REG - Tracsis PLC - North American Rail Acquisition

TracsisAnnouncement

14/03/2022 07:01

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RNS Number : 5835E  Tracsis PLC  14 March 2022

14 March
2022

 

Tracsis plc

("Tracsis" or "the Group")

 

North American Rail Acquisition

 

Tracsis, a leading provider of software, hardware, data analytics/GIS and
services for the rail, traffic data and wider transport industries, is pleased
to announce that it has acquired RailComm LLC ("RailComm") a North American
based rail technology software and services provider.

Headquartered in Fairport, New York and established in 1999, RailComm provides
mission critical automation and control solutions that reduce costs, increase
safety, and improve operational efficiency for rail passenger/freight
operators and rail served ports/industrials. Its two core products are rail
yard automation and computer aided dispatching and it has a wide and
diversified client base across the North American market. The business has
good levels of annual recurring software revenues in addition to large project
delivery/systems integration work. The business employs around 30 full-time
staff, all of whom will remain with the business post transaction.

The acquisition is in line with Tracsis' strategy of extending its rail
software footprint and expanding the addressable markets for its products and
services. In addition to the significant growth opportunities that exist
within RailComm's core rail markets, we now have direct access to a
long-established sales network into a significant number of rail clients in
the North America market. This will enable Tracsis to progressively market its
existing portfolio of rail products and services, with Remote Condition
Monitoring the initial area of focus.

For the financial year ended 31 December 2021, RailComm delivered revenue of
$6.0m (£4.6m) including c$2.5m (£1.9m) of recurring software revenue and
generated an unaudited loss before tax of $0.3m (£0.2m). It has a significant
order book, and as a result we anticipate good levels of revenue and profit
growth going forward.  The business is being acquired on a debt free basis.

The acquisition consideration comprises an initial cash payment of $11.5m
(£8.8m). Additional contingent consideration of up to $2.7m (£2.1m) is
payable subject to RailComm achieving certain financial targets in the first
full year post acquisition. This cash will be held in escrow through that
period. The consideration will be funded out of Tracsis cash reserves.

 

Chris Barnes, Chief Executive Officer of Tracsis plc, commented:

"This is an important strategic acquisition for Tracsis plc, providing a
platform onto which we can start to internationally expand the Tracsis Group
and its rail product portfolio via direct access to the significant and
growing North American rail technology market. We are delighted to welcome all
of the RailComm team into the Tracsis Group and look forward to a successful
future working together".

 

Joe Forgione, President of RailComm LLC, commented:

"The RailComm team is very excited about joining the Tracsis Group. Both
businesses have a long history of driving innovation via R&D built around
long-term client relationships and we look forward to expanding our ability to
offer a much broader range of rail technology solutions across our extensive
client base in North America."

 

 

Notes:

 

1.   The US$ values quoted in this announcement are also shown in £s by
converting the US$ values at an exchange rate of $/£ of 1.31.

 

2.   The information contained within this announcement is deemed by the
Company to constitute inside information under the Market Abuse Regulation
(EU) No. 596/2014.

 

 

 

 Enquiries:

 Tracsis                                                                                                                                                                                                                                                                                                                       Tel: 0845 125 9162
 plc
 Chris Barnes, CEO
 Andy Kelly, CFO

 finnCap                                                                                                                                                                                                                                                                                                                       Tel: 020 7220 0500
 Ltd
 Christopher Raggett/Charlie Beeson, Corporate Finance
 Andrew Burdis, Corporate Broking

 Alma                                                                                                                                                                                                                                                                                                                          Tel: 020 3405 0205
 PR
 Rebecca Sanders-Hewett/David Ison/Joe Pederzolli                                                                                                                                                                                                                                                                              tracsis@almapr.co.uk

 

 

 

Notes to editors:

 

·    Tracsis plc is a technology company and a leading provider of
software and hardware products, data capture and data analytics/GIS services
for the rail, traffic data and wider transport industries.

 

·    Tracsis' products and services are widely used to increase
efficiency, reduce cost and risk, improve operational and asset performance,
improve safety management and decision-making capabilities, and improve the
overall customer experience for clients and customers.

 

·    The Group is split into two principle operating areas built around
detailed industry knowledge and expertise:

-    Rail Technology & Services:  Software and technology/product led
business. It develops and supplies software that solves complex resource,
asset optimisation and control problems for Train Operators and Smart
Ticketing, Delay Repay and other retail software to improve the customer
experience for rail users. It also develops remote condition monitoring
hardware, data acquisition software, safety and risk management software
solutions for rail infrastructure providers.

-    Data, Analytics, Consultancy & Events: A largely services led
business that focuses on data capture, data analytics, GIS, earth observation,
data insights, consultancy, and event traffic management within a range of
transport and pedestrian rich environments.  The business provides
technology/bespoke products and data that underpins large scale intelligent
transport system and smart city planning and positive environmental decision
making.

 

·    Tracsis has a blue-chip client base which includes all major UK
transport owning Groups, Network Rail, Passenger and Freight Train Operating
Companies, the Department for Transport, TfL, multiple local authorities,
major outdoor music and sporting event organisers, and a wide variety of large
engineering and infrastructure companies. In North America our clients include
Class 1 rail freight companies, transit operators, shortline railroads and
several large rail served ports and industrials.

 

·    The business drives growth both organically and through acquisition
and has made seventeen acquisitions since 2008.

 

For more information on Tracsis please visit http://www.tracsis.com
(http://www.tracsis.com/)

 

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