Welcome to the Sensys Gatso Q4 presentation for 2023. During the questions and answers session, participants are able to ask questions by dialing pound key 5 on their telephone keypad. Now I will hand the conference over to CEO Ivo Mönnink and CFO Simon Mulder. Please go ahead.
Good morning, everybody, and welcome to Sensys Gatso's market presentation of the fourth quarter and year-end of 2023. My name is Ivo Mönnink. I am the CEO of Sensys Gatso, and I will be presenting to you together with Simon Mulder, our CFO. In this market presentation, I will provide you with an update on our business for the fourth quarter and year-end of 2023. We then follow up with a financial update by Simon, and finally I will finish this presentation with a summary and our outlook. Now let's look at an update of our business first. In this business update, I will take you through our order intake with strong backlog in our home markets. Strong revenue growth with TRaaS revenue up by 12%. Some special attention for the U.S. market as the driver for our TRaaS growth. Our balanced global revenue distribution.
An update on our large projects in Saudi and Ghana. European nature of our development and supply chain. Our EBITDA that increased by 35% in this quarter and finally our financial results for the year. Order intake and procurement awards during the fourth quarter came in at SEK 212 million compared to SEK 1.1 billion in Q4 2022. The latter was an extraordinary quarter since it included the largest order in the industry from our Swedish customer worth SEK 850 million. In this quarter we have also been awarded an additional SEK 115 million from our Dutch customer raising the contract value to SEK 400 million. The combined value of these two large contracts in our home markets Sweden and the Netherlands is SEK 1.25 billion. We have just started our first system deliveries against these contracts. The remaining backlog is SEK 1.2 billion.
Overall our order intake in previous quarters including new TRaaS contracts provides for a solid revenue generation in the coming years. Our TRaaS revenue for the quarter of SEK 104 million was up by 12% compared to Q4 2022. This recurring business equates to 47% of total sales in the quarter. The growth is mainly related to our U.S. TRaaS managed services business and revenue from our Tasmania Police project in Australia which we started earlier this year. For the full year 2023 the total TRaaS sales amounted to SEK 363 million. An increase of 16% and representing 58% of total revenue. Our Tasmania Police project has contributed SEK 34 million or 10% to our TRaaS sales. The main contributor to our recurring business is our TRaaS managed services business in the U.S. market. This quarter it grew by 27% from SEK 56 million- SEK 71 million.
For the full year 2023 we realized a growth of 22% from SEK 185 million-SEK 226 million. We continue on our growth path in this strategic market for us. During 2023 our expanded sales team has been very active. They executed seven contracts, five trade shows and made more than 40 presentations to potential customers. This already resulted in successful closings. In the first two months of 2024 our sales team signed no less than six new contracts of which four contract renewals including expansions and two new cities in the state of Iowa. The combined value of these contracts is SEK 150 million. With this high commercial activity level we are steadily creating recurring revenue growth and we are gaining market share in the U.S.A. We currently operate our full managed services programs in 43 cities in 11 states across the U.S.A.
In these cities, we automatically enforce speed, red light, or a combination of both. The diversification of our portfolio makes us less vulnerable to changes in state legislation or the loss of a contract. We have arrived at this position because of longstanding experience with answering to customer requirements. Excellent customer relationships and our advanced technology and of course our experienced sales team. With renewed energy, the team has lately been successful signing 13 contracts in the last 14 months. With new states opening up for automated speed enforcement such as Connecticut and Florida, we anticipate further growth. Sensys Gatso is a European company with a global reach and a and a balanced revenue mix. In 2023, the Americas represented 33% of our revenue. Europe 25% and APAC MEA 42%. Our business is built on trust and relationships with road safety governmental customers in more than 70 countries.
We have close relationships with our customers and together we customize solutions to meet local legal requirements. Through this we develop long-term relationships often resulting in add-on sales over time. As anticipated, we have delivered this quarter the remaining 25% of the SEK 270 million contract for our unique vehicle-in-motion solution to our Saudi customer. Building on the excellent customer relationship and satisfaction with our technical capabilities, we are now in discussions with our customer to potentially introduce new enforcement solutions and a service level agreement to maintain the installed base. In December 2022 we signed through a 40% joint venture share in Nationwide Traffic Management Enforcement Ltd. an 11-year contract with the government of Ghana. Our assignment is to design, build, finance, operate, and maintain a nationwide road safety program.
The total revenue of the joint venture is expected to be around SEK 800 million over the 11-year contract period. We are making good progress with the rollout of the project. Software development is at the core of Sensys Gatso's business model and our teams are predominantly in Europe. The hardware design development and production of our systems is in part provided by third-party suppliers in Sweden and partly at our own production facility in Haarlem, the Netherlands. This means that our supply chain dependency on Asia is very limited.
