Tracsis plc

Group revenue was GBP 81.9 million, up 1% reported and 3% like-for-like after excluding exited lower-margin consultancy activities. Adjusted EBITDA was GBP 12.6 million, slightly below last year, while H2 adjusted EBITDA margin was 19.2%, up 331 basis points year over year. Free cash flow was GBP 7.7 million, up GBP 2.3 million, and cash on the balance sheet ended at GBP 23.4 million after completing a GBP 3 million share buyback; the company also put in place a new GBP 35 million RCF that remained undrawn. In Rail Technology & Services, revenue was up 1%, recurring software license revenue rose 6% to GBP 23.2 million, and transactional revenues grew 17% to GBP 4.1 million; EBITDA was GBP 9.6 million, down 2%. In Data, Analytics, Consultancy & Events, like-for-like revenue was up 5% and Events delivered a record year with revenue above GBP 20 million. Management said FY26 expectations remain unchanged and in line with market expectations, with UK rail headwinds, including CP7 funding constraints, already factored in; it also said Tap Converter work gives a full order book in that part of the business for FY26, but no incremental pay-as-you-go transactional revenue has been included in guidance yet.

David Frost emphasized that the business has moved through an operational transformation phase and is now entering a growth transformation phase focused on recurring revenue, SaaS-native products, international expansion, and disciplined M&A. He said the fundamentals remain strong, highlighted market-leading technologies and deep domain expertise, and pointed to North America as a significant long-term opportunity, while acknowledging that winning new opportunities there has been slower than expected because procurement cycles are lengthy. His tone was measured but constructive, with repeated emphasis on execution, patience, and building on the improved second-half momentum.

Andy Kelly focused on the improved H2 trading trend, noting a 19.2% adjusted EBITDA margin in H2, a 331-basis-point improvement year over year, and stronger recurring/transactional revenue growth. He said Remote Condition Monitoring hardware revenue was 42% lower because of CP7 headwinds, which hurt profit by about GBP 1.5 million, while the rest of the group contributed roughly GBP 2 million more EBITDA than last year. He also highlighted GBP 2.4 million of exceptional costs in FY25, of which GBP 2 million were cash costs, and said free cash flow reached GBP 7.7 million due largely to working capital unwind, lower transformational cash outflows, and higher net cash interest. Capital allocation remains focused on organic growth, M&A, and the progressive dividend; management recommended a final dividend of 1.4p per share, taking the total dividend up 8% to 26p.

Analysts focused on capital allocation, asking whether buybacks should be prioritized given the low valuation and cash balance; management said there are no firm plans for another buyback, but it will continue to be reviewed. Questions also probed the M&A pipeline and whether the new cash balance and RCM arrangement implied a transformational deal; David Frost said the pipeline is active but the focus is on bolt-on acquisitions that fit strategy, not transformational M&A. On UK rail headwinds, management said they are fully factored into FY26 guidance and that the company is not relying on an industry recovery to hit its targets. On PAYG, Andy Kelly said Tap Converter work gives a full order book for FY26, but rollout timing and customer adoption are outside Tracsis’ control, so no incremental PAYG transactional revenue has been included in guidance yet.