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Vehicle navigation system provider Trafficmaster has announced a £1 million increase in its annual operating profit.

Preliminary results for the year to December 31st showed that the company's operating profit reached £6.3 million, based on a 25 per cent increase in overall revenue, which was up to £52.8 million.

Although analysts Broker Bridgewell Securities said they had been expecting a better performance from the group, Trafficmaster chief executive Tony Eales welcomed the results and stressed that the company was looking forward to the forthcoming financial year with confidence.

In a statement Trafficmaster said that an increasing number of motorists were benefiting from their services, including its trademark satellite navigation system which helps drivers to calculate the quickest routes based on live traffic information and real-time road speeds.

According to the company, UK drivers using the Smartnav system have saved the equivalent of 300,000 working days in total as a result.

Trafficmaster said that sales by its in-vehicle unit had doubled over the year, with UK revenues up 26 per cent to £14.7 million and operating profit up 84 per cent to £2.4 million.

Other achievements listed by the company included the standard fitting of Smartnav and its stolen vehicle tracking system, Trackstar, to new Citroen Relay and Dispatch vans and the launch of a new partnership with Norwich Union to provide the technology for the insurer's latest pay-as-you-drive scheme.

Meanwhile, Trafficmaster said that its US subsidiary, Teletrac, had achieved "record" sales in the last quarter having expanded its geographical presence and signed its largest contract to date with Ryder Inc, under an agreement which will initially see the company provide fleet management services for 5,000 trucks.

Welcoming the company's performance, Trafficmaster chief Mr Eales said: "Our strategy of developing long term business partnerships has enabled us to more than double in-vehicle unit sales and to increase revenues and operating profit in 2006.

"The improved sales performance, strong services revenues and tight control over operating costs, have led to improved performance across all our major business segments," he added.