State One comments

Revenue at the UK-based ParkingManagement division grew by 42% YoY

(backing out the discontinued Matalanbusiness), reflecting strong contract

growth in the group’s AutomaticNumber Plate Recognition technology; EBITDA

margin growth to 37% from 5%demonstrates the benefit of foregoing low margin

manned contracts in favors ofhigh-margin tech-based business

opportunities. Revenue (external) atthe group’s Technology (sensors/software)

division more than doubled to A$3.2mfrom A$1.6m, while EBITDA - although

still negative - improved to -A$0.5mfrom -A$1.1m.

Target price: increased to A$0.45ps(A$0.38 previously)

Our revised 75:25 weightedDCF/PER-derived target price of A$0.45ps indicates

some 50% upside potential relative tocurrent share price levels. We maintain

a Speculative Buy (Higher Risk)recommendation