Insights

EROAD (ASX:ERD) share price higher after FY 2021 results

The EROAD Ltd (ASX:ERD) share price is on the move to day following the release of its FY 2021 results and guidance for next year…
The post EROAD (ASX:ERD) share price higher after FY 2021 results appeared first on The Motley Fool Australia. –

The EROAD Ltd (ASX: ERD) share price is on the move on Friday morning.

At the time of writing, the transportation technology services company’s shares up 0.5% to $5.26.

Why is the EROAD share price edging higher?

Investors have been buying the company’s shares this morning following the release of its full year results.

According to the release, for the 12 months ended 31 March, EROAD reported a 13% increase in revenue to NZ$91.6 million and a 13% lift in earnings before interest, tax, depreciation and amortisation (EBITDA) to NZ$30.7 million.

Management advised that this was driven by growth in contracted units across all its markets and a stable average SaaS monthly revenue per unit (ARPU) of NZ$58.30 per month.

At the end of the period, the company’s Annualised Monthly Recurring Revenue metric (AMRR) had increased to NZ$88.4 million from NZ$84 million a year earlier.

EROAD’s Chief Executive Officer, Steven Newman, said: “In a year that presented challenging macro-economic conditions we continued to grow across all of our markets delivering a 13% increase in revenue and Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) year on year. In addition, we accelerated our growth strategies to take better advantage of opportunities that have emerged from the challenges of the last twelve months. EROAD is now stronger than ever before, better positioned to capture the increasing growth opportunities in telematics.”

Outlook

EROAD has reiterated the guidance it previously provided for FY 2022. Management explained: “It is anticipated that the percentage revenue growth in FY22 will strengthen from that delivered in FY21, but not be at the level experienced in FY20.”

In New Zealand, the company expects to add a similar number of units to that seen prior to FY 2021 (~9,000 p.a). Its New Zealand Ehubo sales will be complemented with Clarity Dashcam sales.

Whereas in North America, EROAD expects increased unit growth in FY 2022 as the economy returns to pre-COVID conditions. This should be supported by Clarity Dashcam sales.

In Australia, it expects growth during the next two years to come predominantly from an Enterprise pipeline of 15,000 to 20,000 vehicles.

Finally, management advised that it continues to accelerate new product delivery for future growth in FY 2023 and FY 2024. This will see the company spend 24% to 27% of revenue on research and development during FY 2022. Positively, despite this, EROAD anticipates that its EBITDA margin will be maintained for FY 2022 and improve at the end of the financial year.

Learn where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of May 24th 2021

More reading

Is the Costa (ASX:CGC) share price a bargain buy after its selloff?
Why the Latitude (ASX:LFS) share price is rising today
BetMakers (ASX:BET) share price sinks on Tabcorp takeover proposal
Why the Inghams (ASX:ING) share price is racing 10% higher
Shocker: Risk guidance from advisers varies on mood, hunger, marital status

The post EROAD (ASX:ERD) share price higher after FY 2021 results appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!