REG - Trakm8 Holdings PLC - Half-year Report
05/12/2024 07:00
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RNS Number : 8813O Trakm8 Holdings PLC 05 December 2024
The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the UK Market Abuse
Regulation
5 December 2024
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 2024:
Financial Highlights
6 months to 6 months to Year to 31
30 Sept 2024 30 Sept 2023 March 2024
Unaudited (Restated(4)) (Restated(4))
Unaudited Unaudited(4)
£'000 £'000 £'000
Revenue 8,312 8,537 16,088
of which, recurring revenue(1) 4,508 5,234 10,109
Profit/(Loss) before tax 5 13 (1,483)
Adjusted Profit/(Loss) before tax(2) 15 119 (1,344)
Profit/(Loss) after tax 140 109 (1,211)
Cash generated from operations 345 2,349 6,065
Net Bank Debt(3) 6,662 5,570 4,857
Basic earnings/(loss) per share 0.28p 0.22p (2.42p)
Adjusted basic earnings/(loss) per share 0.30p 0.39p (2.20p)
1 Recurring revenues are generated from 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
4. See note 12 for details
Highlights
· H1 2024 results:
o Revenues modestly lower, with reduction in Insurance and Automotive offset
partially by Fleet and Optimisation
o Lack of Insurance capacity coupled with customers running down their
existing stocks has heavily impacted new device sales
o Reduction in Insurance connections has negatively impacted recurring
revenues
o Gross margins improved, with strong software sales after expanded
agreement with Iceland and J Sainsbury's Information Systems Ltd
("Sainsbury's") extending its existing contract, due to expire on 31 December
2024, for two years to 31 December 2026
o New convertible loan note issued to fund investment in Driver Risk
solution and boost working capital position
· H2 2024/25 and FY2026 outlook:
o Insurance device sales forecast to continue to be adversely impacted
through Q3 of FY2025, with expectations of volumes increasing in Q4 of FY2025
from both existing and new customers
o Strong pipeline of Fleet & Optimisation opportunities in H2 2024/25
for devices, service and support and software including significant
Optimisation contract which has been previously highlighted
o Expectation for Insurance and Automotive volumes in FY2026 remains
uncertain, but nonetheless should improve on FY2025 performance
Outlook
The Insurance and Automotive markets continue to provide challenging
forecasting conditions. The prospect of volumes of new device sales from both
existing and new customers not increasing until Q4 of FY2025 means that our
expectations are lower than that we had previously forecast for the Insurance
and Automotive business. However, our Fleet and Optimisation business is
forecast to trade well with a strong pipeline of opportunities across all our
solutions, including the previously highlighted Optimisation contract which
remains in our sales process. We hope that this pipeline will offset the
challenges within the Insurance market.
The outcome for the full year therefore remains uncertain with the strength of
recovery in Insurance unknown. However, the Board remains confident of
improving revenues compared to the prior financial year.
- Ends -
For further information:
Trakm8 Holdings plc
John Watkins, Executive Chairman Tel: +44 (0) 1675 434 200
Jon Edwards, Chief Financial Officer www.trakm8.com (http://www.trakm8.com/)
Allenby Capital Limited (Nominated Adviser & Broker) Tel: +44 (0)20 3328 5656
David Hart / Vivek Bhardwaj, Corporate Finance www.allenbycapital.com
Tony Quirke / Joscelin Pinnington, Sales and Corporate Broking
About Trakm8
Trakm8 is a UK based technology leader in fleet management, insurance
telematics, connected car, and optimisation. Through IP owned technology, the
Group uses AI data analytics collected from 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/optimisation,
self-installed telematics units and one of the widest ranges of installed
telematics devices. Trakm8 has over 243,000 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, Stark, EON, Iceland Foods, Sainsbury's, GSF, Direct Line
Group, Ticker and Freedom Group.
Trakm8 has been listed on the AIM market of the London Stock Exchange since
2005. Trakm8 is also recognised with the LSE Green Economy Mark.
www.trakm8.com (http://www.trakm8.com/) / @Trakm8
Executive Chairman's Statement
Introduction
I present the report of Trakm8's unaudited results for the six months ended 30
September 2024 ("H1 2024").
