Net Insight AB : Interim report January – September 2011

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Net Insight AB [publ] Corporate Reg. No 556533-4397



Third Quarter 2011

·         Net Sales of SEK 75.4 million (67.6) corresponding to a growth of
11.5 % compared with the same period previous year. The growth rate in
comparable currencies amounts to 2 %.

·         Operating earnings of SEK 15.5 million (9.2), corresponding to an
operating margin of 20.6 % (13.7).

·         Earnings per share of SEK 0.04 (0.03).

·         Total cash flow of SEK 4.8 million (-4.2).

January - September 2011

·         Net sales of SEK 214.2 million (199.6) corresponding to a growth of
7.3 % compared with the same period previous year. The growth rate in comparable
currencies amounts to 8 %.

·         Operating earnings of SEK 26.7 million (27.4), corresponding to an
operating margin of 12.5 % (13.7).

·         Earnings per share of SEK 0.07 (0.21), decrease is related to a
positive one time effect in 2010.

·         Total cash flow of SEK -40.5 million (52.3), the cash flow in 2010
included a SEK 60 million positive one time effect.


STRONG REPEAT BUSINESS, NEW IMPORTANT WINS AND GOOD PROFITABILITY

Our third quarter revenue reached SEK 75.4 million (67.6) which is 11 % above
same quarter previous year. Currency adjusted the revenue growth amounted to
2%. The gross margin was strong at 65.8 % (61.1) and also the operating margin
was higher and reached 20,6 % (13,7). Stronger margins and improved finance net
produced a net income before tax of SEK 17 million (9.6). The increased
profitability is driven by good underlying margins, cost control and a positive
currency effect of SEK 2.4 million. The cash flow was positive and our net cash
position increased by SEK 4.8 million to SEK 195.4 million.

On top of steady and profitable repeat business during the quarter we also had
some important new customer wins. We won a contract exceeding SEK 20 million
with a member of the German ARD Group of Broadcasters for a strategically
important extension of their contribution network. Following a successful event
related project in Asia we secured a contract for the build out of a
contribution network with a major operator in China. Via a new partner in Italy
we won a project with Telecom Italia Media Broadcasting (TIMB), which is a major
terrestrial television network operator in Italy, including our video
compression solution.

Our EMEA region has contributed with 69 % (84) of the total revenues. The
Americas contributed 22 % (10) and APAC 9 % (6). Both Americas and APAC are
performing better than last year which is a step in the right direction.

Our partner network is a strategic pillar for our market expansion and an
increasingly important business generator. Our focus going forward is increased
revenue generated per partner before possibly adding new ones. Indirect sales
through partners will vary over time and during the quarter reached the highest
level so far 65 % (46).

We have recently expanded our product portfolio. With the new product releases
we strengthen our access portfolio so that customers can use the Nimbra platform
from the core all the way to the network access. In front of customers it is
important to have a sufficiently large product span and we have now increased
that span significantly and thereby expanded our addressable market. At the same
time this is a new attractive offering and facilitates new entry point business
for our partners.

Net Insight has also been awarded "Best HDTV Technology Project" by Cable and
Satellite International for our successful Digital Terrestrial (DVB-T2) project
with Teracom in Sweden.

As regards the period January to September revenues, gross margin and net income
are up compared with previous year.


Net Insight AB discloses the information provided herein pursuant to the
Securities Market Act and/or the Financial Instruments Trading Act. The
information was submitted for publication on October 25, 2011 at 08.30 am CET.

About Net Insight


Net Insight delivers the world's most efficient and scalable transport solution
for Broadcast and IP Media, Digital Terrestrial TV, Mobile TV and IPTV/CATV
networks.

Net Insight products truly deliver 100 percent Quality of Service with three
times improvement in utilization of bandwidth for a converged transport
infrastructure. Net Insights Nimbra(TM) platform is the industry solution for
video, voice and data, reducing operational costs by 50 percent and enhancing
competitiveness in delivery of existing and new media services.

More than 130 world class customers run mission critical video services over Net
Insight products in over 50 countries. Net Insight is quoted on the NASDAQ OMX,
Stockholm.


For more information, visit www.netinsight.net






Net Insight AB: Interim report January - September 2011:
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