Trakm8 Share Discussion Threads

[jamiemp] 06/9/2017 11:10

Market depressed?

[ch1ck] 06/9/2017 08:50

.This steady string of positive announcements is great news and at a time when the share price is at a low.A good time to accumulate shares especially as the market is depressed.

[sh1984] 06/9/2017 08:44

They figures for the smaller contracts not disclosed because they are similar products and I assume Trak don't want their customers knowing how much the other paid for their contract.

I'm not to worried, the wording is positive and I expect a big cash flow improvement come interim results in November.

[blondeamon] 06/9/2017 07:41

Radio silence from the company, no numbers given unlike all other years. Just a progress update that everything is on track.

With all these contracts recently what could possibly be the reason for that? First 2 months were up 10% so figures must be OK, so why the secrecy?

[nod] 05/9/2017 23:21

In the 1990s I held shares in Toad which specialised in vehicle radios and alarms. As vehicle manufacturers installed these units as standard this aftermarket market largely died. Toad seeing this coming moved into telematics to eventually morph into C21 today. C21 has a niche telematics market of buses but even that is quite competitive and low margin.I can envisage that like sound systems, alarms, sat Nav, Bluetooth, etc. that telematics will become a standard in vehicles. There will be a small number of suppliers developing telematics tech for the vehicle manufacturers.

[jamiemp] 05/9/2017 17:52

I prefer when there aren't any announcements these days...

At least I'm a few hours ahead of GMT right now so things will have been priced in by the time I wake up. I've had enough white knuckle rides with Trakm8.

[blondeamon] 05/9/2017 10:54

Big day tomorrow, let's see if sub-1£ prices will be a thing of the past after the update. 5 full months have passed since the last update and since then we had 4 extensions and 4 new contracts.

Not expecting any big bangs but would love to see a nice bump on number of devices and good progress on converting pipeline into contracts.

I am curious to see if they will announce tomorrow the 2 new contracts I have discovered from my research. One is Fleet and the other Insurance but could still be early for them to launch.

[emptycup] 04/9/2017 20:40

CM - spot on.

Device numbers = nothing unless they generate something. Looks like fleet management provides better revenues than insurance but perhaps not the volume. I'd like to see where the mix of connections comes from and how, after 2+ years of DL et-al, T8 are leveraging their big-data benefits/analytics and winning new contracts in this area. I really do worry, though, about the OEs - if they have no involvement in those dev teams, then what is the long-term future holding.

You have to bear in mind that T8's business is Fleet and Consumer, right? So Fleet buys new vehicles and these may be built with platforms to run software. The HGV market is always way-ahead of light-commercial and transit in terms of engineering tech and just need to be less precious about trying to 'own' the customer in respect of after-market apps and get together with other OEs and come up with an open architecture.. if they did, T8 has no opening... Surely the OEs are doing this and the T8 Tech Dir needs to be on top of this!

There is a bit of a niche in integrating the backoffice systems but blondy didn't really elaborate just how good that is. This is where T8 needs to excel: be the best to talk to the operations, engineering and scheduling systems that all fleets use.

Consumer = retro or the ever-increasing finance market. Why choose T8 tech? either through the insurer (because they say so - and more are) and let's see how they have grown that market? Or aftermarket, through the retail channel trying to gain ground through us sticking dashcams to our cars and having another dangling lead into the cigarette-lighter socket - think not!

Come on T8 - innovate - be specific - do you know what your strategy is - roll-on Thursday!

EC

[blondeamon] 04/9/2017 12:03

Best outcome for shareholders is for this to get bought out at a nice premium. This industry is full of M&A activity with hefty amounts paid per device.

Trakm8 is too small to manage it themselves long term, but their products would be awesome if owned by let's say Verizon.

And all acquisitions are judged on devices not P&L. Just look at ABAX recently, a company roughly the same as TRAK got sold for many times over their annual revenues, all because of their 200k devices.

But I am not disagreeing about profit in general, just that I do not expect to see TRAK making big profits soon as they take all the cash and put it back into making more amazing products and getting more clients and deals.

Do that 2-3 more years and when they reach something like 500,000 devices then they can just sit on their asses and collect the hefty profits or wait to get bought out at £10. But not until then.

[cheshiremoggie] 04/9/2017 11:29

Mmmm...

