Shares of Leeds-based transport data analytics firm Tracsis plc fell as much as 7% after it published results for the year ended July 31, 2024, showing that profit before tax fell 86% to £1 million and revenue slipped 1% to £81 million.
Nonetheless, final dividend per share rises 8% to 1.3p.
Tracsis said business activity levels are increasing following the UK General Election but reported “some near-term variability in customer activity in the UK through H1.”
The firm reported new UK rail technology contracts awarded “across smart ticketing & delay repay, safety & risk management, and operations & planning solutions.”
It said its pipeline of software opportunities “increased by 200% across UK and North American markets.”
The Leeds company said it completed the deployment of a new Train Dispatch product with a US commuter rail provider “opening up a large new product segment opportunity in North America.”
On current trading and outlook, Tracsis reported: “Network Rail Control Period 7 funding pressures impacting UK Remote Condition Monitoring hardware activity …
“Increases in UK national insurance and minimum wage will add cost from April 2025 and beyond; expected to impact FY25 EBITDA directly by c.£0.5m
“Several large multi-year software opportunities in the latter stages of their procurement processes, which are expected to be awarded during FY25 …
“Evaluating M&A opportunities in line with disciplined criteria.”
Tracsis CEO Chris Barnes said: “Despite our financial results for FY24 being impacted by the timing of the UK General Election and lower yard automation conversion in North America, we have made significant progress over the past 12 months in transforming our operating model and laying the foundations for our future growth.
“We have delivered further growth in rail technology licence usage and annual recurring revenues, and have a large pipeline of new software opportunities in both the UK and North America, where long-term market drivers remain strong.
“The UK Rail Industry remains in a period of transition as the new government prepares to provide further detail on its strategic vision for the railway. Tracsis’ products and services are well placed to support this and we look forward to the legislation relating to Great British Railways that is expected in the coming months.
“Some short-term headwinds remain across the UK Rail supply chain related to Control Period 7 funding restrictions from Network Rail, which is impacting our Remote Condition Monitoring hardware activity.
“The changes to national insurance and minimum wage legislation announced in the October Budget will bring additional cost into our business. We are working hard to mitigate these and are continuing to focus on converting our large opportunity pipeline and diversifying our client base both in the UK and internationally.
“We are well positioned to deliver sustainable growth in FY25 and beyond. We have invested in upskilling our commercial, technical and delivery capabilities, and post year-end have delivered the successful go-live of a new Train Dispatch product in North America as well as the latest deployment of our TRACS Enterprise solution in the UK.
“We remain focused on delivering long-term value through the continued pursuit of both organic and acquisitive growth, supported by a strong balance sheet and healthy cash generation, and look to the future with confidence.”