Pricer

Quarterly Report • Apr 24, 2013

Interim Report January - March 2013

Several important contracts increase orders

• Recession in Southern Europe slows net sales and profit

• • Gross margin affected by customer and product mix

• • Carrefour resumes ESL deployment

Events after the end of the period

• • Large-scale deployment of ESL by an electronics chain order value SEK 60 M
• • New orders from Southern Europe initial orders worth SEK 10 M estimated total order value SEK 50 M
• • Pricer won the world's largest order for a single store

First quarter

Order entry:	SEK 143 M (126)
Net sales:	SEK 93.2 M (125.5)
Gross margin:	25.4 percent (32.7)
Operating profit:	SEK -3.8 M (12.6)
Operating margin:	-4.1 percent (10.1)
Net profit:	SEK -3.9 M (10.9)
Cash flow:	SEK 46.8 M (20.5)
Basic earnings per share:	SEK -0.04 (0.10)

Comments from the CEO, Fredrik Berglund

Net sales and results in this quarter were again put under pressure by the weak economic climate in Europe. At the same time, we are pleased to note that orders have increased.

A number of significant contracts have been won since the beginning of the year. An example is that we will be installing the Pricer solution in one of the world's largest electronics chains – the initial order is worth SEK 60 M. This is a crucial step in the development of our concept to attract customers in other retail segments. We are also pleased to report successes in Southern Europe where two chains, despite the poor economic climate, are installing our system. Furthermore, one of our large customers, Carrefour France, has resumed ESL deployments that were put on hold in 2012.

Common to all our new contracts is the increased interest in our graphic displays, which account for a growing proportion of Pricer's net sales. In addition to price, the display also shows other information about products and campaigns, and therefore becomes an important platform for marketing in stores. In the short term, the graphic displays give a lower margin than the more common segment-based displays, which explains the weaker margin in the quarter. The new displays enable a broadening of the market and continue to attract new customer groups.

Market development

The market has continued to develop slowly during the first quarter due to the weak economic climate in Europe. At the same time, we observe continued interest in our solutions. We have obtained several positive order decisions during and after the end of the quarter. We have received orders from new and existing customers in several markets. By investing in and using Pricer's solutions, customers see ways to rationalise and improve profitability by simply and efficiently adjusting their prices in stores, i.e. dynamic pricing. Another effect of the current economic climate is that ongoing projects are taking longer to complete.

The increased interest in and sales of graphic displays reflects customer needs, and shows that customers understand the benefits. It is not only price information that is displayed, but the system also allows our customers to present information about products or direct marketing information on the shelf edge.

A good example is that Pricer has been commissioned to carry out the largest installation so far of graphic labels in a single store. One of the largest chains in the world has placed an order for over 100,000 labels for one of its stores. The order value exceeds SEK 6 million.

Europe, Middle East and Africa

Net sales in the region were SEK 79.4 M (110.8). The decrease in the quarter is due to the weakening economic climate in Europe, particularly in France and Italy.

It is encouraging that one of our larger customers, Carrefour in France, has announced that it will be resuming installation of Pricer's system in line with the agreement entered into in September 2010. These installations were put on hold during 2012 and have now resumed which has increased orders in the quarter.

Since the end of the quarter, Pricer has received new orders from various customers in Southern Europe through its partners in the region. One order is from the Spanish retail chain Alimerka, which will install the electronic shelf label system, ESL, in another 60 stores. The other order is from a retail chain that plans to install the Pricer graphic solution in its 200 stores; the initial order is for 30 stores. Initial value for these orders is over SEK 10 M, and the total value over two years is approximately SEK 50 M.

One of the world's leading electronics chains has placed an order for Pricer's e-paper graphic displays for all its stores in one of the countries in which it operates. The value of the order is nearly SEK 60 M.

Pricer has been nominated in two categories at the prestigious Retail Week Technology Awards in the UK. The nominations are in the categories Technology of the Year and Project Implementation of the Year. The nominations are on the back of Pricer, through its partner Herbert Retail, installing its ESL solution based on graphic e-paper displays in Nisa Local, a chain of convenient stores in Shrewsbury, UK.

