Eroad enjoys surge in revenue
Transport technology services company Eroad is lauding strong growth in its New Zealand business for helping lift overall revenue by 32 per cent from $61.4 million to $81.2m for the year ending March 31.
Net profit was $1m, up from a loss of $4.9m in the previous financial year, while its ebitda margin increased from 25 per cent to 33 per cent.
However, the company warns of “future contracted income” as it feels the impact of Covid-19.
Eroad also recorded growth of 21 per cent in total contracted units and six per cent in average software-as-a-service (SaaS) monthly revenue per unit. Average SaaS monthly revenue per unit increased to $58.38 per month from $55.08.
Chief executive Steven Newman, pictured, says a 95 per cent asset retention rate and a rise in average SaaS monthly revenue per unit of six per cent reflected strong loyalty among customers.
The New Zealand side of the business has shown “continuing growth potential” after revenue in FY2020 increased by 21 per cent from $44.2m to $53.4m. Over the same period, ebitda rose by 25 per cent to $34.9m.
“The New Zealand business ended the year with 80,366 units, adding 10,256 contracted units during the year, to achieve an annual growth rate of 15 per cent through expansion into existing customer fleets, combined with a solid underlying new customer run rate,” the company says.
Eroad adds that it has been able to operate throughout the disruption caused by Covid-19 as many of its customers provide essential services that kept the New Zealand, North American and Australian economies running.
In North America, enterprise sales growth saw revenue climb 62 per cent to $24.8m in the year ended March 31, and ebitda increased from $400,000 to $7.5m.
The company says it is continuing to build its presence in Australia and adds that a “promising enterprise pipeline is already evident”. During the year the Australian business added 784 contracted units, but revenue remained relatively flat at $700,000 compared to $600,000 in the 2019 financial year.
Bosses at Eroad say they are confident of continued growth across all its markets despite ongoing economic uncertainty caused by the Covid-19 pandemic.
“Eroad remains well positioned for FY21 reflecting its strong customer value proposition, future contracted income and diverse customer base across regions, business size and industry,” it explains. “While uncertainty results in longer sales lead-times, Eroad remains confident in continued unit growth across all three markets, albeit it is likely to be lower than delivered in FY20 and previously anticipated for FY21..”
Graham Stuart, chairman, adds: “We are living in unprecedented times … However, our passion and energy for solving our customers’ problems and the growth opportunities that presents, remain the same. With the investment we continue to make in our markets, services and people, we are well placed to support sustained future growth.”
