Quartix Holdings PLC Trading Statement (6019O)
02 Giugno 2020 - 8:00AM
UK Regulatory
TIDMQTX
RNS Number : 6019O
Quartix Holdings PLC
02 June 2020
Quartix Holdings plc
("Quartix" or the "Company")
Trading Statement
Quartix Holdings plc, one of Europe's leading suppliers of
subscription-based vehicle tracking systems, software and services,
issues a further update and trading statement, as promised in its
statement of 27 April.
Trading: January to April 2020
The Board reports that trading for the first four-month period
to 30 April 2020 was strong, and ahead of the equivalent period
last year. The Company's cash balance was GBP9.5m at 1 June.
Employee welfare
The Board is pleased to report that none of the Company's
employees have so far tested positive for Coronavirus. The decision
to close the Company's offices was taken on 9 March and all
employees have been working from home since 16 March. All aspects
of the Company's business continue to operate effectively.
New fleet tracking installations
As previously reported, new fleet installations in April were
60% lower than the same month last year, with 1,500 installations
in total across all territories (2019: 4,200). New installations in
May were 25% below the same period last year at 2,740 (2019:
3,630). The resumption of some business activity on 11 May helped a
strong rebound in France and the Company will provide a full
breakdown by territory in its Interim Results, which will be
released at the end of July.
As previously noted, the Company accounts for the cost of new
installations in the month they are carried out (for both fleet and
insurance) and there has been a consequent reduction in costs.
Where possible, the benefits from this will be used to increase
investment in customer acquisition. Significant development has
been carried out over the past two months on productivity, process
and activity measurement reporting for the Company's sales
operations, and this will help the Company in maximising the
effectiveness of future investments in sales and marketing.
Fleet subscription base
The Company has been monitoring activity levels in its fleet
customer base on a weekly basis since the start of the pandemic,
based on distance travelled and the number of vehicles in use. This
analysis has focused on the UK and France, as these countries
represent 85% of its recurring revenues. The Company's analysis at
22 May showed the following data and trends, using the first
working week of March as the baseline (2 - 6 March):
UK
Vehicle mileage fell by 54% to its lowest point during the
working week 30 Mar to 3 April and had only partially recovered to
32% below normal levels by 22 May. Construction, representing 31%
of the Company's base, fell by 60% in the early stages of lockdown
but is now recovering at a slightly faster pace than the average.
Other site-based services and manufacturing, representing a further
24% of the Company's base, were still operating at 40% below normal
levels on 22 May.
France
Vehicle mileage fell by 63% to its lowest point during the
working week ending 23 - 27 March, one week before the UK. Activity
rates appear to be recovering at a faster pace than in the UK
however, with the aggregate level just 9% below the baseline by 22
May.
Impact on the value of the Company's subscription base
The Coronavirus pandemic has not yet had a material impact on
the Company's subscription base: a slight decline in the value of
the UK base over the past two months has been more-than offset by
small gains in other territories. Similarly, rates of attrition
have held steady at around 12% on an annualised basis. It should be
noted, however, that the Company is in regular communication with a
number of customers (predominantly in the UK) for which it is
providing support in the form of payment relief or deferral. These
customers now represent a total of approximately 6% of the total
base by value. In addition to this there has been some increase in
direct debit and other payment issues, although there has not yet
been a significant increase in bad debt.
As noted on 27 April, the Company believes that the full impact
on its subscription base will not become apparent until the autumn,
as the UK government's financial support measures are withdrawn and
as the Company's SME customers potentially exhaust their cash
reserves. In the meantime it will continue to focus on supporting
its base and on investing in customer acquisition.
Insurance telematics
New installations for insurance were limited by both
installation capacity and demand in April (612 units) but mainly by
reduced demand in May (388 units). New registrations started to
increase towards the end of May as insurers started to write
telematics policies again and the Board expects that this should
take the total for June to approximately 700 units.
Likely impact of Coronavirus on the outlook for 2020 and
2021
As stated in the trading statement of 27 April, The Board's view
is that the COVID-19 pandemic is unlikely to have a material impact
on profit and cash flow in the first half of 2020 but given the
uncertainty that remains, the Board is still unable to provide
guidance for the financial performance in the second half of 2020
and for 2021. A further update will be provided at the end of July
with the Company's Interim Results.
The information communicated in this announcement is inside
information for the purposes of Article 7 of Regulation
596/2014.
Quartix (www.quartix.com)
Andy Walters, Chief Executive Officer
Daniel Mendis, Chief Financial Officer 01686 806 663
finnCap (Nominated Adviser and Broker)
Matt Goode /Hannah Boros (Corporate
Finance)
Alice Lane (Corporate Broking) 020 7220 0500
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END
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June 02, 2020 02:00 ET (06:00 GMT)
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