Source - LSE Regulatory
RNS Number : 0865G
Trakm8 Holdings PLC
23 November 2020
 

23 November 2020

TRAKM8 HOLDINGS PLC

("Trakm8" or the "Group")

Half Year Results

Trakm8 Holdings plc (AIM: TRAK), the global telematics and data insight provider, announces its unaudited results for the six months ended 30 September 2020:

Financial Highlights

 

 

6 months to

6 months to

Year to 31

Change

 

30 Sept 2020

30 Sept 2019

March 2020

 

 

Unaudited

Unaudited

Audited

 

 

£000

 

Revenue

7,321

-17%

of which, recurring revenue1

4,635

-5%

Loss before tax

(845)

-62%

Adjusted loss before tax2

(314)

-80%

Loss after tax

(732)

-59%

Cash generated from operations

2,055

+44%

Net Debt3

5,574

-9%

Basic (loss)/ earnings per share

(1.46p)

-59%

Adjusted basic (loss)/ earnings per share

(0.56p)

-78%

 

1 Recurring revenues are generated from ongoing service and maintenance fees

2 Before exceptional costs and share based payments

3. Total borrowings less cash excluding IFRS 16 adjustment for leased property and motor vehicles

 

Operational Overview

·   H1 2020 results:

Significant reduction in losses despite revenue decline as a result of Covid-19

Improving revenues later in the period, following significant drop in April and May upon Covid-19 lockdown

Significantly improved gross margins due to lower hardware, labour, communications and installation costs

Reduced overheads as a result of efficiency improvements implemented in FY2020, which includes lower payroll costs

Improved cash generation from operations due to significant reduction in losses, PAYE & VAT deferments and strong working capital actions

Launch of extended range of self-fit telematics devices

 

·   Continuation of new contract wins and renewals:

Optimisation contract awarded by major UK food retailer

Strong period of contract renewals in the Fleet business, despite Covid-19 all significant contracts due for renewal in the period have been renewed

Installed base increases in Insurance from existing and new customers offset in part by Fleet reductions

Approximately 253,000 connections (March 2020: 245,000 connections), an increase of 8,000 connections, a 3% increase in the six month period since last year end

 

·   Stronger H2 and FY2021 outlook:

Major automotive customer committed to a further 24,000 units over next 12 months following their European launch

Strong level of orders, post period, from existing and new Fleet customers

Additional  efficiency savings implemented

Investment in engineering to deliver additional gross margin improvements over the next 6 months

Outlook

Revenues picked up during the first half with revenues in the second quarter 23% higher than in the first quarter.  This improvement continued into October in both Insurance and Fleet, resulting in this being the highest revenue month to date this financial year.  The Insurance business benefitted from increasing device shipments to both existing and recently won customers resulting in both September and October 2020 shipments being 50% higher than March 2020.  Fleet sales team performance has returned to pre Covid-19 levels, with the total value of orders in the first half 16% up on the first half of the prior year.  Orders in October 2020 were 12% up on October 2019.  

However due to the second lockdown there is a softening in the market and increased uncertainty that means the Group is still not able to provide guidance for the full financial year at this time.  However the Group expects revenue in the second half to be significantly higher than the first half given current orders, even with a reasonable downside scenario taken into account for the ongoing impact of Covid-19.

- Ends -

 

For further information:

Trakm8 Holdings plc

 

 

John Watkins, Executive Chairman

Tel: +44 (0) 167 543 4200

 

Jon Furber, Finance Director

www.trakm8.com

 

 

 

 

Arden Partners plc (Nominated Adviser & Broker)

Tel: +44 (0) 20 7614 5900

 

Paul Shackleton, Head of Corporate Finance

Simon Johnson, Head of Sales

www.arden-partners.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 analyses data collected by 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, self-installed telematics units and one of the widest ranges of installed telematics devices. Trakm8 has over 253,000 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, Direct Line Group and Ingenie.

 

Trakm8 has been listed on the AIM market of the London Stock Exchange since 2005.

 

www.trakm8.com / @Trakm8

 

 

 

Executive Chairman's Statement

Results

I am pleased to report Trakm8's results for the six months ended 30 September 2020.

The first half of the financial year was significantly impacted by the Covid-19 pandemic.  In the early months of the period Fleet activity reduced very significantly.  Sales of insurance policies reduced dramatically as vehicles were "sorned", driving lessons and tests cancelled.  Gradually over the period both Fleet and Insurance demand levels improved.  I am pleased that overall we secured new orders some 10% higher than the same six months of last year.

However, overall revenues reduced by 17% in the period to £7.32m (H1 2019: £8.87m). There was a reduction of £0.53m in Insurance and Automotive revenues and a reduction in Fleet and Optimisation revenues of £1.02m.

