- Net sales in the first six months amounted to MSEK 99 (95) and net sales in the second quarter amounted to 40 (48) MSEK.
- The gross margin for January-June was 68 % (68) and gross margin for the second quarter was 73% (61). The gross profit for January-June was MSEK 68 (64) MSEK and gross profit in the second quarter was MSEK 29 (29) MSEK.
- Earnings before depreciations and amortizations (EBITDA) in the first six months was MSEK -2 (-27) and EBITDA for the second quarter was MSEK -7 (-27).
- The result after tax for the period was MSEK -10 (-35) and result after tax for the second quarter was MSEK -11 (-28).
- Earnings per share for the first six months 2011 was SEK -0,08 (-0.27), and earnings per share for the second quarter was SEK -0,08 (-0,22).
- The cash flow during the six month period was MSEK -30 (-2) and cash flow for the second quarter was -16 (-7)
Comments from the CEO
Anoto has in the second quarter continued its work to become a more product and customer focused company. Strong efforts have been put into resource optimization to secure a more efficient product development and prepare the ground for a more efficient value chain.
Total revenues are below our expectations, primarily due to lower sales in C-Technologies and Technology Licensing. There is a positive momentum in the Business Solutions market and we recognize a growing interest for digital pen and paper solutions within business process optimization and mobile data capture. We see a growing number of opportunities, especially within healthcare, and several Anoto partners are establishing a foothold with larger system integrators and institutions in the healthcare sector.
Although Technology Licensing had a weak quarter, we still see significant opportunities, especially within Education. Our partner TStudy received a break-through contract in China, which will result in royalty payments to Anoto when products start to be rolled out early next year. There is also strong growth in the market for interactivity and Anoto is discussing with partners how to capture a larger share of that market.
C Technologies introduction of its new C Pen 3.5 software for Android has been delayed and was hence not shipped as expected in Q2. C Pen 3.5 has been well received by customers, but the delay affects sales that will not be fully recovered during 2011.
EBITDA for the first six months is a loss of MSEK 2, including MSEK 4 of exchange rate losses. EBITDA for the second quarter is a loss of MSEK 7. It is important to point out that although OPEX is in line with plans, we will continue to focus on efficiency improvements and optimization of our total resource spending.
The cash flow for the first six months is MSEK -30, of which nearly half comes from restructuring activities in 2010 and 2011, with the rest linked to weak sales in Q2 and an increase in inventory by MSEK 5.
After the reporting period, Anoto recently announced the acquisition of 51% of the shares in Destiny Wireless Ltd. in the UK, one of our best selling partners in the mobile data capture market. The acquisition is a first step to secure a larger part of the value chain by consolidating with some of our leading software platform partners to improve product packaging, realize synergies and get economy of scale, whilst providing more cost effective solutions for mobile data capture based on our technology. Destiny will be operated at an arm’s length distance. Anoto has the option to acquire the remaining 49% in 2014. Revenues will be consolidated from the closing of the transaction next month. Anoto’s strategy with Qualified Channel Partners will continue unaffected with the emphasis to offer a level playing field for all partners. We will consider further acquisitions within Business Solutions when opportunities arise.
Anoto also announced the establishment of a joint venture for product and business development in Asia, Pen Generations Inc., together with TStudy, a subsidiary of TStone Corp and Amicus Wireless Technology, a subsidiary of Solid Technologies Inc, a leading communications systems provider. Pen Generations is an exciting opportunity to capitalize on our network and partners in Korea, one of the world’s most vivid technology centers. Anoto´s and Pen Generations engineers will work closely together to provide the market with state of the art digital pen products and solutions. In addition, the joint venture will significantly strengthen Anoto’s business development capabilities and resources in Asia. Anoto has an option to increase its ownership from 19% to a minimum of 51% from 2014.
Outlook
Since the revenue in Q2 was below our expectations, we are not likely to be cash flow positive during the coming quarter. Anoto’s board and management are however determined to achieve profitable growth in the near future and expect to see improvements including a positive net result and positive cash flow as a result of our ongoing activities.
Anoto Group AB may be required to disclose the information provided herein pursuant to the Securities Markets Act. The information was submitted for publication at 08.30 on July 29, 2011.
For complete report, see attached document.
For more information, please contact:
Torgny Hellström, VD
Tel. +46(0)733 45 13 00
Dan Wahrenberg, CFO
Tel. +46(0)733 45 10 19
