25th Mar 2014 15:45
LONDON (Alliance News) - Ubisense Group PLC Tuesday said that it had entered 2014 with increasing momentum and an enlarged order book, even as its pretax loss widened in 2013 due to higher operating expenses and lower margins.
Ubisense provides hardware, software and services to businesses to track people and assets.
Ubisense posted a pretax loss of GBP1.7 million in 2013, widened from a pretax loss of GBP728,000 in 2012, even though revenue rose to GBP27.0 million, from GBP24.3 million. The revenue increase was more than offset by higher sales costs and operating expenses as the company invested in its Smart Factory and myWorld products.
Revenue was boosted by the acquisition of Geoplan Interworks KK during the year, which contributed GBP700,000 in incremental revenue. New channel partners, including Google Inc, helped contribute to strong customer bookings during the year. Services revenue rose to GBP13.6 million from GBP11.8 million, boosted by contract wins in the US.
Gross margin declined to 34.2%, from 39.5%, due to a higher proportion of revenues coming from the company's Services division, and due to higher-margin Solutions revenue being partly delivered using contractors.
"It's all to do with solutions sales, selling our own IP is very much what we've been trying to do with our whole customer base. We're still a relatively small company dealing with large customers, occasionally we get lumpy deals with margins lower than we'd like, but we take the deals which suppress the overall margin. Clearly we're trying to progress to more and more solutions sales that have margins north of 50%," Chief Executive Richard Green told Alliance News.
The company reorganised its business into a single Real Time Location Intelligence business at the start of 2013, integrating all of its location based technologies into a single platform. Green said that this integration was largely complete, but that it would continue to invest in its research and development.
"The level of investment in research and development we see as a key feature of the business. We're a company that's based on product innovation so we'll want to keep reinvesting in that as we go forward," Green said.
Due to new customer orders during the year, Ubisense's order book as at December 31, 2013, was GBP17.9 million, up from GBP10.2 million in the previous year. Ubisense said it had begun the new year with a robust order book and pipeline, which gave it confidence for its future.
Shares in Ubisense were trading down 1.1% at 241.10 pence Tuesday afternoon.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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