TIDMTRAK
RNS Number : 0865G
Trakm8 Holdings PLC
23 November 2020
23 November 2020
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 2020:
Financial Highlights
6 months 6 months Year to Change
to to 31
30 Sept 30 Sept March 2020
2020 2019
Unaudited Unaudited Audited
GBP000 GBP000 GBP000
-------------- -------------- -------------- -------
Revenue 7,321 8,867 19,550 -17%
-------------- -------------- -------------- -------
of which, recurring revenue(1) 4,635 4,885 9,753 -5%
-------------- -------------- -------------- -------
Loss before tax (845) (2,197) (1,705) -62%
-------------- -------------- -------------- -------
Adjusted loss before tax(2) (314) (1,583) (224) -80%
-------------- -------------- -------------- -------
Loss after tax (732) (1,787) (1,093) -59%
-------------- -------------- -------------- -------
Cash generated from operations 2,055 1,432 4,115 +44%
-------------- -------------- -------------- -------
Net Debt(3) 5,574 6,095 5,643 -9%
-------------- -------------- -------------- -------
Basic (loss)/ earnings per
share (1.46p) (3.57p) (2.19p) -59%
-------------- -------------- -------------- -------
Adjusted basic (loss)/ earnings
per share (0.56p) (2.53p) 0.28p -78%
-------------- -------------- -------------- -------
1 Recurring revenues are generated from ongoing 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
Operational Overview
-- H1 2020 results:
o Significant reduction in losses despite revenue decline as a
result of Covid-19
o Improving revenues later in the period, following significant
drop in April and May upon Covid-19 lockdown
o Significantly improved gross margins due to lower hardware,
labour, communications and installation costs
o Reduced overheads as a result of efficiency improvements
implemented in FY2020, which includes lower payroll costs
o Improved cash generation from operations due to significant
reduction in losses, PAYE & VAT deferments and strong working
capital actions
o Launch of extended range of self-fit telematics devices
-- Continuation of new contract wins and renewals:
o Optimisation contract awarded by major UK food retailer
o Strong period of contract renewals in the Fleet business,
despite Covid-19 all significant contracts due for renewal in the
period have been renewed
o Installed base increases in Insurance from existing and new
customers offset in part by Fleet reductions
o Approximately 253,000 connections (March 2020: 245,000
connections), an increase of 8,000 connections, a 3% increase in
the six month period since last year end
-- Stronger H2 and FY2021 outlook:
o Major automotive customer committed to a further 24,000 units
over next 12 months following their European launch
o Strong level of orders, post period, from existing and new
Fleet customers
o Additional efficiency savings implemented
o Investment in engineering to deliver additional gross margin
improvements over the next 6 months
Outlook
Revenues picked up during the first half with revenues in the
second quarter 23% higher than in the first quarter. This
improvement continued into October in both Insurance and Fleet,
resulting in this being the highest revenue month to date this
financial year. The Insurance business benefitted from increasing
device shipments to both existing and recently won customers
resulting in both September and October 2020 shipments being 50%
higher than March 2020. Fleet sales team performance has returned
to pre Covid-19 levels, with the total value of orders in the first
half 16% up on the first half of the prior year. Orders in October
2020 were 12% up on October 2019.
However due to the second lockdown there is a softening in the
market and increased uncertainty that means the Group is still not
able to provide guidance for the full financial year at this time.
However the Group expects revenue in the second half to be
significantly higher than the first half given current orders, even
with a reasonable downside scenario taken into account for the
ongoing impact of Covid-19.
- Ends -
For further information:
Trakm8 Holdings plc
John Watkins, Executive Chairman Tel: +44 (0) 167 543 4200
Jon Furber, Finance Director www.trakm8.com
Arden Partners plc (Nominated Adviser Tel: +44 (0) 20 7614 5900
& Broker)
Paul Shackleton, Head of Corporate www.arden-partners.com
Finance
Simon Johnson, Head of Sales
About Trakm8
Trakm8 is a UK based technology leader in fleet management,
insurance telematics, connected car, and optimisation. Through IP
owned technology, the Group analyses data collected by 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, self-installed telematics units and one of the
widest ranges of installed telematics devices. Trakm8 has over
253,000 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, Saint
Gobain, EON, Iceland Foods, Direct Line Group and Ingenie.
