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2017-01-26

TagMaster AB: Year end report for TagMaster AB January-December 2016

Press release, Stockholm, Sweden 26 January 2017

High growth and strong finish

Fourth quarter

· Net sales increased during the fourth quarter by 75,5% to 40,1
MSEK (22,8)

· Result before depreciation (EBITDA) was 5,0 MSEK (1,2),
corresponding to a margin of 12,4% (5,4)

· Net result after tax was 8,6 MSEK (4,3)
· Result per share was 0,05 (0,03)
· Both CitySync and the recently acquired Balogh made a positive
quarter and the parent company made its best quarter ever with a
result before depreciation (EBITDA) of 4,8 MSEK (1,1)

· Cash flow from the business for the period was 2,0 MSEK (-2,1)
January - December

· Net sales increased during the period by 44,2% to 114,0 MSEK
(79,0)

· Result before depreciation (EBITDA) was 3,8 MSEK (2,7),
corresponding to a margin of 3,3% (3,4)

· Net result after tax was 4,2 MSEK (3,2)
· Result per share was 0,03 (0,02)
· Cash flow from the business for the period was 0,8 MSEK (5,2)
· No dividend is proposed
Comments by the CEO

Our sales during the fourth quarter has been good for TagMaster and
CitySync as well as Balogh have achieved positive results.

We see that our turnaround work with CitySync, which principally is
ready now, has effect and our new products started delivery during
the quarter and were well received. Our sales during the quarter
ended according to plan and we will now speed it up.

During the quarter, we also started a turnaround work with Balogh with
the purpose to lower personnel costs as well as other costs, decrease
the number of products and simplify the business processes. The cost
savings are estimated at around 6 MSEK on a yearly basis and we
expect the work to be done during the first half year 2017.

Our Rail business has been good during the quarter and product
deliveries have continued for the big rail project announced at the
end of 2015 and for another smaller project. Deliveries will
continue, somewhat slower, during 2017. We are approaching the end of
a development project for a new Railtag, with a 20-year lifetime,
which will be used in these two projects, but also for other future
projects. We already see indications that our acquisition of Balogh
will increase our total offering to the rail market and that our
complementary product assortment is well received by our common
customers. Balogh has during the end of the quarter announced new
projects for delivery during 2017. We have already started the work
to integrate our sales and development resources within rail and we
expect our joint offering to contribute positively already during the
second half of 2017.

Our Traffic business has had a constant development during the
quarter, while the margin continues to develop positively for our
important product groups. The US market has been somewhat slower than
planned and the Nordics and some European markets have continued to
be slow. We will continue to increase our market efforts among others
by participating in more fairs during 2017 and by new recruitment in
sales. We have during the fourth quarter started launching our UHF
products in the French market through the sales channels of Balogh
and in the beginning of 2017 we will let our local sales forces sell
our complete assortment, which means RFID and ANPR products. We see
that we with three home markets (The Nordics, UK, France) are able to
integrate and streamline our sales work and we will therefore create
an EMEA sales organization during early 2017. We will also continue
the work with developing more products in RFID and ANPR and several
of these will be launched during 2017.

Our quarterly result of 5 MSEK (1,2) is clearly a good result to be
satisfied with even if we still have work to be done.

Jonas Svensson

CEO

For further information, please contact:

Jonas Svensson, CEO, +46 8-6321950, jonas.svensson@tagmaster.com

This information is information that TagMaster AB is obliged to make
public pursuant to the EU Market Abuse Regulation and the Securities
Markets Act. The information was submitted for publication, through
the agency of the contact person set out above, at 8.30 a.m. CET on
January 26, 2017.

About TagMaster

TagMaster is an application driven technology company that designs and markets advanced identification systems and solutions based on radio & vision technology (RFID & ANPR) for demanding environments. Business areas include Traffic Solutions and Rail Solutions sold under the brands TagMaster, CitySync and Balogh with innovative mobility solutions in order to increase efficiency, security, convenience and to decrease environmental impact within Smart Cities. TagMaster has dedicated agencies in the US and in China and exports mainly to Europe, The Middle East, Asia and North America via a global network of partners, systems integrators and distributors. TagMaster was founded in 1994 and has its headquarters in Stockholm. TagMaster is a public company and its shares are traded on First North stock exchange in Stockholm, Sweden. TagMasters certified advisor is Remium AB.

www.tagmaster.com

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http://news.cision.com/tagmaster-ab/r/year-end-report-for-tagmaster-ab-j...
http://mb.cision.com/Main/1590/2173636/619157.pdf

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