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Trakm8 shares fall as it makes weak start to the year

Trakm8 said the first five months of the year commencing April 1 has been behind that of the same period a year ago
Shares in Trakm8 fell more than 4% in morning trading

Trakm8 Holdings PLC (LON:TRAK) shares dropped on Wednesday after the telematics and data supply firm warned it had a weak start to the current financial year.

The company said trading in the first five months of the year commencing April 1 has been behind that of the same period a year ago. It said the decline reflected the termination of £1.6mln in contract electronics manufacturing (CEM) work last year and the working down of launch stocks by one of its major customers.

READ: Trakm8 shares fall as it cautions on first-half revenue as 2017/18 revenue and profit jump

A significant insurance customer has also cancelled telematics policies, offsetting new policy sales.

In the second half, Trakm8 said results will benefit from the resumption of volume shipments to the significant customer and increased momentum in the fleet management market.

“The directors are also confident that new contracts to be awarded, particularly in the insurance space, will drive additional revenues in the second half of the year,” said executive chairman John Watkins.

He added: "The board is pleased to report that the outlook for the year ending 31 March 2019 is in line with market expectations, with an improved financial performance driven by continued growth in the telematics business more than offsetting the eliminated CEM activities.”

Shares fell 4.05% to 71p in morning trading.

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