Total recurring revenues decreased by 5% during the period to £4.63m (H1 2019: £4.89m), as a result of the decline in the connected base in the Fleet market. The reduction in service fees year on year took place in the early months of the period and have since recovered. Recurring revenues represent 63% of Group revenues (H1 2019: 55%). Covid-19 materially increased Fleet attrition during the period and the slow start for new orders meant new deployments were substantially lower than normal, overall reducing connections by 7,000 units since March 2020 to 70,000 (9%). 

Despite the large reduction in telematics insurance policies being written across the market, our success in rolling out solutions to a number of additional clients has resulted in device shipments 14% ahead of the same period last year with the month of September being 177% greater than April.  As a result, Insurance & Automotive connections increased by 15,000 since March 2020, to 183,000 (9%).  We estimate that the impact of Covid-19 has resulted in circa 33,000 connections less than it would have been.

Gross profit margin has increased to 62% (H1 2019: 53%).  This is due in part to the higher recurring revenues as a percentage of sales but also due to the vigorous actions taken over the past 24 months to introduce hardware with lower costs, reduce the direct labour costs and to reduce the cost of communications and installations.  This trend is expected to continue as further cost improvements are delivered.

Total overhead costs, excluding exceptional costs and share based payments reduced by £1.61m to £4.71m (H1 2019: £6.32m).  This is the result of the cost actions taken over the last 12 months along with £0.77m of furloughed staff costs which have been charged to exceptional costs, which have been offset by £0.55m of furlough grant received.  In addition to this £1.61m reduction in overheads the level of R&D expenditure capitalised has reduced by £0.27m.   Exceptional costs in the period of £0.44m include headcount reduction activity undertaken during the period and costs associated with the impact of Covid-19.

Despite the challenges of Covid-19, I am pleased to report that the Group adjusted loss reduced by 80% to £0.31m (H1 2019: £1.58m).  Loss before Tax reduced by 62% to £0.85m (H1 2019: £2.20m).  We estimated if it had not been for the significant impact of Covid-19 that we would have been profitable under both profit measures.

Financial position

Net cash inflow from operating activities was £2.06m (H1 2019: £1.43m).  During the period the R&D tax claim of £0.86m was offset against agreed PAYE/NI deferments.  At the 30 September £1.10m of VAT and PAYE/NI deferments have been agreed, with a repayment schedule that runs into next financial year.  The improvement in cash inflow from operating activities is a good result, reflective of the significant reduction in losses and continued strong working capital management, which includes a £0.34m reduction in inventory since last financial year end. 

 

The overall cash outflow for the period was £0.12m, which was an improvement of £0.39m from the prior period.  This resulted from the improvement in the cash inflow from operating activities detailed above, and £0.27m reduction in capitalised development costs.

Net debt as at 30 September 2020 excluding the impact of the IFRS16 lease recognition was lower than both September last year and the end of the last financial year at £5.57m (H1 2019: £6.10m) (31 March 2020: £5.64m) including £1.54m of cash (H1 2019: £0.69m). In addition, the Group at 30 September 2020 held an undrawn credit facility of £0.50m at HSBC. Net Debt including IFRS 16 reduced to £7.27m (H1 2019: £8.42m), (31 March 2020: £7.95m).

The revolving credit facility with HSBC of which £4.50m was drawn at 30 September 2020 is due for renewal on 30 September 2021, therefore still had 12 months to run from 30 September 2020.  As a result this is now reported within current liabilities on the balance sheet and the reason why they increased from £7.43m to £11.70m.  The Group expects to extend this facility before year end.

Strategy

The Group has been following the strategy outlined in the 2020 Annual Report. Our focus is to provide ever more meaningful insights to our customers using the data generated by our installed devices and other connections so that they can run their operations more efficiently and safely.

Our primary strategy going forward is to return to growth of our business through more connections, increased device sales and higher service fees. Due to the high level of new contract wins in the Insurance space the number of connections have increased overall by 5% in the past 12 months and by 3% in past 6 months. The number of devices sold has increased by 11% to 49,000 (H1 2019: 44,000). Increased market share is anticipated following the introduction of additional self-fit devices.

Trakm8 has focused on delivering market leading technology and ensuring that the solutions are generating the best possible ROI's for our customers. We have, for another year, further reduced the levels of expenditure in R&D but believe we have appropriate levels of resource to continue to invest heavily to meet the demands of the market and customers. We will continue to own the majority of IP in our value chain. The technical challenges of the RH600 product experienced in previous years have been resolved and new generations of the product will have significant additional features.

Our third strategy has been to improve the efficiencies of our business in every possible way. We have been extremely successful in delivering the £1.5m reduction on all costs year-on-year promised last year (on top of the £2.0m savings delivered in the previous year).  We have continued to focus on this and have implemented a further £0.6m of annualised cost reductions by the end of the period.   We will continue to seek efficiencies as we go forward.