Given our European-centric development model Sensys Gatso is required to meet EU environmental legislations and regulations. Compared to Q4 of last year we see this quarter a SEK 221 million revenue level which is 37% higher than last year. At this revenue level our EBITDA arrived this quarter at SEK 45 million an improvement of 35% compared to Q4 of 2022.
On a 12-month rolling basis our EBITDA increased by 15% SEK 74 million-SEK 85 million. At 21% our EBITDA margin in this quarter is ahead of our 2025 ambition of more than 15%. For the full year 2023 we realized an EBITDA margin of 14% slightly below our 2025 ambition. On the back of our record-breaking order intake in 2022 we're targeting full year 2023 revenues in the range of SEK 550- SEK 650 million and an EBITDA margin of between 10%-15%. With the completion of the deliveries to Saudi Arabia the rollout of the new TRaaS programs in the U.S.A. as well as several other small deliveries I'm very proud that we delivered on the high end of our guidance. Revenues arrived at SEK 724 million and our EBITDA margin landed at 14% or SEK 85 million.
With SEK 1.2 billion of our two large contracts in our home markets still in our backlog and strong sales performance in the U.S. we are now on track to meet our 2025 ambition. On that note I hand over to our CFO Simon.
Okay, thank you Ivo. We have three topics for today: our consolidated income statement, the performance of our segments, and finally our financial position. Looking at the consolidated income statement, we focus on revenue, margins, and profitability. We started the year 2023 with a slow first quarter, which was impacted by project volatility and seasonality impacting our U.S. business operations. In the second half of the year, we've seen more stability in project deliveries by resuming the Saudi in-vehicle project. An increase in our TRaaS managed services revenues in the U.S. and Australia. The total revenue for the fourth quarter ended at SEK 221 million compared to SEK 161 million driven by growth in both system sales and TRaaS revenues. The TRaaS revenues are up by 12% in the quarter and 16% for the full year. The full year revenue has increased by 26%to SEK 624 million.
The group's gross margin is impacted by the mix of revenue between system sales and TRaaS. On average the gross margin moves around 40%. The fourth quarter gross margin ended at 42% due to high margin on TRaaS managed services and an efficient production process on higher volume projects. The full year margin landed at 40%. The operating expenses for the quarter totaled SEK 58 million compared to SEK 54 million for the same quarter last year excluding other operational costs. Year-to-date the expenses amounted to SEK 214 million compared to SEK 203 million. Our operating profit for the period came in at SEK 34 million and SEK 39 million for the full year 2023. Our segment our managed services segment predominantly reflects our U.S. business including the costs related to development and maintenance of our software suite Xilium, Flux. During the quarter we have recorded no new contract signings.
The signings of several new renewals and new contracts have all moved to Q1 of 2024. The total order intake reported in January and February amounts to SEK 150 million. The managed services segment has realized both revenue and EBITDA growth in the fourth quarter which is driven by the investments in the organization in 2022 and throughout 2023. The quarter has seen a significant revenue growth of 30% compared to last year. This increase is caused by an increased volume on existing programs which is partially due to seasonality, and the startup of several new customer projects. From an EBITDA perspective the profitability for the quarter has improved by SEK 8 million. The EBITDA for the segment landed at SEK 15 million for the quarter and SEK 26 million for the full year. Now onto the segment system sales starting with order intake.
During the quarter we have signed SEK 212 million in order intake and procurement awards. The order intake is mainly due to an increased contract value related to the Dutch tender by SEK 150 million from 250 million-SEK 400 million over the contract period of six years. Revenue was up by SEK 46 million driven by project deliveries to Saudi for the vehicle-in-motion project. With the deliveries in the fourth quarter we have now completed the project by delivering 1,000 vehicle-in-motion systems. After the quarter we've received payments on the deliveries of the third quarter lowering our trade receivables on this project by SEK 36 million. In 2023 we have focused on development and customization of the solutions for Sweden and the Netherlands as well as delivering on our Saudi project. During the fourth quarter we've started with deliveries on the Dutch project.
We've been building up work in progress and inventories to be able to roll out the project with higher speed in 2024. The EBITDA for the segment system sales came in at SEK 30 million for the quarter, up SEK 4 million compared to Q4 last year. The full year EBITDA landed at SEK 59 million compared to SEK 40 million, a growth of 48%. Discussing the financial position of our company, I would like to focus on cash movements, interest-bearing debt, and available cash. Our available cash at the beginning of the year amounted to SEK 171 million. Throughout 2023 we have pre-financed big projects such as the order from the Swedish government, the Dutch tender, and the deliveries to our Saudi customer for the in-vehicle solution. This has resulted in an increased working capital position of SEK 103 million, predominantly in inventories, work in progress, and trade receivables.
