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April 8, 1997updated 05 Sep 2016 12:05pm

TRAFFICMASTER PROMISES PROFITABILITY THIS YEAR

By CBR Staff Writer

Now past the last stage of its three-year plan to achieve profitability (CI No 2,886), Trafficmaster Plc still finds itself to be a loss-making company. Pre-tax losses rose in fiscal 1996 to 3.4m pounds from 2.5m pounds previously, although revenue climbed a substantial 35% – it shipped around 56,000 units in 1996, up 133% on the 24,000 last time. Shares however, by fell ninepence at 323.5 pence yesterday morning, but Milton Keynes, UK-based provider of real-time traffic information systems is banking on a number of OEM contracts it has won over the last 12 months, and a focus on Europe, finally to bring it into the black. The company announced last week (CI No 3,132) that it has licensed Mannesmann AG to build a Trafficmaster network in Germany and T-Mobil GmbH, a Mannesmann-Deutsche Telekom joint venture will to provide services based on Trafficmaster’s Oracle system. It hopes to reap one-off license fees in 1997 and 1998, as well as annual royalties, eventually, based on revenue generated by the German firms. In combination with tighter cost controls, the company expects to hit profitability this year. Its contract with Vauxhall Motors Plc, signed in August, to supply its 100,000 units of its Oracle system (CI No 3,016) has been extended to cover more car models. It has also won deals to incorporate driver information into in-car navigation systems and car radios developed by Philips Electronics NV and Blaupunkt AG and hopes to be in production by the end of the calendar year. The company has won contracts to install its technologies in several police control centers in the UK and has also developed a receiver unit for the mobile phone market. Trafficmaster says it has 15.6m pounds cash in the bank, and that that sum will be more than sufficient to complete its plans, including further extension of its network. It will not be paying a dividend this period.

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