REG - Quartix Technologies - Interim Results Timetable and Trading Update

Quartix TechnologiesAnnouncement

11/07/2022 07:00

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RNS Number : 9112R  Quartix Technologies PLC  11 July 2022

 

Quartix Technologies plc

("Quartix", "the Group" or "the Company")

Interim Results Timetable and Trading Update

Quartix Technologies plc, a leading supplier of subscription-based vehicle
tracking systems, software and services, is pleased to announce that it will
publish interim results for the six-month period ending 30 June 2022 (the
"Period") on Wednesday 27 July 2022.  They will be posted on the Company's
website that morning, together with accompanying presentations.

 

Company Results

 

The Company is delighted to report that the strong growth in new unit
subscriptions previously reported for the first quarter has continued, and
that as a result new unit subscriptions are up 26% for the first half compared
with the same period in 2021. For the full year it expects revenue, adjusted
EBITDA, and free cash flow to be in line with consensus market forecasts(1).

 

Following the increase in new unit subscriptions, the Group expects to report
revenue of £13.3m, adjusted EBITDA of around £2.6m and underlying free cash
flow(2) of approximately £2.0m for the Period. The Company's cash balance was
£3.9m at 30 June 2022.

 

Fleet Results

 

The Company achieved excellent growth in new units installed during the
Period, which were 26% ahead of the equivalent period in 2021. These totalled
32,085 units, which was the highest recorded growth ever for a 6-month period.
As a consequence of the new unit subscriptions, the vehicle subscription base
at 30 June increased by 9.4% during the Period to 221,800 vehicles, and the
annualised subscription base value increased by £1.6m (2021 £1.0m) on a
constant-currency(3) basis to £26.0m.  Invoiced recurring revenues remained
high at 92% of sales. Price erosion over 12 months calculated at constant
currency rates continues to improve and was 5.6% compared to 6.5% in the same
period in 2021.  Our low rate of attrition remained stable.

 

Quartix's long established policy of immediately expensing the cost of new
units and their installation means that strong growth in new units causes a
short term reduction in profitability. This is followed by increased profits
due to the recurring nature of revenues.

 

New unit subscriptions in Europe and the UK continue to perform very strongly.
Unit growth in the US does not yet reflect the impact of new strategic
initiatives for the region. Growth in new unit subscriptions for the first
half are shown in the table below. Exact totals may vary slightly in
preparation of the interim results.

 

 

                        2022    2021    Growth
 UK                     14,825  12,055  23%
 France                 8,178   5,631   45%
 USA                    5,237   4,852   8%
 Spain, Italy, Germany  3,845   2,955   30%
 Total                  32,085  25,493  26%

 

 

Richard Lilwall, Chief Executive Officer of Quartix commented:

 

"Quartix has had a very strong first half and it is very pleasing to see first
half installed units grow at 26%, especially following the strong performance
in the first half of 2021. The UK saw excellent performances in all channels,
and our field sales team gained some significant contract wins. Onboarding of
our French field sales team is complete, and they are showing an encouraging
future pipeline.   The US has seen mixed results across channels with some
performing significantly better than others. US initiatives are anticipated to
positively impact unit growth in 2023, including some functionality that is
specific for that region.

 

We have launched our Quartix EVolve (electric vehicle analysis) product and
the pipeline is already building with new and existing customers. We will be
launching our Quartix Check (walkaround) module in the second half of our
financial year.

 

Our work on operational scalability has been successful, allowing our team to
improve customer satisfaction on our growing subscription base without adding
further resources. Sales execution excellence is well underway with the
imminent introduction of new tools to drive best practice and insights at
every stage of the sales funnel. Initial implementation is expected to be
completed within the next quarter and further refinement and improvement will
allow us to achieve further revenue improvements in 2023. We are looking
forward to the second half with confidence in achieving market expectations
for the full year."

 

 

(1) The Board believes that consensus market expectations for 2022 prior to
this announcement, were as follows: Revenue: £27.4m; Adjusted EBITDA £5.7m;
Underlying Free Cash Flow(2): £4.1m.

(2) Underlying Free Cash Flow stated before expenditure on 3G swap out in the
US - see 2021 Annual Report.

(3) Based on currency rates as at 30 June 2022.

 

For further information, please contact:

 Quartix (www.quartix.net)                                           01686 806 663

 Richard Lilwall, Chief Executive Officer

 Emily Rees, Chief Financial Officer

 finnCap (Nominated Adviser and Broker)                                 020 7220 0500

 Matt Goode / Kate Bannatyne / Milesh Hindocha (Corporate Finance)

 Alice Lane (Corporate Broking)

 

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the company's obligations under Article 17 of
MAR.

 

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