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Trakm8's shares dive as it misses profit and revenue expectations

By Duncan Ferris

Date: Monday 08 Jul 2019

Trakm8's shares dive as it misses profit and revenue expectations

(Sharecast News) - Trakm8's shares slid on Monday after the company said it swung to an annual loss, with revenues hit by sales-related challenges and contract delays.
The global telematics and data insight provider swung to a pre-tax loss of £3.6m for the year ended 31 March from a £0.5m profit the year before, as revenue fell 35% to £19.1m, failing to meet expectations on both counts.

The AIM-listed company's largest customer suffered a significant reduction in market share in the young driver insurance market, reducing revenues and installed base, while delays in new insurance customers' programmes also dealt a blow to overall revenue.

Trakm8 said delays in programme launch of a connected car proposition by breakdown companies substantially impacted revenues in the second half, while the fleet management sales team "simply failed to win enough business" and the effect of US sanctions on Iran impacted a multi-million-pound contract for the supply of insurance solutions into the Islamic Kingdom.

Executive chairman John Watkins said: "Given the disappointing failure to predict the outcome last year, it is prudent to be tempered in our outlook but current market expectations are for a relatively modest recovery (low double digit growth) in our revenues and very modest adjusted profitability for the financial year as a whole. The board is confident that this will be achieved."

Trakm8 said it has started the current financial year with new contract awards from two further insurance companies, which are expected to "strongly impact" the second half.

Trakm8's shares were down 20.00% at 18.00p at 1038 BST.

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