Member Info for dc2_

Heres hoping.....I am probably not as far down the rabbit hole as you (I may be) including the duration, having never got in before that incredible rise. 50p plus would be nice :o) I think this is the year for change in either direction - hard debt payments, HMRC payment and major contract renewals - if they can get through that without raising extra cash I think they will be back on trak (yes). Latest job posting talks about continued growth (ok, it is an ad) - the only thing I did not like about it was the number of devices (down to 255k - probably a typo and irrelevant for the job listing).

Not that it matters but that 6,770 (at 14.63p) - mid price 14.75p - was a purchase by me. I assume there is a large sell in the background or the MMs don't want to hold that many so sold some of the earlier 15,000 sell to me, below what they paid, gulp.

Against all odds, I am feeling upbeat about Trak at the moment (is this some psychological disorder!?) - I think this will turn on a few RNSs. But equally, I am prepared to lose my holdings if it came to that (obviously, I don't want that to be the outcome).

I think it all hinges on these contract renewals, so fingers crossed. Hopefully we will get these and more - still would like the directors to buy some, but....

So what is you take on the RNS? Yes, it is pretty boring but does this firmly under pin th 29p fair value viewpoint - I would imagine so.

https://wp-allenby-2020.s3.eu-west-2.amazonaws.com/media/2022/07/Allenby-Capital-TMT-Update-11.07.22-ENSI.L-CPX.L-OSI.L-ECSC.L-TRAK.L.pdf?c3106=on

Trakm8 Holdings plc* (TRAK.L, 15p/£7.5m)
Contract win: Further progress in usage based insurance (06.07.22)
• Contract awarded by Love Your Miles for the provision of devices, a custom app and platform services for
Love Your Miles' insurance propositions. Love Your Miles is a new usage based insurance (or 'Pay as You
Drive') that will start writing policies this month. Co-founders and managing directors Stuart Whalley and
Chris Pryor are experienced in the insurance sector and were both formerly at Fresh Insurance.
• Policy purchasers will be sent a MileMeter, a Trakm8 hardware device, that is installed in the OBD port of
the vehicle to track the vehicle's actual mileage. If the customer travels fewer miles than predicted, the
could qualify for a discount at the time of renewal.
• No change to forecasts or 29p/share fair value.

and then QTX put out a stunning TU

https://uk.advfn.com/stock-market/london/quartix-technologies-QTX/share-news/Quartix-Technologies-PLC-Interim-Results-Timetable/88557994

"The Company achieved excellent growth in new units installed during the Period, which were 26% ahead of the equivalent period in 2021. These totalled 32,085 units, which was the highest recorded growth ever for a 6-month period"

Wish Trak could do similar...

Nice positive post....comments worth a read.....one way to look at it (especially those with large holdings) is that we own some of that.

"On Wednesday we celebrated Trakm8's 20th Anniversary by gathering for a Summer BBQ Party and a company-wide meeting. This was a special moment for the business and was thoroughly enjoyed by all. On this special year of our company anniversary, we want all our customers to know that your support and trust have been the biggest drive towards our continued growth. Thank you for inspiring us to do better over the years. Giving you the best products and services is what motivates us to continuously improve our services. We would also like to say a huge thank you to all the staff that have contributed to the success of Trakm8 over the last 20 years. "

https://www.linkedin.com/posts/trakm8_on-wednesday-we-celebrated-trakm8s-20th-activity-6951123066336784386-Egs7?utm_source=linkedin_share&utm_medium=member_desktop_web

As you say, we may be worrying over nothing.....

I look at it and wonder how they could raise from dilution. Given what Pianista said, it would not look good for Microlise. So you imagine, a raise at this share price is ultimately allowing Microlise to buy a bigger percentage as part of an ultimate take-over (no clue). To be clear, I mean that Microlise would get first refusal on such an investment and they would be likely to snap it up (because it would be cheap).

If they do need cash then I think it is more likely that a change in terms to the existing loans and/or a new loan will happen. That is what I would hope for (obviously, I hope they don't need any extra cash).

