Trakm8 (TRAK) H1 2025 earnings summary

Executive summary

• Revenue for H1 2024 was £8.31m, down from £8.54m year-over-year, mainly due to lower Insurance and Automotive sales, partially offset by growth in Fleet and Optimisation.

• Gross margins improved, driven by strong software sales and contract renewals with Iceland and Sainsbury's.

• Adjusted profit before tax was £0.02m, compared to £0.12m in H1 2023; profit after tax rose to £0.14m from £0.11m.

• Insurance device sales and recurring revenues declined due to market challenges and reduced connections.

• A new £1.0m convertible loan note was issued to fund investment in Driver Risk solutions and support working capital.

Financial highlights

• Revenue: £8.31m (H1 2024) vs £8.54m (H1 2023); recurring revenue £4.51m vs £5.23m.

• Adjusted profit before tax: £0.02m (H1 2024) vs £0.12m (H1 2023).

• Profit after tax: £0.14m (H1 2024) vs £0.11m (H1 2023).

• Net bank debt increased to £6.66m from £5.57m year-over-year.

• Cash generated from operations: £0.35m (H1 2024) vs £2.35m (H1 2023).

Outlook and guidance

• Insurance and Automotive device sales expected to remain weak through Q3 FY2025, with potential recovery in Q4 FY2025.

• Fleet and Optimisation pipeline remains strong, with significant contract opportunities in H2 2024/25.

• Full-year outcome remains uncertain due to Insurance market volatility, but Board expects improved revenues over prior year.

• FY2026 Insurance and Automotive volumes remain uncertain but anticipated to improve on FY2025.