interim report january-march 2004

M A K E Y O U R N E T W O R K S M A R T E R

Interim Report January-March 2004

Ray Mauritsson, CEO

Highlights Q1 2004

Continued growth for Video, +23% Weak sales development for Print Launch of new generation video

products

Financial performance Q1 2004

Net sales: SEK 152 M (153) Currency effects impacted

negatively: SEK 14 M Operating loss: -6 M (1)

Sales Q1 2004

64%Print 28%

Scan & Store 3%

Access and other 5%

Video

23%

26%

51%

Asia

Americas

EMEA

Sales by Product Group Sales by Region

Sales by quarter

Q1: Continued growth

in Video Currency effects

and weak Print sales

MSEK

2004

Video

Other

2003

0

20

40

60

80

100

120

140

160

180

Q1 Q2 Q3 Q4 Q1

EBIT by quarter

-10

-5

0

5

10

15

20

25

30

Q1 -03 Q2 -03 Q3 -03 Q4 -03 Q1 -04

MkrQ1: Gross margin:

49.3% (53.7) Operating margin:

-3.9% (0.4)

Gross margin by quarter

0

10

20

30

40

50

60

Q1 -03 Q2 -03 Q3 -03 Q4 -03 Q1 -04

%

This is Axis

A global market leader in network connectivity

20 years of network experience Sales in more than 70 countries Global network of distributors,

systems integrators, resellers and solution partners

Axis’ two main product areas

Network Video Products Worldwide #1 position Axis’ largest product area,

64% of sales An installed base of more

than 300,000 units

Network Print Servers Worldwide #2 position 28% of Axis’ sales An installed base of more

than 2,000,000 units

Strategic direction

Maximize the video opportunity

Protect the printing business

Nurture new ideas for future growth

A growing video market

Significant growth potential¬ Growing interest in surveillance and

security¬ Shift from analog to digital solutions¬ New technical possibilities

0

50

100

150

200

250

300

350

400

-98 -99 -00 -01 -02 -03

SEK M

Video sales development 1998-2003

Benefits of network video

Remote access to Video from any location

Low start-up and operating costs Flexible and scalable solutions

based on open standards¬ Integration possibilities

Future proof technology

Axis compared with the competition

Dedicated to IP solutions Global coverage Easily available Widest range Own technology Over 150 ADP partners

Axis’ competitive advantage

Own ASIC and compression chip¬ Performance, image quality and lower cost¬ ETRAX and ARTPEC

Experience¬ 9 years of imaging experience¬ 20 years of networking experience

Only open standards

Trends - Technology

New technology is opening up possibilities in image quality and functionalities

Examples:

¬ Megapixel ¬ Pictures scalable to any format¬ License plate recognition¬ Digital PTZ

101001010100011101

New generation video products

Aggressive roadmap

New compression techniques Higher resolution Full frame rate Built-in wireless solution Power over Ethernet Dome cameras

Axis’ core technology: ARTPEC-2

Real-time compression¬ Up to 45 Megapixel/second

Support for multiple Motion JPEG streams and for MPEG-4 part 2,

Support for a range of CCD and CMOS sensors

Superior image quality¬ Sharpening¬ Backlight compensation¬ Noise reduction¬ White balance

New generation video servers

AXIS 241S ¬ 1 channel video server¬ 768x576, up to 30 fps¬ PTZ control ¬ Video motion detection¬ Strong security package

AXIS 241Q, 4 channels¬ Same as above with 4 channels¬ 30 fps on all channels

New generation cameras

AXIS 210¬ Motion JPEG / MPEG-4¬ 640x480, up to 30 fps¬ Progressive scan CCD¬ Video motion detection¬ Indoor

Outlook 2004

Continued growth potential for Video

Accelerating technology shift An aggressive product roadmap Restrained development for

Print Well positioned for profitable

growth