Interim Report January - September 2021

24/11/2021 - July – September 2021
- Net Sales MSEK 130.4 (131.6)
- Order intake MSEK 64.2 (323.7)
- Operating profit (EBIT) MSEK 28.2 (12.9)
- Operating profit (EBITDA) MSEK 38.0 (22.8)
- Total Comprehensive income MSEK 26.1 (4.8)
- Earnings per share, before and after dilution (SEK) 0.02 (0.01)
- Cash flow from operating activities MSEK -0.2 (11.0)

January – September 2021
- Net Sales MSEK 334.3 (320.7)
- Order intake MSEK 172.9 (667.9)
- Operating profit (EBIT) MSEK 18.7 (-1.7)
- Operating profit (EBITDA) MSEK 46.0 (36.1)
- Total Comprehensive income MSEK 24.1 (-7.5)
- Earnings per share, before and after dilution (SEK) 0.02 (-0.01)
- Cash flow from operating activities MSEK -2.2 (22.5)

Comments from the CEO
Operating profit (EBIT) SEK 28 million, up 119%
Due to the excellent gross margin of 49%, together with our steady cost structure, the EBITDA reached SEK 38 million, close to 30% of net sales. This underlines the credibility of our long term EBITDA goal, indicating that with the right product mix, our ambition to target at least 15% EBITDA margin by 2025 is realistic. Year to date our EBITDA is up by 28% from SEK 36 million in 2020 to SEK 46 million in 2021.

In the quarter we invested in the development of our software platforms Puls, Xilium and FLUX. We also invested in Fixed Assets, necessary to operate our TRaaS programs in the USA. Taking the depreciation over these essential investments to support our future growth into account, we nevertheless reached an operating profit level (EBIT) of SEK 28.2 million, 119% higher than last year. Year to date  our EBIT is  at SEK 18.7 million, 72% higher than full year 2020.  

Order intake picking up after the quarter
The order intake arrived this quarter at SEK 64 million, compared to a record breaking SEK 324 million in Q3 last year. This difference is mainly due to the SEK 275 million Saudi contract won in Q3 2020. We are pleased with the regional spread of the order intake this quarter, with orders coming from Australia, the Middle East as well two new TRaaS contracts in the United States. We also benefited this quarter from our global existing customer base that placed repeat orders and orders for parts and system calibrations for a total of SEK 33 million, making up 52% of our Q3 order intake. After the quarter the order intake announced in press releases amounted to SEK 181 million, mainly relating to the TRaaS recurring revenue contracts in our 51% Joint Venture Sensys Gatso Colombia.

Solid Order Backlog of SEK 850 million
End of 2020 we communicated a record high 12 months rolling order intake of SEK 788 million. The conversion of order intake to revenue is dependent on our customer needs and ability to implement our solutions. Since 2017 we have recorded an order intake of SEK 2.35 billion that has converted into SEK 1.5 billion of revenue to date. We have a solid order backlog as of the third quarter of 2021, which amounts to approximately SEK 850 million. Of this backlog, 46% relates to system sales projects and 54% relates to TRaaS recurring revenue such as Managed Services, Service and Maintenance and licenses. The system sales order backlog is expected to be delivered in the near future. The TRaaS order backlog has a recurring nature and will convert into revenue over the remaining contract periods.  

SEK 109 million invested for future growth
In the third quarter of last year the company raised 75 million in a directed share issue to support our future growth. This capital has been employed in our Fixed Assets in Operations in the USA, supporting our TRaaS Managed Services programs for the amount of SEK 23 million. In the same period we have significantly invested in the core development of our software platforms to the amount of SEK 17 million. A further SEK 69 million has been employed in Net Working Capital to finance larger System deliveries. This will convert into cash in the upcoming quarters. In total over the last four quarters the company has invested SEK 109 million for future growth. 

US TRaaS Sales up 40%
Net Sales for the quarter arrived at SEK 130 million, an equal level compared to last year. More importantly, our total recurring TRaaS business increased by 28%. Year to date this strategic growth pillar now represents 52% of our total Sales. Within our total TRaaS business, the full TRaaS business model we operate in the USA, is a strategic growth pillar. This US TRaaS business reached SEK 37 million this quarter, up by nearly 40%. Compared to the previous quarter, our US TRaaS business showed an increase of 15%. The continued growth of our TRaaS business in the USA is in line with our strategy and business plan and indicates a normalization of this important recurring revenue stream after the COVID related school closings in 2020 and 2021. 

