Kapsch TrafficCom finished a weak fiscal year 2012/13 with an outstanding fourth quarter.
- The company has passed through a transition period on the way to new projects and structures
- Revenue and earnings are below expectations, but the balance sheet demonstrates financial potential
- Proposed dividend of EUR 0.40 corresponds to a 54% payout ratio
- Strategy and organizational structure are aligned with further growth on the ITS market
|1 April – 31 March||2012/13||+/- %||2011/12|
|Revenues (in million EUR)||488.9||-11%||549.9|
|EBIT (in million EUR)||15.3||-64%||42.2|
|Profit for the period (in million EUR)||16.7||-39%||27.5|
|Earnings per share (in EUR)1||0.74||-54%||1.62|
|Dividend per share (in EUR)||0.402||-56%||0.90|
*1 Earnings per share 2012/13 relate to 13.0 million shares, 2011/12 relate to a weighted average number of 12.74 million shares
*2 Proposal of the executive board subject to approval of the shareholders´ meeting on 12 September 2013
Vienna, June 11, 2013 – Kapsch TrafficCom AG (ISIN AT000KAPSCH9), listed on the Vienna Stock Exchange in the prime market segment, is reporting on its fiscal year 2012/13 as a transition period in terms of projects and the company’s organizational structure, which was retooled during the reporting period for the planned continuation of growth.
The Kapsch TrafficCom Group made significant progress during the past fiscal year, although the investments in the future as well as project delays led to lower revenues with simultaneously high expenditures. The earnings figures of the reporting year therefore lie clearly below the targets of the executive board.
Revenue and earnings.
The revenue in the fiscal year 2012/13 was EUR 488.9 million, which is 11.1 % below the previous year’s value of EUR 549.9 million. This decline reflects, on one hand, the fact that the major installation projects in Poland and South Africa were already completed but the new projects were of smaller overall volume and only began contributing revenue as of the second half of the year. On the other hand, the operation revenues in Poland and South Africa were still significantly below expectations since the completed system in South Africa did not go into operation by the end of the fiscal year and the revenues earned in Poland reached the expected levels only as of the third quarter. The number of on-board units sold also remained below that of the previous year since no initial deliveries or subsequent deliveries for new systems took place.
These circumstances also led to an operating result (EBIT) that was negative in the first two quarters. In the third quarter, the continued delays in the South African project forced Kapsch TrafficCom to update the contract calculation. This resulted again in negative operational earnings. Only in the fourth quarter did the improved system operation in Poland together with progress in the project in Belarus enable a significant increase in revenue, making the quarterly earnings more than satisfactory at EUR 24.9 million. For the entire year, the EBIT was EUR 15.3 million, following EUR 42.2 million in the previous year. This puts the EBIT margin at 3.1 %, considerably below the previous year’s value of 7.7 %.
The reporting year was also characterized by preparations for new projects, in other words by already recorded expenditures that were not yet offset by corresponding revenue or income. The implementation of the new organizational structure also required initial investments. The lower revenues made cost coverage more difficult here.
The profit before taxes decreased from EUR 36.3 million in the previous year to EUR 16.9 million. Lower tax expenses and increased finance income were able to partially compensate for the decline in the operating result (EBIT). The profit for the period declined from EUR 27.5 million to EUR 16.7 million, putting the profit per share at EUR 0.74 compared with EUR 1.62 in the year before.
The executive board will recommend to the annual shareholders' meeting on 12 September 2013, the payment of a dividend of EUR 0.40 per share (2011/12: EUR 0.90 per share) for the fiscal year 2012/13. The payout ratio (with respect to the profit for the period attributable to the equity holders of the company) is therefore roughly 54 % (2011/12: roughly 57 %).
The segment RSP (Road Solution Projects) recorded revenues of EUR 128.3 million after EUR 229.9 million in the previous fiscal year, a decrease of 44.2 %. The projects begun in Belarus, France, Australia and the U.S.A. as well as the extensions to the system in Poland were not able to compensate for the revenue decline in connection with the complete or largely concluded system implementations in Poland and South Africa. The EBIT of the segment RSP was EUR -51.7 after EUR 4.1 million in the previous year. Due to the decreased revenues, it was not possible to cover the regular costs associated with this segment. The project in South Africa also further weighed down the result.