Americas

Net sales in the region were SEK 11.4 M (13.4). Interest in electronic shelf labels is growing on the American continent, with the base being the most significant on-going installation projects in recent years, both in the US and Mexico. Pilot projects and smaller installations are in progress in a number of retail chains in various sectors in several countries in this important market region.

Asia and the Pacific

Net sales in the region were SEK 2.4 M (1.3). The development in the region continues on a low level.

Orders, net sales and financial performance for the quarter

Orders in the first quarter were SEK 143 M (126), an increase of 13 percent compared to last year. Excluding the currency effect, the increase was 18 percent, as the Swedish krona strengthened during the period. At the end of the quarter, the order back log was worth SEK 138 M (125), an increase of 10 percent.

Net sales were SEK 93.2 M (125.5) during the quarter, which was 26 percent lower than the first quarter 2012. Excluding currency effect, the decrease was 23 percent. The Swedish krona strengthened during the period, reducing the value on revenue from exports. Net sales were SEK 517 M (627) on an annual moving basis, which is a decrease of 18 percent.

CURRENCY EFFECTS ORDER ENTRY & SALES

			Full
	Q 1	Q 1	year
	2013	2012	2012
% Change in Order entry	13%	-38%	-21%
whereof currency effect	-5%	1%	0%
% Change in Order entry
adjusted for currency effect	18%	-39%	-21%
% Change in Sales	-26%	13%	-10%
whereof currency effect	-3%	1%	0%
% Change in Sales
adjusted for currency effect	-23%	12%	-10%

Gross profit was SEK 23.7 M (41.0) and gross margin was 25.4 percent (32.7) for the quarter. Gross margin has fallen due to effects of customer and product mix, and the strengthening Swedish krona.

Operating expenses were SEK 27.5 M (28.4) during the quarter.

Operating profit was SEK -3.8 M (12.6) during the quarter. This resulted in an operating margin of -4.1 percent (10.1).

Net financial items were SEK -0.3 M (-1.2) for the quarter and consisted mainly of negative currency effects from translation of current financial assets and cash positions.

Net profit was SEK -3.9 M (10.9) for the quarter. Translation differences in other comprehensive income consisted of negative currency revaluation of net assets in foreign subsidiaries in euro, primarily goodwill.

Cash flow and financial position

Cash flow from operating activities was SEK 46.8 M (20.5); this has improved in the quarter due to increased customer payments.

Working capital was SEK 253.4 M (248.2) at the end of the period. Working capital has decreased by 17 percent since the beginning of the year, when it was SEK 305.7 M.

Fair value of derivatives at the end of the period was SEK 0,8 M (- 0,3) net.

Cash and cash equivalents at the end of the period were SEK 84.4 M (78.5). In addition to available cash, Pricer has unused bank overdraft facilities of SEK 50 M in the form of a bank overdraft and an additional SEK 50 M in promissory credit.

Capital expenditure

Capital expenditure was SEK 7.6 M (3.9) during the first quarter, and comprised mainly capitalised development costs of SEK 6.4 M (3.3).

Miscellaneous

Parent Company

Net sales in the Parent Company were SEK 93.5 M (98.4) and net profit was SEK 5.5 M (11.0) for the period. The Parent Company had cash and cash equivalents of SEK 68.5 M (59.0) at the end of the period.

Employees

The average number of employees in the quarter was 77 (72) and, at the end of the quarter, the company had 79 (72) employees.

NET SALES AND OPERATING PROFIT, SEK M

	Jan - Mar 2013	Jan- Mar 2012
Net sales	93.2	125.5
Cost of goods sold	-69.5	-84.5
Gross profit	23.7	41.0
Gross margin, %	25.4	32.7
Expenses	-27.5	-28.4
Operating profit	-3.8	12.6
Operating margin, %	-4.1	10.1

Risks and uncertainties

Pricer's results and financial position are affected by a number of risk factors that must be taken into consideration when assessing the Group and the Parent Company and their future potential. These risks primarily concern developments in the ESL market. Given the customer structure and the large size of the contracts, any delay in installations may have a significant impact on any given quarter. For additional risks, please see the annual report.