Trakm8 has been listed on the AIM market of the London Stock
Exchange since 2005.
www.trakm8.com / @Trakm8
Executive Chairman's Statement
Results
I am pleased to report Trakm8's results for the six months ended
30 September 2020.
The first half of the financial year was significantly impacted
by the Covid-19 pandemic. In the early months of the period Fleet
activity reduced very significantly. Sales of insurance policies
reduced dramatically as vehicles were "sorned", driving lessons and
tests cancelled. Gradually over the period both Fleet and Insurance
demand levels improved. I am pleased that overall we secured new
orders some 10% higher than the same six months of last year.
However, overall revenues reduced by 17% in the period to
GBP7.32m (H1 2019: GBP8.87m). There was a reduction of GBP0.53m in
Insurance and Automotive revenues and a reduction in Fleet and
Optimisation revenues of GBP1.02m.
Total recurring revenues decreased by 5% during the period to
GBP4.63m (H1 2019: GBP4.89m), as a result of the decline in the
connected base in the Fleet market. The reduction in service fees
year on year took place in the early months of the period and have
since recovered. Recurring revenues represent 63% of Group revenues
(H1 2019: 55%). Covid-19 materially increased Fleet attrition
during the period and the slow start for new orders meant new
deployments were substantially lower than normal, overall reducing
connections by 7,000 units since March 2020 to 70,000 (9%).
Despite the large reduction in telematics insurance policies
being written across the market, our success in rolling out
solutions to a number of additional clients has resulted in device
shipments 14% ahead of the same period last year with the month of
September being 177% greater than April. As a result, Insurance
& Automotive connections increased by 15,000 since March 2020,
to 183,000 (9%). We estimate that the impact of Covid-19 has
resulted in circa 33,000 connections less than it would have
been.
Gross profit margin has increased to 62% (H1 2019: 53%). This is
due in part to the higher recurring revenues as a percentage of
sales but also due to the vigorous actions taken over the past 24
months to introduce hardware with lower costs, reduce the direct
labour costs and to reduce the cost of communications and
installations. This trend is expected to continue as further cost
improvements are delivered.
Total overhead costs, excluding exceptional costs and share
based payments reduced by GBP1.61m to GBP4.71m (H1 2019: GBP6.32m).
This is the result of the cost actions taken over the last 12
months along with GBP0.77m of furloughed staff costs which have
been charged to exceptional costs, which have been offset by
GBP0.55m of furlough grant received. In addition to this GBP1.61m
reduction in overheads the level of R&D expenditure capitalised
has reduced by GBP0.27m. Exceptional costs in the period of
GBP0.44m include headcount reduction activity undertaken during the
period and costs associated with the impact of Covid-19.
Despite the challenges of Covid-19, I am pleased to report that
the Group adjusted loss reduced by 80% to GBP0.31m (H1 2019:
GBP1.58m). Loss before Tax reduced by 62% to GBP0.85m (H1 2019:
GBP2.20m). We estimated if it had not been for the significant
impact of Covid-19 that we would have been profitable under both
profit measures.
Financial position
Net cash inflow from operating activities was GBP2.06m (H1 2019:
GBP1.43m). During the period the R&D tax claim of GBP0.86m was
offset against agreed PAYE/NI deferments. At the 30 September
GBP1.10m of VAT and PAYE/NI deferments have been agreed, with a
repayment schedule that runs into next financial year. The
improvement in cash inflow from operating activities is a good
result, reflective of the significant reduction in losses and
continued strong working capital management, which includes a
GBP0.34m reduction in inventory since last financial year end.
The overall cash outflow for the period was GBP0.12m, which was
an improvement of GBP0.39m from the prior period. This resulted
from the improvement in the cash inflow from operating activities
detailed above, and GBP0.27m reduction in capitalised development
costs.
Net debt as at 30 September 2020 excluding the impact of the
IFRS16 lease recognition was lower than both September last year
and the end of the last financial year at GBP5.57m (H1 2019:
GBP6.10m) (31 March 2020: GBP5.64m) including GBP1.54m of cash (H1
2019: GBP0.69m). In addition, the Group at 30 September 2020 held
an undrawn credit facility of GBP0.50m at HSBC. Net Debt including
IFRS 16 reduced to GBP7.27m (H1 2019: GBP8.42m), (31 March 2020:
GBP7.95m).