As noted in the results for the financial year ended 31 March 2024, announced
by the Company on 29 July 2024, the Insurance market continues to provide a
challenging backdrop. This has contributed to another difficult period for the
Group. Despite this, through strong relationships with our customers and our
market-leading products, our Fleet and Optimisation vertical continues to show
progress. This has helped to ensure that the Group's overall H1 2024 results
were broadly in line with the corresponding period for the previous financial
year.
I would like to thank the Trakm8 team which continues to ensure that our
customers' needs are met resulting in positive outcomes across their
businesses.
Markets
We continue to focus on two key markets: Insurance & Automotive as well as
Fleet & Optimisation.
Our Insurance customers continue to see a slower recovery in policy sales than
they had anticipated. The availability of capacity, whilst improving, is slow
to be released for policy sales which, coupled with higher levels of
customers' existing stock holdings being used, has meant that our new device
sales have been heavily impacted for a further reporting period. In addition,
several Insurers have also seen price pressure from competitors again
resulting in lower policy sales and renewals. Insurance telematics continues
to be a necessity for some younger drivers where insurance premiums continue
to rise whilst other markets are now being explored by our customer base
including older drivers and those higher risk drivers who struggle to get
policies from traditional routes.
Automotive saw the launch of the AA Vixa product during the period and volumes
have increased as they roll out advertising and incentives to existing policy
holders. Our Automotive expertise has meant that through our solution we have
helped deliver real time vehicle health information to both the end user and
the AA, ensuring that vehicles are maintained effectively.
Fleet and Optimisation has produced a strong result for the period. Our
solutions for fleets of vehicles continue to deliver cost and risk
improvements with our Optimisation algorithms in particular delivering vast
benefits. With cost increases set to continue for businesses, we believe that
our solutions are well placed to deliver strong returns on investment on fleet
sizes ranging from less than ten to large fleets of thousands. We believe that
most fleets will need to adopt camera technology over the coming years and our
range of cameras caters for most needs which, when coupled with one of our
Insight packages, is expected to deliver the outcomes that our customers
require. We are seeing more prospects and existing customers interested in the
integrated Telematics and Optimisation offering available within the Insight
platform.
Strategy
The Group continues to follow the previously outlined strategy of:
· Increasing our market share
· Delivering a cutting-edge solutions portfolio
· Streamlining our internal operations
Our primary focus is to increase our market share through more device sales,
more connections and higher service fees. The challenging conditions of the
Insurance market were entirely responsible for connections dropping to 243,000
as at 30(th) September 2024 (FY2024: 275,000). With Insurance and Automotive
volumes expected to increase during H2 2024/25, we expect to see this
stabilise and begin to improve as FY2025 comes to an end.
With the introduction of our Fleet Customer Success team, we are ensuring that
our customer base benefits from our latest solutions and can explore
opportunities for expansion of services being delivered, further improving
results in both cost saving and safety. Our strong relationship management
with enterprise customers resulted in further renewals and expansions from
Iceland and Sainsburys which extended for one and two years respectively
during the calendar year.
Our second strategic aim is to continue to build and provide exceptional
solutions. Our focus is to concentrate on fewer significant projects. Whilst
the main development of Insight was completed during previous financial years,
we continue to add functionality to the platform, focusing on our core
competencies of Optimisation, Risk Management and Vehicle Health. Following
the acquisition of a Driver Risk solution early in this financial year, we are
integrating this alongside our existing solution to deliver a market-leading
scoring solution to our entire customer base. Our customers also trust our
solutions in mission critical processes, so we continue to invest in and
improve our security to mitigate external risks wherever possible.
Our third strategic aim has been to improve the efficiencies of our business
in every possible way. Following the implementation of a new data centre, we
continue to look for further savings in this area along with reductions in
other third-party costs to the business. Where possible, we are looking at
automating processes with a particular focus on customer experience to support
our increased market share aspirations.
Financial Results
Revenues for H1 2024 were modestly lower in comparison to the corresponding
period of the previous financial year at £8.31m (H1 2023: £8.54m).
In H1 2024, there was a 25% increase in Fleet & Optimisation revenues to
£6.16m (H1 2023: £4.91m). Fleet telematics was largely consistent with last
year, but Optimisation revenues were much better, with strong software
revenues of £1.84m (H1 2023: £0.19m) following the renewals with both
Iceland and Sainsburys as previously discussed. Connections as at 30(th)
September 2024 remained static at 63,000 (FY2024: 63,000). Insurance &
Automotive saw a reduction in revenues to £2.15m (H1 2023: £3.63m). The lack
of new device sales, coupled with the reduction in Insurance and Automotive
connections as at 30(th) September 2024 to 179,000 (FY2024: 212,000), has
resulted in an estimated loss of £2m of revenue compared to our expectations
in early 2024.