Related parties

There have been no significant transactions involving related parties that could have a material impact on the financial position and earnings of the Group or the Parent Company.

Accounting principles

This interim report showing the consolidated accounts has been prepared in accordance with IAS 34, Interim Financial Reporting, and applicable regulations in the Swedish Annual Accounts Act. This interim report for the Parent Company has been prepared in accordance with the Swedish Annual Accounts

ISSUED AND OUTSTANDING SHARES

Stated in thousands of shares	Serie A	Serie B	Total
At the beginning of the year 2013-01-01	226	109 666	109 892
As at the end of the period 2013-03-31	226	109 666	109 892

Class A share holds five votes and class B share one vote

Act, Chapter 9, and RFR 2. Accounting principles applied for the consolidated and the Parent Company accounts are consistent with the principles applied in the most recent annual report.

The new or amended IFRS that came into effect on 1 January 2013 has had no material effect on the consolidated financial statements, except that the amended IAS 1 has led to a new structure of the items shown in other comprehensive income. The comparative year has been adjusted in line with this.

Outlook

In 2013, higher net sales, but slightly lower operating profit, are expected because of a lower gross margin. This is due to an adjusted product mix.

Next reporting date

The interim report for January – June 2013 will be published on 23 August 2013.

Stockholm, 24 April 2013 Pricer AB (publ)

Fredrik Berglund CEO

This report has not been subject to review by the auditors

(The interim report is a translation of the Swedish original for the sake of convenience)

In its capacity as issuer, Pricer AB is releasing the information in this interim report for January – March 2013 in accordance with the Swedish Securities Exchange Act (2007:528). The information was distributed to the media for publication at 13.50 CEST on Wednesday 24 April 2013.

For further information, please contact: Fredrik Berglund, CEO or Harald Bauer, CFO, Pricer AB +46 8 505 582 00

STATEMENT OF CONSOLIDATED COMPREHENSIVE INCOME IN SUMMARY

	Q 1	Q 1	Fyll year
Amounts in SEK M	2013	2012	2012
Net sales	93.2	125.5	549.2
Cost of goods sold	-69.5	-84.5	-377.9
Gross profit	23.7	41.0	171.3
Selling and administrative expenses	-22.5	-24.5	-84.4
Research and development costs	-5.0	-3.9	-17.2
Operating profit	-3.8	12.6	69.7
Net financial items	-0.3	-1.2	-3.1
Profit before tax	-4.1	11.4	66.6
Income tax	0.2	-0.5	-31.0
Profit for the period	-3.9	10.9	35.6
Other comprehensive income
Items that have or may be accounted for in the profit for the period
Translation differences	-10.2	-3.7	-12.4
Cash flow hedges, net	0.5	-	0.2
Tax relating to items in other comprehensive income	0.4	-	4.6
Net comprehensive income for the period	-13.2	6.0	28.0
Profit for the period attributable to:
Owners of the Parent Company	-3.9	10.9	35.6
Non-controlling interest	0.0	0.0	0.0
Other comprehensive income for the period attributable to:
Owners of the Parent Company	-13.2	6.0	28.0
Non-controlling interest	0.0	0.0	0.0

EARNINGS PER SHARE

	Q 1	Q 1	Full year
	2013	2012	2012
Basic earnings per share, SEK	-0.04	0.10	0.33
Diluted earnings per share, SEK	-0.04	0.10	0.33
Number of shares, millions	109.9	108.5	109.3
Diluted number of shares, millions	109.9	109.1	109.5

NET SALES BY GEOGRAPHICAL MARKET

	Q 1	Q 1	Full year
Amounts in SEK M	2013	2012	2012
Europe, Middle East and Africa	79.4	110.8	454.1
America	11.4	13.4	64.8
Asia & the Pacific	2.4	1.3	30.3
Total net sales	93.2	125.5	549.2

