Quartix Holdings plc (AIM:QTX), a leading supplier of vehicle tracking systems and services to the fleet and insurance sectors, is pleased to announce its unaudited results for the half year ended 30 June 2018.
Restatement of comparatives:
All comparative monetary amounts for 2017 have been restated in line with the Group’s adoption of the recognition and measurement principles of IFRS 15: ‘Revenue from Contracts with Customers’ and the related ‘Clarifications to IFRS 15 Revenue from Contracts with Customers’ (See note 1).
Financial highlights:
- Group revenue increased by 7% to £12.9m (2017: £12.1m)
- Fleet revenue grew by 10% to £9.1m (2017: £8.3m)
- Insurance revenue comparable at £3.8m (2017: £3.8m)
- Adjusted EBITDA* of £4.1m (2017: £4.0m)
- Operating profit of £3.8m (2017: £3.8m)
- Profit before tax of £3.9m (2017: £3.8m)
- Diluted earnings per share of 6.86p (2017: 6.83p)
- Cash generated from operations of £3.3m (2017: £2.9m)
- Free cash flow ** of £2.8m (2017: £2.6m)
- Operating cash conversion*** of 86% (2017: 76%)
- Interim dividend of 2.4p per share proposed
* EBITDA adjusted for share based payment expense of £0.1m (see note 4)
** Cash generated from operating activities after investing activities
*** Cash generated from operations of £3.3m divided by operating profit of £3.8m
Operational highlights
Fleet
Good progress in the main fleet business
- Subscription base grew by 7% to 112,530 vehicles (31st December 2017: 105,314)
- Fleet installations grew by 6% to 15,220 (6ms 30 June 2017: 14,324)
- Customer base increased by 10% to 12,035 (31st December 2017: 10,961)
- Fleet invoiced recurring revenue increased by 11% to £8.4m (6ms 30 June 2017: £7.6m)
- Attrition* on a rolling 12-month basis was 12.0%, below the estimated 14% industry average
* Attrition is calculated as the difference between the number of new unit installations and the increase in active subscriptions between 1 July 2017 and 30 June 2018, expressed as a percentage of the mean subscription base between those two points in time: (28,124-15,559)/104,750 = 12.0%
UK & Ireland
- 86,300 active vehicle subscriptions, up 4% (31 December 2017: 83,210)
- 8,228 customers, up 7% (31 December 2017: 7,725)
France
- 15,390 active vehicle subscriptions, up 17% (31 December 2017: 13,131)
- 2,101 customers, up 18% (31 December 2017: 1,776)
USA
- 10,840 active vehicle subscriptions, up 21% (31 December 2017: 8,973)
- 1,706 customers, up 17% (31 December 2017: 1,460)
Insurance
Continue to refocus insurance business away from lower margin indirect business, growing our direct offering.
- Insurance installations comparable at 23,969 (2017: 23,947).
- Volumes in the period were lower than in the second half of 2017, although some stabilisation seen towards the end of the second quarter.
- This stabilisation was, in large part, due to growth achieved in the Company’s ‘Powered by Quartix’ direct offering to insurance brokers, offering improved margins for this area of the business.
Andy Walters, Managing Director of Quartix, commented: “We have made good progress in the first half. We have continued to focus on our key fleet business, resulting in strong growth in international markets. As indicated two years ago we have restricted our insurance business to those applications which appropriately value the Group’s service and technology, and as a consequence our revenue in that sector was comparable with that of last year. So it is pleasing to see that good growth in the fleet sector enabled us to report total revenue of £12.9m, representing an increase of 7% overall.”
“We achieved substantial progress in our subscription bases in France and the USA, as these markets registered increases of 35% and 42% respectively over the past 12 months. The UK subscription base grew by 11% over the same period. This rate of growth in the UK is lower than in previous years and we have therefore undertaken appropriate management actions and changes to reverse this trend.”
“I am pleased to report that we are on track to meet market expectations for the year as a whole”.
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