Tracsis Reports Improved H2 Performance and Recurring Revenue Growth in FY25

FY25 results: resilient revenue, stronger H2, and more recurring income

Tracsis delivered a steady set of audited FY25 results, with a clear second-half rebound. Group revenue edged up 1% to £81.9m and adjusted EBITDA was broadly flat at £12.6m (margin 15.4%). Statutory profit before tax rose 60% to £1.6m despite a small dip in adjusted EBITDA, helped by higher net finance income and lower exceptional items.

The improvement came through in H2: adjusted EBITDA margin hit 19.2%, up 331 bps on H2 FY24 and 878 bps on H1 FY25. Recurring revenues kept climbing and cash generation stayed healthy, leaving Tracsis well funded for investment and M&A.

Headline figures	FY25	FY24	Change
Revenue	£81.9m	£81.0m	+1%
Adjusted EBITDA	£12.6m	£12.8m	-1%
Adjusted EBITDA margin	15.4%	15.7%	-39 bps
Profit before tax	£1.6m	£1.0m	+60%
Cash	£23.4m	£19.8m	+£3.6m
Adjusted diluted EPS	24.8p	25.1p	-1%
Basic EPS	1.7p	1.6p	+6%
Total dividend	2.6p	2.4p	+8%

What drove the numbers by division

Rail Technology & Services: recurring growth offsets CP7 headwinds

Division revenue nudged up 1% to £37.9m. The main drag was Network Rail’s Control Period 7 (CP7) funding constraints, which cut UK Remote Condition Monitoring (RCM) hardware revenue by 42%. That was more than balanced by growth across other UK categories and higher recurring software and consumer transaction revenues.

• Recurring software licence revenue rose 6% to £23.2m.
• Consumer-driven PAYG and delay repay transactional revenue jumped 17% to £4.1m.
• UK Rail Technology revenue was £33.4m, up 5%.
• North America revenue was £4.5m, down 21% after a large Train Dispatch deployment completed in September 2024.

Adjusted EBITDA dipped 2% to £9.6m, with around a £1.5m adverse impact from lower UK RCM volumes. Profit before tax still increased 5% to £2.8m after cost actions and despite £1.5m of exceptional items, including North American headcount reductions and the termination of a very low margin UK contract.

Data, Analytics, Consultancy & Events: H2 recovery and record Events revenue

Reported revenue was £43.9m (+1%), with like-for-like growth of 5% after excluding Transport Consultancy activities being exited. Events delivered record revenue of over £20m, offsetting softer Traffic Data earlier in the year and lower Professional Services revenue after the consultancy exit.

• Traffic Data & Events revenue: £32.5m, up 7%.
• Professional Services revenue: £11.4m, down 13% (consultancy wind-down and lower Data Analytics/GIS).
• Adjusted EBITDA: £3.0m, up 1%.
• PBT moved from a £0.8m loss to a £0.2m profit on lower transformation costs and better H2 trading.

Management acted on H1 margin pressure via operational changes, pricing and tighter cost control. H2 adjusted EBITDA margin in these businesses was 400 bps higher than H2 FY24, with the full benefit expected in FY26.

Quality of earnings: recurring, transactional and contracted

Recurring revenue is moving the right way. Software licences grew 6% to £23.2m and consumer transaction revenue (PAYG and delay repay) was up 17% to £4.1m after deployments in FY24. The orderbook remains solid, with £27.8m of contracted revenue yet to be recognised at year-end, of which £18.3m is expected within 12 months.

Key multi-year wins matter here: the Tap Converter contract with Rail Delivery Group embeds Tracsis’ ticketing back office for a UK PAYG rollout, with customer deployments from 2026. RailHub development continues with Network Rail. Post year-end, a new 5-year GeoIntelligence contract with the UK government was awarded, with an option to extend for 5 more years and a total maximum value in excess of £9m over 10 years.

Cash, buyback and dividend: funding growth while returning cash

Free cash flow increased to £7.7m (FY24: £5.4m), helped by working capital unwind and higher interest income. The balance sheet remains strong: £23.4m of cash and no debt at 31 July 2025, plus a new £35m revolving credit facility to provide flexibility.

• Share buyback of £3.0m completed during H2.
• Final dividend of 1.4p proposed, taking the total dividend to 2.6p (+8%). Subject to approval, the final dividend will be paid on 12 February 2026 to shareholders on the register on 30 January 2026.

Strategy in action: unify, productise, and scale

Management has completed a two-year operating model transformation, unifying Rail Technology & Services under a single global leadership and delivery model. Post year-end, Tracsis began investing in a next-generation Operations & Planning software platform – modular and SaaS-native (software delivered by subscription) – to reinforce its UK leadership and create a scalable base for international growth.

North America remains a long-term opportunity. The Train Dispatch pipeline across passenger, freight and industrial operators is healthy, although timelines depend on customer requirements. Tracsis has streamlined the cost base while retaining delivery capability.

Outlook for FY26: steady guidance, known headwinds

Q1 trading is in line with expectations and the Board expects adjusted EBITDA to be in line with market expectations for the full year. The company notes four covering analysts with a mean FY26 adjusted EBITDA expectation of £13.3m (range £13.0m-£13.8m).

UK rail headwinds are likely to persist through FY26. CP7 funding constraints are keeping RCM hardware volumes below historical levels, with recovery dependent on project approvals. Procurement timelines are also extended as renationalisation of Train Operating Companies and the creation of Great British Railways progress. Offsetting this, recurring licence revenues and consumer PAYG activity have been unaffected, and DPAYG trials using the Hopsta platform are underway on the Northern network between Harrogate and Leeds.

Josh’s take: why this matters for investors

Positives

• Clear H2 improvement and margin recovery where it was most needed (Traffic Data and Events).
• Recurring software and PAYG/compensation revenues growing – exactly the type of income that improves visibility and margins over time.
• Robust cash generation, £23.4m on the balance sheet, new £35m facility, and a completed £3m buyback alongside a higher dividend.
• Contract wins with multi-year visibility – Tap Converter, RailHub and the GeoIntelligence award underpin FY26.

Watch items

• CP7 funding constraints continue to suppress RCM hardware – timing of recovery is uncertain.
• North America growth relies on conversion of a concentrated pipeline; timelines can slip.
• Statutory profits remain modest due to amortisation and exceptional items (£2.4m this year), even as cash flow is strong.

Overall, this reads as a disciplined execution year: stabilise, fix the weak spots, grow the sticky revenue lines and keep the cash engine humming. If Tracsis converts its pipeline and continues shifting the mix toward licences and transactions, the margin profile should improve further, even if UK rail procurement stays sluggish.

Extra detail: segment and geography snapshots

• Rail Technology & Services: revenue £37.9m; adjusted EBITDA £9.6m; PBT £2.8m.
• Data, Analytics, Consultancy & Events: revenue £43.9m (like-for-like £43.7m); adjusted EBITDA £3.0m; PBT £0.2m.
• Revenue by customer location: UK £66.8m, Ireland £9.1m, Rest of Europe £0.5m, North America £4.6m, Rest of World £0.9m.
• Contracted but not yet recognised revenue at year-end: £27.8m (£18.3m within one year).
• Exceptional costs: £2.4m (FY24: £3.0m) including transformation and contract termination costs.