 

 

JOHN WATKINS

Executive Chairman

               
          Unaudited Consolidated Statement of Comprehensive Income for the six months to 30 September 2020

 

 

 

 

Six months to 30 September

Six months to 30 September

Year to
31 March

 

 

 

 

2020

2019

2020

 

 

 

 

Unaudited

Unaudited

Audited

 

 

 

 

£'000

£'000

£'000

 

 

 

Note

 

 

 

 

 

 

 

 

 

 

Revenue

 

 

3

            7,321

          8,867

     19,550

Cost of sales

 

 

 

(2,804)

(4,174)

(7,991)

Gross profit

 

 

 

            4,517

          4,693

     11,559

 

 

 

 

 

 

 

Other income

 

 

4

               103

             213

          364

 

 

 

 

 

 

 

Administrative expenses excluding exceptional costs

 

(4,800)

(6,435)

(11,926)

Exceptional administrative costs

 

 

7

(442)

(501)

(1,296)

Total administrative costs

 

 

 

(5,242)

(6,936)

(13,222)

 

 

 

 

 

 

 

Operating loss

 

 

 

(622)

(2,030)

(1,299)

 

 

 

 

 

 

 

Finance income

 

 

 

                 39

                 3

           12

Finance costs

 

 

8

(262)

(170)

(418)

 

 

 

 

 

 

 

Loss before taxation

 

 

 

(845)

(2,197)

(1,705)

 

 

 

 

 

 

 

Income tax

 

 

 

               113

             410

          612

 

 

 

 

 

 

 

Loss for the period

 

 

 

(732)

(1,787)

(1,093)

 

 

 

 

 

 

 

Other Comprehensive Income

 

 

 

 

 

 

Items that may be subsequently reclassified to profit or loss:

 

 

 

Exchange differences on translation of foreign operations

                   5

                 1

(7)

Total other comprehensive income

 

 

                   5

                 1

(7)

 

 

 

 

 

 

 

Total Comprehensive Loss for the period attributable to owners of the parent

5

(727)

(1,786)

(1,100)

 

 

 

 

 

 

 

Adjusted operating loss before tax

 

6

(314)

(1,583)

(224)

Loss before taxation

 

 

 

(845)

(2,197)

(1,705)

Exceptional administrative costs

 

 

 

               442

             501

       1,296

IFRS2 Share based payments charge

 

 

                 89

             113

          185

 

 

 

 

 

 

 

Loss per ordinary share (pence) attributable to owners of the Parent

 

 

 

 

 

 

 

 

 

Basic

 

 

9

(1.46)

(3.57)

(2.19)

Diluted

 

 

9

(1.46)

(3.57)

(2.19)

 

 

 

 

 

 

 

Adjusted basic loss per share (pence)

 

9

(0.56)

(2.53)

         0.28

Adjusted diluted loss per share (pence)

 

9

(0.56)

(2.53)

         0.28

 

The results relate to continuing operations.

Unaudited Consolidated Statement of Changes in Equity for the six months to 30 September 2020

 

Share capital

Share premium

Merger  reserve

Translation reserve

Treasury  reserve

Retained earnings

Total equity

 

£'000

£'000

£'000

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

 

Balance as at 1 April 2019

500

14,691

1,138

203

(4)

   5,566

22,094

 

 

 

 

 

 

 

 

Comprehensive income

 

 

 

Loss for the period

-

-

-

-

-

(1,787)

(1,787)

Other comprehensive income

 

 

 

Exchange differences on translation of overseas operations

             -

              -

              -

             1

                   -

 -

             1

Total comprehensive income

-

-

-

1

-

(1,787)

(1,786)

 

 

 

 

 

 

 

 

Transactions with owners

 

 

 

IFRS 2 Share-based payments

-

-

-

-

-

113

113

Transactions with owners

-

-

-

-

-

113

113

Balance as at 30 Sept 2019

500

14,691

1,138

204

(4)

3,892

20,421

 

 

 

 

 

 

 

 

Comprehensive income

 

 

 

Loss for the period

-

-

-

-

           -

 694

    694

Other comprehensive income

 

 

 

 

Exchange differences on translation of overseas operations

             -

              -

              -

(8)

                   -

 -

(8)

Total comprehensive income

-

-

-

(8)

-

694

686

 

 

 

 

 

 

 

 

Transactions with owners

 

 

 

 

IFRS2 Share-based payments

-

-

-

-

-

72

72

Transactions with owners

         -  

            -  

         -

  -

   -

        72

72

Balance as at 31 March 2020

500

14,691

1,138

196

(4)

4,658

21,179

 

 

 

 

 

 

 

 

Comprehensive income

 

 

 