One thing for sure, I would not put anything past the BoD.

It will be spun as needed for growth....

I think one is coming but a dilution at this price would be very bad. Who sells at 14p when the update was quite rosy (ok, we don't know why they sold).

Completely agree, I have thought this for a long time now but they do not seem to care. Ok, perhaps they are too busy on the day job.

And the award for the most unloved company goes to......

This is good news, especially as they commence shipping this month. Huge spread at the moment, so doubt the share price will stay up (from experience). Interesting that this is they are a competitor to ByMiles, does that leave a bad taste in the mouth for ByMiles? Also, MarketStudy a key partner/investor - they own Vision Track (a competitor of sorts), suggests Trakm8 are successfully diversifying into areas VT are not interested in.

It is a good point about the 60% increase..... the update was not bad at all, but the continued decline in the share price, in the face of that update, is concerning. Ok, I know the broader markets are also down - and some other shares have been much worse, but it still feels bad.

Here is my view of the world.

Bear case

From £2.4m in the bank, they have managed to get it down to £1m and increase the debt by £0.5 in the process. £0.9 was PAYE and another is coming from the £1m cash in hand. Servicing existing debt may have been part of the £1.9m outflow of cash but this has only been happening since Sept, so they will be under pressure. Especially as H2 is historically their best half.

Their going concern tests assume a 10% loss in fleet and insurance (I may have misintepreted this) with increaed costs. If they do not get the contract renewals they have previously mentioned then I think they will breach this.

They will need to raise cash, but at this share price it will be hard and will serverly dilute the shares. I am not sure if Raza will appreciate that. More likely, Raza will take over the company for a nominal value (like he is waiting in the shadows, hence no M&A activiy by Microlise), remove the bloat and sort out the finances and extract the potential of Trak's offering.

Bull case

Company with state of the art offerings, who have invested a lot in R&D and this is just about to start to pay dividends. Market forces/inflation means fleets need to save costs and telematics could be the answer. Post covid pick up continues at a pace, a company who is attracting some pretty impressive clients who you imagine have done their due diligience, so all is good. Not only that, but it is in the interest of those clients to sell to their users for their own ends, so indirectly takes pressure away from Trak having to sell.

A tough period of debt repayment but they manage as revenues increase, and a renegotiation of finances is agreed to take the pressure away from their existing term loans. No need for a new injection of share holder cash. Contract renewals happen and additional marketing spend/pipeline provide client windfall. Reduced costs of the year amplify profit.

Significant re-rating (and a party on KYK's multi-million pound yacht [which they can afford as a result])

Summary

In other words, we are in a fifty fifty position at the moment and it could go either way. It mainly depends on the contract renewals, debt servicing and a significant boost in insurance devices.

I too am concerned about this..... can anyone explain this to me?

"Net debt excluding IFRS 16 lease liability of £1.6m (FY-2021 £1.9m) increased by £0.5m to £5.4m (FY-2021:
£4.9m). Cash balances total £1.0m (FY-2021: £2.4m)"

So, debt has increased and there is less cash - so £1.9m more spent over the year, and clearly this cannot occur again. Am I missing something?

I agree - unless it was a delayed one from when the price was higher yesterday (but that seems too small to me to be that delayed) - however, price seems to be very low for the size (relative to the others)

Also the annual report

https://www.trakm8.com/wp-content/uploads/Trakm8-Annual-Report-March-2022.pdf

Whatever is happening, people are selling at 14p. I assume it is for better opportunities or just being sick of this share going nowhere.

I thought the broker note was good, and yes the fair value was a bit disappointing when compared to the Arden one. If they get the contract renewals and a large increase in insurance devices (which should not be that difficult - they have the clients, the clients just need the end-user demand which is in their interest to do) then this should get to 29p easily (famous last words). If they don't then (let's not go there).

Haven't read it yet, but they have updated this (so the date at the bottom says). This is where they talk about the one million connections (although the broker note yesterday gave a good indication of how they may achieve this)

https://www.trakm8.com/investors/company-information/corporate-governance/