SMARTRAC Reports Fiscal Year 2012 Results

SMARTRAC N.V. announced financial figures for the fiscal year 2012. The company further increased its revenues and reported total sales of €255.5 million in fiscal year 2012, compared to sales of €167.6 million in 2011. EBITDA for 2012 amounted to €23.4 million in 2012, compared to EBITDA of €15.2 million in 2011. Net profit for the period, including non-controlling interests, amounted to €5 million in 2012, compared to net loss of €42 million in 2011.

SMARTRAC started the business year with the burden of the flood disaster in Thailand, the positive momentum of the acquisitions conducted at the end of 2011 and the commitment to further improve its excellence. Over the course of the year, integration of the former KSW Microtec AG, Dalton Group, and Neology were completed, while integration of the former UPM RFID has been finalized at the end of January 2013. Along with the integration, joint product and technology roadmaps were developed and the company started leveraging synergies resulting from the acquisitions.

From an overall perspective, business development in 2012 was characterized by stable demand for high-security inlays, e-Covers and card inlays as well as a very favorable growth in the retail and apparel tracking business. SMARTRAC also introduced several new products for use in access control, animal identification, automated fare collection, cable tagging, item-level tagging, high-security documents, and NFC applications to the market which generated significant customer interest.

Revenues in the Security Segment (Business Units eID and CTA) increased by 22% and amounted to €143 million in 2012 compared to €117 million in 2011. Revenues in the Industry Segment (Business Units Industry & Logistics and ePI, Neology and Dalton) increased by 124% to €112 million in 2012 compared to €50 million in 2011. Growth mainly resulted from stable demand for card inlays and PRELAM products, the significant increase of sales in the ePI business (including the business of former UPM RFID), and the contribution of the new business unit Dalton & Neology.
EBITDA in the Security Segment amounted to €15 million in 2012 compared to EBITDA of E€13 million a year ago. This represents an increase of 13%. The EBITDA margin of 10% (2011: 11%) was burdened by higher administration costs mainly due to the acquisitions conducted at the end of 2011.

The Industry Segment reported EBITDA of €10 million in 2012 compared to EBITDA of €3 million reported in 2011. The EBITDA margin further increased from 5% in 2011 to 9% in 2012.

Overall, SMARTRAC will continue to improve excellence and driving down costs in 2013.

As of December 31, 2012, SMARTRAC employed a total workforce of 3,635 people compared to 3,676 employees at the end of 2011.

On July 20, 2012, the Management Board of SMARTRAC N.V. was informed that OEP Technologie B.V. decided to initiate squeeze-out proceedings against all minority shareholders in SMARTRAC N.V. in order to have their shares in SMARTRAC N.V. transferred to OEP Technologie B.V., pursuant to Article 2.92a of the Dutch Civil Code. The Management Board of SMARTRAC N.V. was also informed that OEP Technologie B.V. intended to request the Enterprise Chamber of the Amsterdam Court of Appeal to order the minority shareholders to transfer their shares and to set the price of the shares to be transferred at EUR 11.00 per share.

On Sept. 12, 2012, the SMARTRAC Management Board resolved to apply for a delisting of the company’s shares from the Frankfurt Stock Exchange (Prime Standard) and to propose to the general meeting a change of the company’s articles of association subject to the approval of the delisting.

At the Extraordinary General Meeting of shareholders held on Oct. 29, 2012, the proposed changes of the company’s Articles of Association were approved with 99.9% of the votes cast.

On Nov. 30, 2012, SMARTRAC N.V. was informed about the decision of the Frankfurt Stock Exchange regarding its request for a delisting of the company’s shares from the Frankfurt Stock Exchange (Prime Standard). On the company’s request, the Frankfurt Stock Exchange decided to revoke the listing of the ordinary bearer shares, ISIN NL0000186633, on the regulated market. The Frankfurt Stock Exchange also informed SMARTRAC N.V. that the revocation will become effective at the end of the day on May 28, 2013.

Dr. Christian Fischer resigned from his position as chairman of the Management Board and CEO effective September 3, 2012. He left SMARTRAC on Dec. 31, 2012, and handed over responsibility to Christian Uhl and Nigel Sealey. Uhl joined SMARTRAC in May 2006, and Sealey has been working for SMARTRAC since April 1, 2012, thus providing continuity in the management board.

Uhl was appointed director A of SMARTRAC N.V. on Oct. 29, 2012, and as co-chairman of the Management Board of the company on Dec. 5, 2012. Sealey was appointed as director A of SMARTRAC N.V. and as co-chairman of the Management Board on January 22, 2013. In their new role, they will specifically concentrate on accelerating profitable revenue growth and the implementation of action plans focused on the operational and administrative cost structure of the company.

For the 2013 fiscal year, the SMARTRAC Management Board is confident that it will be able to achieve growth and improve the company’s profitability. SMARTRAC Group sales are expected to come close to the €300 million mark in 2013.

From a strategic perspective, the Management Board will pursue the target to optimize structures and processes in order to further improve overall efficiency of the Company and profitability of the Group.
“2012 has been another successful year in our company history despite the various challenges we faced,” said Uhl, co-chairman of the Management Board and CFO. “Based on our technology leadership, the broad product range, and our clear focus on customer needs, we are confident that we will be able to further grow in 2013 together with our customers and business partners.”