 

Loss for the period

-

-

-

-

-

(732)

(732)

Other comprehensive income

 

 

 

 

Exchange differences on translation of overseas operations

             -

              -

              -

             5

                   -

 -

             5

Total comprehensive income

-

-

-

5

-

(732)

(727)

 

 

 

 

 

 

 

 

Transactions with owners

 

 

 

 

 

 

 

IFRS2 Share based payments

-

-

-

-

-

89

89

Transactions with owners

-  

-  

-

-

-

    89

      89

Balance as at 30 Sept 2020

    500

14,691

 1,138

    201

(4)

 4,015

20,541

                     

Unaudited Consolidated Statement of Financial Position as at 30 September 2020

 

 

 

 

As at 30 September

As at 30 September

As at 31 March

 

 

 

 

2020

2019

2020

 

 

 

Note

Unaudited

Unaudited

 Audited

 

 

 

 

£'000

£'000

£'000

 

 

 

 

 

 

 

Non-current assets

 

 

 

 

 

 

Intangible assets

 

 

10

           22,230

         21,337

    21,997

Plant, property and equipment

 

 

 

               831

             716

         717

Right of use assets

 

 

14

            2,838

          3,073

      3,004

Deferred income tax asset

 

 

 

-

39

             -

Amounts receivable under finance leases

 

 

                 65

               65

           41

 

 

 

 

           25,964

         25,230

    25,759

Current assets

 

 

 

 

 

 

Inventories

 

 

 

            1,701

          2,119

      2,043

Trade and other receivables

 

 

 

            7,171

          6,710

      7,854

Corporation tax receivable

 

 

 

               317

          1,320

        863

Cash and cash equivalents

 

 

 

       1,541

          692

     1,665

 

 

 

 

    10,730

         10,841

   12,425

Current liabilities

 

 

 

 

 

 

Trade and other payables

 

 

 

(5,574)

(5,750)

(6,180)

Borrowings

 

 

11

(5,417)

(1,013)

(1,125)

Right of use liability

 

 

14

(679)

(639)

(656)

Provisions

 

 

 

(26)

(26)

(27)

 

 

 

 

(11,696)

(7,428)

(7,988)

 

 

 

 

 

 

 

Current assets less current liabilities

 

 

(966)

          3,413

      4,437

Total assets less current liabilities

 

 

    24,998

28,643

   30,196

 

 

 

 

 

 

 

Non-current liabilities

 

 

 

 

 

 

Trade and other payables

 

 

 

(593)

(630)

(713)

Borrowings

 

 

11

(1,231)

(5,198)

(5,675)

Right of use liability

 

 

14

(1,941)

(2,257)

(2,162)

Provisions

 

 

 

(179)

(137)

(157)

Deferred income tax liability

 

 

 

(513)

                 -

(310)

 

 

 

 

(4,457)

(8,222)

(9,017)

 

 

 

 

 

 

 

Net assets

 

 

 

          20,541

 20,421

   21,179

 

 

 

 

 

 

 

Equity

 

 

 

 

 

 

Share capital

 

 

12

               500

             500

         500

Share premium

 

 

 

           14,691

         14,691

    14,691

Merger reserve

 

 

 

            1,138

          1,138

      1,138

Translation reserve

 

 

 

               201

             204

         196

Treasury reserve

 

 

 

(4)

(4)

(4)

Retained earnings

 

 

 

            4,015

          3,892

      4,658

Total equity attributable to owners of the parent

 

           20,541

         20,421

    21,179

 

         Unaudited Consolidated Cash Flow Statement for the six months to 30 September 2020

 

 

 

 

Six months to

Six months to

Year to

 

 

 

 

30 September

30 September

31 March

 

 

 

 

2020

2019

2020

 

 

 

Note

Unaudited

Unaudited

Audited

 

 

 

 

£'000

£'000

£'000

 

 

 

 

 

 

 

Net cash generated from operating activities

13

            2,055

          1,432

      4,115

 

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

Purchases of property, plant and equipment

 

 

(183)

                    -

(20)

Purchases of software

 

 

 

(24)

(1)

(23)

Capitalised Development costs

 

 

 

(1,220)

(1,488)

(3,156)

Net cash used in investing activities

 

 

(1,427)

(1,489)

(3,199)

 

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

New bank loan

 

 

 

                     -

             500

      2,000

Repayment of bank loans

 

 

 

(171)

(505)

(1,440)

Repayment of obligations under lease agreements

 

(344)

(281)

(630)

Interest paid

 

 

 

(237)

(170)

(386)

Net cash generated from financing activities

 

(752)

(456)

(456)

 

 

 

 

 

 

 

Net (decrease)/ increase in cash and cash equivalents

 

(124)

(513)

460

 

 

 

 

 

 

 

Cash and cash equivalents at beginning of period

 

            1,665

          1,205

      1,205

 

 

 

 

 

 

 

Cash and cash equivalents at end of period

 

            1,541

             692

      1,665

 

Notes To The Unaudited Consolidated Financial Statements

1.     Basis of preparation

 

 

 

 

 

 

 

 

 

 

 

 

 

The Group's interim results for the 6 months to 30 September 2020 (prior period 30 September 2019) were approved by the Board of Directors on 20 November 2020.

