Transport technology company EROAD has revised its revenue guidance following a major new North American contract plus a renewed contract with one of its largest customers.
The NZX/ASX listed company has now set FY23 revenue guidance of between $154m – $164m compared to a previous $150m – $170m.
The company says it had “a number of headwinds” on operating costs in the first half of FY23, however management have been focused on cost reduction and improving operating leverage to ensure it remains on track for FY23 normalised EBIT of between a loss of $5m and breakeven.
“Cost reduction initiatives will reduce the impact of inflationary pressures and will reflect in improved performance in the second half of FY23.
“EROAD continues to experience disruption in its global supply chains, including access to supply of critical electronic componentry and increased prices. This is being actively managed through longer purchasing lead times, increased inventory levels and strong supplier relationships,” the company says.
Agreement with Sysco
In its market update, the company announced a major new contract with North American foodservice operator Sysco.
EROAD will supply its CoreHub technology and SaaS solutions for over 9000 trucks with further growth potential.
It will work with Sysco to roll-out its solutions across the next 12 months to provide supply chain assurance for critical food service distribution throughout North America.
“EROAD is more than just a technology provider,” Sysco chief supply chain operations officer Daniel Purefoy says. “The team really took the time to understand our challenges as well as our dedication to corporate social responsibility and sustainability.
“As a result, they presented a solution that not only addressed those challenges and unique needs but is completely transforming our approach to fleet management.
“They’re helping us create an entirely new digital experience, and we’re excited to see all of the benefits that will come from working with EROAD,” Purefoy says.
ABC Supply renews
EROAD has also renewed its contract with one of its largest North American enterprise customers, ABC Supply, for over 6000 subscriptions through to at least August 2024.
ABC Supply is one of North America’s largest wholesale distributors of roofing, siding, and other select exterior and interior building products, and has been partnering with EROAD since 2019.
“EROAD has been a valuable partner for us throughout the past few years and we look forward to continuing this relationship,” ABC Supply driver safety and compliance manager Brian Widder says.
“EROAD’s solutions have allowed us to reduce the time to manage unidentified drive times (UDTs) by 25% and caused a 50% reduction in hours of service (HOS) violations when compared to our previous telematics provider.”
