Digital Identification Solutions AG: Strong business performance supports company policy

Digital Identification Solutions AG  / Key word(s): Half Year Results

09.08.2011 09:13

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          Good half-year results / July 2011 promising to mark a new record

Stuttgart/ Germany, August 9, 2011 - Digital Identification Solutions AG
(DISO), a leading international ID solutions provider, reports strong
business performance in the first half of 2011 and continues to achieve
significant growth in terms of gross profit and earnings before interest
and taxes (EBIT). The start into the second half has been even more
successful since the month of July 2011 is promising to become the best
month in company history. The news in detail:

  - Good sales development: The half-yearly figures came in slightly below
    the previous year's level, which was only due to a supply-side delay in
    delivery in June. However, this difference will be more than
    compensated for by the particularly strong July.

  - Improved gross profit margin thanks to a consistent focus on more
    profitable businesses.

  - Significantly improved EBIT: The Company, which was not profitable a
    year earlier, continues to advance into the profit zone (threshold of
    EUR 1 million - planned figure for the fiscal year 2011 - is expected
    to be exceeded already in July)

  - Further strengthening of the balance sheet as well as stabilization of
    the cash position

  - All in all, a clear confirmation for the Company's policy

EUR mn                                   2010          2011         Change
Sales                                    12.2          11.4          -6.5%
Gross profit                              5.3           5.3           0.0%
Gross margin                            43.4%         47.0%           8.0%
EBITDA                                    0.4           0.9           100%
EBIT                                     -0.2           0.4           n.a.
Order backlog                             3.1           7.5           100%



The robust growth of the DISO Group continued in the second quarter of
2011, especially in terms of bottom-line results: While sales only grew a
mere 4% to EUR 5.8 million compared to the first quarter, the Group's EBIT
rose significantly from EUR 0.1 million to EUR 0.3 million over the
previous quarter, representing a threefold increase. Accordingly, the
Company has been profitable since three quarters.

EUR mn                            Q1/2011          Q2/2011         Change
Sales                                 5.6              5.8           0.4%
Gross profit                          2.5              2.8           9.8%
EBITDA                                0.4              0.5          25.3%
EBIT                                  0.1              0.3           100%
Order backlog                         2.0              7.5           100%



In the first half of 2011, DISO generated sales of EUR 11.4 million,
representing a slight decline compared to the previous year. This decrease
is attributable to a supply-side delay in June. Nevertheless, the Company's
EBIT improved by EUR 0.6 million during the same period so that the Company
was able to advance further into the profit zone. This success is a result
of the strategic realignment initiated in the last year, which has led to a
reduction of the expense ratio.

EUR mn                                Q1/2011        Q2/2011       Change
Hardware                                  1.7            1.6        -4.8%
Consumables                               3.0            3.4        12.1%
Software & Services                       0.9            0.8        -9.0%
Total                                     5.6            5.8         4.0%



At EUR 5.3 million, gross profit reached the prior year level. In contrast,
the gross profit margin of 47.0% was above the corresponding previous
year's figure which indicates that the focus of the Company on profitable
sales is yielding the desired success. In terms of product mix, the Company
was able to raise its margins considerably compared to the previous year,
climbing from 28% to 44% for Hardware as well as from 68% to 79% for
Software and Spare Parts, while the contribution of the Consumables
business remained stable at 40%.

While sales in June 2011 were 6.5% lower compared to the previous year,
this was attributable to an external event - the above-mentioned delay in
the receipt of ordered goods - representing an exception to the rule. The
start into the second half of 2011 has been even more successful since the
month of July 2011 with sales of EUR 4.7 million is promising to become the
best month in company history. Due to the continued very good cost base, it
is expected that the Company will exceed the EBIT threshold of EUR 1
million already in July.

The Company's situation continued to improve in terms of the balance sheet
as well, despite another slight increase in stock levels, due to the
above-mentioned external event: Accordingly, the cash position remained at
a stable level of EUR 3.7 million in spite of a substantial reduction of
trade payables. Further details on the development of the Company will be
given at the Annual General Meeting on August 10, 2011.
 
Outlook

'Our most recent figures show that the Company is in an excellent position
and is on the right track,' says Frank Posnanski, CFO of DISO AG. 'After a
good first half, the month of July will bring us record results as existing
data suggest. Accordingly, we exceed our forecasts by far and have made
further considerable progress in reaching our annual guidance. Initially we
planned with sales of EUR 28.0 million and an EBIT of EUR 1.2-1.4 million,
however these targets have been raised in the meantime to EUR 32.0 million
for sales and EUR 2.5 million for EBIT,' Posnanski adds.

The Management Board



About Digital Identification Solutions
The Digital Identification Solutions Group is a global provider of advanced
identification solutions with a worldwide install base of more than 11,000
systems. In October 2009, the Group introduced to the world market the
latest EDIsecure(R) XID Retransfer Printer generations for distinct
Business Line segments, as well as a much enhanced Professional Line
Portfolio in combination with new Inline Lamination Modules. The
Professional Line Portfolio will support multiple new modules in the
forthcoming future, as well as the revolutionary LCP 9000 Laser Color
Personalization System. The company has its own sales, marketing, logistic
and support centers in Germany, the United Arab Emirates, Singapore, China,
the United States and Mexico. Together with its vast network of certified
partners, Digital Identification Solutions is in a position to deliver
state-of-the-art solutions virtually anywhere in the world. The company
combines cutting-edge technology, extensive industry know-how and an
impressive array of references in the private and public sector.

For further information please visit www.digital-identification.com

Contact:

Frank Posnanski
CFO
Digital Identification Solutions AG
Teckstrasse 52
D-73734 Esslingen

Phone: +49 (711) 341 689-0
Fax:   +49 (711) 341 689-550
mail_ir@digital-identification.com

 
Anke Abendroth
Corporate Marketing & Communication
Digital Identification Solutions AG
Teckstrasse 52
73734 Esslingen
Germany 

Phone: +49 711-341 689-145
Fax:   +49 711-341 689-550
mail_ir@digital-identification.com





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Language:     English
Company:      Digital Identification Solutions AG
              Teckstraße 52
              73734 Esslingen
              Germany
Phone:        +49 (0)711 341 689 280
Fax:          +49 (0)711 341 689 550
E-mail:       abendroth@digital-identification.com
Internet:     www.digital-identification.com
ISIN:         DE000A0JELZ5
WKN:          A0JELZ
Listed:       Freiverkehr in Berlin, Düsseldorf, München, Stuttgart; Entry
              Standard in Frankfurt
 
End of Announcement                             DGAP News-Service
 
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