AVTECH Sweden AB (publ) INTERIM REPORT January - March 2019
- AVTECH Group's turnover for the first quarter of 2019 amounted to MSEK 4.1 (2.8).
- Operating profit before depreciation for the first quarter of 2019 was MSEK +0.9 (+0.3).
- The net result for the first quarter of 2019 amounted to MSEK +0.1 (-0.9) or SEK 0.04 (0.04) per share.
- Cash flow from operating activities for the first quarter of 2019 amounted to MSEK -1.0 (-0.3). The Group's cash and cash equivalents at the end of the period amounted to MSEK 14.1 (15.7 at the end of the year). Increased market efforts of approximately SEK 0.8 million have affected liquidity during the quarter.
- Shareholders' equity at the end of the period amounted to SEK 28.2 million (28.1 at the previous year-end) or SEK 0.50 (0.50) per share. The Group's equity was 93.0 (93.0) percent.
- The first quarter of the financial year has led to continued investments in sales and marketing. Despite an increasing degree of uncertainty in the aviation industry, caused by both the decision to stop 737 MAX as well as a concern for the negative environmental effects, we can observe a continued increasing interest in our products. The lasting impression, however, is that the pressured cost situation within the airlines means that you do not buy anything other than those that have a significantly short return on investment. This means that you want to test all products in your own operation before deciding. The result is a long sales cycle starting from the customer interest ending with a contract. We believe that we currently have more than 4 major European airlines that are in the final phase of the decisions that usually generate contract negotiations. Often such a contract initially contains AVENTUS NowCast, our most proven product. Each customer relationship is connected to an "NDA" (non disclosure agreement). This makes it very difficult for us to inform about the progress of different customer projects before the LOI or contract has been signed. We hope for continued understanding of this limitation among our shareholders.
- Development projects in the area of climb and cruise optimization are proceeding according to plan. These projects will lead to new products within the Aventus product family that further increase the effect of using 10K weather. The Climb project has been granted external part-financing by the Swedish Energy Agency and is carried out in close cooperation with Norwegian.
- With the above complementary products, we can offer pilots an optimization solution of the flight path in order to considerably optimize fuel saving and flight time. The solution is based on AVTECH's unique access to 10K weather and is no longer limited by the capacity of the aircraft's computer. This is particularly requested and interesting for the market by Boeing 737 operators where the ability of the flight computer to optimize the flight based on favorable wind information is severely limited. These products have been presented and generated a clear interest from the airlines during the customer meetings during the period.
- In December 2018, a follow-up meeting was held with Southwest Airlines in Dallas. The conversation continued in the spring of 2019 in a good spirit.
- During one of the planned major customer meetings, a request was made for a customized adaptation of SIGMA for monitoring flight through volcanic ash. The dialogue has continued and opens for possible further development of the service.
- The discussion with Gatwick Airport regarding TTAM (Target Time Arrival Manager) is ongoing as planned. The project will be completed in the mid-2020s.
Events after the end of the period
- As a consequence of increased marketing efforts in recent quarters, interest in AVTECH's product portfolio has increased. An increased environmental focus and a rising fuel price are expected to further strengthen the interest in 2019. Airlines that have previously shown weak interest have returned with requests for detailed discussions.
- Björn Ostertag, former Fuel Efficiency manager at Lufthansa Cargo, has been affiliated with AVTECH and will be active in marketing and sales. Björn adds great expertise and experience to the market conditions under which airlines operate and is a welcome reinforcement in AVTECH's marketing team. Björn will be assigned his own focus area. focused on air cargo companies.
- The dialogue with airlines within the Lufthansa Group has intensified and moved into a more detailed phase. AVTECH's products receive an all over positive response and the goal is to work with a larger part of the Lufthansa Group airlines.
- An important part of our marketing plan is participation at trade fairs and conferences in the aviation industry. Decisions have been made to attend:
- Airline & Aerospace MRO & Flight Operations IT Conference 11-12 Jun, Miami
- 13th Annual Flight Operations Conference 3-4 Dec, London
- The number of pilots using proFLIGHT in their daily operation is continuously increasing. The users today represent more than 25 global airlines that together have a worldwide network of networks. We also see increased interest among the airlines for proFLIGHT and for present discussions with two major European operators regarding the possibility of implementing proFLIGHT in their daily operations.
The process of getting proFLIGHT approved and verified by EASA (European Union Aviation Safety Agency) is ongoing and is expected to be completed during the second half of 2019.
In addition to being an attractive tool for the pilot during the flight, proFLIGHT also appears to be an effective way of visually demonstrating the complex technical processes that form the basis of the different Aventus family products.
Kista, May 6, 2019 AVTECH Sweden AB (publ), the Board. This report has not been reviewed by the company's auditors.
For further information, please contact
Christer Fehrling, CEO, +46 (0) 8 544 104 80
Britt-Marie Lodenius, CFO, +46 (0) 8 544 104 80 or visit the company's website www.avtech.aero
AVTECH Sweden AB ( publ), corporate identity number 556568-3108, has its registered office in the municipality of Stockholm.
Postdress: Färögatan 33, 24 tr, 164 51 KISTA, Sweden.
The company's B-share (short name AVT B) has been traded on NASDAQ OMX First North since February 2012. The company's A share is not traded on any marketplace. Certified Adviser is currently Redeye AB (www.redeye.se), tel: 08-121 576 90, e-mail address certified email@example.com. For explanation of technical terms, see the glossary on page 73 of the company's New Issue Prospectus 2011. The information in this press release is such that AVTECH Sweden AB (publ) is obliged to publish in accordance with the EU Market Abuse Regulation. The information was submitted, through the agency of the above contact person, for publication on May 8, 2019 at 08.30 CET
ABOUT THE AVTECH GROUP
AVTECH develops products and services for digital air traffic management systems. Customers are the global aviation industry's players such as airlines, airports, air traffic control providers, technology companies and aircraft manufacturers. With the help of the company's products and services, each individual flight or entire flight operation can be optimized in terms of economy, noise and emissions, efficiency, capacity, punctuality and safety. The head office is in Stockholm, Kista. For more information, see www.avtech.aero.