The revolving credit facility with HSBC of which GBP4.50m was
drawn at 30 September 2020 is due for renewal on 30 September 2021,
therefore still had 12 months to run from 30 September 2020. As a
result this is now reported within current liabilities on the
balance sheet and the reason why they increased from GBP7.43m to
GBP11.70m. The Group expects to extend this facility before year
end.
Strategy
The Group has been following the strategy outlined in the 2020
Annual Report. Our focus is to provide ever more meaningful
insights to our customers using the data generated by our installed
devices and other connections so that they can run their operations
more efficiently and safely.
Our primary strategy going forward is to return to growth of our
business through more connections, increased device sales and
higher service fees. Due to the high level of new contract wins in
the Insurance space the number of connections have increased
overall by 5% in the past 12 months and by 3% in past 6 months. The
number of devices sold has increased by 11% to 49,000 (H1 2019:
44,000). Increased market share is anticipated following the
introduction of additional self-fit devices.
Trakm8 has focused on delivering market leading technology and
ensuring that the solutions are generating the best possible ROI's
for our customers. We have, for another year, further reduced the
levels of expenditure in R&D but believe we have appropriate
levels of resource to continue to invest heavily to meet the
demands of the market and customers. We will continue to own the
majority of IP in our value chain. The technical challenges of the
RH600 product experienced in previous years have been resolved and
new generations of the product will have significant additional
features.
Our third strategy has been to improve the efficiencies of our
business in every possible way. We have been extremely successful
in delivering the GBP1.5m reduction on all costs year-on-year
promised last year (on top of the GBP2.0m savings delivered in the
previous year). We have continued to focus on this and have
implemented a further GBP0.6m of annualised cost reductions by the
end of the period. We will continue to seek efficiencies as we go
forward.
JOHN WATKINS
Executive Chairman
Unaudited Consolidated Statement of Comprehensive Income for the
six months to 30 September 2020
Six months Six months Year to
to 30 September to 30 September 31 March
2020 2019 2020
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Note
Revenue 3 7,321 8,867 19,550
Cost of sales (2,804) (4,174) (7,991)
Gross profit 4,517 4,693 11,559
Other income 4 103 213 364
Administrative expenses excluding
exceptional costs (4,800) (6,435) (11,926)
Exceptional administrative
costs 7 (442) (501) (1,296)
Total administrative costs (5,242) (6,936) (13,222)
Operating loss (622) (2,030) (1,299)
Finance income 39 3 12
Finance costs 8 (262) (170) (418)
Loss before taxation (845) (2,197) (1,705)
Income tax 113 410 612
Loss for the period (732) (1,787) (1,093)
Other Comprehensive Income
Items that may be subsequently reclassified
to profit or loss:
Exchange differences on translation of
foreign operations 5 1 (7)
Total other comprehensive income 5 1 (7)
-------------------- ------------------ -------------
Total Comprehensive Loss for the
period attributable to owners of
the parent 5 (727) (1,786) (1,100)
-------------------- ------------------ -------------
Adjusted operating loss before
tax 6 (314) (1,583) (224)
Loss before taxation (845) (2,197) (1,705)
Exceptional administrative
costs 442 501 1,296
IFRS2 Share based payments charge 89 113 185
-------------------- ------------------ -------------
Loss per ordinary share (pence) attributable to
owners of the Parent
Basic 9 (1.46) (3.57) (2.19)
Diluted 9 (1.46) (3.57) (2.19)
Adjusted basic loss per share
(pence) 9 (0.56) (2.53) 0.28
Adjusted diluted loss per share
(pence) 9 (0.56) (2.53) 0.28
---------------------------------------- ----- -------------------- ------------------ -------------
The results relate to continuing operations.
