Total cash flow of SEK -10.4 million (-39.6).
Revenues of 68 MSEK (80 MSEK) are 15 % below the same period in the previous year. The revenue decline is driven by the same events as explained in the full year comment below. In summary it relates to project delays in Eastern Europe, Middle East and Africa while Western Europe and APAC performed well and ahead of previous year. The gross margin reached 59 % (62 %) a difference mainly due to increased depreciation of capitalized R&D. The fourth quarter result is affected by a one-time restructuring charge of 3 MSEK. Excluding the restructuring charge the operating earnings reached 1 MSEK (17 MSEK). The restructuring charge relates to the efficiency and cost reduction program announced in October that reduces our total cost base by 25 MSEK for 2013.
During the quarter we had a good flow of repeat business from customers across the world but it was the first quarter in a long time where we actually did not close any large single projects, which of course affects the result negatively. As communicated earlier, single large projects will have a significant effect on our quarterly financial performance.
Already the first three quarters indicated relatively flat revenues and, with a weak top line in the fourth quarter, we end the full year with total revenues of 280 MSEK (295 MSEK). The reported decline is 5 % and currency adjusted the decline would be 3.5 %. The gross margin reached 60 % (62 %) and the slight decline is mainly due to increased depreciations on capitalized R&D. The full year operating result, excluding the restructuring charge of 3 MSEK, reached 6 MSEK (43 MSEK). The decline is explained by; 22 MSEK of increased Operating Expenses, increased depreciation on R&D by 11 MSEK and lower revenues.
There are three main reasons why we were not able to grow in 2012. Projects identified and targeted for 2012 in Eastern Europe, Middle East and Africa did not materialize as planned and were delayed, but not lost. Secondly, five of our ten largest target project opportunities were DTT-projects, none of which materialized during the year, again not lost but delayed. Thirdly and consequently, the average order size declined significantly meaning more efforts to reach "flat" revenues.
Nevertheless, we had very important customer wins and we launched many new products. Overall we did business with over 100 of our total 175 customers around the world. We did business with over 25 new customers globally. We continued to win the DTT expansions and increase our business and presence in important countries like China and Brazil. The projects became smaller than expected but just as an example, we already count 20 different customers in China where we recently strengthened our presence.
Net Insight AB