Commercial GPS tracking manufacturer Quartix Holdings Plc (LON: QTX) said that it was to ‘at least’ meet market expectations for full-year earnings and cash flow.
This news comes with the company posting its latest trading update, which confirms increased sales and installations of tracking equipment on-year, alongside development of its new 4G telematics system and a continued reduction of its lower-margin insurance tracking operations.
Trading update
“Management expects to report revenue, adjusted EBITDA and free cash flow for the First Half of approximately £12.6m, £3.5m and £3.0m, respectively. This has been delivered alongside a continuation of the increase in investment in sales and marketing activity which commenced during the last financial period.” said the company in its update.
“As a result, management’s expectations for the full year are that revenue will now be at least £25m and that adjusted EBITDA and free cash flow will at least meet market expectations* for the year.”
Comments regarding fleet expansion,
“This increased investment has driven strong growth in the Company’s core fleet business: total new installations are approximately 45% ahead of the same period last year, and excellent progress has been made in each of the Company’s existing markets (UK, France and USA). Fleet revenue in the First Half is expected to have grown by £1m to just over £10m.”
“The fleet subscription base is expected to reach 137,000 vehicles by the end of the First Half and the value of the base (which is an indicator of future revenues) has also shown accelerated growth.”
In response to the positive update, Company Chief Executive Officer Andy Walters, said,
“We are delighted with the expansion of our fleet subscription base in the First Half. We significantly increased investment in customer acquisition and achieved a substantial improvement in growth, and are now confident of at least meeting expectations for revenue, profit and cashflow for the year.”
“We are well positioned for future growth in our fleet business and continue to review the opportunities to invest in this further. We look forward to updating shareholders on our progress on 24 July.”
Quartix investor update
On the posting of the update, the company’s shares rallied 10.59% or 27p to 282p a share. Analysts from finnCap have reiterated their ‘Corporate’ stance on Quartix stock.
