ATC area (automatic traffic safety control). Sensys develops, markets and sells systems that are mainly used to monitor and register speed limit violations and for red-light enforcement. In addition to sales of systems, Sensys Traffic also provides service and maintenance. Sensys Traffic’s end customers are primarily police and road authorities all round the world, but also include private operators. Sales are conducted either directly or via partners, agents and distributors. Sensys Traffic is headquartered in Jönköping, Sweden, is listed on NASDAQ OMX Stockholm, has 41 employees and turnover for 2013 was SEK 62.5 million.