Amounts in SEK M	31/03/2013	31/03/2012	31/12/2012
Intangible fixed assets	244.7	248.1	247.2
Tangible fixed assets	7.9	4.2	7.5
Deferred tax assets	102.7	124.8	101.7
Total fixed assets	355.3	377.1	356.4
Inventories	155.5	131.1	142.0
Current receivables	206.8	215.7	264.4
Cash and cash equivalents	84.4	78.5	45.7
Total current assets	446.7	425.3	452.1
TOTAL ASSETS	802.0	802.4	808.5
Shareholders' equity	690.3	701.4	703.4
Non-controlling interest	0.1	0.1	0.1
Total equity	690.4	701.5	703.5
Long-term liabilities	2.7	2.3	4.3
Short-term liabilities	108.9	98.6	100.7
Total liabilities	111.6	100.9	105.0
TOTAL EQUITY AND LIABILITIES	802.0	802.4	808.5
Pledged assets	60.4	60.4	60.4
Contingent liabilities	0.7	1.0	0.8
Basic shareholders' equity per share, SEK	6.28	6.46	6.44
Diluted shareholders' equity per share, SEK	6.28	6.43	6.42

STATEMENT OF CONSOLIDATED FINANCIAL POSITION IN SUMMARY

STATEMENT OF CHANGES IN CONSOLIDATED EQUITY IN SUMMARY

	3 months	3 months	Full year
Amounts in SEK M	2013	2012	2012
Equity at beginning of period	703.5	691.6	691.6
Result for the period	-3.9	10.9	35.6
Other comprehensive income for the period	-9.3	-4.9	-7.6
Net comprehensive income for the period	-13.2	6.0	28.0
Share issue	-	3.7	10.6
Dividend	-	-	-27.2
Share based payments, equity settled	0.1	0.2	0.5
Total transactions with owners of the Group	0.1	3.9	-16.1
Equity at end of period	690.4	701.5	703.5
Attributable to:
- Owners of the Parent Company	690.3	701.4	703.4
- Non-controlling interest	0.1	0.1	0.1
Total	690.4	701.5	703.5

STATEMENT OF CONSOLIDATED CASH FLOWS IN SUMMARY

	Q 1	Q 1	Full year
Amounts in SEK M	2013	2012	2012
Profit before tax	-4.1	11.4	66.6
Adjustment for non-cash items	3.8	1.2	10.2
Paid income tax	-0.3	-1.4	-15.6
Change in working capital	47.4	9.3	-38.0
Cash flow from operating activities	46.8	20.5	23.2
Cash flow from investing activities	-7.6	-3.9	-18.1
Cash flow from financing activities	-	3.7	-16.7
Cash flow for the period	39.2	20.3	-11.6
Cash and cash equivalents at beginning of period	45.7	58.8	58.8
Exchange-rate difference in cash and cash equivalents	-0.5	-0.6	-1.5
Cash and cash equivalents at end of period	84.4	78.5	45.7
Unutilised bank overdraft facilities	50.0	50.0	50.0
Disposable funds at end of period	134.7	128.5	95.7

KEY RATIOS

	Q 1	Q 4	Q 3	Q 2	Q 1
Amounts in SEK M	2013	2012	2012	2012	2012
Order entry	143	76	112	198	126
Order entry - rolling 4 quarters	528	512	584	616	570
Net sales	93.2	144.1	121.8	157.7	125.5
Net sales - rolling 4 quarters	516.9	549.1	596.9	641.2	627.4
Operating profit	-3.8	11.4	16.9	28.7	12.6
Operating profit - rolling 4 quarters	53.3	69.6	84.7	93.9	81.7
Profit for the period	-3.9	-7.5	13.6	27.1	10.9
Cash flow from operating activities	46.8	9.3	-29.3	22.7	20.5
Cash flow from op.activities - rolling 4 quarters	49.5	2.7	43.6	27.6	-3.5
Number of employees, end of period	79	73	71	74	72
Equity ratio	86%	87%	89%	86%	87%

