DGAP-News: After the first quarter of 2020: init innovation in traffic systems SE grows according to plan despite the coronavirus crisis

- Revenues increased by around 14 percent to EUR 40.3m (Q1 2019: EUR 35.3m)
- Operating profit more than tripled compared with previous year
- Gross margin increased to 35 percent (Q1 2019: 30 percent)
- Incoming orders on target at EUR 44m
- Cash flow reaches EUR 6.5m (Q1 2019: EUR 1.8m)

The coronavirus crisis did not affect the growth of init innovation in traffic systems SE (ISIN DE 0005759807) in the first quarter of the 2020 financial year. According to the figures available now, the leading international supplier of telematics, planning and ticketing systems for buses and trains increased its revenues in this period by around 14 percent year on year to EUR 40.3m (Q1 2019: EUR 35.3m). Both the operating profit (EBIT) and the consolidated net profit tripled at the same time. The Managing Board has therefore confirmed its forecast for the year as a whole with a revenues target of around EUR 180m and earnings before interest and taxes (EBIT) of EUR 18 to 20m. The 2020 revenues and earnings planning takes into account the full consolidation of the DResearch Fahrzeugelektronik Group (DVS/DFE) starting in April 2020.

"We are all currently feeling the challenges posed by an unprecedented situation. We are monitoring current developments with regard to the consequences of the pandemic spread of the Covid-19 virus very closely, and are taking all necessary steps to minimise risks to our employees, customers and business partners. Up to now, there has been no, or only a limited, direct impact on the revenues and earnings planning for 2020", the Managing Board said in its quarterly statement.

The figures from the first quarter confirm this: revenues growth of around 14 percent was in line with expectations, with the North American region alone accounting for EUR 17.8m or 44 percent of quarterly revenues.

This reflects the high number of incoming orders in the previous periods from precisely this economic region. For example, in the same quarter of the previous year, init received the major contract of the Metropolitan Transit System (MTS) from San Diego, amounting to around USD 30m. In contrast, orders in the first quarter of 2020 were dominated by small and medium-sized projects. All in all, init acquired incoming orders to the value of EUR 44.0m in the first quarter (Q1 2019: EUR 69.2m). "Current incoming orders are in line with our expectations. We are well on the way to achieving our target of EUR 180 to 190m in incoming orders for 2020", the Managing Board said in its quarterly statement. The order backlog as at 31 March was EUR 156m (previous year: around EUR 178m).

On the profits side, the first quarter of 2020 saw the full impact of the cost-cutting and efficiency-boosting measures introduced in 2019. Gross profit increased to EUR 14.3m (Q1 2019: EUR 10.6m). This gives a gross margin of 35 percent (Q1 2019: 30 percent).

Increase in incoming orders expected

Earnings before interest and taxes (EBIT) more than tripled to EUR 3.4m (Q1 2019: EUR 1.1m). This gives an earnings per share of EUR 0.22 (Q1 2019: EUR 0.07).

The cash flow from operations was especially positive in the first quarter. At EUR 6.5m, it was well above the previous year's figure (Q1 2019: EUR 1.8m).

Although the Managing Board cannot exclude the effects of the coronavirus crisis over the remaining year, it currently believes that the init group is well on the way to achieving the targets set for the year as a whole. "We continue to expect an increase in incoming orders. The major order from the Metropolitan Transit Authority of Harris County (METRO, Houston, USA) of well over USD 30 million announced for the second quarter also points in this direction. There are also positive effects from the consolidation of the new acquisition DResearch Fahrzeugelektronik Group", the Managing Board said, striking a confident tone.

The complete quarterly statement will be available from 14 May 2020 on the init website under the following link www.initse.com/ende/investors/financial-reports.