30 June 2020

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TRAKM8 HOLDINGS PLC

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('Trakm8' or 'the Group' or 'the Company')

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Final Results

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Trakm8 Holdings plc (AIM: TRAK), the global telematics and data insight provider, announces its final results for the year ended 31 March 2020 (FY-2020).

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FINANCIAL SUMMARY:

¹ Recurring revenues are generated from ongoing service and maintenance fees

²�Before exceptional costs and share based payments

^3�Total borrowings less cash and cash equivalents. FY-2020 net debt excludes �2.3m IFRS 16 lease liability.

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OPERATIONAL OVERVIEW

������ Modest return to growth (+2%) despite Covid-19 impact late March.

������ Significant improvement in financial performance to close to breakeven adjusted profit.

������ Strong continued reduction in direct and indirect costs.

������ Strengthened Group with appointment of Group Sales and Marketing Director

������ Production launch of new insurance self-fit hardware products.

������ Over 245,000 connected units in operation (FY-2019: 243,000).

������ New contract wins with two new significant Insurance companies.

������ Contract renewals with two large long term customers (E.ON and Bibby) and a significant enhancement to the solution for Iceland Foods

������ R&D spend down 7%, however still �4.1m invested.

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OUTLOOK

������ Momentum established in last year disrupted by Covid-19.

������ The new financial year has begun with new contract awards from two further insurance companies, with revenues already commenced.

������ Revenues from new insurance contract wins now compensating for the impact of Covid-19 on the overall market with recent device shipments ahead of last year.

������ The AA Smart Breakdown sales now underway albeit impacted by Covid-19.

������ Fleet sales negatively impacted by Covid-19 but recent weeks show progress.

������ Early months in current financial year benefitting from the various Government initiatives.

������ Given the uncertainty of the impact and timing due to the Covid-19 pandemic the Group is not providing any guidance to the results for the current financial year.

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- Ends -

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For further information:

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Notes to Editors

Trakm8 is a UK based technology leader in fleet management, insurance telematics, connected car, and optimisation. Through IP owned technology, the Group analyses data collected by its installed base of telematics units to fine tune the algorithms that are used to produce its' solutions; these monitor driver behaviour, identify crash events and monitor vehicle health to provide actionable insights to continuously improve the security and operational efficiency of both company fleets and private drivers.

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The Group's product portfolio includes the latest data analytics and reporting portal (Trakm8 Insight), integrated telematics/cameras/optimisation, self-installed telematics units and one of the widest ranges of installed telematics devices. Trakm8 has over 245,000 connections.

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Headquartered in Coleshill near Birmingham alongside its manufacturing facility, the Group supplies to the Fleet, Optimisation, Insurance and Automotive sectors to many well-known customers in the UK and internationally including the AA, Saint Gobain, EON, Iceland Foods, Scottish Power, Direct Line Group, LexisNexis and Ingenie.

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Trakm8 has been listed on the AIM market of the London Stock Exchange since 2005.

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www.trakm8.com / @Trakm8

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The information communicated in this announcement is inside information for the purposes of Article 7 of Regulation 596/2014.

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EXECUTIVE CHAIRMAN'S STATEMENT

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Results

FY-2020 was a productive year in terms of financial results.� We delivered on our promise to return to growth and but for a Covid-19 induced disruption in the final two weeks of the financial year, we would have achieved our plan to deliver a modest adjusted profit. Notwithstanding that, we did achieve a significant improvement with a small adjusted loss.�

Revenue grew by 2% and the Group posted an adjusted loss before tax of �0.2m. Connections grew by 1% to 245,000. The total fleet management connections increased by 1% over the year to 77,000 (FY-2019: 76,000). Telematics for insurance/automotive connections also increased by 1%. At the year-end we had 168,000 insurance/automotive connections (FY-2019: 167,000). Recurring service revenues reduced by 3.3% to �9.8m (FY-2019: �10.1 m).

It was pleasing to improve cash generation significantly with cash flow from operations of �4.1m (FY-2019: -�1.8m). In achieving this, the Group only deferred �0.2m under the Government tax deferral support schemes.� This resulted in a free cash flow of �0.8m (FY-2019 -�4.9m) and net debt unchanged at �5.6m (pre-IFRS 16). The Group had �1.7m cash on hand and an undrawn RCF of �0.5m.

FY-2020 was another year of excellent progress in many internally focussed activities. The Group continued to focus on improving efficiency of our operations and engineering activities. Significant reductions in direct and indirect costs were delivered during the year. During the year restructuring of the engineering department led to the COO taking direct responsibility for the engineering teams. Improved testing and software coding standards have been implemented to address some of the technical challenges we have experienced. The investment in engineering resources, whilst some �0.3m less than last year, has continued to deliver market-leading software and hardware solutions. Trakm8's Insight platform provides superb customer experience and data, enabling vehicle operators both to improve operational efficiencies and reduce risk significantly.