Recurring revenues continue to be the bedrock of the Group and were £4.51m in
H1 2024 (H1 2023: £5.23m) representing 54% of the Group's overall revenue.
Insurance and Automotive's drop in connections during the period accounts for
£0.5m of this reduction, with Fleet continuing to see some attrition in
smaller fleets with new connections only starting to benefit towards the end
of the period.
Overheads in the period increased by 18%. This increase is inclusive of a 18%
increase in amortisation following extensive investment in technology in
earlier years. Increased costs were experienced in staff salaries, an area
where we seek to ensure that we maintain market rates wherever possible, and
we also increased our marketing spend by 75% as we look to deliver our
increased market share strategy.
Due to the improved gross margin from increased software revenues, the
continued benefit of recurring revenues and controlled costs, the Group
produced a small Adjusted profit of £0.02m (H1 2023: £0.12m). Profit after
tax for the period was £0.14m compared to £0.11m for H1 2023.
Financial position
Cash generation from operations was £0.35m (H1 2023: £2.35m) and as at 30
September 2024, the Group's net bank debt, excluding the impact of the IFRS16
lease liability, was £6.66m (H1 2023 £5.57m), representing an increase of
£1.81m compared to the end of the previous financial year as cash balances
decreased and a new convertible loan note was issued for £0.99m to fund the
acquisition of a complementary driver risk solution as reported in the Group's
FY2024 results.
The reduced cash generation from operations was again down to Insurance device
sales being lower than expected, which compared to Fleet contract wins, turn
to positive cashflow in shorter timeframes. We continue to hold more
inventory than desired due to Insurance sales volumes and committed material
purchases during 2023 when lead times were in excess of twelve months - this
represents an opportunity to improve the working capital position as device
sales return.
During the period, we agreed revised agreements with both HSBC and Maven and
the Group continues to closely monitor its working capital position.
The overall cash outflow for the financial period was £1.04m (H1 2023:
£0.25m). Cash on hand was £0.35m (H1 2023: £0.87m) with £0.5m in unused
overdraft facility at the period end.
Outlook
The Insurance and Automotive markets continue to provide challenging
forecasting conditions. The prospect of volumes of new device sales from both
existing and new customers not increasing until Q4 of FY2025 means that our
expectations are lower than that we had previously forecast for the Insurance
and Automotive business. However, our Fleet and Optimisation business is
forecast to trade well with a strong pipeline of opportunities across all our
solutions, including the previously highlighted Optimisation contract which
remains in our sales process. We hope that this pipeline will offset the
challenges within the Insurance market.
The outcome for the full year therefore remains uncertain with the strength of
recovery in Insurance unknown. However, the Board remains confident of
improving revenues compared to the prior financial year.
JOHN WATKINS
Executive Chairman
Unaudited Consolidated Statement of Comprehensive Income for the six months to
30 September 2024
Six months to Six months to Year to
30 September 30 September 31 March
2024 2023 (Restated) 2024 (Restated)
Unaudited Unaudited Unaudited
£'000 £'000 £'000
Note
Revenue 3 8,312 8,537 16,088
Cost of sales (2,438) (3,494) (7,152)
Gross profit 5,874 5,043 8,936
Administrative expenses excluding exceptional costs (5,297) (4,507) (9,462)
Exceptional administrative costs 4 - (94) (115)
Total administrative costs (5,297) (4,601) (9,577)
Operating profit/(loss) 577 442 (641)
Finance income 1 13 18
Finance costs 5 (573) (442) (860)
Profit/(Loss) before taxation 5 13 (1,483)
Income tax 135 96 272
Profit/(Loss) for the period 140 109 (1,211)
Other Comprehensive Income
Items that may be subsequently reclassified to profit or loss:
Exchange differences on translation of foreign operations 5 (15) (7)
Total other comprehensive income 5 (15) (7)
Total Comprehensive Profit/(Loss) for the period attributable to owners of the 145 94 (1,218)
parent
Profit/(Loss) before taxation 5 13 (1,483)
Exceptional administrative costs 4 - 94 115
IFRS2 Share based payments charge 10 12 24
Adjusted profit/(loss) before tax 15 119 (1,344)
Earnings per ordinary share (pence) attributable to owners of the Parent
Basic 6 0.28 0.22 (2.42)
Diluted 6 0.28 0.22 (2.42)
The results relate to continuing operations.
