Smart Eye Interim report January-December 2017
Summary fourth quarter 2017
• Net sales totalled SEK 10,506 (14,574) thousand which corresponds to a drop of 28%.
• Operating profit/loss totalled SEK –14,814 (1,162) thousand, which is in line with the scheduled expansion resulting from investments primarily in staff and geographical coverage.
• Profit/loss after financial items was SEK –14,894 (938) thousand
• Profit/loss after tax per share is negative.
• Cash and cash equivalents totalled SEK 10,262 thousand at the end of December.
• Smart Eye was awarded 13 design wins with an additional European manufacturer of premium cars.
• The fourth quarter was characterised by an increase in business activity that is yet to be translated into sales.
• A directed new issue of SEK 43.6 million was completed after the end of the period.
January–December 2017
• Net sales totalled SEK 43,199 (40,743) thousand, which represents a rise of 6% year on year.
• Operating profit/loss totalled SEK –41,463 (–11,159) thousand.
• Profit/loss after financial items was SEK –41,896 (–12,403) thousand
• Profit/loss after tax per share is negative.
Comments from CEO
The fourth quarter of 2017 was chiefly characterised by a global rise in activities linked to the introduction of driver monitoring in mass produced cars. Procurements are in progress in all places where cars are being developed and manufactured. Europe is at the forefront, but North America and Asia are close behind. Up until Q4 2017, Smart Eye has been awarded with 16 design wins, 13 of which were in the fourth quarter, and bolstered its position as market leader and a technical benchmark for the automotive industry. The market is now taking a huge leap forward. The number of car manufacturers is growing, the number of drivers with driver monitoring per manufacturer is up, the number of cars per procurement is on the rise and consequently the size of the transactions. The European Road Safety Agency EuroNCAP indicated in the autumn that driver monitoring should be encouraged from 2020, which has immediately impacted on the purchasing behaviour of our customers. The intensified activity means that we can manage more resources than we previously expected without any delays in order to support the automotive industry in procurement projects globally. We have acted decisively when it comes to defending and enhancing our position as a leading provider of software for driver monitoring. Our employees have spent many long days of on the road supporting our customers in the global automotive industry. They are doing an outstanding job, but it is still difficult to cover all the geographical areas that are currently of increasing interest. We are therefore looking for an oppertunity to launch local offices in Japan, China and Korea. It is all about being at the centre of where things are happening. We conducted a new issue in early 2018 to give some support to this new position. We can see that we need to keep on striking while the iron is hot and invest in these opportunities in the present year, which could have an adverse impact on short-term profitability. In return, we are putting together a sustained consolidated competitive position as there are high thresholds for new manufacturers to deliver quality-assured software for safety features in vehicles.
When we achieve success with our offensive strategy, it will primarily be shown through our communication of new design wins. This will be partly from brand new customers but also from existing ones when they choose to embed the system into more models on the existing car platform. We have witnessed a fall in sales and earnings for both business areas in Q4 which is down to the increasingly intense level of business critical activities that need to be supported by the Applied Solutions business area. The fall in sales can be derived from a very high activity in the market during Q4 and we therefore belive that this investment will be rewarded in the year to come.
We are entering an extremely interesting 2018 with an ever-increasing technical offering, a high-performing team, a market-leading position and last but not least a dogged determination to reinforce our leadership in the competition for the global market in driver monitoring.
This information is information which Smart Eye AB (publ) is required to disclose under the EU Market Abuse Regulation. The information has been provided by the contact person below for publication on 27 February 2018 at 08:00 CET.
For more information, please contact or visit:
http://corp.smarteye.se
Martin Krantz, CEO
Phone: +46 70-329 26 98
Email: martin.krantz@smarteye.se