Both the Swedish and the Dutch projects are expected to speed up in delivery in 2024. After the quarter we've received payment from our Saudi customer on the deliveries of the third quarter totaling SEK 36 million. In 2023 the company has invested in expansion of its fixed assets in operations our software platforms and the Ghana project. Almost 57% or SEK 59 million of these investments relate to investments in fixed assets in operations expanding our fixed base of enforcement equipment in the U.S. as well as in Australia. The development of Flux, Puls and Xilium has continued in 2023 with an investment of SEK 27 million. Since the announcement of the Ghana project through our 40% subsidiary the project has been in a startup phase and an initial setup phase.
This has resulted in investments to 40% of the total costs and investments in the subsidiary to the amount of SEK 10 million. Financing for working capital and the investments in Ghana are done through our credit facility line at Rabobank. The investments in fixed assets in operations are done through our Capex investment facility at Rabobank to the amount of SEK 100 million. Of which approximately SEK 75 million is remaining on top of our available cash position of SEK 84 million. The Capex investment facility will enable Sensys Gatso to finance the U.S. growth in 2024. Due to investments in working capital and in fixed assets our net interest bearing debt has increased to a closing position of SEK 87 million at the end of 2023. On that note I would like to hand it over to Ivo.
Thank you Simon. Our order book is strong with a revenue backlog of SEK 1.2 billion from two large contracts in our home market Sweden and the Netherlands. Our profitable trust business continues to grow and our strengthened team in the U.S.A. proves to be able to push our top line in this strategic market. On top we see our new groundbreaking roadside platform Flux coming to fruition in the market with SEK 624 million of revenue and 40% EBITDA margin we delivered on the high end of our financial guidance for 2023.
We therefore retain our long-term plan and ambition to by 2025 grow our net sales to more than SEK 1 billion of which our trust revenues is more than SEK 600 million and we also retain our ambition to increase our EBITDA margin to more than 15% in 2025. On that note I would like to open up for questions.
If you wish to ask a question please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question please dial pound key 6 on your telephone keypad. There are no more questions at this time so I hand the conference back to the speakers for any closing comments.
Thank you all for attending this, for us, excellent quarter and year result of 2023. Hope to see you again in Q1.
This call is being recorded. Your line is muted.
Joseph.
Okay, Ivo Mönnink, we have some written questions we want to take on right now. The first one is, the question is, is the revenue of SEK 71 million for managed services considered to be a new standard? Are there any new, are there any one-offs? Well, I mean, managed services is on a growth path, so saying it's a new standard would be not doing it a lot of Dutch justice. We are in the mode, in the, in the progress of closing new contracts and expanding on existing contracts. So yes, it will be going up from here. Bear in mind that in this, in this number we also see the number for the Tasmania Police managed services program, so that's also a new.
A new number to be added to managed service and also bear in mind that typically in the United States we've heard about storms , blizzards and et cetera. There is some seasonality in this number which is something we always have to bear in mind in Q4 as well as in Q1. Hope that answers the question. The second question is coming from Niels. The first one was actually from yesterday Jesper von Koch from Redeye. Niels asked could you explain the negative SEK 14.7 million in financial expenses in the cash flow statement. Maybe you could answer that Simon.
Yeah, so what we've seen in currency is that it's been usually volatile throughout 2023. So basically the effects of translating euro loans into Swedish kronor has had a negative impact on the financial expenses throughout the year. Conversely in 2022 we've seen a huge positive impact there. So it has to do with the volatility of the currencies and the Swedish kronor related to other currencies.
Yeah. Okay. This is in Swedish, so this is going to be interesting. But I guess it says how is it going in Uruguay and Colombia. Well, let's start with Colombia. We know that the government has changed there and we know that the program could not be executed because of COVID and budgetary issues in Colombia. We don't see a lot of progress there for the same reason which is budgetary restrictions. So we're not talking with Colombia on how to dissolve this and how to get compensated for this. That's on Colombia. Meanwhile we are doing something completely different. Colombia not working at a national level but working at a municipality level with a number of cities in Colombia. And then on Uruguay we work with a partner. Ciemsa is the name.
They're very active and we see some great progress with new contracts coming out of that region. So all in all Uruguay up Colombia down but at the same time Ecuador is up for us as well. So we see some good progress on the business in Ecuador. So Latin America for us now is a little bit of a mixed bag. Okay no more answers no more questions so I'll leave it at that and thank you once more for attending our call.