Unaudited Consolidated Statement of Changes in Equity for the six months to 30
September
2024
Share capital Share premium Merger reserve Translation reserve Treasury reserve Convertible loan reserve Retained earnings Total equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance as at 1 April 2023 500 14,691 1,138 212 (4) 11 2,581 19,129
Comprehensive income
Loss for the period - - - - - - 109 109
Other comprehensive income
Exchange differences on translation of overseas operations - - - (15) - - - (15)
Total comprehensive income - - - (15) - - 109 94
Transactions with owners
IFRS 2 Share-based payments - - - - - - 12 12
Transactions with owners - - - - - - 12 12
Balance as at 30 Sept 2023 500 14,691 1,138 197 (4) 11 2,702 17,935
Comprehensive income
Profit for the period - - - - - - (1,320) (1,320)
Other comprehensive income
Exchange differences on translation of overseas operations - - - 8 - - - 8
Total comprehensive income - - - 8 - - (1,320) (1,312)
Transactions with owners
IFRS2 Share-based payments - - - - - - 12 12
Transactions with owners - - - - - - 12 12
Balance as at 31 March 2024 500 14,691 1,138 205 (4) 11 1,394 17,935
Comprehensive income
Profit for the period - - - - - - 140 140
Other comprehensive income
Exchange differences on translation of overseas operations - - - 5 - - - 5
Total comprehensive income - - - 5 - - 140 145
Transactions with owners
IFRS2 Share based payments - - - - - - 10 10
Transactions with owners - - - - - - 10 10
Balance as at 30 Sept 2024 500 14,691 1,138 210 (4) 11 1,544 18,090
Unaudited Consolidated Statement of Financial Position as at 30 September
2024
As at 30 September As at 30 September As at 31 March
2024 2023 (Restated) 2024
Note Unaudited Unaudited Unaudited £'000
£'000 £'000
Non-current assets
Intangible assets 7 23,769 23,397 23,828
Plant, property and equipment 1,009 1,125 1,123
Right of use assets 8 1,300 1,994 1,558
Other Receivables 1,182 1,203 953
27,260 27,719 27,462
Current assets
Inventories 2,709 2,813 2,506
Trade and other receivables 3,692 5,159 3,613
Corporation tax receivable 413 861 363
Cash and cash equivalents 354 874 1,395
7,168 9,707 7,877
Current liabilities
Trade and other payables (6,766) (8,532) (8,255)
Borrowings 9 (6,543) (5,847) (2,502)
Right of use liability 9 (480) (557) (489)
Provisions - - (24)
(13,789) (14,936) (11,270)
Current assets less current liabilities (6,621) (5,229) (3,393)
Total assets less current liabilities 20,639 22,490 24,069
Non-current liabilities
Trade and other payables (763) (474) (895)
Borrowings 9 - (213) (3,165)
Right of use liability 9 (589) (1,273) (831)
Provisions (253) (261) (208)
Deferred income tax liability (944) (1,034) (1,035)
(2,549) (3,255) (6,134)
Net assets 18,090 19,235 17,935
Equity
Share capital 10 500 500 500
Share premium 14,691 14,691 14,691
Merger reserve 1,138 1,138 1,138
Translation reserve 210 197 205
Treasury reserve (4) (4) (4)
Convertible loan reserve 11 11 11
Retained earnings 1,544 2,702 1,394
Total equity attributable to owners of the parent 18,090 19,235 17,935
Unaudited Consolidated Cash Flow Statement for the six months to 30
September
2024
Six months to Six months to Year to
30 September 30 September 31 March
2024 2023 2024
Note Unaudited Unaudited Unaudited
£'000 £'000 £'000
Net cash generated from operating activities 11 345 2,349 6,065
Cash flows from investing activities
Purchases of property, plant and equipment (208) (373) (740)
Proceeds from sale of property, plant and equipment - - -
Purchases of software - - (500)
Capitalised Development costs (1,219) (1,102) (2,357)
Net cash used in investing activities (1,427) (1,475) (3,597)
Cash flows from financing activities
New convertible loan note 990 - -
Loan arrangement fees (66) (42) (42)
Repayment of bank loans (50) (469) (821)
Repayment of obligations under lease agreements (250) (229) (542)
Interest paid (583) (379) (787)
Net cash generated from financing activities 41 (1,119) (2,192)
Net (decrease)/increase in cash and cash equivalents (1,041) (245) 276
Cash and cash equivalents at beginning of period 1,395 1,119 1,119
Cash and cash equivalents at end of period 354 874 1,395
Notes to the unaudited consolidated financial statements
1. Basis of preparation
The Group's unaudited interim results for the 6 months to 30 September 2024
(prior year 30 September 2023) were approved by the Board of Directors on 4
December 2024.
