Continued growth and prepared for success
July – September 2020
- Net sales totaled SEK 15,212 (12,264) thousand which corresponds to an increase of
24 %. The increase in sales is mainly due to increased license revenues within Automotive Solutions. - Operating loss totaled SEK -12,818 (-23,623) thousand, operating expenses are significantly lower than last year due to Corona related measures.
- Profit/loss after financial items was SEK -12,854 (-23,676) thousand
- Profit/loss after tax per share is negative.
- Cash and cash equivalents totaled SEK 67,314 thousand at the end of September.
- In October, the company carried out a directed new share issue that provided the company with approximately SEK 189 million before transaction costs.
- On October 14, the company announced two new design wins with an existing Korean OEM. The estimated revenue for the order is SEK 100 million over a product life cycle.
January - September 2020
- Net sales amounted to SEK 46,772 (36,312) thousand, which corresponds to an increase of 29%.
- Operating profit amounted to SEK -57,729 (-70,519) thousand, lower costs during the second and third quarter had a positive effect on earnings.
- Profit after financial items amounted to SEK -57,957 (-70,772) thousand
- Earnings after tax per share are negative.
Estimated value of obtained design wins
As of the report for the second quarter of 2018, the company provides information on the estimated market value of obtained design wins at the time of publication of the report. The figures in brackets show the levels at the time of the publication of the preceding report, which in this case was August 26th 2020.
The total estimated value of the company’s 83 (81) design wins announced to date currently amounts to at least 2,100 MSEK (2,000) over a product life cycle.
If the company’s system had been used in all car models on existing platforms by the twelve (twelwe) car manufacturers with whom design wins have been communicated, the estimated value would amount to at least 5,800 MSEK (5,300) over a product life cycle.
Comments from the CEO
Continued success and preparations for the next wave of DMS
During the third quarter we negotiated an extension of an existing contract with a Korean customer. It has resulted in two new design wins on an additional car platform. Serial production is scheduled for late 2021. One of the cars is in the upper-mid level segment and one is a premium car. It’s with great satisfaction that we again see the scalability of the business model and that satisfied customers are ready to come back and puchase our software again and again.
We have also ended the short-time furlough program and are again increasing our pace regarding current project commitments as well as the upcoming wave of procurements. This is possible after a fast and successful directed share issue of 189 million SEK. Once again, the interest was bigger than the number of offered shares. We are quite pleased to be able to carry it out in such a way in spite of the pandemic. We view it as a sign of recognition from the market of the numerous successes in DMS during the past 18 months. We expect DMS to be procured representing 30% of the world’s vehicle production before the end of 2023, with start of production from 2024 and onwards. We intend to stand as strong as possible before the upcoming wave of DMS procurements and thanks to the recent financing, we are in a good position to do so.
Smart Eye’s goal of being the market leader stands firm
We have twelve of the biggest car companies as customers and we are in dialouge with many more. Out of our customers no less than 11 are on the list of the world’s largest 20 manufacturers, measured on number of vehicles produced yearly. Our intention is to continue as the market leader and we will do the necessary ground work to reach that goal.The share issue should be seen in this light, for us to be able to deploy resources where they are most needed.
Research Instruments
During the second half of March, the order intake slowed down and continued to do so during spring and early summer, which was tough for the whole research market. We still managed to increase the sales in the third quarter but less than our pre-Corona goals. The Q3 result was to a large extent produced during September, and the 15% increase from last year should be viewed with that in mind. We are seeing an increased demand during the fall and have a positive outlook on the fourth quarter.
AIS
Smart Eye’s newest business area with focus on automotive aftermarket products has been experiencing some Corona related delays. With Chinese suppliers it has been challenging to synchronize the work done in both China and Sweden. We are working intensely to gain back the lost ground, but we will not be able to launch products in 2020 as previously planned, instead aiming for early 2021. The market activity level went from high to low in March. We expect demand to slowly increase to the high level again as the pandemic subsides. The need to solve the problem with drowsy and distracted drivers is of course as big as ever.
Final words
With numerous new car contracts during the last year, along with the recently completed funding we are relatively safe in an otherwise stormy world. Now is a good time for us to increase the pace while many others have pressed the pause button. The period of increased insecurity is not over yet, but the company has, during times of change, once again shown foresight and an ability to adapt under different circumstances. We will continue to be cautious on all levels and will first and foremost make sure that we are a long-term player in the automotive sector’s transition to safer cars. Our many customers guarantee continuity and transparency in future revenues. As long as there is a need for personal transportation there will be an industry serving that need. Delivery of high-quality, safety level software will continue to be in strong demand for a long time to come.
Martin Krantz
VD Smart Eye
For more information
Martin Krantz, CEO Smart Eye AB
Phone: +46 70-329 26 98
Email: martin.krantz@smarteye.se
Anders Lyrheden, CFO Smart Eye AB
Phone: +46 70-320 96 95
Email: anders.lyrheden@smarteye.se
About Smart Eye
Since 1999 Smart Eye has been engaged in development of artificial intelligence (AI) in the form of eye tracking technology that understands, supports and predicts a person’s intentions and actions. By carefully studying eye, facial and head movement, our technology can draw conclusions about a person’s awareness and mental state.
Today our eye tracking technology is used in the next generation of cars and is helping the automotive industry take an important step towards safer and more environment-friendly transport solutions. In the research field, Smart Eye’s solutions are providing new opportunities in complicated and real situations and are paving the way for new insights in the aerospace, aviation and defence industries as well as in the fields of psychology, neuroscience, medicine and academic research.
Smart Eye’s head offices are in Gothenburg, Sweden, and the company also has offices in Detroit, Michigan (USA), Tokyo (Japan) and Chongqing (China). In addition to these offices of its own, Smart Eye also has partners, retailers and distributors in several locations in Europe, the USA and APAC. Smart Eye’s solutions are used around the world by more than 700 partners and customers, leading research teams, brands and laboratories, including the US Air Force, NASA, BMW, Lockheed Martin, Audi, Boeing, Volvo and GM, to name a few.
Smart Eye’s business is organized in three business areas, Research Instruments, Automotive Solutions and Applied AI Systems (AIS). In Research Instruments, Smart Eye provides advanced eye tracking systems for measuring and analyzing human behavior. In Automotive Solutions, the company provides eye tracking software for integration in vehicles. In AIS, Smart Eye provides both software and hardware for eye tracking integration in vehicles, specifically designed for retrofit for public transportation and commercial vehicles.
Visit www.smarteye.aifor more information.
Visit our investor web for more financial information: http://www.corp.smarteye.se/en/
This information is information that Smart Eye 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 October 20, 2020 at 8:30 am (CEST).
Smart Eye is listed on Nasdaq First North Growth Market.
Erik Penser is Certified Adviser and can be reached at +46-8-463 8000 or certifiedadviser@penser.se.