We have continued to invest in our software solutions, algorithms and devices, ensuring that Trakm8 retains market-leading solutions with the widest and deepest offer in the market today.

Post-year end, we have concluded contracts with two additional insurance companies.

Research and development ('R&D')

Trakm8 has maintained a significant level of investment in R&D although for a second year below the level of the previous year. The Board believes that this level of investment is necessary to retain a portfolio of market-leading technology. Trakm8 continues to focus on owning the intellectual property ('IP') we use in our solutions, and we see this as one of our key competitive advantages. Telematics systems are complex; but because we own all the elements that encompass a solution (with the exception of the mobile networks) we have the ability to understand and more easily resolve problems.

The R&D investment has concentrated on building out a range of self-fit devices, improved cameras, development of the feature set in Insight, including a SaaS optimisation product. As identified in previous years, the requirement to do more at a lower cost remains a key strategy as this widens the opportunity to expand the rate of growth as the ROI for our customers improves.

Trakm8 was pleased to be granted two patents in the year, a patent for the ADAS algorithm it developed for detection of tailgating situations and a patent for monitoring the health of a vehicle battery for its Connectedcare solution.

Governance

In the prior financial year we adopted the Quoted Companies Alliance's (QCA) Corporate Governance Code for small and mid-size quoted companies, which the Board considers the most appropriate for the size and structure of the Group. The Board annually reviews its Corporate Governance policies and procedures, these were last reviewed on 18 June 2020. More information can be found in the Governance Report section of this report and our website.

Post year end the Group appointed a third Non-Executive Director, Penny Searles who brings greater diversity to the Board and increases the Group's compliance with the code.

Please see https://www.trakm8.com/investor-relations/corporate-governance for our full compliance statement.

Dividend

The Group does not propose to recommend a dividend for the year at the forthcoming AGM.� However, the Board will continue to review its dividend policy in light of future results and investment requirements.

People

The number of people Trakm8 employs has reduced further during FY-2020 with reductions in operational and engineering headcount. In total our actual staff numbers have reduced by 15% over the year.

The turnaround in performance has taken extraordinary efforts. We have an exceptional team and I would like to thank everyone for their hard work, dedication and contribution to the ongoing success of the business.

Outlook

The momentum established in the business last year has been disrupted by the Covid-19 epidemic. We had returned to growth in our Fleet business and had finally launched with three new Insurance customers. The AA had launched Smart Breakdown. Two more insurance customers have been secured since year end. Prior to the current lock down, this year was expected to be one of very significant growth.

Our new year started in the early stage of the lockdown and unsurprisingly April saw very significant reductions in new business. May saw slight improvements and June has improved further still.

The total value of new Fleet contracts signed in April was 83% down on the prior year, 50% lower in May compared to the prior year and is expected to be 22% lower in June compared to the prior year.�

Insurance shipments in April at 3,867 devices were 39% below last year, May shipments at 5,447 devices were in line with the prior year. Currently June shipments are expected to be 26% higher than last year.

With a significant proportion of revenues derived from the service fees of the installed base, the first two months of the year revenues were 27% lower than the previous year but resulted in a significantly reduced loss because of lower direct and indirect costs.

We are confident that the growth potential in our chosen markets is good and that we have the solutions and sales teams to deliver on this opportunity. It is simply a matter of timing and landscape as the crisis subsides. The solutions we provide significantly improve the customer's efficiencies and so that market driver remains. We cannot predict how many of our existing and potential customers will no longer be at the scale they were.

We have continued to drive operational efficiency savings in direct and indirect costs, both those made last year that will benefit the full year and some made this year.

Trakm8 has availed itself of various support measures from the government including the cash deferment of VAT and PAYE/NI and is benefitting from the payroll support through the furlough scheme.

Trakm8 has agreed capital repayment holidays with our debt providers and agreed covenants that we are confident are achievable. Based on current forecasts and scenario planning that Trakm8 has undertaken, along with the agreed capital repayment holidays we believe this provides appropriate cash headroom, therefore the Group are not currently progressing with a CBILS loan.

Despite the positive trends of the year to date, the uncertainty due to Covid-19 is such that the Group is not able to provide forward guidance at this time but will do so as soon as there is more certainty in the market.

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John Watkins

EXECUTIVE CHAIRMAN

29 June 2020

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FINANCIAL REVIEW

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TRADING RESULTS

¹�Before exceptional costs and share based payments

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Revenue

Group revenue increased by 2% to �19.6m (FY-2019: �19.1m). Fleet revenues increased by 11% to �12.0m, primarily due to additional Optimisation revenues, this was offset by a 9% reduction in Insurance and Automotive revenues to �7.5m.� The recently launched Insurance and Automotive customers resulted in the second half revenue being 19% higher than the first half reversing some of the full year decline.� Recurring revenue generated from service and maintenance fees decreased by 3% to �9.8m (FY-2019: �10.1m) due to the reduction in Connections from Insurance customers earlier in the year, which were not offset by the growth from the newly launched customers towards the end of the financial year.

