TIDMQTX
RNS Number : 8361C
Quartix Holdings PLC
22 October 2020
Quartix Holdings PLC
22 October 2020
Quartix Holdings plc
("Quartix" or the "Company")
Trading Statement
Quartix Holdings plc, one of Europe's leading suppliers of
subscription-based vehicle tracking systems, software and services,
is pleased to provide an update on trading for the 9 months ended
30 September 2020.
The Board is pleased to report that it expects revenue and free
cash flow for the year to 31 December 2020 to be in line with
current consensus market forecasts, which are shown at the foot of
this announcement(1) . Adjusted EBITDA is expected to be
approximately 15% ahead of current consensus market forecasts.
The Company's expectations for free cashflow are based on the
assumption that the Company will not carry any deferred payments
for taxation (under the Government's COVID-19 provisions) into
2021, as it intends to repay such deferred payments for taxation by
the end of 2020.
These expectations are based on the current outlook for the
final three months of the year and may be subject to revision
depending on the severity of the second wave of Coronavirus
infection in the Company's key markets.
Despite the serious impact of COVID-19 on new subscriptions for
tracking systems Quartix has, in the year to date, achieved
approximately 7% revenue growth in its core fleet business compared
with the first 9 months of 2019. The fleet division now represents
84% of the Company's revenue.
The Company's subscription base has grown by 11% in the first 9
months of 2020, driven in particular by strong growth in the
subscription base in France and the USA, with an increasing
contribution from the new territories it now operates in.
Region New subscriptions Subscription Subscription Growth -
base base first 9 months
2020
(units) (units) (units)
first 9 months 1/1/2020 1/10/2020
2020
UK and Eire 15,886 105,631 112,784 7%
------------------- -------------- ------------ ----------------
France 6,297 25,643 29,177 14%
------------------- -------------- ------------ ----------------
USA 6,577 18,050 22,323 24%
------------------- -------------- ------------ ----------------
New territories* 2.085 1,316 3,351 155%
------------------- -------------- ------------ ----------------
Total 30,845 150,640 167,635 11%
------------------- -------------- ------------ ----------------
*Note - new territories included: Spain, Poland, Germany and
Italy
The value of the fleet subscription base on an annualised basis
was GBP21.9m on 1 October, representing a gain, in constant
currency terms, of GBP1.1m since the start of the year. This is
based on exchange rates as at 1 October.
Installations for the Company's insurance business in the first
9 months declined by 49% to 13,383 units. The cancellation of
driving tests from March until July, and the difficulty in
obtaining a test appointment since then have contributed to a fall
in the young-driver insurance market. Quartix has also continued
its migration away from lower-margin business in this sector, a
trend which the Board expects will continue.
The impact of Coronavirus on the Company's subscription base
since March has not, so far, been as significant as that
anticipated in the scenario outlined in the Company's trading
statement of 27(th) April. Despite the significant reduction in new
subscriptions in April and May the Company is pleased to report
that it returned to growth in Q3, with new subscriptions for the
quarter exceeding those of same period in 2019. The acquisition of
new customers, which had reached a new peak of more than 500 in
January, has also recovered reasonably strongly and is now
approaching the same level again.
Given this encouraging position, Quartix intends investing
further during the remainder of 2020 and 2021 in sales, marketing
and technological development in order to capitalise further on the
profitable subscription platform it has created. An accompanying
presentation to this announcement will be posted on the Company's
investor site this morning at www.quartix.com/2020-q3
Andy Walters, Chief Executive Officer of Quartix, commented :
"We are pleased with the progress we have made so far in 2020,
despite the impact of COVID-19 on our clients and markets. Our
subscription base grew in each of our markets and now stands at
more than 167,000 vehicles with recurring revenues of just under
GBP22m. We will continue to invest in the growth of our fleet
subscription business."
([1]) The Board believes that consensus market expectations for
2020, prior to this announcement, were as follows: revenue:
GBP25.8m; adjusted EBITDA GBP6.9m; free cash flow: GBP5.2m.
The information communicated in this announcement is inside
information for the purposes of Article 7 of Regulation
596/2014.
For further information, please contact:
Quartix (www.quartix.net)
Andrew Walters, Chief Executive
Daniel Mendis, Chief Operating and
Financial Officer 01686 806 663
finnCap (Nominated Adviser and Broker)
Matt Goode / Kate Bannatyne (Corporate
Finance)
Alice Lane (Corporate Broking) 020 7220 0500
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END
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