Transport software company Eroad has slipped to a half year loss as Covid-19 affected sales, and expenses rose as it pressed on with market and product development ahead of its takeover of a rival business.
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Key numbers (for the six months ended September vs year ago):
- Net loss $2.9 million vs profit $1.0m
- Revenue $48m vs $46m
- Expenses $35.4m vs $30.5m
- No dividend
Chief executive Steven Newman said the company had been resilient in the face of Covid and other market disruptions while it had pressed on with investment in future growth.
Eroad supplies devices and software for trucking companies to manage fleets, maintenance, driver hours, and road user charges, as well as dashboard cameras.
New Zealand revenue had improved, but there had been a dip in North America after it lost a customer through a takeover and change of equipment, while expenses rose as it hired more staff and incurred costs for its planned takeover of Coretex.
Regulators have just given for the $158m takeover of Coretex, which produces software to manage fuel consumption, speed and monitor the driver's habits.
Newman said the focus was now on getting the two businesses integrated, which was likely to take 12 to 18 months, and will take the group to a new level.
"It's cool to have two New Zealand companies combining to take on the world, and it really is transformational, particularly in how we can drive momentum in that North American market."
He said the two companies looked similar on the surface but had different market and product focuses which were complementary, and he expected earnings to show the benefits of the takeover in 12 to 18 months.