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
statement are the same as those set out in the Group's annual financial
statements for the year ended 31 March 2024. 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 2024 have been delivered to the Registrar of Companies. The audit report
of those accounts was unqualified, did not draw attention to any matters by
way of emphasis and did not contain a statement under Section 498(2) or (3) of
the Companies Act 2006. This audit was completed without the restatements as
disclosed in Note 12 of this announcement.
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.
2. Risks and uncertainties
The Board has considered the principal risks and uncertainties for the
remaining half of the financial year and determined that the risks presented
in the 31 March 2024 Annual Report, described as follows, also remain relevant
to the rest of the financial year: Operating in a fast moving technology
industry where we will always be at risk from new products being launched;
Deteriorating economic climate; Access to long term and working capital;
Cyber-attack , data security & data breaches; Significant operational
failure; Adverse mobile network changes; Attracting and maintaining high
quality employees; Electronics supply chain under constraint; Business
disruption from communicable diseases; Climate Change. These are detailed on
pages 15 to 18 of the 2024 Annual Report, a copy of which is available on the
Group's website at www.trakm8.com. (http://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
2024 2023 2024
Unaudited Unaudited Unaudited
£'000 £'000 £'000
Solutions: 8,312 8,537 16,088
Fleet and optimisation 6,160 4,908 9,511
Insurance and automotive 2,152 3,629 6,577
4. Exceptional costs
Six months to 30 September Six months to 30 September Year to 31 March
2024 2023 2024
Unaudited Unaudited Unaudited
£'000 £'000 £'000
Exceptional administrative costs
Integration and restructuring costs - 94 115
- 94 115
The integration and restructuring costs in the previous year relate to the
Group's decision to maintain a narrower product focus. The prior year costs
include final amounts in relation to the professional services and termination
fees incurred through the exit of a lease property that was no longer required
due to this decision.
Detailed explanation of prior year exceptional costs are detailed on page 63
of the 2024 Annual Report, a copy of which is available on the Group's website
at www.trakm8.com. (http://www.trakm8.com/)
Six months to Six months to Year to
5. Finance costs
30 September 30 September 31 March
2024 2023 2024
Unaudited Unaudited Unaudited
£'000 £'000 £'000
Interest on bank loans 431 339 652
Amortisation of debts issue costs 39 52 66
Interest on Hire Purchase and similar agreements 103 51 142
573 442 860
6. 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
2024 2023 2024
Unaudited Unaudited Unaudited
Profit/(Loss) the year after taxation 140 109 (1,211)
Exceptional administrative costs - 94 115
Share based payments 10 12 24
Tax effect of adjustments - (24) (29)
Adjusted profit/(loss) after taxation 150 191 (1,101)
No. '000 No. '000 No. '000
50,004 50,004 50,004
Number of Ordinary shares of 1p each
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 earnings/(loss) per share 0.28p 0.22p (2.42p)
Diluted earnings/(loss) per share 0.28p 0.22p (2.42p)
Adjust for effects of: Exceptional costs
0.00p 0.14p 0.17p
Share based payments 0.02p 0.02p 0.05p
Adjusted basic earnings/(loss) per share 0.30p 0.39p (2.20p)
Adjusted diluted earnings/(loss) per share 0.30p 0.39p (2.20p)
7. Intangible Assets
Goodwill Intellectual property Customer Relationships Development costs Software Total
Cost £'000 £'000 £'000 £'000 £'000 £'000
As at 31 March 2023 10,417 1,920 100 24,811 1,819 39,067
Additions - Internal development - - - 1,011 - 1,011
Additions - External purchases - - - 91 - 91
As at 30 September 2023 10,417 1,920 100 25,913 1,819 40,169
