(Alliance News) - Trakm8 Holdings PLC on Tuesday said its loss narrowed in its most recent financial year thanks to higher revenue combined with reduced cost of sales, as well as lower administrative costs.
Shares in Trakm8 were up 22% at 15.80 pence on Tuesday afternoon in London.
The vehicle tracking company posted a pretax loss of GBP1.7 million for its year ended March 31, sharply narrowed from a GP3.6 million loss the year before.
The narrowed loss was attributed to a 2.5% rise in revenue to GBP19.6 million from GBP19.1 million while cost of sales fell 10% to GBP8.0 million from GBP8.9 million. This gave a gross profit of GBP11.6 million, up 13% from GBP10.3 million in financial 2019.
Additionally, total administrative costs fell 5.7% to GBP13.2 million from GBP14.0 million.
Trakm8 said the momentum it established last year has been disrupted by the Covid-19 pandemic. However, it said it has obtained new contract awards from another two insurance companies so far in its new financial year, adding that revenue from these have already commenced.
Overall, revenue from new insurance contract wins is how compensations for the damage done by the pandemic to the overall market and recent device shipments are ahead year-on-year. Nonetheless, in light of Covid-19, Trakm8 is not providing any guidance for its financial year ending 2021.
The company said it is making use of government support measures including deferred VAT and payroll support via the furlough scheme.
Executive Chair John Watkins said: "Trakm8 has agreed capital repayment holidays with our debt providers and agreed covenants that we are confident are achievable. Based on current forecasts and scenario planning that Trakm8 has undertaken, along with the agreed capital repayment holidays we believe this provides appropriate cash headroom, therefore the group are not currently progressing with a [Coronavirus Business Interruption Loan Scheme] loan.
"Despite the positive trends of the year to date, the uncertainty due to Covid-19 is such that the group is not able to provide forward guidance at this time but will do so as soon as there is more certainty in the market."
By Anna Farley; annafarley@alliancenews.com
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Trakm8 Hldgs (TRAK)