Transport technology services company ERoad says quarterly sales numbers are below expectations.
The Auckland-based company added 4,172 contracted units and saw 5% growth in its quarterly update for the three months to June 2018. It now has a total 81,772 contracted units.
“The unit sales in the first quarter of FY19 has been much slower than we initially expected as many deals have been pushed out beyond the quarter,” a company statement says.
“While the annual unit sales cycle has always been seasonal, the expected delivery timeframe for units in the sales pipeline this year results in an expectation that quarterly unit sales will be much more lumpy in FY19 than prior years.”
Australian and New Zealand markets still show “strong demand” for ERoad and future growth is expected.
Meanwhile, the North American market is going strong despite delays.
“In this quarter, the North American business has seen significant interest from prospective customers, especially those with ‘buyer’s remorse’ from the acquisition of other ELD (electronic logging device) solutions that are not meeting their needs.
“These customers, having been unhappy with their initial purchase, are looking to trial or pilot replacement solutions before agreeing to make a replacement purchase.
“The caution taken in market decision making, along with the need for the prospects to exit existing contracts, is impacting the speed of the sales cycle.
“Later in the financial year we expect to see increased demand due to intrastate trucking fleets adopting ELD solutions to meet state regulatory requirements and the larger fleets, with grandfathered solutions, looking to replace these with ELD solutions,” ERoad says.
