Final Results

Transense Technologies PLC
31 March 2006

31 March 2006



Transense Technologies PLC ('Transense')



Preliminary results for the year ended 31 December 2005



Chairman's Statement



2005 was a year of considerable progress. Turnover was similar to last year at
£553,000 (2004: £563,000) and gross profit was £468,000 (2004: £521,000).
Overheads rose by 10% predominantly because of staff increases and one
retirement settlement, as well as increased executive and staff costs from
greater travel in support of major licensees' requests as the pace of programmes
quickens. This resulted in an increased loss for the year of £874,000 compared
with £683,000 in 2004. Cash at the end of December 2005 was £2.4 million
following the successful placement announced in October.



Our Intellectual Property (IP) base continued to strengthen during 2005. The
number of granted patents per invention increased to 24 from 20 in 2004 and the
number of granted patents around the world based on these inventions is far
higher. The costs of these new additions, and maintenance of those already
granted, came to £143,000 against £136,000 in 2004. Our IP base represents
significant shareholder value considerably in excess of our balance sheet and
will result in strong dividend flow in the years to come as our licensees launch
their product programmes.



This IP is the foundation of our licence deals. Even with strong IP, the
development of new licence contracts often appears to take an inordinate amount
of time, but this is par for the course where valuable licences are concerned.
We recognise this can be frustrating for shareholders and it can also test the
patience of management. Notwithstanding this, we need to be very careful when
negotiating with large world-class companies to fully protect our valuable IP,
regardless of time delays. It is imperative that we get these deals right.



We have finished the Tyre Pressure Monitoring System (TPMS) engineering
development programme for commercial vehicle applications on behalf of a major
licensee and the launch is going ahead this year. We have previously stressed
the importance of this launch since it will trigger the follow on truck
applications in Europe and Asia, as well as expediting other projects,
particularly passenger car TPMS. The licensee is well known for its very
thorough testing and the endorsement this will give Transense's technology will
open up further business opportunities.



The team that had been working on commercial vehicle applications is now
supporting other licensees and potential licensees by installing our TPMS in
passenger cars for demonstration purposes to major automotive Original Equipment
Manufacturers (OEMs).  We have added European TPMS (different specification)
demonstration vehicles to the North American demonstrators and we are in
discussions with Japanese companies. Through our own contacts, together with
those of certain of our licensees, we already have direct links on TPMS with
most of the world's vehicle manufacturers. Our initial target implementation
objective for TPMS on passenger vehicles remains 2007.



We are actively engaged in finalising a further arrangement with a Tier One
system integrator of major significance that is currently heavily involved in
the supply of first generation TPMS. Collaboration with them has involved
incorporating the TPMS into the keyless entry system. We anticipate this will be
the subject of a further announcement over the coming months.



Now that the key components are becoming available, Transense has been exploring
alternative routes to market for TPMS. We have a number of other licence
opportunities under discussion, particularly for the aftermarket. In particular,
we have identified an aftermarket application in conjunction with the fitment of
another safety product. The safety product is already established and marketed
worldwide and one country has recently made fitment mandatory for certain
categories of vehicles. The Transense TPMS enhances this product and a
significant order is expected shortly for delivery this year.



The availability of components has also impacted on STACK. Since taking a
licence for F1 and other motorsport and special applications, STACK have
developed their dedicated version of the Transense TPMS, which they have
presented at a number of international motorsport exhibitions. This has given
rise to a considerable volume of enquiries, which should translate to
potentially valuable orders in the coming months. The endorsement of Surface
Acoustic Wave (SAW) TPMS by motorsport will not go unnoticed by the vehicle and
motorcycle manufacturers behind these teams.



We delivered, under contract, our first prototype driveline torque transducer to
one of the largest automotive groups in the world, which has now been followed
up with a further order for two more systems, one of which will be tested in a
passenger vehicle in the next few months. In addition, another of the big three
automakers has also commissioned us to supply a driveline transducer for test in
its vehicles. These two contracts are extremely important to Transense because,
given successful trials, the market that will open up for our technology in this
area alone is very large.  Our technology has also been selected by a 3 OEM
joint research group for a torque sensing demonstration project in the USA. We
have high confidence these programmes will be implemented over the next two
years and show strong growth thereafter. To enhance these requirements we have
developed a new torque and temperature sensor.



Our Electric Power Assisted Steering (EPAS) torque sensors, which provide a more
direct feel to the steering, continue to attract the attention of relevant Tier
One suppliers, and we are providing support as they demonstrate our technology
to their customers.



The technical development of SAW system components is now virtually complete.
SAW die and packaging, electronic interrogation and antennae, and Application
Specific Integrated Circuits (ASICs) are at, or close to, production status. We
are also in the final stages of making an agreement with another major
international electronic component supplier. The emphasis is now on refining,
extending, protecting and supporting our technological base by working with our
licensees as they finalise their plans to market to the automotive OEMs. In this
regard it is noteworthy that in 2005 two major licensees requested our strong
direct support at these important later stages.



