Redeye - The forming of the new Anoto

Prior to the Q3 report earlier this week we were looking forward to something new regarding the negotiations with the large OEM. However, Anoto are not yet allowed to say anything about this OEM, as opposed to Panasonic that was an entirely open deal. We conclude that this is because there is a lot more revenue potential, for both parties, in the new OEM deal. Anoto's CEO Stein Revelsby has several times stated that for Panasonic, that is one of the five largest electronics companies in the world, less than 100 000 sold units would be a total failure. Our conclusion is that the new OEM deal would amount to at least 100 000 pens. Since we know that Anoto now are targeting the high end users we are calculating with a price per pen of around Livescribe’s pen price, of USD 150. Judging from these estimates a deal with the new OEM would be worth at least SEK 100 million, licensing fees excluded. In our estimates of today we are only expecting half of this potential to materialize. We are looking forward to see Anoto close this deal before Christmas and then hopefully get some more accurate figures of the potential pen sales.

As for the Q3 numbers, the burn rate in Q3 was slightly faster than our estimates, due to lower sales of SEK 27 million, compared to our estimates of SEK 31 million. However, we are not making any changes in our estimates from Q4 2014 and forward, since we understand that the outlook for the coming quarters is strong. Our investment case and the motivated value of SEK 0.33 remains the same.

The PDF-file in the link is an update of our recent initial report of Anoto entitled "redrawing the map", published on October 13, following the Company's financial report for the third quarter of October 21. In appendix 1 we have made some smaller clarifications, emphasizing that Anoto's technology is completely different from the traditional active pen technology and something that has not yet, as far as we know, been given any attention in external research reports. Besides that, and the updating of the figures for Q3 2014, there are no material changes in this update, which is why we have included all content from the initial report once again.

Download the full update in PDF-format: http://korta.nu/oL1

This is a pressrelease from Redeye. Read more of our articles at www.redeye.se.