 

 

 

 

 

 

 

 

As permitted this Interim Report has been prepared in accordance with UK AIM Rules for Companies and not in accordance with IAS 34 "Interim Financial Reporting" and therefore is not fully in compliance with IFRS. 

 

 

 

 

 

 

 

 

Trakm8 Holdings PLC ("Trakm8") is a public limited company incorporated in the United Kingdom under the Companies Act 2006.  Trakm8 is domiciled in the United Kingdom and its ordinary shares are traded on AIM, the market operated by the London Stock Exchange plc.

 

 

 

 

 

 

 

 

The accounting policies adopted in the preparation of the interim financial statements are the same as those set out in the Group's annual financial statements for the year ended 31 March 2020. The Group adopted IFRS16 on a modified retrospective basis, this is disclosed in note 14. The financial statements have been prepared on the historical cost basis except for certain liabilities and share based payment liabilities which are measured at fair value.

 

 

 

 

 

 

 

 

The interim financial statements have not been audited or reviewed by Group's auditors pursuant to the Auditing Practice Board guidance on 'Review of Interim Financial Information' and do not include all of the information required for full annual financial statements.

 

 

 

 

 

 

 

 

The financial information contained in this report is condensed and does not constitute statutory accounts of the Group within the meaning of Section 434(3) of the Companies Act 2006. Statutory accounts for the year ended 31 March 2020 have been delivered to the Registrar of Companies. The audit report of those accounts was unqualified, but did include an emphasis of matter due to the financial uncertainty created within the economy by the Coronavirus pandemic resulting in increased difficulty in forecasting future results for the Group.  The audit report did not contain a statement under Section 498(2) or (3) of the Companies Act 2006.

 

 

 

 

 

 

 

 

Going concern

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The consolidated interim financial statements are prepared on a going concern basis. The directors report that, having reviewed current performance and projections of its working capital and long term funding requirements, including assessments against the covenants agreed with our bank and downward sensitivity analysis, they are satisfied that the Group has sufficient resources to continue in operation for the foreseeable future, a period of not less than 12 months from the date of this report. Accordingly, they continue to adopt the going concern basis in preparing the condensed financial statements.

 

Exceptional Items

 

Exceptional items are those items that, in the Directors' view, are required to be separately disclosed by virtue of their size or incidence to enable a full understanding of the Group's financial performance.  See note 7 for further details.

 

2.     Risks and uncertainties

 

 

 

 

 

 

 

 

 

 

 

 

 

The Board has considered the principal risks and uncertainties for the second half of the financial year and determined that the risk presented in the 31 March 2020 Annual Report, described as follows, also remain relevant to the rest of the financial year: Significant operational system failure; Cyber-attack and data security; Brexit and a deteriorating economic climate; Operating in a fast-moving technology industry where we will always be at risk from new products; Adverse mobile network changes; Attracting and maintaining high-quality employees; Access to long term and working capital; Electronic supply chain under constraint and Covid-19 impacting internal and operational capacity and significant economic impact. These are detailed on pages 20 to 22 of the 2020 Annual Report, a copy of which is available on the Group's website at www.trakm8.com.

               

 

 

 

3.     Segmental Analysis

 

 

 

 

 

 

 

 

 

 

 

 

 

The chief operating decision maker ("CODM") is identified as the Board. It continues to define all the Group's trading under the single Integrated Telematics Technology segment and therefore review the results of the group as a whole.  Consequently all of the Group's revenue, expenses, assets and liabilities are in respect of one Integrated Telematics Technology segment. 

 

 

 

 

 

 

 

 

The Board as the CODM review the revenue streams of Integrated Fleet, Optimisation, Insurance and Automotive Solutions (Solutions) as part of their internal reporting. Solutions represents the sale of the Group's full vehicle telematics and optimisation services, engineering services, professional services and mapping solutions to customers.

