The business had gone through a consolidation process which included management changes‚ closure of the Mexico office and completion of business development initiatives in Asia without gaining any immediate returns. The same applied to development costs in the UK insurance market‚ it said.
Revenue was up 2% to R863m‚ with earnings before interest‚ tax‚ depreciation and amortisation rising 7% to R114m.
During the year‚ the group increased the installed base by 89‚228 units - an increase of 17% from units shipped for the previous financial year.
Depreciation and amortisation charges rose significantly because of the increase in rental assets being depreciated over the term of contracts. Major contributors to the higher depreciation charge included the R15.3m depreciation of intangible assets under development and R61.9m related to rental stock.
Digicore says a detailed impairment review was done and goodwill relating to subsidiaries in the UK and Europe had been impaired.
Moreover, it says, cellular connection incentive bonuses paid by networks were stopped‚ with a short-term effect on performance and cash flow. "However‚ lower monthly subscriptions would have a greater positive effect in the long-term," Digicore says.
The group said the consolidation and management changes undertaken‚ particularly in the past six months, left the board cautiously optimistic about an improved trading performance in the year ahead.
With the new technology platform firmly in place‚ commercialisation of DigiCore's latest product and software solutions‚ and the investment in sales structure‚ the group had already started to capitalise on opportunities in the fleet‚ mining‚ government and insurance telematics industries.
"Our sales model in future should be more balanced with the external funding now in place. This will allow us improved shorter-term profits and cash flow while still building future annuity income‚ although at a slower but more sustainable pace. We have recaptured lost fleet management business and trust we will continue this trend," says Digicore.
It added that new channels to distribute its stolen vehicle recovery products had been opened and volumes are improving.
"Partnerships and long-standing relationships with customers‚ locally and internationally‚ would contribute to the number of systems sold and growing annuity revenue streams due to new technology and solid customer service‚" it said.
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