25/02/2021 - October–December 2020
- Net Sales MSEK 134.3 (158.0)
- Order intake MSEK 120.5 (241.2)
- Operating profit (EBIT) MSEK 12.5 (13.9)
- Operating profit (EBITDA) MSEK 23.3 (27.1)
- Total Comprehensive income -8.0 MSEK (7.8)
- Earnings per share, before and after dilution (SEK) 0.01 kronor (0.02)
- Cash flow from operating activities MSEK -7.0 (43.4)
- Net Sales MSEK 454.9 (406.3)
- Order intake MSEK 788.4 (561.9)
- Operating profit (EBIT) MSEK 10.8 (-24.4)
- Operating profit (EBITDA) MSEK 59.4 (28.6)
- Total Comprehensive income MSEK -15.5 (-6.0)
- Earnings per share, before and after dilution (SEK) 0.00 kronor (-0.02)
- Cash flow from operating activities MSEK 15.5 (-3,7)
Comments from the CEO
Order Intake up 40%
The order intake for the fourth quarter arrived at a solid SEK 121 million. More important than the absolute size of the order intake is the quality of it. With TRaaS contracts signed in the USA and Netherlands, the major part of the order intake came from recurring revenue contracts. The renewal of the Dutch TRaaS contract stands out this quarter for its longevity. We received the second renewal of this contract in November, extending it to a total contract length of 12 years. This speaks for our long standing customer relationship, based on our excellent hit rate and uptime performance. In the USA two of the three contracts we signed in the quarter were school zone speed enforcement contracts, a strategic objective for us.
Looking at the full year of 2020, we booked a record high order intake of 788 million on a 12-months rolling base. This is 40% higher than the already strong 2019 year. The excellent global spread of the full year order intake as well as the high level of TRaaS order intake, is paving the way for strong profitable sales growth in the years to come.
TRaaS Sales up by 23%
The total Sales for the quarter came in at SEK 134 million. We are pleased with this sales level, given that not all school zone speed enforcement programs in the USA have fully restarted in Q4 as a result of the pandemic. Of the Sales in the quarter, 44% relates to TRaaS, mainly from programs in the USA. This is an improvement of 12 percentage points compared to Q4 last year at 32%.
Overall the total global Sales for the year grew by 12% to SEK 455 million compared to SEK 406 million in 2019. Given the market challenges in 2020, we consider this an excellent growth level. The global distribution of our Sales by Region is well balanced in 2020, with 26% coming from Americas, 34% from Europe and 40% from APAC and MEA. In 2020 TRaaS accounted for SEK 217 million, 48% of total Sales. Compared to 2019, with SEK 177 million of TRaaS Sales, this is an increase of 23%.
Positive EBIT of SEK 11 million
We finished the year at a high EBITDA level of nearly SEK 60 million,or 13% of Sales. This is a doubling of our EBITDA compared to 2019. We are particularly proud to have reached this result in a year of global economic downturn due to the COVID-19 crisis. Right from the start of the pandemic, we came together as a global team and continued our business, almost as usual. It has taught us that our investments in customer relations, in our internal organisation and in our agile way of working are paying off in times of global distress. Due to this favourable situation we could keep our sales levels high and our margins up. On top, we managed the cost side of our company well, even with the average number of full time employees during the year increasing with 27, to support our growing business. Our total expenses decreased with 11 percent during the year. With higher sales, stable margins and lower expenses we are proud to have realized a positive EBIT of SEK 11 million in 2020, an improvement of SEK 35 million compared to last year.
Strong position in Costa Rica contract
During the quarter it became apparent that the Costa Rican economy has been severely impacted by the COVID-19 pandemic. The budget already allocated to our customer for the execution of our contract was withheld by the Ministry of Finance. The Costa Rican government clearly recognises the benefits of our traffic enforcement program for the general public, but has other financial priorities in the short term. Given our strong contractual position and the willingness of the government to ultimately implement a national traffic safety program, we believe the program will be rolled-out as projected, albeit later than initially expected. Right now, our best estimate is that first deliveries will start in the second half of 2021.
Saudi Arabia deliveries restarted
In August 2020 we received a contract from our customer in the Kingdom of Saudi Arabia for our in-vehicle solution. With a total contract value of SEK 275 million, this represents the largest single contract ever awarded to Sensys Gatso. We are pleased to have started the deliveries of this program in Q3. Due to logistics challenges at our customer, only 15% of the contract revenue is accounted for in 2020. We have restarted deliveries in February and foresee the remainder of the deliveries under the contract to be executed throughout 2021.
Investigation in The Netherlands
In January the Fiscal Information and Investigation Service in the Netherlands started an investigation into Sensys Gatso Netherlands B.V. (formerly known as Gatsometer BV). The investigation relates to allegations of misconduct in Gatsometer B.V., before the acquisition by Sensys Traffic AB. The investigation is at the very initial phase of collecting information and verifying details related to a certain contract dating back to 2015. Although not a MAR obligation, we decided nevertheless to inform the market about this initial investigation. We have initiated our own internal audit which has not provided any indications of possible wrong-doing. We will proactively share our findings with the investigating authority. Although we are positive about the outcome, it will not be possible to assess if there are any consequences for the company, until a final conclusion has been reached by the investigating authority.
Pär Degerman joins Sensys Gatso as CTO
We are pleased that Pär Degerman has joined Sensys Gatso in February as our new CTO, replacing Timo Gatsonides, who decided to pursue other opportunities. Timo’s vast experience in our industry and his inclusive leadership style have helped us to get to our current leading market position. Timo Gatsonides will remain with the company in an advisory role.
Pär Degerman has an international technical background from Scania and Einride where he has served as CTO of the company. Pär holds a Master of Science as well as a Licentiate degree from Linköping University. He has strong skills in building a modern engineering organization and he brings additional knowledge about the automotive and traffic industry to our company. I am confident that he will be able to help align the company with the changing market needs, creating long term shareholder value. Pär will introduce himself and share his technology vision on our business during the Q1 market presentation.
Our order book is stronger than ever before, our TRaaS business continues to grow, leading to higher margins. Together with tightly managed costs, our EBITDA margin has nearly doubled from 7% in 2019 to 13% in 2020.
Even with some short term revenue impact related to COVID-19, we retain our long-term plan to grow our net sales from SEK 454 million in 2020 to more than SEK 1 billion, of which TRaaS revenues is more than SEK 600 million, in 2025. We also retain our ambition to increase the profitability from 13 percent EBITDA margin in 2020 to more than 15 percent in 2025.
CEO, Sensys Gatso Group
Invitation to a presentation for press and analysts
On 25 February at 10 am CET Sensys Gatso Group invites to 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 https://www.sensysgatso.com
Link to the presentation/audiocast: https://tv.streamfabriken.com/sensys-gatso-group-q4-2020
Sweden: +46 8 51 99 93 83
UK: +44 333 300 92 72
US: +1 8 338 230 590
NL: +31 107 12 91 62
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 25 February 2021.
For further information please contact:
Ivo Mönnink, CEO
e-mail IR: firstname.lastname@example.org
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, 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.