In the segment SEC (Services, System Extensions and Components Sales), revenues increased by 11.1 % from EUR 308.1 million in the previous year to EUR 342.3 million. A significant revenue contribution was supplied by the project in Poland, which went into operation in July 2011 and therefore only contributed income for nine months. The operation of the nationwide systems in the Czech Republic, Austria and Switzerland continued to yield stable revenue contributions. On the other hand, the continued delay in the commissioning of the project in the South African province of Gauteng had a negative impact. The number of on-board units sold was 9.3 million compared with 11.2 million units in fiscal year 2011/12. The lower volume in the fiscal year just finished was related to the absence of additional deliveries for the project in Gauteng, South Africa. The EBIT of the segment SEC was EUR 66.1 million after EUR 37.3 million in the previous year. The EBIT margin therefore increased from 12.1 % to 19.3 %.
Financial position and cash flows.
The balance sheet of the Kapsch TrafficCom Group paints an extremely solid picture. The conclusion of the system implementation in Poland and the associated payment of the last milestone from construction of the system in the first quarter of the reporting year led to noticeable improvements compared with the balance sheet date of 31 March 2012. Despite the weak profit situation, the equity ratio was 42.4 % at the end of the fiscal year 2012/13. The net debt on 31 March 2013 was 46 % below the previous year’s value despite financing of the Belarus project. The net working capital and the capital employed are also far below the level of the previous year despite the rise in the fourth quarter. The cash and cash equivalents increased over the fiscal year from EUR 44.9 million to EUR 79.0 million. The free cash flow, which was negative in the comparison period, amounted to EUR 48.3 million at the end of the reporting year. This confirms that Kapsch TrafficCom has the necessary financial potential for the planned growth.
In 2012, the Kapsch TrafficCom Group defined its company strategy up to the year 2016 as well as four specific strategy paths. Since October 2012 the entire group now shares a globally standard organizational structure with coordinated standards, processes and interfaces. This should increase efficiency and support further growth. Additional growth prospects also lie in the development of complete ITS (Intelligent Transportation Systems) solutions. “We will continue our investments in the future despite the weak results of the fiscal year 2012/13. Making cuts due to the current situation would mean not having the necessary structures and capacities for the projects that are expected in the future,” says Georg Kapsch, CEO of Kapsch TrafficCom AG, in confirmation of the growth strategy.
Kapsch TrafficCom considers itself well positioned with its ITS strategy and the new company structure. The strong balance sheet structure shows that the group also has sufficient financial potential for upcoming projects both small and large – even running in parallel.
The fiscal year 2013/14 will be marked by a continuation of the existing projects. In particular, the further developments in South Africa will influence the revenue and earnings situation. In addition, an invitation to tender has already begun in Slovenia. Kapsch TrafficCom expects additional tenders in Belgium and the U.S.A. Extensive toll systems are under discussion in Bulgaria, Russia and the surrounding countries as well as in Germany, and these discussions are also being followed with great interest.
An overview of the fiscal year 2012/13 (key aspects and figures) can be found at www.kapsch.net/ktc/ir/downloadcenter
Kapsch TrafficCom is a provider of intelligent transportation systems (ITS) in the application fields of road user charging, urban access and parking, road safety enforcement, commercial vehicle operations, electronic vehicle registration, traffic management and V2X cooperative systems. Kapsch TrafficCom covers with end-to-end solutions the entire value creation chain of its customers as a one-stop shop, from components and subsystems to their integration and operation. The solutions of Kapsch TrafficCom help to provide funding for infrastructure projects, to increase traffic safety, to optimize traffic flow, and to reduce environmental pollution from traffic. The core business is to design, build and operate electronic toll collection systems for multi-lane free-flow traffic. References in 43 countries on all continents make Kapsch TrafficCom a recognized supplier of electronic toll collection worldwide. As part of the Kapsch Group, a family-owned Austrian technology group founded in 1892, Kapsch TrafficCom, headquartered in Vienna, Austria, has subsidiaries and representative offices in 33 countries, has been listed on the Vienna Stock Exchange (KTCG) since 2007, and generated with more than 3,000 employees revenues of EUR 488.9 million in fiscal year 2012/13.