TIDMQTX
RNS Number : 3740E
Quartix Technologies PLC
07 July 2021
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
in the UK, announces that it will publish interim results for the
six-month period ending 30 June 2021 (the "Period") on Wednesday 28
July 2021. They will be posted on the Company's website that
morning, together with accompanying presentations.
The Company is pleased to report that trading for the first 6
months of the year has been good, following a period of strong
growth in new fleet telematics installations, and in line to
achieve consensus market expectations for the year(1) . The Board
expects to report revenue of GBP12.5m, adjusted EBITDA of
approximately GBP2.7m and underlying free cash flow(2) of
approximately GBP1.3m for the Period. The Company's cash balance
was GBP 4.2m at 30 June 2021.
Although the sourcing of electronic components has been
challenging during the first half, the Group has been able to
secure its production supplies and remains confident of doing so
through the rest of 2021. This has, however, been at the expense of
higher costs in some cases and of needing to purchase larger
quantities where components are available. This has had an impact
on free cashflow in the Period and could have a moderate impact on
free cashflow for the year as a whole if contingency stock levels
need to be increased, but the additional costs are not expected to
have a material impact on the Company's expected financial
performance for the year.
Fleet telematics
The Company achieved strong growth in new installations, which
were 31% ahead of H1 2020, at 25,497 units. This result was also
13% ahead of the same period in 2019, which was previously the
highest recorded for a 6-month period. All major territories are
now operating at above pre-pandemic levels with the exception of
the UK, where record orders in H1 2019 were driven by a significant
number of larger contract wins and distribution orders. This will
be an area of focus for the Company's sales teams as contact
restrictions are lifted.
New installations in international markets exceeded those in the
UK for the first time, and performance in the Group's new
territories and France were particularly encouraging. Further
investment initiatives are already underway which are expected to
contribute to continued growth in the second half.
As a consequence of the growth in new installations, the fleet
subscription base at 30 June increased to 188,155 vehicles, up 8%
since the start of the year. The Company now has 20,698 fleet
clients (1 January 2021: 19,039).
New fleet telematics installations for the first half are shown
in the table below. Exact totals may vary in preparation of the
interim results.
2021
vs.
2021 2020 Growth 2019 2019
UK/Eire 12,053 10,017 20% 13,369 -10%
France 5,631 3,959 42% 4,461 26%
USA 4,852 4,274 14% 4,365 11%
New territories* 2,961 1,230 141% 309 858%
------- ------- ------- ------
Total 25,497 19,480 31% 22,504 13%
------- ------- ------- ------- ------
* Note: new territories include Spain, Italy, Germany and
Poland.
Insurance telematics
Further restrictions on driving tests and the young-driver
market in the UK are expected to have reduced Company revenues in
the insurance telematics sector by a further 60% compared with
2020, with 3,540 units installed in the first half (2020:
9,915).
In line with Quartix's stated strategy of focusing on fleet
telematics, the insurance sector is expected to represent just 7%
of H1 revenues and, given the current worldwide shortage of
electronic components as described above, the Company has taken the
decision to terminate the supply of new installations for its main
insurance client in order to prioritise its fleet operations. Under
a new agreement Quartix will only continue to provide tracking
systems for the customer's existing policy holders and will provide
data and warranty services for a contractually agreed monthly
service fee until September 2022. This will not have a material
impact on the Company's expected financial performance for the
year. Insurance revenues in 2022 are expected to represent
approximately 3% of Group turnover.
Andy Walters, Chief Executive Officer of Quartix commented:
"I am delighted with the growth in new installations achieved in
our fleet business during the first half. Our focus on fleet and
the strategic move away from insurance over the past 5 years has
served us well during the pandemic and we continue to invest in
building our sales channels in each territory. We look forward to
the second half with confidence and to updating investors on
progress in three weeks' time."
(1) The Board believes that consensus market expectations for
2021 prior to this announcement, were as follows: Revenue:
GBP25.6m; Adjusted EBITDA GBP5.1m; Underlying Free Cash Flow(2) :
GBP4.0m.
(2) Underlying Free Cash Flow stated before expenditure on 3G
swap out in the US - see 2020 Annual Report
For further information, please contact:
Quartix (www.quartix.net)
Andrew Walters, Chief Executive Officer
Emily Rees, Chief Financial Officer 01686 806 663
finnCap (Nominated Adviser and Broker)
Matt Goode / Kate Bannatyne / Milesh
Hindocha (Corporate Finance)
Alice Lane (Corporate Broking) 020 7220 0500
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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