Unaudited Consolidated Statement of Changes in Equity for the
six months to 30 September 2020
Share Share Merger Translation Treasury Retained Total
capital premium reserve reserve reserve earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance as at
1 April
2019 500 14,691 1,138 203 (4) 5,566 22,094
-------------- --------------- --------------- -------------- -------------------- ---------- --------------
Comprehensive income
Loss for the
period - - - - - (1,787) (1,787)
Other comprehensive income
Exchange
differences
on
translation
of overseas
operations - - - 1 - - 1
-------------- --------------- --------------- -------------- -------------------- ---------- --------------
Total
comprehensive
income - - - 1 - (1,787) (1,786)
Transactions with owners
IFRS 2
Share-based
payments - - - - - 113 113
Transactions
with owners - - - - - 113 113
-------------- --------------- --------------- -------------- -------------------- ---------- --------------
Balance as at
30 Sept
2019 500 14,691 1,138 204 (4) 3,892 20,421
-------------- --------------- --------------- -------------- -------------------- ---------- --------------
Comprehensive income
Loss for the
period - - - - - 694 694
Other comprehensive income
Exchange
differences
on
translation
of overseas
operations - - - (8) - - (8)
Total
comprehensive
income - - - (8) - 694 686
-------------- --------------- --------------- -------------- -------------------- ---------- --------------
Transactions with owners
IFRS2
Share-based
payments - - - - - 72 72
Transactions
with owners - - - - - 72 72
-------------- --------------- --------------- -------------- -------------------- ---------- --------------
Balance as at
31 March
2020 500 14,691 1,138 196 (4) 4,658 21,179
-------------- --------------- --------------- -------------- -------------------- ---------- --------------
Comprehensive income
Loss for the
period - - - - - (732) (732)
Other comprehensive income
Exchange
differences
on
translation
of overseas
operations - - - 5 - - 5
Total
comprehensive
income - - - 5 - (732) (727)
-------------- --------------- --------------- -------------- -------------------- ---------- --------------
Transactions
with owners
IFRS2 Share
based
payments - - - - - 89 89
Transactions
with owners - - - - - 89 89
-------------- --------------- --------------- -------------- -------------------- ---------- --------------
Balance as at
30 Sept
2020 500 14,691 1,138 201 (4) 4,015 20,541
-------------- --------------- --------------- -------------- -------------------- ---------- --------------
Unaudited Consolidated Statement of Financial Position as at 30
September 2020
As at 30 As at 30 As at
September September 31 March
2020 2019 2020
Note Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Non-current assets
Intangible assets 10 22,230 21,337 21,997
Plant, property and
equipment 831 716 717
Right of use assets 14 2,838 3,073 3,004
Deferred income tax
asset - 39 -
Amounts receivable under finance
leases 65 65 41
25,964 25,230 25,759
------------------- ------------------ --------------
Current assets
Inventories 1,701 2,119 2,043
Trade and other receivables 7,171 6,710 7,854
Corporation tax receivable 317 1,320 863
Cash and cash equivalents 1,541 692 1,665
10,730 10,841 12,425
------------------- ------------------ --------------
Current liabilities
Trade and other payables (5,574) (5,750) (6,180)
Borrowings 11 (5,417) (1,013) (1,125)
Right of use liability 14 (679) (639) (656)
Provisions (26) (26) (27)
(11,696) (7,428) (7,988)
------------------- ------------------ --------------
Current assets less current
liabilities (966) 3,413 4,437
------------------- ------------------ --------------
Total assets less current
liabilities 24,998 28,643 30,196
------------------- ------------------ --------------
Non-current liabilities
Trade and other payables (593) (630) (713)
Borrowings 11 (1,231) (5,198) (5,675)
Right of use liability 14 (1,941) (2,257) (2,162)
Provisions (179) (137) (157)
Deferred income tax
liability (513) - (310)
(4,457) (8,222) (9,017)
------------------- ------------------ --------------
Net assets 20,541 20,421 21,179
------------------- ------------------ --------------
Equity
Share capital 12 500 500 500
Share premium 14,691 14,691 14,691
Merger reserve 1,138 1,138 1,138
Translation reserve 201 204 196
Treasury reserve (4) (4) (4)
Retained earnings 4,015 3,892 4,658
Total equity attributable to owners
of the parent 20,541 20,421 21,179
------------------- ------------------ --------------
Unaudited Consolidated Cash Flow Statement for the six months to
30 September 2020
Six months Six months Year
to to to
30 September 30 September 31 March
2020 2019 2020
Note Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Net cash generated from operating activities 13 2,055 1,432 4,115
---------------------- --------------------- -----------
Cash flows from investing activities
Purchases of property, plant and
equipment (183) - (20)
Purchases of software (24) (1) (23)
Capitalised Development costs (1,220) (1,488) (3,156)
Net cash used in investing activities (1,427) (1,489) (3,199)
---------------------- --------------------- -----------
Cash flows from financing activities
New bank loan - 500 2,000
Repayment of bank loans (171) (505) (1,440)
Repayment of obligations under lease
agreements (344) (281) (630)
Interest paid (237) (170) (386)
Net cash generated from financing activities (752) (456) (456)
