Last checked at 21 Sep 2023 07:00
| 21 September 2023 |
Trakm8 Holdings plc
('Trakm8' or the 'Group')
AGM Statement & Trading Update
John Watkins, Executive Chairman of Trakm8 Holdings plc (AIM: TRAK), the global telematics and data insight provider, will make the following statement on current trading at Trakm8's Annual General meeting ("AGM") being held today.
"The financial year has started in line with management's expectations, details of which were set out in the Company's announcement on 4 July 2023. Pleasingly, Fleet and Optimisation revenues have been ahead of last year. However, as anticipated, Insurance revenues continue to be supressed because of the capacity constraints in the Insurance market which have persisted, though the addition of two new customers recently has provided some mitigation to this. Notwithstanding this, a very large increase in the cost of insurance policies has significantly impacted the insurance market.
During the first five months of the current financial year, new unit sales have decreased by 28% to 63,402 (last year's corresponding period: 87,362). With the renewal of insurance policies also impacted, total connections have reduced overall by approximately 6% to 326,000.
The Group has benefitted from the considerably lower levels of overheads following the cost reduction actions taken by the Board last year. We expect revenues for the six months ending 30 September 2023 to be slightly lower than last year's, but with a significantly lower cost base delivering a significantly improved result.
We have recently undertaken a capital investment amounting to £0.5m in our in-house data centres and as a result expect to significantly reduce the external cost of hosting our platforms. The investment and overhead reductions are anticipated to be fully operational by the start of the second half of this financial year. This capital investment is anticipated to save £0.6m per annum.
We had originally expected that during the second half of the current financial year the capacity issues would reduce. However, we now believe that the downside risk of these challenges may continue for the remainder of the financial year. We expect a third new client with capacity to start ordering within the next few weeks. As a result, we expect that the number of connections at year end (31 March 2024) will increase by circa 7% to 350,000, which will be the driver for increased recurring revenues in subsequent years.
As previously advised, our expectations for the financial year remain dependent on both the recovery of the capacity in the Insurance market and ongoing discussions regarding securing a further significant new software contract which we hope will be achieved at the end of the current financial year. We remain confident in our current profit expectations for this financial year; however this will be achieved on lower revenues due to the insurance capacity and pricing issues offset by the lower cost base."
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For further information:
Trakm8 Holdings plc |
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John Watkins, Executive Chairman | Tel: +44 (0) 1675 434 200 |
Jon Edwards, Chief Financial Officer | www.trakm8.com |
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Allenby Capital Limited (Nominated Adviser & Broker) | Tel: +44 (0)20 3328 5656 |
David Hart / Vivek Bhardwaj, Corporate FinanceTony Quirke / Joscelin Pinnington, Sales and Corporate Broking
| www.allenbycapital.com |
About Trakm8
Trakm8 is a UK based technology leader in fleet management, insurance telematics, connected car, and optimisation. Through IP owned technology, the Group uses AI data analytics collected from its installed base of telematics units to fine tune the algorithms that are used to produce its' solutions; these monitor driver behaviour, identify crash events and monitor vehicle health to provide actionable insights to continuously improve the security and operational efficiency of both company fleets and private drivers.
The Group's product portfolio includes the latest data analytics and reporting portal (Trakm8 Insight), integrated telematics/cameras/optimisation, self-installed telematics units and one of the widest ranges of installed telematics devices. Trakm8 has over 326,000 connections.
Headquartered in Coleshill near Birmingham alongside its manufacturing facility, the Group supplies to the Fleet, Optimisation, Insurance and Automotive sectors to many well-known customers in the UK and internationally including the AA, Saint Gobain, EON, Iceland Foods, GSF, Direct Line Group, Ticker and Howden Driving Data.
Trakm8 has been listed on the AIM market of the London Stock Exchange since 2005. Trakm8 is also recognised with the LSE Green Economy Mark.
www.trakm8.com / @Trakm8