LONDON (ShareCast) - Software Radio Technology’s (SRT) annual profits soared as revenues rose on the back of demand for automatic identification systems (AIS) in the maritime market.

The developer and provider of maritime identification and tracking technologies posted a pre-tax profit of £1.2m for the year ended March 31st, up from £0.2m the previous year.

Revenue rose to £10m from £6.2m, boosted by strong performance in Mexico, Russia and European Union fisheries.

"These markets are driven by regulatory fit requirements and are in their early stages with further substantial demand expected in the future," said Chairman Simon Rogers.

"As is the nature of these markets, order inflow was lumpy across the year and remains difficult to predict accurately. However, we also saw a steady increase in our core business where customer orders are driven by general non-mandated demand and I am pleased to report that this is considerably easier to forecast."

Gross margin was at 46%, below the long-term target of 50% and last year’s 51%, due to higher than expected weighting of lower margin products and exceptional costs related to early production runs of new products.

The group, however, expects its investments over the past three years will result in long term margin across all products.

During the year, the company kept tight rein on costs despite substantial development and customer support activities.

As year end, the company was debt free with cash of £1.5m.

Simon Tucker, Chief Executive of SRT, said: "The global market for AIS has made substantial progress this year with many pending projects entering their implementation phase and many more new projects materialising.

"In parallel we have continued to execute our strategy to be the global source provider of AIS technologies and products through building our customer network to over 110 customers and broadening and improving our product range. SRT is in pole position to reap the rewards from the global AIS opportunity."

Shares fell 7.50% to 27.75p at 09:59 Tuesday.

RD

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