Growth and financial strength in an unsettling time

INTERIM REPORT FOR THE PERIOD JANUARY – MARCH 2020

FIRST QUARTER

  • Net sales totalled SEK 23.1 (12.1) million.
  • Net operating profit/loss totalled SEK 0.1 (-7,9) million.
  • The profit/loss totalled SEK 0.3 (-7,9) million.
  • Earnings per share totalled SEK 0,00 (-0,02).
  • Cash flow from operating activities totalled 6.9 (-10.2) million.

SIGNIFICANT EVENTS DURING THE QUARTER

Adjustment of operations due to COVID-19 to safeguard operations and employee safety
Agreement signed with Exeger regarding biometric access to facilities
Pilot project initiated with Friskis & Svettis in Lund to test Precise product for biometric access to facilities during unmanned periods

SIGNIFICANT EVENTS SINCE THE END OF THE FULL-YEAR PERIOD

Extended license agreement with leading provider of fingerprint sensors, Egis Technology. For 2020, the total revenue from Egis is estimated to amount to around MSEK 60.
YOUNiQ 3-year contract with Temporary Space Nordics AB

FINANCIAL DATA AND KEY INDICATORS


KEY INDICATORS


202020192019Rolling
Amounts in SEK thousand unless otherwise statedQ1Q1Full-year12 mth
Net sales23 06512 14491 927102 848
Net sales growth, %89,9%-33,1%35,9%66,9%
Gross margin, %87,7%71,2%86,4%88,5%
Operating profit/loss148-7 8686518 667
Operating margin, %0,6%-64,8%0,7%8,4%
Cash flow from the operating activities6 935-10 206-47716 664
Cash and cash equivalents78 39967 47473 67678 399

Definitions, see financial glossary.

PRESENTATION OF THE INTERIM REPORT

In connection with today’s interim report, we include an invitation to a telephone conference/webcast today at 10:00 AM.

The conference call starts at 10:00 AM (CET).

Link to all public information such as link to audiocast and participant number for the telephone conference.

https://financialhearings.com/event/12329

To take part, click on the link above to listen to and follow the presentation online, or call +443333009267 to follow it over the phone.

You will be asked to state your name when you connect to the conference call and there will be an opportunity to ask questions in Swedish. The conference call will be held in English.

Participating on behalf of Precise:
Stefan K Persson, CEO
Ulrik Nilsson, CFO

CEO COMMENTS
The spread of Covid-19 has affected people and companies all over the world, and Precise's operational work has been put to the test during the quarter. It has been challenging, but at the same time very instructive, and altogether Precise has managed to successfully fend off the pandemic so far. The most important event so far in 2020 occurred after the end of the quarter, when we extended the agreement with sensor manufacturer Egis Technology regarding our identification software for mobile devices. This means that we now have approximately MSEK 60 in revenue for 2020 secured from a large and important partner with most of the major OEM manufacturers in their customer portfolio. The revenues from Egis are divided into license revenues, royalties and support and maintenance fees, which is important for a broad spread of current revenues.

Net sales for the first quarter amounted to SEK 23.1 million, an increase of 90 percent compared with the same period in the previous year. More pleasing news is that results have improved considerably, with a positive EBIT result of SEK 0.1 million, an increase of SEK 8 million compared with the corresponding period in the previous year. We are completely debt-free with cash and cash equivalents of SEK 78.4 million, which is a strength, not least in times like these. Through continued investments in all business areas, we are broaden our offering in order to be able to reduce our dependency on revenue from the mobile side (which remains volatile) in the future and therefore able to stand even more stable. We continue to take important steps on our journey towards growth and becoming a profitable company that creates value for our customers, end users and shareholders.

In the Digital Identity business area, we have accelerated our commercial activities, mainly regarding access applications. We have started a number of exciting pilot projects with players such as Friskis & Svettis in Lund, and we have also received our first commercial order from Exeger, a very innovative technology company. By installing our identification software, their employees and visitors can now gain access to the company's premises in a much simpler and more secure way than before. We have also initiated proof-of-concepts with some hospitals, where we installed our product for access in different medicine cabinets for easier and more secure handling and control of medicines and medicinal products. It is a very exciting project where we can be involved in digitizing and streamlining healthcare, which also shows the wide range of application areas our access product has.

Something we really take with us from the current pandemic in relation to our business is the importance of contactlessness, whether it is payments, access or other applications, where biometrics can best be used as a way of verifying the user's identity. We see that demand is increasing and we are working closely with our partners to remain at the forefront of innovation, user-friendliness and security in order to continue to gain ground in our business areas.

I am happy and proud of how we have performed both financially and operationally so far, where each employee has done their utmost to maintain and strengthen our leading position.

Stefan K Persson, CEO