Init Innovation In Traffic : Preliminary half-year figures 2017 published

init revenues increase by around 40 per cent

• Growth in core business and through acquisitions
• Incoming orders above expectations at EUR 84.3m
• Increase in earnings in line with planning

Karlsruhe, 4 August 2017.

init innovation in traffic systems SE (ISIN DE 0005759807) continued its positive business performance in the second quarter of 2017. According to the preliminary half-year figures, revenues increased further to EUR 58.3m as at the end of June, some 40 per cent above the previous year (EUR 41.8m). Incoming orders confirmed the growth outlook for the world's leading provider of integrated telematics and electronic ticketing solutions for buses and trains, reaching EUR 84.3m in the first half of 2017, a historical high (previous year: EUR 80.2m) that exceeded expectations. init was also able to improve its earnings, with the increase here in line with planning due to acquisition-related costs. In its current outlook, the Managing Board expects further significant growth in revenues and earnings can be achieved in the third and fourth quarters of 2017.

The EUR 7.9m revenue growth year-on-year in the core business (group structure before acquisitions) is particularly pleasing. Acquisitions effective in the second half of 2016 accounted for EUR 8.6m. The strong revenue growth was also reflected in gross profit, which totalled EUR 19.0m (first half of 2016: EUR 11.5m). However, this was offset by acquisition-related higher sales and administrative expenses, increased personnel and external consulting costs, and greater impairments on assets from the acquisitions.

Smart ticketing as a growth driver from 2018

init's most significant earnings indicator is earnings before interest, taxes, depreciation and amortisation (EBITDA). In the first half of 2017, this rose to EUR 4.1m (previous year: EUR 3.7m), or EUR 4.6m excluding acquisitions. Earnings before interest and taxes (EBIT) increased to EUR 2.2m (previous year: EUR 1.9m), or EUR 3.3m excluding acquisitions-related effects. Due to the aforementioned effects, consolidated net profit as at 30 June 2017 increased to around EUR 1.4m (first half of 2016: EUR 1.2m). This corresponds to earnings per share of EUR 0.14 (first half of 2016: EUR 0.12).

In terms of revenues and earnings, the init group's performance in the second quarter of 2017 confirmed estimates and forecasts by the Managing Board. As the figures were in line with planning, the Managing Board has maintained its forecast for 2017, despite major global political uncertainties. Revenues are expected to rise to around EUR 120m and operating profit (EBIT) to be EUR 5-7m. The full-year 2017 target for incoming orders also remains unchanged at EUR 120-130m.

In the medium term, the Managing Board considers the issues of digitisation, electromobility, autonomous driving, networking of transport systems and data communication security to be specific growth drivers in the market for init solutions. Other growth areas include automatic passenger counting and smart ticketing. Here, init has systematically strengthened itself by means of acquisitions, and as one of the market leaders, should be heavily involved in the rapid expansion of this sector.

In addition, init is establishing a position for itself as a partner for transport operators by the assumption of the technical operation of systems. In Asia, there are also major opportunities in software solutions for vehicle diagnostics, driver behaviour and in passenger counting. In the long term, init will benefit from long-term growth trends such as growing requirements placed on local public transport systems, investment in climate protection and the need to modernise the IT infrastructure of transport companies in industrialised countries. From 2018 in particular, the init Managing Board therefore anticipates an acceleration in growth and a significant increase in earnings.

The half-year financial report for 2017 will be published on 11 August 2017.