Additions - Internal development - - - 1,131 - 1,131
Additions - External purchases - - - 124 500 624
As at 31 March 2024 10,417 1,920 100 27,168 2,319 41,924
Additions - Internal development - - - 1,115 - 1,115
Additions - External purchases - - - 104 - 104
As at 30 September 2024 10,417 1,920 100 28,387 2,319 43,143
Amortisation
As at 31 March 2023 - 1,920 100 12,042 1,623 15,685
Charge for period - - - 1,053 34 1,087
As at 30 September 2023 - 1,920 100 13,095 1,657 16,772
Charge for period - - - 1,292 32 1,324
As at 31 March 2024 - 1,920 100 14,387 1,689 18,096
Charge for period - - - 1,249 29 1,278
As at 30 September 2024 - 1,920 100 15,636 1,718 19,374
Net book amount
As at 30 September 2024 10,417 - - 12,751 601 23,769
As at 31 March 2024 10,417 - - 12,781 630 23,828
As at 30 September 2023 10,417 - - 12,818 162 23,397
As at 31 March 2023 10,417 - - 12,769 196 23,382
8. Right of use assets
Furniture, fixtures Motor vehicles Software Total
and
Leased equipment Computer
buildings equipment
COST £'000 £'000 £'000 £'000 £'000 £'000
As at 31 March 2023 2,098 583 502 607 - 3,790
Additions - - 214 308 - 522
Disposals - - - (358) - (358)
As at 30 September 2023 2,098 583 716 557 - 3,954
Additions 17 - 326 46 - 389
Disposals (1,132) - - (63) - (1,195)
As at 31 March 2024 983 583 1,042 540 - 3,148
Additions Disposals - - - - - -
- - - - - -
As at 30 September 2024 983 583 1,042 540 - 3,148
AMORTISATION
As at 31 March 2023 1,059 264 307 449 - 2,079
Charge for period 115 36 40 48 - 239
Disposals - - - (358) - (358)
As at 30 September 2023 1,174 300 347 139 - 1,960
Charge for period 70 36 81 72 - 259
Disposals (566) - - (63) - (629)
As at 31 March 2024 678 336 428 148 - 1,590
Charge for period 53 30 90 85 - 258
Disposals - - - - - -
As at 30 September 2024 731 366 518 233 - 1,848
Net book amount
As at 30 September 2024 252 217 524 307 - 1,300
As at 31 March 2024 305 247 614 392 - 1,558
As at 30 September 2023 924 283 369 418 - 1,994
As at 31 March 2023 1,039 319 195 158 - 1,711
9. Borrowings
As at 30 September 2024 As at September 2023 As at 31 March 2024
Current Non-current Current Non-current Current Non-Current
£'000 £'000 £'000 £'000 £'000 £'000
Borrowings 3,976 - 4,273 213 2,502 1,591
Convertible unsecured loan note 2,567 - 1,574 - - 1,574
Right of use liability 480 589 557 1,273 489 831
Totals 7,023 589 6,404 1,486 2,991 3,996
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 £5.3m 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
from 31 January 2025 of £113,000 and a final repayment of the outstanding
balance on 31 July 2025 and bears interest at a floating rate of 5.1% over
base rate. As at 30 September 2024 the Group owed £3.5m (March-24: £3.9m).
A £0.5m overdraft facility with HSBC. The overdraft facility bears an
interest rate of 5.3% over LIBOR on the drawn amount. As at 30 September 2024
the Group had not used this overdraft facility.
A £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 quarterly instalments
recommencing in December 2024. The loan is secured by a secondary fixed and
floating charge on all the assets of the Group. As at 30 September 2024 the
Group owed £500K (March-24: £590K).
Convertible unsecured loan notes totaling £2.6m. £1.0m was issued in April
2024 with the loan bearing a fixed interest rate of 18% per annum, expiring on
the 13 September 2025. The interest is payable quarterly from issue date until
repayment or conversion on 13 September 2025. The Loan Note is convertible at
a conversion price of 8.1p, a ten percent discount to the closing mid-market
price of a Trakm8 ordinary share on 2 April 2024, the last practicable date
prior to the issue and reissue of the convertible notes. At the same time of
this issue, the existing Loan Note of £1.6m was extended to 13 September 2025
with the interest rate and conversion price being amended to 18% and 8.1p
respectively, matching the new Loan Note issued.