I too am looking forward to hearing if the company strategy is paying off.

However, long term there is only ONE thing that matters --- Profit.


CM.

[blondeamon] 04/9/2017 10:22

2 days left before what IMO will be a very good progress update and will make clear why they chose that strategy last year. Sacrificing cash for R&D is always a big bet that if it pays off it will pay big.

This year:
- 1.5m cost savings will be achieved (consolidating offices etc)
- no dividend (0.6m in cash last year)
- no acquisitions expected (1m paid for Roadsense in 2016, 9m for RM in 2015)
- low margin 3rdP contracts dropped and expected to be replaced with our own high margin ones
- International Sales should pick up, sales in EUR especially. I would be happy with a 3-4% part of our sales being priced in USD or EUR.

As always, only 2 things matter long term:
- Number of devices
- Recurring revenue

[lukead] 01/9/2017 14:23

Come on the MOUSE.

[jamiemp] 31/8/2017 17:34

Yes, I'm just making the point that there is a lot of money looking at it. Its just walking past.


Its still a valid takeover target regardless of FCF. Perhaps even more so as it depresses the market cap. A buyer would just strip out excess costs and central overheads like management. Possibly R+D if they were big enough to absorb it.


Quartix are doing 6-7M pre-tax profit off of lower revenues. If a buyer thought they could achieve this via cost synergies with Trakm8, it would mean they could bolt on around 85M GBP of value onto their own market cap.


In a supposedly consolidating sector, I would think that's enough to give a fair chance of drawing someone in for a sniff. Due diligence would soon show someone in the same sector if these new contracts and the sales pipeline are credible.

[pj0077] 31/8/2017 16:28

Think you've answered your issue there jamiemp : retail investors drove the price to 300p.. how smart was that buying?!Institutions don't look at TRAKM8 because it doesn't generate any FCF. When expectations change on this, there will be genuine buying interest.

[slartybartfaster] 31/8/2017 15:08

No mention of revenues.

[pj0077] 31/8/2017 14:00

There are no institutions with significant holdings in TRAKM8 ie it is held by private investors. So it's likely that you know as much or more than 'the market' in this stock.

[jamiemp] 31/8/2017 13:34

No fireworks from the market.


Personally I think the change to FD is positive but its always a red flag to the market and to be honest it looks like they tried to slip it under the Radar with a contract announcement. Incidentally, the contract was originally meant to commence end-July.


It does all sound very bullish in theory, I guess the concern is does all this need a placement to fund the short term needs? You would think if it is indeed all going as planned, they have adequate debt facilities to cover the short term.


I am a substantial holder but after months of contract wins, I have to be honest and think "am I one of the few in the right?" or is the market assessing this with a cooler head? The former seems unlikely given the coverage this share has gotten in the past. It seems more likely the market is aware of it and recent happenings it is just anticipating more financial fumbling.

[blondeamon] 31/8/2017 12:05

More amazing news, about time we had some board reshuffle with new blood. New CFO's CV looks impressive and with direct tech growth experience.

I hope for a more sales-oriented approach which is also what we already see with the recent flow of contracts and restructuing of company hierarchy into clear streams.

Also, the last 2 companies he worked at got sold for very significant amounts 2 years in after he joined so that could be one of the reasons for his selection as well.

[pj0077] 31/8/2017 09:20

I guess for TRAK this will result in a huge cash outflow as they invest in working capital?

[blondeamon] 31/8/2017 08:08

Boom!!

Like I called it 6 months ago, Intelematics and Arc Europe group signed a master supply agreement with us.

Which means all of their members (20 Roadside Assistance companies in Europe and Russia) will be getting their telematics by us. And in EUR.

That's potentially more than 30-40m members. Imagine how many car Genies we could sell. Already launched from AA and in Netherlands (ANWB).

This is bigger than the AA contract in 2012 or Direct Line in 2014. This is transformational stuff.

[blondeamon] 30/8/2017 21:01

RouteMonkey received a 1m euro funding in May as part of an EU wide project for Horizon 2020.

Details here:

[edmonda] 30/8/2017 17:56

Dont forget next week Open Day in Coventry:

Technology Roadshow Wednesday 6 September 2017 at 10.30 a.m. at the Ricoh Arena

preregister with MHP Communications by e-mailing [e-mail]