 

A breakdown of revenue within these streams are as follows:

Six months to

Six months to

Year to

 

30 September

30 September

31 March

 

2020

2019

2020

 

Unaudited

Unaudited

Audited

 

£'000

£'000

£'000

Solutions:

7,321

8,867

19,550

Fleet and optimisation

4,419

5,435

12,034

Insurance and automotive

3,432

7,516

 

4.     Other income

 

 

 

 

 

 

 

Six months to

Six months to

Year to

 

 

 

30 September

30 September

31 March

 

 

 

2020

2019

2020

 

 

 

Unaudited

Unaudited

Audited

 

 

 

£'000

£'000

£'000

 

 

 

 

 

 

Grant income

 

 

103

213

361

R&D tax credit

 

 

                   -

                 -

4

R&D tax credit adjustment in respect of prior periods

                   -

                 -

(1)

 

 

 

103

213

364

 

5.     Loss per ordinary share attributable to the owners of the parent

 

 

 

 

Six months to

Six months to

Year to

 

 

 

30 September

30 September

31 March

 

 

 

2020

2019

2020

 

 

 

Unaudited

Unaudited

Audited

 

 

 

£'000

£'000

£'000

 

 

 

 

 

 

Loss attributable to the owners of the parent

 

(727)

(1,786)

(1,100)

 

6.    Adjusted loss before tax

 

 

 

 

Adjusted Loss Before Tax is monitored by the Board and measured as follows:

 

 

 

Six months to

Six months to

Year to

 

30 September

30 September

31 March

 

2020

2019

2020

 

Unaudited

Unaudited

Audited

 

£'000

£'000

£'000

 

 

 

 

Loss Before Tax

(845)

(2,197)

(1,705)

Exceptional administrative costs

       442

       501

 1,296

Share based payments

          89

       113

       185

Adjusted loss before tax

(314)

(1,583)

(224)

 

7.    Exceptional costs

 

 

 

 

 

 

 

Six months to

Six months to

Year to

 

 

 

30 September

30 September

31 March

 

 

 

2020

2019

2020

 

 

 

Unaudited

Unaudited

Audited

 

 

 

£'000

£'000

£'000

 

 

 

 

 

 

Acquisition costs

 

 

-

41

52

Integration and restructuring costs

 

97

227

602

Covid-19 costs

 

 

891

-

200

Furlough grant income

 

(546)

-

-

New product component refit costs

 

-

233

442

 

 

 

442

501

1,296

 

The integration and restructuring costs in the current year relate to an ongoing project to streamline and rationalise the operations of the business.
 

The Group has also incurred exceptional costs in the current financial year relating to the Covid-19 pandemic.  These costs relate to a variety of overheads including employee costs, cancelled marketing events and bad debts resulting from Covid-19.

 

Furlough grant income relates to other income received from the Coronavirus Job Retention Scheme for employees furloughed as a result of Covid-19.
 

Detailed explanation of prior year exceptional costs are detailed on page 64 of the 2020 Annual Report, a copy of which is available on the Group's website at www.trakm8.com.

 

 

8.      Finance costs

 

 

 

 

 

 

 

 

Six months to

Six months to

Year to

 

 

 

30 September

30 September

31 March

 

 

 

2020

2019

2020

 

 

 

Unaudited

Unaudited

Audited

 

 

 

£'000

£'000

£'000

 

 

 

 

 

 

Interest on bank loans

 

 

191

106

284

Amortisation of debts issue costs

 

21

14

32

Interest on Hire Purchase and similar agreements

50

50

102

 

 

 

262

170

418

 

9.      Earnings Per Ordinary Share

 

 

 

 

 

The earnings per Ordinary share have been calculated in accordance with IAS 33 using the profit for the period and the weighted average number of Ordinary shares in issue during the period as follow:

 

 

 

 

 

Six months to

Six months to

Year to

 

 

 

 

30 September

30 September

31 March

 

 

 

 

2020

2019

2020

 

 

 

 

Unaudited

Unaudited

Audited

 

 

 

 

£'000

£'000

£'000

 

 

 

 

 

 

 

Loss the year after taxation

 

 

 

(732)

(1,787)

(1,093)

Exceptional administrative costs

 

 

 

               442

             501

       1,296

Share based payments

 

 

 

                 89

             113

          185

Tax effect of adjustments

 

 

 

(84)

(95)

(246)

Adjusted (loss)/profit after taxation

 

 

(285)

(1,268)

          142

 

 

 

 

 

 

 

 

 

 

 

No.

No.

No.

