Tracsis almost doubled its profit in the year to July 2011.
Tracsis provides resource optimisation software for the rail industry and there was a two month contribution from its most recent acquisition, data logging equipment supplier MPEC Technology, in the latest figures. MPEC generated £1.07m of the £4.08m revenues last year, up from £2.65m in 2009-10. Pre-tax profit jumped from £584,000 to £1.12m, including an operating profit contribution of £357,000 from MPEC. House broker WH Ireland had forecast a profit of £910,000.
Net cash was £4.69m at the end of July 2011, following a £1.95m share placing at 45p a share. There could be up to £1m more payable for MPEC. That should be generated by operations. Tracsis has plenty of spare cash to finance other acquisitions.
Consultancy and training revenues were flat but re-franchising activity could generate additional business. Rail operators need to operate as efficiently as possible so software revenues continue to rise. The head office has been moved from Loughborough to Derby, which is a major centre for the rail sector.
There have been business enquiries from outside of the UK.
At 57.5p a share, up 2.5p, Tracsis is valued at £13.8m. A 2011-12 profit of £1.41m was originally forecast but another strong performance from MPEC would make that easily achievable. The shares are trading on 13 times prospective earnings.
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