Transense Technologies LON:TRT the Bicester-based, AIM-listed manufacturer of advanced wireless and passive vibration sensory equipment used in the aerospace, mining, motor and industrial sectors, published its final results for the year ended 30th June 2024 today (23rd September).
The technology company has continued its strong growth, reporting an 18% surge in revenue to GBP4.2m. Adjusted profit before taxation and before exceptional administrative expenses was up 20% to GBP1.3m. Earnings per share was also up, by 15%, to 10.13p with cash up from GBP980,000 in 2023 to GBP 1.3m.
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Transense Technologies has two divisions that develop and supply sensor technology and measurement solutions. SAWsense supplies proven Surface Acoustic Wave (SAW) sensor technology. This is used in demanding applications to accurately and reliably measure torque, temperature, force, and pressure to improve performance, efficiency, and safety. Translogik is a tyre inspection and data capture tool. It is used by the world’s leading fleet managers, tyre suppliers, and service centres to rapidly and accurately capture and digitalise safety-critical tyre condition data. The data can then be used to reduce operating costs and improve safety.
Different revenue growth across divisions
Translogik’s revenue grew 9% to GBP1.12m, however SAWsense’s revenue fell a bit from GBP490,000 to GBP450,000. In SAWsense’s case, the second half of the year was much better than the first; the division brought in 80% of its departmental revenue in the back end of the year.
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As previously reported one of Transense’s streams of income is royalties. Management reported royalty income from its Bridgestone partnership increased by 30%, reflecting increased conversion of new installations in the year,
Royalty income from Bridgestone iTrack increased by 30%, reflecting increased conversion of new installations in the year. The company’s gross margin was maintained to 87% of revenue amounting to GBP3.65m. That said, Transense’s administration expenses increased 13.4% to GBP2.4m, before exceptional severance costs of GBP500,000.
Transense is targeting aerospace growth
One of the company’s target markets is aerospace. The company has a relationship with GE Aerospace [NYSE:GE.] who it is helping to scale-up its T901 engine program, integrating SAWsense components into the engine’s propulsion systems. Transense is also working with Airbus [EPA:AIR] on a new landing gear project. The Airbus collaboration is part of the GBP38.7m LANDOne project announced in April to develop next-generation landing-systems technology.
Other R&D wins included SAWsense being involved in a GBP11m UK Government-sponsored programme to help develop motor, electronics and control software in electronics vehicles. Transense will collaborate with Protean and its other partners – Unipart, Viritech and Hypromag – to deliver the Power-electronics Upscale for Localisation and Sustainable Electrification (PULSE) programme.
The company appointed Ryan Maughan as managing director in March. Maughan joined SAWsense in sales in 2021 and has been in place in a strong trading period for the company. Transense is 60% ahead of where it was last year with profits showing good progress despite increased overhead costs.
Translogik contracts underway
Translogik is now positioned to convert new business for its tyre management products directly with fleet customers. Several large potential contracts are under negotiation. The Oxfordshire firm is bringing manufacture and assembly of the full range of Translogik products in-house, facilitated by reconfigured premises. Maughan is confident this change will further improve customer service, product quality, availability and cost.
Management is pleased with the progress made and remains confident in the growth prospects over the remaining six year period in which royalty income will be derived from Bridgestone iTrack, and into the next decade.
Bridgewise, the AI-analyst recommends Transense as a ‘Buy’. The analyst said: “Based on Transense Technologies’ most recent financial results, the company ranks in the top 10% of Consumer Discretionary companies. This is primarily driven by its overperformance in Net Change in Cash and EBITDA, Lease Adjusted when compared to peers. Analysing historical performance, better results in these two metrics have frequently coincided with an increased probability of a stock outperforming industry rivals. In light of Transense Technologies’ recent financial performance, the company’s stock appears to be an attractive investment choice in the Automobile Components industry.”
Transense opened trading for the week (23rd September) at 192.9p. This was up 83.7% over one-year, with its shares ranging between 89p and 194.9p. Over the year-to-date the company’s shares are up 86.4% The company has a market capitalisation of GBP28.9m.