 

 

 

 

'000

'000

'000

Number of Ordinary shares of 1p each

 

 

50,004

50,004

50,004

 

 

 

 

 

 

 

Basic weighted average number of Ordinary shares of 1p each

50,004

50,004

50,004

Diluted weighted average number of Ordinary shares of 1p each

50,004

50,004

50,004

 

 

 

 

 

 

 

Basic loss per share

 

 

 

(1.46p)

(3.57p)

(2.19p)

Diluted loss per share

 

 

 

(1.46p)

(3.57p)

(2.19p)

 

 

 

 

 

 

 

Adjust for effects of:

 

 

 

 

 

 

Exceptional costs

 

 

 

0.72p

0.81p

2.10p

Share based payments

 

 

 

0.18p

0.23p

0.37p

 

 

 

 

 

 

 

Adjusted basic (loss)/earnings per share

 

 

(0.56p)

(2.53p)

0.28p

Adjusted diluted (loss)/earnings per share

(0.56p)

(2.53p)

0.28p

 

 

 

10.      Intangible Assets

 

 

 

 

 

 

 

Goodwill

Intellectual property

Customer Relationships

Development costs

Software

Total

 

£'000

£'000

£'000

£'000

£'000

£'000

Cost

 

 

 

 

 

 

As at 31 March 2019

10,417

1,920

100

14,034

2,033

28,504

Additions - Internal development

-

-

-

1,378

-

1,378

Additions - External purchases

-

-

-

110

23

133

Reclassification of right of use assets

 

 

 

 

(153)

(153)

As at 30 September 2019

10,417

1,920

100

15,522

1,903

29,862

Additions - Internal development

-

-

-

1,385

-

1,385

Additions - External purchases

-

-

-

283

-

283

As at 31 March 2020

10,417

1,920

100

17,190

1,903

31,530

Additions - Internal development

-

-

-

1,200

-

1,200

Additions - External purchases

-

-

-

20

24

44

As at 30 September 2020

10,417

1,920

100

18,410

1,927

32,774

 

 

 

 

 

 

 

Amortisation

 

 

 

 

 

 

As at 31 March 2019

-

1,849

89

4,632

769

7,339

Charge for period

-

30

11

1,007

138

1,186

As at 30 September 2019

-

1,879

100

5,639

907

8,525

Charge for period

-

31

-

840

137

1,008

As at 31 March 2020

-

1,910

100

6,479

1,044

9,533

Charge for period

-

10

-

867

134

1,011

As at 30 September 2020

-

1,920

100

7,346

1,178

10,544

 

 

 

 

 

 

 

Net book amount

 

 

 

 

 

 

As at 30 September 2020

10,417

-

-

11,064

749

22,230

 

 

 

 

 

 

 

As at 31 March 2020

10,417

10

-

10,711

859

21,997

 

 

 

 

 

 

 

As at 30 September 2019

10,417

41

-

9,883

996

21,337

 

 

 

 

 

 

 

As at 31 March 2019

10,417

71

11

9,402

1,264

21,165

               

 

 

 

11.      Borrowings

 

 

 

 

As at 30 September 2020

As at 30 September
2019

As at 31 March
2020

 

Current

Non-Current

Current

Non-Current

Current

Non-Current

 

£'000

£'000

£'000

£'000

£'000

£'000

Borrowings

5,417

1,231

1,013

5,198

1,125

5,675

Right of use liability

679

1,941

639

2,257

656

2,162

Totals

6,096

3,172

1,652

7,455

1,781

7,837

 

All borrowings are held in sterling and the Directors consider their carrying amount approximates to their fair values.

 

 

 

 

 

 

 

 

Borrowings comprise of the following loans: 

 

 

 

A £5.0m term loan with HSBC.  The loan is secured by a fixed and floating charge on all the assets of the Group. It is repayable by monthly instalments until 2021 and bears interest at a floating rate of 1.95% over base rate. As at 30 September 2020 the Group owed £0.7m (30 Sept 2019: £1.4m, 31 Mar 2020: £0.9m).

 

A £5.0m revolving credit facility with HSBC which is repayable in full on 30 September 2021.  The loan bears an interest rate of 4.5% over LIBOR on the drawn amount and a fee of 0.8% on the undrawn facility.  As at 30 September 2020 the Group had drawn down £4.5m of this credit facility (30 Sept 2019: £4.9m, 31 Mar 2020: £4.5m).

 

£1.5m growth capital loan with MEIF WM Debt LP. The loan  bears a fixed interest rate of 8% per annum and is repayable in 13 quarterly instalments commencing on 30 June 2021. As at 30 September 2020 the Group owed £1.5m (30 Sept 2019: £nil, 31 Mar 2020: £1.5m).

 

 

 

 

 

 

 

 

The Group's obligations under right of use assets are secured by the lessors' title to the leased assets (see note 14).

 

12.      Share Capital

 

 

 

 

 

 

As at 30 September 2020

As at 30 September 2019

As at 31 March
2020

 

No's

 

No's

 

No's

 

 

000's

£'000

000's

£'000

000's

£'000

Authorised:

 

 

 

 

 

 

Ordinary shares of 1p each

200,000

200,000

200,000

200,000

200,000

200,000

Allotted, issued and fully paid:

 

 

 

 

 

 

Ordinary shares of 1p each

50,004

500

50,004

500

50,004

500

 

 

 

 

 

 

 

Movement in share capital:

 

 

 

 

 

£'000

 

 

 

 

 

 

 

As at 1 April 2019

 

 

 

 

 

500

As at 30 September 2019

 

 

 

 

 

500

As at 31 March 2020

 

 

 

 

 

500

As at 30 September 2020

 

 

 

 

 

500

 

The Company currently holds 29,000 Ordinary shares in treasury representing 0.06% (2018: 0.08%) of the Company's issued share capital. The number of 1 pence Ordinary shares that the Company has in issue less the total number of Treasury shares is 49,975,002.