USA TRaaS growth push
During the quarter we reevaluated our USA business plan with the objective to further enhance growth. On November 15th, President Joe Biden signed into law a transportation authorization bill that includes, for the first time ever, explicit federal funding support for speed cameras. This represents a major win for the photo enforcement industry, in which we operate. With this federal monetary and political support, the US market for photo enforcement is gaining positive momentum, also for Sensys Gatso. 

There are now 25 states that allow for Automated Traffic Enforcement. Within these states, hundreds of cities potentially qualify as customers for Sensys Gatso. Currently we serve 35 cities in 11 states with our TRaaS model. With a targeted data driven sales approach, investments into our organization, in software developments to drive efficiencies and of course in traffic enforcement equipment to support growth of our TRaaS operation, we feel confident we can further push our profitable recurring revenue growth in the dynamic US market. 

Buffalo Contract suspended, not terminated
During the quarter the Buffalo schoolzone program was suspended due to heated political discussion surrounding mayoral elections. This suspension was an unprecedented event in the 15 years we have operated our business in the USA. Subsequently the incumbent mayor, under whom our automated school zone speed enforcement program was awarded, has won the Buffalo mayoral re-elections. To date we have not received a termination letter from the city authorities and therefore the program could be restarted following the reinstatement of the elected mayor.

40% of Saudi Arabia contract delivered
Year to date in Q3 we have delivered 40% of this SEK 275 million contract for our unique Vehicle-in-Motion solution. The slower than initially expected  delivery schedule  is related to complexity at the side of the end-customer. After having visited our customer lately, we expect another 15% of the systems still to be delivered this year and the remainder throughout 2022. 

Sensys Gatso Colombia established
After the quarter we announced the establishment of Sensys Gatso Colombia, a joint venture with Capatest Colombia SAS, a leading local provider of automated traffic enforcement solutions. With this Joint Venture we  combine our TRaaS business model with the local knowledge and experience in Traffic Enforcement from Capatest. As part of the agreement Sensys Gatso will provide back office processing software Xilium, PULS analytics software, enforcement hardware and the Sensys Gatso Brand name. Two existing enforcement contracts currently operated by Capatest, for the amount of approximately SEK 145 million, over the remaining 17 year contract period will be added to the Joint Venture once Sensys Gatso Colombia is fully operational. This is expected by the second half of 2022. With this new venture we deliver on our promise to grow our TRaaS business in new regions.

Our sales outlook is strong, our costs are in control and we demonstrated this quarter an improving profitability development.  We see that our TRaaS business is back on its growth track. This is especially due to the Covid school closings in the USA that for now seem to be behind us. With our positive TRaaS business momentum in the new LATAM region and our overall  solid margin development and order backlog, we feel confident about our future. We retain our long-term plan to grow our net sales to more than SEK 1 billion, of which TRaaS revenues will be more than SEK 600 million, in 2025. We also retain our ambition to increase our EBITDA margin to more than 15 percent in 2025.

Ivo Mönnink
CEO, Sensys Gatso Group

Invitation to a presentation
On 24 November at 10 am CET Sensys Gatso Group invites press, analysts, shareholders, and stakeholders to participate in a presentation/audiocast. The company’s CEO Ivo Mönnink and CFO Simon Mulder will present the financial results in English. The presentation in connection with this report will be published on the website.

The presentation/audiocast can be joined online or via telephone and will be available on the company’s webpage

Link to the presentation/audiocast:

Dial-in number 
Sweden: +46 8 5055 83 51
UK: +44 333 300 92 63
US: +1 646 722 4903 

This information is information that Sensys Gatso Group AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 08.30 on 24 November, 2021.

 The release (pdf)

For further information please contact:
Ivo Mönnink, CEO
e-mail IR: 
Telephone: +46 36 34 29 80


Sensys Gatso Group AB is a global leader in traffic management solutions for nations, cities and fleet owners. Sensys Gatso Group has subsidiaries in Australia, Costa Rica, Germany, the Netherlands, Sweden and the USA, and a branch office in the United Arab Emirates and has 252 employees. The Sensys Gatso Group’s shares are listed on Nasdaq Stockholm.

Published: 24/11/2021