Small Cap Value Report (Fri 16 Nov 2018) - TRAK, EYE

Friday, Nov 16 2018 by

Good morning!

Obviously the political situation is taking centre stage at the moment. This has been such a long-running saga, that the stock market seems to have priced-in political uncertainty.

How do I see politics affecting the stock market? The chance of a Corbyn Government (a far bigger risk to company earnings than Brexit, in my opinion) still seems very remote, thanks to the fixed term rules. So a Government apparently no longer has to call a general election, even if it loses a no confidence vote.

Nobody seems to like Mrs May's deal. So what happens next? She seems to have an extraordinary ability to stagger on, regardless of anything that's thrown at her. That would be a great plus, if she were actually competent. Having an incompetent, but extraordinarily stubborn & tenacious PM, is surely the worst of both worlds.

Conspiracy theories, suggesting that we're being manipulated into abandoning Brexit, are looking more credible by the day.

The way I look at it, is that chaos is the new normal. We just have to live with it, and share prices have already discounted the uncertainty.

Trakm8 Holdings (LON:TRAK)

Share price: 22.5p (down 65% today, at 13:45)
No. shares: 36.0m
Market cap: £8.1m

Half year results & trading update

Trakm8 is a UK based technology leader in fleet management, insurance telematics, connected car, and optimisation.

Awful results today, have clobbered the share price. Bad luck to shareholders here.

H1 was heavily loss-making, and I think the big issue is now whether the company can survive, given that debt has risen sharply?

I've highlighted the items below which concern me the most;


Various reasons are given for the poor performance - see RNS if you're interested.

Outlook - the dreaded H2 weighting strikes again;

Since the Group's trading update announced in September 2018 it has become clear that the improved H2 financial performance, driven by continued growth in the telematics business, will not materialise as the Group anticipated.

Continuing delays in decisions by customers is preventing the return to the usual levels of success in Fleet and Optimisation, a move to a rental model in the automotive space, and the loss, due to sanctions, of a multi-million-pound contract for the supply of…

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Trakm8 Holdings PLC is a Big Data company. The Company, through its subsidiaries, manufactures, distributes and sells telematics devices and services. The Company focusses on owning the intellectual property that it uses in its products and solutions. It supplies its customers in the fleet management and insurance sectors across the United Kingdom. In addition, the Company provides hardware devices that can be integrated into third party telematics or Internet of Things (loT) solutions. It offers Configuration Manager, Product Datasheets, Radio Frequency Identification, Telematics Devices, Vehicle Connectivity and Accessories, among others. Its portfolio of solutions includes Trakm8 ecoN, Trakm8 Tacho, Trakm8 Secure, Trakm8 Logistics and Trakm8 Insure. Its portfolio offers telematics solutions, including dashboard cameras that enable customers to record driving incidents and mitigate the risk from crash to cash accidents. It provides bespoke solutions and engineering support services. more »

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Eagle Eye Solutions Group plc is a software as a solution (SaaS) technology company. The Company is engaged in the marketing, validation and redemption of digital promotions in real-time for the grocery, retail and hospitality industries. The Company's software platform, Eagle Eye AIR, integrates with all existing point of sale (POS) systems and creates digital offers, rewards and vouchers then delivers them to customers by e-mail, text or through a loyalty application for instant redemption. Eagle Eye AIR enables brands and merchants to set up targeted campaigns, choosing various media channels to reach specific demographics. Eagle Eye AIR captures real-time data on consumer activity and campaign success. Eagle Eye Promote is a rules-based platform for brands and retailers, which creates, builds and manages their promotional campaigns. Eagle Eye Gift allows tracking of gift vouchers, including redemption data. Eagle Eye Reward supports and enables the digitization of loyalty schemes. more »

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  Is LON:TRAK fundamentally strong or weak? Find out More »

42 Comments on this Article show/hide all

MrContrarian 16th Nov '18 1 of 42

My morning smallcap tweet: TRAK driving with no visibility.

Trakm8 Holdings (LON:TRAK), £AD4, STM (LON:STM)

Trakm8 (TRAK) H1 and huge warning only 2 months after an in-line stmt. H1 re down 38% and adj EPS -4.94p (+2.15p). Guides FY rev down 20-25%.vs F/C +9%. Blames delays in decisions by customers, a move to a rental model in the automotive space, and the loss, due to sanctions, of a multi-million-pound contract for the supply of Insurance solutions into Iran. I thought everyone knew about Iran sanctions. Too busy to read the papers? Doesn't guide loss level.
Adept4 (AD4) guides FY rev flat, Trading Group EBITDA down at ~£0.6m.
STM Group (STM) CEO won't be charged by Gibraltar police in the matter of a client's tax dispute.

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andrea34l 16th Nov '18 2 of 42

There is a Rule 8 RNS this morning from Flybe (LON:FLYB) indicating that several directors have between 612,745 and 1,470,588 shares under their performance plan with an exercise of 1p. ONE PENCE!! That seems crazy to me. I wonder what the terms of the performance plan are....

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About Paul Scott

Paul Scott

I trained as an accountant with a Top 5 firm, but that was so boring that I spent too much time in the 1990s being a disco bunny, and busting moves on the dancefloor, and chilling out with mates back at either my house or theirs, and having a lot of fun!Then spent 8 years as FD for a ladieswear retail chain called "Pilot", leaving on great terms in 2002 - having been a key player in growing the business 10 fold. If the truth be told, I partied pretty hard at the weekends too, so bank reconciliations on Monday mornings were more luck than judgement!! But they were always correct.I got bored with that and decided to become a professional small caps investor in 2002. I made millions, but got too cocky, and lost the lot in 2008, due to excessive gearing. A miserable, wilderness period occurred from 2008-2012.Since then, the sun has begun to shine again! I am now utterly briliant again, and immerse myself in small caps, and am a walking encyclopedia on the subject. I love writing a daily report for on most weekday mornings, constantly researching daily results & trading updates for small caps. Cheese! more »


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