Sensor production has started at Honeywell's Chinese plant. In a recent
restructure, Honeywell formed the Emerging Electronic Solutions Group which has
responsibility for developing all applications of the SAW sensor business.
Transense works very closely with this Group and provides technical support,
particularly for application projects. As part of this teamwork, we have been
developing new applications for SAW sensors in conjunction with vehicle
manufacturers and Tier Ones. Our relationship with Honeywell is developing very
well.



In summary, we continue to make sound progress and are now not far from that
first licensee launch date. We have of course intimated that before, but, as in
all technology developments, hurdles appear and have to be overcome, and
eventually are overcome.  The heavy investment, dedication and persistence of
that first licensee towards ensuring the launch of a perfect new system will
have a significant impact on Transense as our other technologies arrive in the
market place over the coming years.



Once again on behalf of the Board, I thank all in the Transense team for their
hard work over the past year.



P.J. Woods

Chairman











                                             Transense Technologies plc
                               Profit & Loss Account for the Year to 31 December, 2005

                                                                   2005                     2004
                                                                   £000                     £000
Turnover                                                            553                      563
Cost of Sales                                                      (85)                     (42)
Gross profit                                                        468                      521
                                                                                       
Administration expenses                                         (1,500)                  (1,358)

Operating loss                                                  (1,032)                    (837)

Interest income                                                      58                       54

Loss on ordinary activities before taxation                       (974)                    (783)

Taxation                                                            100                      100
Loss for the year                                                 (874)                    (683)


Loss per share                                                   (1.6p)                   (1.3p)

                                         Balance Sheet at 31 December, 2005

                                                      2005         2005         2004        2004
                                                      £000         £000         £000        £000
Fixed assets                                                      1,665                    1,579

Current assets:      Debtors                           598                       590
                     Cash                            2,399                     1,161
                                                     2,997                     1,751
Less: Creditors falling due within one year            288                       242

Net current assets                                                2,709                    1,509

Net assets                                                        4,374                    3,088


Capital and reserves:
                     Share capital                                5,641                    5,376
                     Share premium                                5,368                    3,473
                     Profit and Loss account                    (6,635)                   (5,761)
Shareholders' funds                                               4,374                    3,088



             Cash Flow Statement for the Year to 31 December, 2005



                                                                                 2005          2004
                                                                                 £000          £000
Net cash outflow from operating activities                                      (912)       (1,079)

Returns on investments and servicing of finance                                    58            54

Taxation   Corporation tax received                                               100           100

Net capital expenditure                                                         (168)         (164)
Cash outflow before management of liquid resources and financing                (922)       (1,089)

Management of liquid resources
           (Payments to) / receipts from short term deposits                  (1,200)           850

Financing  Issue of new ordinary shares                                         2,160           179

Increase / (decrease) in cash in the year                                          38          (60)


Reconciliation of operating loss to net cash outflow from
operating activities
           Operating loss                                                     (1,032)         (837)
           Depreciation and amortisation                                           87            77
           Profit on disposal of fixed assets                                     (5)            --
           Net movement in current debtors and creditors                           38         (319)
Net cash outflow from operating activities                                      (912)       (1,079)

Reconciliation of net cash flow to movement in net funds
           Increase / (decrease) in cash in the year                               38          (60)
           Cash outflow / (inflow) from changes in liquid resources             1,200         (850)
           Movement in net funds in the year                                    1,238         (910)
           Net funds at 1 January                                               1,161         2,071
           Net funds at 31 December                                             2,399         1,161







Analysis of net funds                                                      Liquid
                                                                        Resources           Cash          Total
                                                                             £000           £000           £000
        At 1 January                                                        1,100             61          1,161
        Cash flow                                                           1,200             38          1,238
        At 31 December                                                      2,300             99          2,399





Notes to the Preliminary results for the year 2005

1.                  The Accounts

The summary of results for the year to 31 December, 2005 does not constitute
statutory accounts within the meaning of Section 240 of the Companies Act 1985.
The full statutory accounts, which will be available to shareholders shortly,
have been reported on by the Company's auditors but have not yet been delivered
to the Registrar of Companies.



Full accounts in respect of the year to 31 December, 2004 have been delivered to
the Registrar of Companies.  The auditors have reported on the accounts and the
Audit Reports were unqualified and did not contain statements under the
Companies Act 1985, Section 237 (2) or (3).



2.         The Annual Report and the AGM

The Annual Report and Accounts will be posted to shareholders by the end of
April and the Annual General Meeting will be held on 19 May, 2006.


                      This information is provided by RNS
            The company news service from the London Stock Exchange