---------------------- --------------------- -----------
Net (decrease)/ increase in cash and
cash equivalents (124) (513) 460
Cash and cash equivalents at beginning
of period 1,665 1,205 1,205
Cash and cash equivalents at end of
period 1,541 692 1,665
---------------------- --------------------- -----------
Notes To The Unaudited Consolidated Financial Statements
1. Basis of preparation
The Group's interim results for the 6 months to 30 September 2020 (prior
period 30 September 2019) were approved by the Board of Directors on
20 November 2020.
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
statements are the same as those set out in the Group's annual financial
statements for the year ended 31 March 2020. The Group adopted IFRS16
on a modified retrospective basis, this is disclosed in note 14. 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 2020 have been delivered to the Registrar of
Companies. The audit report of those accounts was unqualified, but
did include an emphasis of matter due to the financial uncertainty
created within the economy by the Coronavirus pandemic resulting in
increased difficulty in forecasting future results for the Group. The
audit report did not contain a statement under Section 498(2) or (3)
of the Companies Act 2006.
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.
Exceptional Items
Exceptional items are those items that, in the Directors' view, are
required to be separately disclosed by virtue of their size or incidence
to enable a full understanding of the Group's financial performance.
See note 7 for further details.
2. Risks and uncertainties
The Board has considered the principal risks and uncertainties for the
second half of the financial year and determined that the risk presented
in the 31 March 2020 Annual Report, described as follows, also remain
relevant to the rest of the financial year: Significant operational
system failure; Cyber-attack and data security; Brexit and a deteriorating
economic climate; Operating in a fast-moving technology industry where
we will always be at risk from new products; Adverse mobile network
changes; Attracting and maintaining high-quality employees; Access to
long term and working capital; Electronic supply chain under constraint
and Covid-19 impacting internal and operational capacity and significant
economic impact. These are detailed on pages 20 to 22 of the 2020 Annual
Report, a copy of which is available on the Group's website at 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 Six months Six months
are as follows: to to Year to
30 September 30 September 31 March
2020 2019 2020
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Solutions: 7,321 8,867 19,550
Fleet and optimisation 4,419 5,435 12,034
Insurance and automotive 2,902 3,432 7,516
------------- ------------- ---------
4. Other income
Six months Six months
to to Year to
30 September 30 September 31 March
2020 2019 2020
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Grant income 103 213 361
R&D tax credit - - 4
R&D tax credit adjustment in respect
of prior periods - - (1)
103 213 364
-------------------- ------------------ ---------
5. Loss per ordinary share attributable to the owners of the parent
Six months Six months
to to Year to
30 September 30 September 31 March
2020 2019 2020
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Loss attributable to the owners
of the parent (727) (1,786) (1,100)
------------- ------------- ---------
6. Adjusted loss before tax
Adjusted Loss Before Tax is monitored by the Board
and measured as follows:
Six months Six months
to to Year to
30 September 30 September 31 March
2020 2019 2020
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Loss Before Tax (845) (2,197) (1,705)
Exceptional administrative costs 442 501 1,296
Share based payments 89 113 185
Adjusted loss before tax (314) (1,583) (224)
-------------- ------------- ----------
7. Exceptional costs
Six months Six months
to to Year to
30 September 30 September 31 March
2020 2019 2020
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Acquisition costs - 41 52
Integration and restructuring
costs 97 227 602
Covid-19 costs 891 - 200
Furlough grant income (546) - -
New product component refit costs - 233 442
442 501 1,296
------------- ------------- ---------
The integration and restructuring costs in the current year
relate to an ongoing project to streamline and rationalise the
operations of the business.
The Group has also incurred exceptional costs in the current
financial year relating to the Covid-19 pandemic. These costs
relate to a variety of overheads including employee costs,
cancelled marketing events and bad debts resulting from
Covid-19.
Furlough grant income relates to other income received from the
Coronavirus Job Retention Scheme for employees furloughed as a
result of Covid-19.
Detailed explanation of prior year exceptional costs are
detailed on page 64 of the 2020 Annual Report, a copy of which is
available on the Group's website at www.trakm8.com .