The Group's obligations under right of use assets are secured by the lessors'
title to the leased assets. Obligations under right of use assets by category
at 30 September 2024 were as follows:
Furniture, Total
fixtures
Freehold property and equipment Computer equipment
Motor Software
vehicles
£'000 £'000 £'000 £'000 £'000 £'000
Current 118 12 188 162 - 480
Non-current 168 1 272 148 - 589
Total 286 13 460 310 - 1,069
The maturity of obligations under right of use assets as at 30 September 2024
were as follows:
Freehold property Furniture,
fixtures Computer equipment
and equipment
Motor vehicles Software Total
£'000 £'000 £'000 £'000 £'000 £'000
Within 1 year 118 12 188 162 - 480
1 to 2 years 79 1 143 127 - 350
2 to 5 years 89 0 129 21 - 239
More than 5 years - - - - - -
Total 286 13 460 310 - 1,069
10. Share Capital
As at 30 September 2024 As at 30 September As at 31 March
2023
2024
No's No's No's
000's £'000 000's £'000 000's £'000
Authorised:
Ordinary shares of 1p each 200,000 2,000 200,000 2,000 200,000 2,000
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 2023 500
As at 30 September 2023 500
As at 31 March 2024 500
As at 30 September 2024 500
The Company currently holds 29,000 Ordinary shares in treasury representing
0.06% (March-24: 0.06%) 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.
11. Cash Generated from Operations
Six months to 30 September Six months to 30 September Year to 31 March
2024 2023 2024
Unaudited Unaudited Unaudited
£'000 £'000 £'000
Net profit/(loss) before taxation 5 13 (1,483)
Depreciation 383 381 769
(Profit)/Loss on disposal of fixed assets 197 209 449
(Profit)/Loss on disposal of right of use assets - - (62)
Net bank and other interest 584 429 833
Exceptional costs - 94 115
Amortisation of intangible assets 1,278 1,087 2,411
Exchange movements 5 (15) (7)
Share based payments 10 12 24
Operating cash flows before movement in working capital 2,462 2,210 3,049
Movement in inventories (203) (387) (80)
Movement in trade and other receivables (309) 1,590 3,386
Movement in trade and other payables (1,621) (1,018) (874)
Movement in provisions 21 21 (8)
Cash generated from operations before exceptional costs 350 2,416 5,473
Cash outflow from exceptional costs - (94) (115)
Cash generated from operations 350 2,322 5,358
Interest received 1 13 18
Income taxes received (6) 14 689
Net cash-inflow from operating activities 345 2,349 6,065
Income taxes received are in relation to funds received in relation to
Research and Development activities.
12. Restatements to Prior Periods
Previous periods have been adjusted to reflect two changes in presentation:
i) Ageing of future contract assets between Current and Non-Current Assets
The results for the six months to 30 September 2023 have been restated to
reflect the ageing of future contract assets. The effect of this change is as
follows:
- Results for the six months to 30 September 2023
- Other receivables within Non-Current Assets have been increased
by £1,203,000
- Other receivables within Current Assets reduced by £1,203,000
ii) Classification of customer platform hosting from Administrative expenses
to Cost of sales due to it being directly attributable to revenue generating
activities
The results for the six months to 30 September 2023 and the 12 months to 31
March 2024 have been restated to reclassify the variable costs for customer
platform hosting from Administrative expenses to Cost of Sales which more
accurately represents the financials of the Group. The effect of this change
is as follows:
- Results for the six months to 30 September 2023
- Increase Cost of Sales and decrease Gross Profit by £627,000
- Decrease Administrative Expenses by £627,000
- Results for the six months to 31 March 2024
- Increase Cost of Sales and decrease Gross Profit by £1,457,000
- Decrease Administrative Expenses by £1,457,000
Whilst the results for the year ended 31 March 2024 prior to these
restatements were audited, no audit has been completed on the relevant
restatements to this period.
13. Further Copies
This statement, full text of this announcement and the results presentation
can be found on the Group's website www.trakm8.com (http://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.
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