Microlise Group is a SaaS-based transport management technology company that has more than 400 customers with over 500,000 vehicles using its software. Although hardware is supplied, it is the software that provides the long-term cash generative ability of the company.
One of the most impressive things is that the churn rate is around 1%. The software focus probably helps but it is an indication that the software is well thought of by the end customers and it is useful to them. Signing customers up on multiyear deals also helps.
Cash generation outstrips revenues because many of the customers sign up for up to five years and pay in advance. Trading has recovered in the six months to June 2021, and it is above pre-pandemic levels.
There is plenty of organic growth potential ...