8. Finance costs
Six months Six months
to to Year to
30 September 30 September 31 March
2020 2019 2020
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Interest on bank loans 191 106 284
Amortisation of debts issue costs 21 14 32
Interest on Hire Purchase and similar
agreements 50 50 102
262 170 418
------------- ------------- ---------
9. 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 Six months
to to Year to
30 September 30 September 31 March
2020 2019 2020
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Loss the year after taxation (732) (1,787) (1,093)
Exceptional administrative
costs 442 501 1,296
Share based payments 89 113 185
Tax effect of adjustments (84) (95) (246)
Adjusted (loss)/profit after
taxation (285) (1,268) 142
------------------- ---------------- -------------
No. No. No.
'000 '000 '000
Number of Ordinary shares of
1p each 50,004 50,004 50,004
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 loss per share (1.46p) (3.57p) (2.19p)
Diluted loss per share (1.46p) (3.57p) (2.19p)
Adjust for effects of:
Exceptional costs 0.72p 0.81p 2.10p
Share based payments 0.18p 0.23p 0.37p
Adjusted basic (loss)/earnings
per share (0.56p) (2.53p) 0.28p
Adjusted diluted (loss)/earnings per share (0.56p) (2.53p) 0.28p
10. Intangible Assets
Goodwill Intellectual Customer Development Software Total
property Relationships costs
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cost
As at 31 March 2019 10,417 1,920 100 14,034 2,033 28,504
Additions - Internal development - - - 1,378 - 1,378
Additions - External purchases - - - 110 23 133
Reclassification of right
of use assets (153) (153)
-------- ------------ -------------- ----------- -------- --------
As at 30 September 2019 10,417 1,920 100 15,522 1,903 29,862
Additions - Internal development - - - 1,385 - 1,385
Additions - External purchases - - - 283 - 283
-------- ------------ -------------- ----------- -------- --------
As at 31 March 2020 10,417 1,920 100 17,190 1,903 31,530
Additions - Internal development - - - 1,200 - 1,200
Additions - External purchases - - - 20 24 44
-------- ------------ -------------- ----------- -------- --------
As at 30 September 2020 10,417 1,920 100 18,410 1,927 32,774
-------- ------------ -------------- ----------- -------- --------
Amortisation
As at 31 March 2019 - 1,849 89 4,632 769 7,339
Charge for period - 30 11 1,007 138 1,186
-------- ------------ -------------- ----------- -------- --------
As at 30 September 2019 - 1,879 100 5,639 907 8,525
Charge for period - 31 - 840 137 1,008
-------- ------------ -------------- ----------- -------- --------
As at 31 March 2020 - 1,910 100 6,479 1,044 9,533
Charge for period - 10 - 867 134 1,011
-------- ------------ -------------- ----------- -------- --------
As at 30 September 2020 - 1,920 100 7,346 1,178 10,544
-------- ------------ -------------- ----------- -------- --------
Net book amount
As at 30 September 2020 10,417 - - 11,064 749 22,230
-------- ------------ -------------- ----------- -------- --------
As at 31 March 2020 10,417 10 - 10,711 859 21,997
-------- ------------ -------------- ----------- -------- --------
As at 30 September 2019 10,417 41 - 9,883 996 21,337
-------- ------------ -------------- ----------- -------- --------
As at 31 March 2019 10,417 71 11 9,402 1,264 21,165
-------- ------------ -------------- ----------- -------- --------
11. Borrowings
As at 30 September As at 30 September As at 31 March
2020 2019 2020
---------------------- ---------------------- ----------------------
Current Non-Current Current Non-Current Current Non-Current
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Borrowings 5,417 1,231 1,013 5,198 1,125 5,675
Right of use liability 679 1,941 639 2,257 656 2,162
Totals 6,096 3,172 1,652 7,455 1,781 7,837
-------- ------------ -------- ------------ -------- ------------
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 GBP5.0m 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
until 2021 and bears interest at a floating rate of 1.95% over base
rate. As at 30 September 2020 the Group owed GBP0.7m (30 Sept 2019:
GBP1.4m, 31 Mar 2020: GBP0.9m).
A GBP5.0m revolving credit facility with HSBC which is repayable in
full on 30 September 2021. The loan bears an interest rate of 4.5%
over LIBOR on the drawn amount and a fee of 0.8% on the undrawn facility.
As at 30 September 2020 the Group had drawn down GBP4.5m of this credit
facility (30 Sept 2019: GBP4.9m, 31 Mar 2020: GBP4.5m).
