London-listed Seeing Machines (AIM:SEE) reported double digit growth at 12.8% in operational revenues as the demand for Driver Monitoring System (DMS) technologies continues to grow.
In a half-year trading statement for the six months to 31 December 2019, the DMS provider said it had seen operational revenues at $15.8m from $14.0m in the first half of 2019, whilst net losses increased from $24.7m to $24.9m.
In particular, monitoring services revenue grew by over 67% compared with the same period last year to $4.1m from $2.4m and fleet and off-road division grew to $12.9m from $8.8m.
The group has attributed its revenue boost to accelerated growth of vehicles connected to its Guardian driver monitoring system (DMS) and said it expects that this trend will continue.
The ongoing cost of Guardian hardware was successfully reduced by 21% and is expected to deliver improvements in gross margin and savings of around $8.4m.
Shares in Seeing Machines were trading 0.80% higher at 3.15p during Tuesday trading.
Annualised Recurring Revenue, including royalties, also grew to $13.2m from $12m in 2019 whilst gross profit declined compared to last half year by $3.2m, or 36%, with the primary driver being reclassification of engineering development expenditure, the group outlined.
The group said its newest division, Aviation, has made ‘a promising start’ and that whilst sales lead times are anticipated to be lengthy, contract values were predicted to be ‘significant’.
“Our teams are working with some of the world's biggest brands in Automotive and Aviation, and these deep relationships will secure our long-term competitive position across each of our transport sectors,” said Paul McGlone, CEO of Seeing Machines.
The group said they were ‘encouraged’ by the strong level of its order book including the nine programs it has through six Automotive OEM relationships and that discussions with existing and additional OEMs were underway.
"We continue to work through significant opportunities across each business unit and leverage the growing momentum for driver monitoring technology in Europe, the US and around the world,” said Paul McGlone, CEO of Seeing Machines.
Seeing Machines added that it does not foresee any short-term supply issues as a result of the coronavirus COVID 19 outbreak.
“It is clear that DMS is becoming increasingly more integral to improved safety on roads and there is growing recognition for its ability to improve efficiencies and safety in aviation.
As this continues to be embraced globally, Seeing Machines is in an outstanding position as the world-leading provider of this technology,” added McGlone.
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