Transportation technology company EROAD has reported a $9.6 million loss for its full year 2022 result.
This compares to a net profit of $2.5m in the year prior. Revenue increased from $91.6m to $114.9m reflecting the merger of Coretex and organic growth across all markets.
New Zealand continued to deliver strong growth in new and existing customers reaching over 100,000 connected vehicles and Australia grew significantly delivering its first year of positive EBITDA
North America has started to regain growth momentum following the Coretex merger which improved product market fit and capabilities to acquire enterprise customers, the company says.
FY23 revenue is anticipated to be $150m – $170m and FY23 EBIT between a loss of $5m and breakeven.
EROAD says it’s in a period of “significant transition” to build greater growth momentum targeting to deliver ongoing strong growth in revenue, increasing to at least $250m by FY25.
Over the period, contracted units grew by 64% to 208,697 reflecting the merger of Coretex which added 66,157 units on November 30, 2021, and organic growth across all the markets.
North America growth slowed prior to the merger of Coretex as EROAD experienced “high churn” from its small-to-medium size customers through the 3G to 4G upgrade programme.
Growth gained momentum following the merger with Coretex, which improved EROAD’s product market fit and increased capability to win enterprise customers
Acting chief executive Mark Heine says the company has made significant progress accelerating its growth strategies and delivered on its FY22 financial result despite challenging macro-economic conditions and a number of one-off impacts.
“New Zealand had an exceptional year with growth in new and existing customers and a huge number of customer renewals.
“In North America the team has been focused on improving our product market fit and enterprise capabilities through R&D and the merger with Coretex to regain growth momentum,” Heine says.
Growth strategies
During the year EROAD has released 10 enhancements and nine new products to enable growth, including Clarity Solo Dashcam, EROAD Analyst, EROAD Where Mini Tags, EROAD Geoalerts and EROAD Satellite communications.
The company has now built up a video telematics portfolio with the launch of Clarity dashcam in March 2021, Clarity Solo (with no in-cab requirement for a pre-installed EHUBO unit) in October and the Coretex Corevision camera launching in FY23 in North America .
It reports significant progress has been made with the integration of the Coretex business with sales activities already underway with the Coretex 360 platform and Corehub hardware solutions provided as EROAD’s next generation platform solution.
The merger also provided access to a large pipeline of enterprise customers and the company is reporting “solid progress” with a number of pilots for potential large enterprise customers in progress. In the North American market alone, EROAD currently has eight enterprise customer pipeline opportunities at the pilot stage relating to potential opportunities of around 26,000 units.
The merger also positions EROAD to become a bigger player in international telematics.
Following the resignation of long-time chief executive Steven Newman in April this year, the company says a global search process has progressed well and is now in the final stages of a new chief executive appointment, with an announcement expected soon.