GBP1.5m growth capital loan with MEIF WM Debt LP. The loan bears a
fixed interest rate of 8% per annum and is repayable in 13 quarterly
instalments commencing on 30 June 2021. As at 30 September 2020 the
Group owed GBP1.5m (30 Sept 2019: GBPnil, 31 Mar 2020: GBP1.5m).
The Group's obligations under right of use assets are secured by the
lessors' title to the leased assets (see note 14).
12. Share Capital
As at 30 September As at 30 September As at 31 March
2020 2019 2020
--------------------- --------------------- ------------------
No's No's No's
000's GBP'000 000's GBP'000 000's GBP'000
Authorised:
Ordinary shares of 1p each 200,000 200,000 200,000 200,000 200,000 200,000
Allotted, issued and fully
paid:
Ordinary shares of 1p each 50,004 500 50,004 500 50,004 500
Movement in share capital: GBP'000
As at 1 April 2019 500
--------
As at 30 September 2019 500
--------
As at 31 March 2020 500
As at 30 September 2020 500
--------
The Company currently holds 29,000 Ordinary shares in treasury
representing 0.06% (2018: 0.08%) 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.
13. Cash Generated from Operations
Six months Six months
to to Year to
30 September 30 September 31 March
2020 2019 2020
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Net loss before taxation (845) (2,197) (1,705)
Depreciation 380 334 699
Amortisation of intangible assets 1,011 1,186 2,194
Exchange movements - - (7)
Interest received (39) (3) -
Bank and other interest charges 262 170 406
Share based payments 89 113 185
------------------- ------------- ---------
Operating cash flows before movement in
working capital 858 (397) 1,772
Movement in inventories 342 617 693
Movement in trade and other receivables 659 1,750 589
Movement in trade and other payables (726) (573) (21)
Movement in provisions 21 21 42
Cash generated from operations 1,154 1,418 3,075
Interest received 39 3 12
Income taxes received 862 11 1,028
Net cash inflow from operating
activities 2,055 1,432 4,115
------------------- ------------- ---------
14. IFRS 16 Leases
This note explains the impact of the adoption of IFRS16 Leases
which the Group adopted with effect from 1 April 2019 on the
group's financial statements. The Group principally leases real
estate and vehicles. Leases are recognised as a right of use asset
with a corresponding liability recorded at the date at which the
leased asset is available for use by the Group.
The movements in right of use assets were as follows:
Furniture,
Freehold fixtures Computer Motor
property and equipment equipment vehicles Software Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
As at 1 April 2019 2,098 - - 412 - 2,510
Reclassification* - 446 140 - 153 739
Lease additions - 63 35 - - 98
Lease terminated - - - (13) - (13)
Depreciation of right
of use assets (132) (24) (31) (74) - (261)
As at 30 September 2019 1,966 485 144 325 153 3,073
Lease additions - - - 244 - 244
Lease terminated - - - (24) - (24)
Depreciation of right
of use assets (132) (25) (31) (101) - (289)
As at 31 March 2020 1,834 460 113 444 153 3,004
Lease additions - - 76 79 - 155
Lease terminated - - - (10) - (10)
Depreciation of right
of use assets (132) (46) (16) (117) (311)
As at 30 September 2020 1,702 414 173 396 153 2,838
---------- --------------- ----------- ---------- --------- --------
*Amounts previously recognised as finance lease assets have been
reclassified to right of use assets upon transition to IFRS 16 on 1
April 2019.
Lease liabilities by category at 30 September
2020 were as follows:
Furniture,
Freehold fixtures Computer Motor
property and equipment equipment vehicles Software Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Current 272 117 15 204 71 679
Non-current 1482 166 44 196 53 1941
Total 1,754 283 59 400 124 2,620
---------- --------------- ----------- ----------- --------- --------
The maturity of lease liabilities at 30 September 2020
were as follows:
Furniture,
Freehold fixtures Computer Motor
property and equipment equipment vehicles Software Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Within 1 year 272 117 15 204 71 679
1 to 2 years 297 91 15 147 46 596
2 to 5 years 805 75 29 49 7 965
More than 5 years 380 - - - - 380
Total 1,754 283 59 400 124 2,620
---------- --------------- ----------- ---------- ---------------- -------------
15. Further Copies
This statement, full text of the Stock Exchange announcement and
the results presentation can be found on the Group's website
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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END
IR BBBDBUUDDGGB
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