Listed software firm expecting annual revenues of £48m

Tracsis, a Leeds-based provider of software, hardware and services for transport industries, has confirmed the Covid-19 outbreak had a negative impact of around £10m on its overall revenues.

The effects of the pandemic mainly hit the company’s Traffic & Data Services Division, though Tracsis stresses the impact was much less than it originally feared.

In a trading update for the year ended 31 July 2020, the firm reports its Group revenues are expected to be around £48m (2019: £49.2m).

Its update adds: “Under the circumstances, the Board is pleased with the overall revenue performance, which was assisted by a very strong performance from our Rail Technology & Services Division.

“Despite the impact of Covid-19, the Group expects to report a pre IFRS 16 EBITDA margin in the region of 20% (2019: 21%). 

“Adjusted EBITDA before the adoption of IFRS 16 and Adjusted Profit are therefore both expected to be less than the previous year (2019: £10.5m EBITDA, £9.7m Adjusted Profit).

“Cash balances at the end of July were circa £18m (2019: £24.1m) after having completed the acquisition of iBlocks Limited in March 2020, making all tax payments due and all payments due in respect of previous acquisitions.”

The Group notes it has started delivering recently announced major software contract wins, which include a large multi-year TRACS Enterprise contract and a large RSSB grant secured by Bellvedi to develop dynamic train planning software over the next two years.

The update adds: “Despite the impact that Covid-19 has had on clients cancelling and postponing projects within the  Traffic & Data Services division we have continued to secure new work during the pandemic.

“The impact of the reduced revenue on profitability has been mitigated to an extent by not requiring casual labour at major events that have not taken place, plus other actions that have been proactively taken to quickly reduce the fixed cost base across this part of the Group.”

The company’s full year results will be announced to the market in November 2020.

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