Loss before tax

The Group reported a loss before tax of �1.7m (FY-2019: �3.6m).� This significant reduction in losses was primarily due to the significant efficiencies the Group realised through both cost of sales and administrative costs.� Gross margin improved by 5% points to 59% primarily due to a change in mix in revenue, but also due to lower cost hardware products and improved efficiency on communication and installation costs.� Total administrative costs reduced by �0.8m of which �0.6m was a reduction in non-recurring exceptional costs (detailed below).� Other administrative costs (excluding exceptional costs and depreciation and amortisation) reduced by �0.9m due to headcount reductions as a result of the cost saving initiatives implemented, offset by a �0.7m increase in depreciation and amortisation, �0.3m from capitalised development costs, reflecting the significant investment undertaken by the group in earlier years and �0.4m due to the adoption of IFRS16.�

Adjusted Loss before tax

The improved trading performance and significantly reduced cost base resulted in adjusted loss before tax decreasing to a loss of �0.2m (FY-2019: �1.5m).� The �1.3m improvement in gross profit as detailed above fully converted into a significant reduction in Adjusted Loss before tax.� Administrative costs (excluding exceptional costs and depreciation and amortisation) were �0.9m lower than the previous year, offset by a �0.7m increase in amortisation and depreciation as detailed above, and a �0.2m increase in finance costs.

Exceptional Costs

Exceptional costs totaling �1.3m (FY-2019: �1.9m) include integration and restructuring costs relating to initiatives to streamline and rationalize the operations of the business and additional costs relating to the acquisition of Roadsense Technology Limited.� Additionally, significant product component refit costs relating to ongoing re-visit and material costs were incurred to remedy significant component and software issues relating to the prior year, these issues have been fixed by year end. The Group also incurred a number of one-off costs as a result of the Covid-19 pandemic, these relate to employee costs, cancelled marketing events and bad debts.

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Balance Sheet

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Net Assets decreased by �0.9m to �21.2m (FY-2019: �22.1m) reflecting the loss for the year, after adding back the IFRS2 Share based payments charge.�

Non-current assets increased by �3.0m to �25.8m (FY-2019: �22.7m).� This is due to the adoption of IFRS 16 in the current year, with no adjustment to the prior year which resulted in �2.8m of leased assets being capitalised, offset by depreciation charge in the year of �0.6m.� Continued investment in development in both software and hardware with capitalised development costs in the year totaling �3.2m (FY-2014: �3.4m), offset by a �0.3m increase in amortisation to �1.8m (FY-2019: �1.5m).�

Cash Flow

¹ Cash generated from operating activities less cash used in investing activities (excluding cash flows related to acquisitions)

²�Total borrowings less cash and cash equivalents. FY-2020 net debt excludes �2.3m IFRS 16 lease liability.�

Cash from operating activities significantly improved by �5.9m during this year to an inflow of �4.1m (FY-2019: �1.8m outflow), which included R&D tax credit cash receipts of �1.0m (FY-2019: �1.0m).� The R&D tax credit cash receipt reflects the Group's investment in development.� The operational cash flow improvement is due to the significantly reduced operating loss increasing operating cash flows (�2.9m) and �3.0m improvement year on year from enhanced working capital management.

Free cash inflow of �0.9m (FY-2019: outflow �4.9m) is due to the �4.1m Net Cash generated from operating activities as detailed above offset by cash outflows from investing activities which remained flat at �3.2m (FY-2019: �3.2m).� The ongoing investing activities outflow has decreased by �0.5m to �3.2m, with the prior year investment of �3.7m offset by the one-off �0.5m from the proceeds of the property disposal.

Financing activities was an outflow of �0.5m (FY-2019: Inflow �2.7m).� This outflow is net of �2.0m new loans which includes the �1.5m growth capital loan from MEIF WM Debt LP.� The decrease from prior year was due to the subscription in December 2018 which raised approximately �3.1m (net of expenses) to fund general working capital requirements and further strengthen the Group's balance sheet.

Net Debt�

Net debt excluding IFRS 16 lease liability of �2.3m remained flat at �5.6m (FY-2019: �5.6m).� Cash balances total �1.7m (FY-2019: �1.2m) and total borrowings including IFRS16 lease liability of �2.3m totals �9.6m (FY-2019: �6.8m) of which �0.9m (FY-2019: �1.8m) was a term loan with HSBC, �1.5m (FY-2019: nil) was a term loan with MEIF WM Debt LP, �4.5m (FY-2019: �4.4m) were amounts drawn under our �5m revolving credit facility with HSBC and �2.8m (FY-2019: �0.6m) were obligations under Right of use lease liabilities, which includes finance lease liabilities from the prior year.

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