OK, so this is loss making, so is risky, but it is actually a quality share at a bargain basement price and for just 20p, you can get a share of the action! It is near its year low but a new 3 year contract with Renault this morning is the icing on what is actually a rather tasty cake.
ITIS (ITH) when I looked earlier this year i was sceptical but I have gone back and been persuaded after recent results. A host of good contracts for their Estimotion traffic information systems have been won, revenues increased 85% to over 7 million, substantial cost reductions have been made, the cash balances are strong and they have a host of big name clients.

Car manufacturers using ITIS RDS-TMC: Bentley Motors, BMW, Ford, Land Rover, Lexus, Mini, Nissan, Renault, Saab, Subaru, Toyota, VW, Vauxhall Motors

and from the annual report you should read this statement, despite which the shares have fallen since:

The Board believes that the efforts of the last few years have now resulted in a
focused, well managed and fast growing business. There is great demand for all
of our services and with an expanding and prestigious customer base we are well
positioned to reach profitability. We can confirm that we are in active
discussions with most of the vehicle manufacturers who are currently not
customers and are confident that more announcements will follow in due course.
We are pleased to report that we have seen a strong start to the current
financial year and that we see no reason why this will not continue. During the
first two months of the new financial year our losses and cash usage were down
substantially when compared with the same period last year and we expect to
continue to see cash usage decline as a result of growing revenues and a stable
cost base.

Strong Buy, I think!

Bullish AGM statement this morning. :)

The following statement will be read by Sir Trevor Chinn, Chairman of ITIS, at
today's AGM to be held at Station House, Stamford New Road, Altrincham, Cheshire
at 10.00am.

"Trading has been very strong in the first half of this financial year and we
expect the high demand for our services will continue into the second half. Our
interim results for the six months ended 30th September 2004 will be
substantially better than those achieved in the same period last year as a
result of significantly increased revenues and tight cost controls which have
led to a substantial reduction in loss and reduced cash outflow.

Our business is split between into two main operating areas. ITIS collects
traffic information using Floating Vehicle Data (FVD) and our new Estimotion
technology (which anonymously samples the position of mobile phones in moving
vehicles) and distributes it to the automotive sector, (through RDS-TMC,
cellular networks and via short dial premium line numbers) and to both local and
central Government. NavTrak is our stolen vehicle tracking service and is sold
directly to OEM's and fitted to high value vehicles.

ITIS continues to be the market leader in RDS-TMC services and now has contracts
with Bentley Motors, BMW, Ferrari & Maserati, Ford Motor Company, Land Rover,
Lexus, Mitsubishi Motors, Nissan, Renault, Saab, Subaru Europe, Toyota, Vauxhall
Motors and Volkswagen and in the aftermarket with Alpine, Becker, Panasonic,
Pioneer and Siemens VDO. We expect to announce further contracts during the
remaining part of this year ensuring that we remain the major provider of
RDS-TMC in the UK. As RDS-TMC is an international standard we are investigating
how we can use our knowledge together with the Estimotion technology to support
services outside the UK.

In February this year we announced a three year contract to supply historic FVD
to the Department for Transport and we are pleased to report that the DfT is now
starting to use and distribute our data widely. Both national and local
Government are key areas for ITIS and we will build on this contract from the
DfT to maximise revenues from this important sector.

The acquisition of Estimotion in December 2003 has exceeded our expectations. We
have secured O2 as a network partner in the UK and will shortly be taking our
first deployment in Scotland and expect other cities will follow shortly after.
We are working with the Flemish Government and Proximus, the largest network in
Belgium and last week we announced our entry into the US market with a
strategically significant contract to provide real time traffic information in
the Baltimore region. There is considerable interest from Government and
cellular networks around the world for our technology and we will find a balance
between taking advantage of this interest whilst ensuring that we do not over
commit in terms of resources. We will prioritise contracts where there are
immediate revenue streams and where we do not need to invest heavily in people
or infrastructure. Our preference is for licensing or partnerships with either
the cellular networks who can use the data which we produce to provide services
back to their customers or alternatively, those organisations who have access to
other markets where traffic data can be sold. Next month, under the terms of the
acquisition we will pay the next tranche payment of #816,000.

We believe that there is a huge market for real time traffic information using
our technology and we have proven that we can work outside the UK without the
need to use our own delivery channel. We are therefore focussed on using our
understanding of traffic and congestion combined with our knowledge of specific
applications, like RDS-TMC to support customers with the data they need on a
stand alone basis.

NavTrak is performing well as a result of our focus on manufacturer customers
who include Land Rover, Bentley Motors and Ferrari/ Maserati and is now cash
flow positive on a monthly basis.

The Board are extremely satisfied with the financial performance to date and are
pleased to report that with continued strong demand for our services and greatly
reducing losses our cash balances remain strong.