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, will be publishing its interim results next Tuesday (18th February).
The Armchair Trader has been following the company for a while, last reporting that the company was continuing its strong growth trajectory, something that the company expects to continue into 2025.
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The company published a trading update recently for the half-year to end-December and the company is expecting that it will trade in-line with the expectations of the market for the year to end-June 2024, as the technology company has had strong revenue growth for the period, which has allowed it to invest in its operational capabilities.
SAWsense is making excellent progress
Chairman, Nigel Rogers said: “The first six months of the financial year has seen us continue the strong underlying growth, whilst successfully recruiting a team that can take the business to the next level of performance. We remain in line with market expectations in the current year, and the opportunities ahead of us give us significant optimism for the future. SAWsense is making excellent progress and the pipeline for Translogik is also very encouraging.”
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.
Transense Technologies revenue up 37%
Transense said that total revenue for the period was 37% ahead of the corresponding period last year at £2.41m. The market was expecting revenue growth of 30%. The biggest performance jump was from SAWsense which saw revenues up 330% y-o-y. iTrack, which is a collaboration with Bridgestone in the Translogik division to monitor tyre performance by comparison saw revenues increase by 28% across the year. Translogik as a whole saw revenue increase by 7% y-o-y which, the company said, was “[…] consistent with the expected growth from existing customers, although new business conversion was slightly slower than anticipated.” Transense expected this to improve in the second half of the year.
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The company has kept up its margins, with gross profit margin maintained at more than 87% of revenue. However, the company has been investing in its products and people, increasing staff by eleven in just over one-year to end-January to thirty, with key hires in engineering, operations, sales and marketing. The company said that it has completed the bulk of its hiring, and does not anticipate salaries increasing significantly in the next year.
Investment in staff costs to hit net earnings
However, this investment in staff will see net earnings fall by about 20% y-o-y but Transense is expecting the investment to start paying back from the second half of the year as the new team members close opportunities currently in the pipeline. Net cash was marginally down by around £90,000 year-on-year. Royalties from Bridgestone iTrack were up around £140,000 which helped bolster the company’s net cash position.
SAWsense is seeing more revenue per customer as Transense develops deeper relationships with its existing customers, and its aerospace demand remains buoyant with some significant new projects in aerospace, robotics and off-road vehicles launching in the second half. Translogik is looking at global expansion, targeting Southeast Asia and hopes to appoint a distributor for the North American market.
The company opened the week at 152p, up 53.5% over one-year. The company has a market cap of £22.7m
Growing demand across key sectors
Transense Technologies’ strong revenue growth and strategic investments position the company for continued expansion in 2025 and beyond. With SAWsense gaining momentum, Translogik exploring new markets, and operational improvements underway, the company remains confident in its trajectory. While short-term earnings may reflect the impact of increased hiring and investment, management anticipates a return on these efforts in the second half of the year. With a robust pipeline of opportunities and a commitment to innovation, Transense Technologies is well-placed to capitalise on growing demand across its key sectors.