STATEMENT OF INCOME AND STATEMENT OF COMPREHENSIVE INCOME OF PARENT COMPANY IN SUMMARY

STATEMENT OF INCOME

	3 months	3 months	Full year
Amounts in SEK M	2013	2012	2012
Net sales	93.5	98.4	439.6
Cost of goods sold	-72.2	-71.6	-336.2
Gross profit	21.3	26.8	103.4
Selling and administrative expenses	-9.7	-10.4	-35.5
Research and development costs	-5.0	-3.9	-17.2
Operating profit	6.6	12.5	50.7
Income and expenses from financial items	-0.4	-1.0	-2.8
Profit before tax	6.2	11.5	47.9
Income tax	-0.7	-0.5	-25.6
Profit for the period	5.5	11.0	22.3

STATEMENT OF COMPREHENSIVE INCOME

	3 months	3 months	Full year
Amounts in SEK M	2013	2012	2012
Profit for the period	5.5	11.0	22.3
Items that have or may be accounted for in the profit for the period
Translation differences	-2.6	-0.9	-3.0
Cash flow hedges, net	0.5	-1.6	0.2
Tax relating to items in other comprehensive income	0.4	0.4	4.6
Net comprehensive income for the period	3.8	8.9	24.1

PARENT COMPANY BALANCE SHEET IN SUMMARY

Amounts in SEK M	2012-12-31	2011-12-31	2012-12-31
Intangible fixed assets	34.3	24.9	29.8
Tangible fixed assets	6.3	2.0	5.7
Financial fixed assets	371.7	396.9	371.4
Total fixed assets	412.3	423.8	406.9
Inventories	122.7	100.5	115.4
Current receivables	141.3	123.6	185.1
Cash and cash equivalents	68.5	59.0	29.8
Total current assets	332.5	283.1	330.3
TOTAL ASSETS	744.8	706.9	737.2
Shareholders' equity	646.0	646.8	642.2
Total equity	646.0	646.8	642.2
Provisions	8.0	10.3	8.1
Long-term liabilities	0.1	0.1	0.1
Current liabilities	90.7	49.7	86.8
Total liabilities	98.8	60.1	95.0
TOTAL EQUITY AND LIABILITIES	744.8	706.9	737.2
Pledged assets	59.6	59.6	59.6
Contingent liabilities	-	-	-

PARENT COMPANY STATEMENT OF CHANGES IN EQUITY

	3 months	3 months	Full year
Amounts in SEK M	2013	2012	2012
Equity at beginning of period	642.2	634.2	634.2
Net comprehensive income for the period	3.8	8.9	24.1
Share issue	-	3.7	10.6
Dividend	-	-	-27.2
Share based payments, equity settled	-	-	0.5
Equity at end of period	646.0	646.8	642.2

About Pricer

Pricer provides the retail industry's leading electronic display and Electronic Shelf Label (ESL) platform, solutions, and services for intelligently communicating, managing, and optimizing price and product information on the retail floor. The platform is based on a two-way communication protocol to ensure a complete traceability and effective management of resources. The Pricer system significantly improves consumer benefit and store productivity by simplifying work in the store.

Pricer, founded in 1991 in Uppsala, Sweden, offers the most complete and scalable ESL solution. Pricer has installations in over 50 countries with the largest ESL world market share. Customers include many of the world's top retailers and some of the foremost retail chains in Europe, Japan and the USA. Pricer, in co-operation with qualified partners, offers a totally integrated solution together with supplementary products, applications and services.

Pricer AB (publ.) is quoted on the Nasdaq OMX Stockholm, Small Cap list. For further information, please visit www.pricer.com

Sweden

Visiting adress: Västra Järnvägsgatan 7 SE-111 64 Stockholm Sweden

Pricer AB Website: www.pricer.com Box 215 Telephone: +46 8 505 582 00 SE-101 24 Stockholm Corporate Identity number: 556427-7993