 

 

13.      Cash Generated from Operations

 

 

 

 

 

 

 

 

Six months to

Six months to

Year to

 

 

 

 

30 September

30 September

31 March

 

 

 

 

2020

2019

2020

 

 

 

 

Unaudited

Unaudited

Audited

 

 

 

 

£'000

£'000

£'000

 

 

 

 

 

 

 

Net loss before taxation

 

 

(845)

(2,197)

(1,705)

Depreciation

 

 

 

               380

334

699

Amortisation of intangible assets

 

            1,011

1,186

2,194

Exchange movements

 

-

-

(7)

Interest received

 

 

 

(39)

(3)

-

Bank and other interest charges

 

               262

170

406

Share based payments

 

                 89

113

185

Operating cash flows before movement in working capital

               858

(397)

1,772

 

 

 

 

 

 

 

Movement in inventories

               342

617

693

Movement in trade and other receivables

               659

1,750

589

Movement in trade and other payables

 

(726)

(573)

(21)

Movement in provisions

 

                 21

21

42

Cash generated from operations

            1,154

1,418

3,075

 

 

 

 

 

 

 

Interest received

 

 

 

                 39

3

12

Income taxes received

 

 

               862

11

1,028

Net cash inflow from operating activities

 

            2,055

1,432

4,115

               

 

 

 

14.      IFRS 16 Leases

 

 

 

This note explains the impact of the adoption of IFRS16 Leases which the Group adopted with effect from 1 April 2019 on the group's financial statements.  The Group principally leases real estate and vehicles. Leases are recognised as a right of use asset with a corresponding liability recorded at the date at which the leased asset is available for use by the Group.

 

The movements in right of use assets were as follows:

 

Freehold property

Furniture, fixtures and equipment

Computer equipment

Motor vehicles

Software

Total

 

£'000

£'000

£'000

£'000

£'000

£'000

As at 1 April 2019

2,098

-

-

412

-

2,510

Reclassification*

-

446

140

-

153

739

Lease additions

-

63

35

-

-

98

Lease terminated

-

-

-

(13)

-

(13)

Depreciation of right of use assets

(132)

(24)

(31)

(74)

-

(261)

As at 30 September 2019

1,966

485

144

325

153

3,073

Lease additions

-

-

-

244

-

244

Lease terminated

-

-

-

(24)

-

(24)

Depreciation of right of use assets

(132)

(25)

(31)

(101)

-

(289)

As at 31 March 2020

1,834

460

113

444

153

3,004

Lease additions

-

-

76

79

-

155

Lease terminated

-

-

-

(10)

-

(10)

Depreciation of right of use assets

(132)

(46)

(16)

(117)

 

(311)

As at 30 September 2020 

1,702

414

173

396

153

2,838

 

*Amounts previously recognised as finance lease assets have been reclassified to right of use assets upon transition to IFRS 16 on 1 April 2019.

 

Lease liabilities by category at 30 September 2020 were as follows:

 

 

 

 

 

Freehold property

Furniture, fixtures and equipment

Computer equipment

 Motor vehicles

Software

Total

 

£'000

£'000

£'000

£'000

£'000

£'000

Current

272

117

15

204

71

679

Non-current

1482

166

44

196

53

1941

Total

1,754

283

59

400

124

2,620

 

The maturity of lease liabilities at 30 September 2020 were as follows:

 

 

 

Freehold property

Furniture, fixtures and equipment

Computer equipment

Motor vehicles

Software

Total

 

£'000

£'000

£'000

£'000

£'000

£'000

Within 1 year

272

117

15

204

            71

          679

1 to 2 years

297

91

15

147

            46

       596

2 to 5 years

805

75

29

49

               7

     965

More than 5 years

380

-

-

-

-

          380

Total

1,754

283

59

400

124

2,620

 

15.      Further Copies

 

 

 

 

 

 

This statement, full text of the Stock Exchange announcement and the results presentation can be found on the Group's website www.trakm8.com and also from the registered office of Trakm8 Holdings PLC.  The address of the registered office is: Roman Way, Roman Park, Coleshill, North Warwickshire, B46 1HG.

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.
 
END
 
 
IR BBBDBUUDDGGB
Find out how to deal online from £1.50 in a SIPP, ISA or Dealing account.