9077J Interim Report 2007
TRAKM8 HOLDINGS PLC
(“Trakm8” or “the Group”)
Unaudited Interim Report
for the six months to 30 September 2007
Highlights Six months to Six months to
30 Sept 2007 30 Sept 2006
(restated)
Unaudited Unaudited
£000’s £000’s
Revenue 2,458 3,206
Gross Profit 988 1,177
Gross Profit % 40.2% 36.7%
Operating (Loss) / Profit (432) 155
(Loss) / Profit on ordinary (465) 145
activities before taxation
Cash and cash equivalents 416 257
Net Assets 1,271 1,503
Key points:
• Turnover and operating profit declined in part due to suspected
brand impact from our reported supplier issue and a delay in orders
as customers wait for our new platform launch
• Gross margin 3.5% increase
• Cash and cash equivalents increased
• Acquisition of PJSoft completed
• Partnership with Motorola and licence agreement with Tyco announced
in May and November 2007 respectively
• £1.1m government grant funding awarded for Trusted Road Usage
& Emissions Profiling Project
Chairman’s Statement
During this half year the Group has continued its strategy to become an
integrated telematics service provider (TSP) and significant progress has been
made in a number of areas. The Group also completed the acquisition of
PJSoft s.r.o. (PJSoft) and has continued its work in the design and testing of our
next generation telematics platform, the T6.
Revenue in the period reduced 23.4% to £2.46m (2006: £3.21m) and this
generated a loss before tax of £0.47m (2006: profit £0.15m). Cash and cash
equivalents increased to £0.42m (2006: £0.26m).
Turnover and operating profit declined in part due to suspected brand impact
from our reported supplier issue affecting T4 and Solo hardware sales and a delay
in orders as customers wait for the T6 launch. However sales from
Trakm8 SWIFT®, our flagship TSP offering, have increased and we are
witnessing a firming of pricing for our hardware products.
The Company was pleased to report in May 2007 the signing of a partnership
agreement with Motorola to integrate its GPS tracking products with Motorola's
Astro radio network and, as announced on 9 November 2007, the Group entered
into a co-operation agreement with Tyco Electronics Limited (Tyco). As a result
the hardware design of the Group’s new platform, and its design costs, have been
shared with Tyco and the Group looks forward to developing this relationship
further once the product is launched in the next half year.
As announced today the Group was awarded a £1.1m government grant to lead
the Trusted Road Usage & Emissions Profiling Project. This three year project will
significantly increase the speed of our R&D programme and positions the Group
to take commercial advantage of future national and regional road user charging
initiatives.
Chairman’s Statement
continued
Outlook
The Trakm8 Group is committed to its transition to a fully integrated TSP provider
and I believe we are firmly on track to achieving this. As reported above revenues
from T4 & Solo hardware sales have reduced, however the pipeline for these
products is encouraging and sales of Trakm8 SWIFT® are expected to continue
to increase and become a substantial part of the business in the future. Further
we expect demand for the T6, our next generation hardware platform, to be
launched by March 2008, to be strong.
Consequently we expect the second half of the financial year to demonstrate
improved operating performance resulting from a combination of increased sales
and a cost cutting exercise undertaken during the period.
These major initiatives have required significant efforts from everyone in the
Group and I would like to thank the Executive team and staff for their
continuing hard work and dedication.
DAWSON BUCK
CHAIRMAN