Tech manufacturer issues profit warning after contract delays

Coleshill telematics and data insight firm Trakm8 has issued a profit warning following the fall through of a large software sales contract.

The contract would have enabled the fleet management firm to meet market expectations if it was secured this financial year, but it believes to “secure the commercial outcome” it is no longer able to conclude discussions in the current financial year.

Trakm8’s telematics cameras and devices track fleets for clients including Autoglass, Eon, Iceland and Altrad. The software gives companies and insurers insight into a range of areas, from route optimisation and fuel expenditure to vehicle health and driver behaviour.

Alongside the challenge of the deal, Trakm8 says it has been impacted by a weak trading environment in February and March, due to ongoing shortages of insurance capacity. This has contributed to lower connections and recurring revenues than previously expected.

Trakm8 now believes its turnover for FY2024 will be £16.4m resulting in an adjusted loss before tax of £1.4m for the period. The group’s cash position on 31 March 2024 is anticipated to be £400k.

Whilst conversations continue for the potential deal, Trakm8 is hoping it benefits from the revenues generated if the contract is secured.

However, due to poor levels of insurance, the extent of a shortfall is dependent on a surge in demand for insurance capacity.