By using Big Data analytics to improve driver behaviour, Trakm8 is now a leading technology designer, developer and maker of telematics products and solutions. Primarily, the company makes its money by distributing its hardware and software through a network of distributors and by providing vehicle monitoring and tracking services direct to the business-to-business market. Trakm8's IP-owned products and services allow vehicles and drivers to be monitored, enabling organisations to manage deliveries and services, or track stolen vehicles to within five metres. The product offering also includes driver behaviour management systems that can reduce fuel consumption by 10 per cent or more, reduce risk of accidents, and make logistics routing & scheduling packages more efficient too.
As the latest contract with Marmalade highlights this is proving a popular and highly profitable niche to be operating in. Stripping out the £4.2m contribution from the acquisition of BOX Telematics, acquired by Trakm8 in October 2013 in a £3.5m deal, I estimate that the company's underlying revenues increased by two thirds to £4.3m in the six months to end September 2014. This heady growth rate is set to continue as like-for-like new orders were 53 per cent ahead at the end of December 2014, buoyed by a raft of new orders. Customers include Direct Line Group, Eon, the AA, Fujitsu and Kubota. These are not one-off deals either as the company's annualised recurring revenue of £5.3m is the equivalent of 30 per cent of the £18m current fiscal year revenue forecast of analyst Lorne Daniel at brokerage finnCap.