FINANCIAL REPORT FOR TAGMASTER AB (publ.) January-September 2014


Continued profitable growth

Third quarter

  ·
Net sales increased by 17% during the third quarter and was 13,0 MSEK (11,2)

  ·
Result before depreciation (EBITDA) was 1,4 MSEK (0,4), corresponding to a
margin of 10,7% (3,8)

  ·
Net result was 1,2 MSEK (0,0)

  ·
Result per share was 0,01 (0,00)

January-September

  ·
Net sales increased during the period by 19% to 43,8 MSEK (36,7)

  ·
Result before depreciation (EBITDA) increased by 101% to 5,1 MSEK (2,5), which
corresponds to a margin of 11,7% (6,9)

  ·
Net result was 4,3 MSEK (1,3)

  ·
Result per share was 0,04 (0,01)

  ·
Cash flow from the business for the period January to September was 2,6 MSEK (
-1,8)

Sales and
income
TSEK       Third                  9 month                 Full
           quarter                s                       year
           2014     2013  Change  2014     2013   Change  2013   2012   Change
Sales      13 039   11    17%     43 774   36     19%     50     39     27%
                    173                    690            344    681
Operating  1 401    419   234%    5 111    2 542  101%    2 776  154    1703%
income
(EBITDA)
Operating  10,7%    3,8%          11,7%    6,9%           5,5%   0,4%
margin
(EBITDA)
Income     1 193    13    9077%   4 349    1 337  225%    1 512  -5     -128%
before                                                           466
tax
Operating  3 085    818   277%    2 631    -1     -249%   -1     -379   219%
cash flow                                  761            209
Earnings   0,01     0             0,04     0,01   300%    0,01   -0,05  -120%
per share

Comments by the CEO

Our sales during the third quarter have seen a good growth on the total level
and with one more positive quarterly result we feel the stability of our
business increasing. We are still not satisfied with all parts of our growth,
which we would like to improve further ahead. Our Rail business has been
somewhat slower during the period but with an even flow of serial deliveries to
several customers. New projects are discussed and our focus is to work more and
tighter with our already established big partners, with whom we want to expand
our business and become a more important business partner for them. We make the
judgment that we will see some more new projects coming during the year. We have
after analyzing the business made the judgment that our product offering is most
successful in certain specific applications and we will therefore “drill deeper”
in these applications and spend less time on the requests regarding our less
efficient offerings. Being a small company it is very important that we focus on
the right things and especially within Rail Solutions where the projects are
complex, project specific and always demanding major resources.

Our Traffic business has developed good in the US market, while it has been
somewhat weaker in the Chinese market. In the EMEA region the sales has been
according to plan, but we intend to increase our efforts there supported by our
newly launched UHF products and which we judge will have a positive impact on
sales and result during the latter part of the year. In the Nordic market we
increase our presence and we already see that our new UHF reader finds a great
interest among established as well as new partners.

The innovation work will continue and we plan to launch more products in our new
UHF family early next year. In focus for our product innovation we have the
customer’s need for security and safety, reliability, functionality, design and
life cycle cost. Our judgment is that further launches is that further launches
is a must and that we thereby will increase our addressable market and this is a
fundamental requisite for increasing our growth. To support our long time growth
plans we continue to recruit new employees in especially technical development.

Our result of 1,4 MSEK (0,4), is an improvement compared to last year and
considering that the third quarter with the summer season is normally our
weakest quarter, I think we should be pleased by the quarterly result even if we
are not satisfied and would like to see more ahead. Our cash flow has developed
well during the quarter which can also be seen in our improved balance sheet.

Our new UHF products will contribute with the major part of our growth the next
few years to come, but we also see selective acquisitions as a way to complement
our product portfolio with the purpose to increase the value and the attraction
of our customer offering.

Jonas Svensson

CEO

This report like all previous economic reports can be found at the company home
page www.tagmaster.com

For further information, please contact:

Jonas Svensson, CEO, +46 8-6321950, jonas.svensson@tagmaster.com

About TagMaster

TagMaster is an application driven technology company that designs and markets
advanced radio frequency identification (RFID) products and systems for
demanding environments. Business areas include Traffic Solutions and Rail
Solutions providing innovative applications in order to increase efficiency,
security, convenience and to decrease environmental impact. TagMaster has
dedicated agencies in the US and in China and exports mainly to Europe, Middle
East, Asia and North America via a global network of partners, systems
integrators and distributors. TagMaster was founded in 1994 and has its
headquarters in Stockholm. TagMaster is a public company and its shares are
traded on First North stock exchange in Stockholm, Sweden. For more information
about TagMaster, please visit www.tagmaster.com

Attachments

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