Tracsis : Completion of Acquisition

Tracsis plc

('Tracsis' or the 'Group')

Completion of Acquisition

Tracsis plc, a leading provider of software and services for the traffic data and transportation industry, is pleased to announce that it has acquired the entire issued share capital of Compass Informatics Limited (Ireland) and Compass Informatics UK Limited (collectively 'Compass').

Headquartered in Dublin and established in 1997, Compass is a systems development and data analytics company that specialises in combining geographical information systems (GIS), location technologies, data analytics and field computing. The business works across a variety of sectors but derives most of its revenue from transportation, asset management, planning, and environmental customers.

The acquisition of Compass is the first overseas acquisition made by Tracsis and the Directors believe the business is highly complementary to the Traffic & Data Services division whilst also bringing potential benefit and cross-sell potential to Tracsis' existing transport clients.

In the year ended 30 September 2018, Compass generated revenue of €4.8m, Profit before Tax of €0.6m, and had net assets of €1.8m. The business is debt free, and has a long history of stable organic growth. Compass employs around 50 permanent staff, all of whom will remain with the business post transaction.

The acquisition consideration comprises an initial cash payment of €3.15m which will be funded out of Tracsis cash reserves and the issue of 53,204 new ordinary shares in Tracsis (issued at a price of 587p) to a value of €350k. An additional payment of circa €0.5m will be made on a euro for euro basis to reflect the net current asset position of the business (above a working capital hurdle) at completion and will be finalised in due course.

Additional contingent consideration of up to €2.0m is payable subject to Compass achieving certain stretched financial targets in the three years post acquisition.

John McArthur, Chief Executive Officer of Tracsis plc, commented:

'We have known the Compass team for a number of years now and are delighted to have completed this transaction which is a natural fit for our Traffic & Data Services division. Coming together with Compass will strengthen the product and service offerings to our client base in the UK and also benefit those existing clients retained by Compass in Ireland. This is a further significant milestone in our strategy of improving our data service offering. We welcome the whole Compass team to Tracsis, and look forward to future successes together.'

Gearoid O'Riain, Managing Director of Compass, commented:

'We are thrilled to have completed this transaction and to be joining forces with Tracsis. Compass has an established position with our domestic Irish market and our highly respected clients, and has aspirations to further grow our presence in the UK market - which provides a far larger market opportunity. Working as part of the Tracsis Group allows us to make this jump and we look forward to the significant growth opportunities that lie ahead.'

An application has been made for the new Ordinary Shares to be admitted to trading on AIM and dealings are expected to commence on 22 January. The shares issued are subject to a two year lock-in agreement whereby no disposals may be made within the first 12 months with any disposals thereafter up to 24 months subject to orderly market conditions.

Following the issue of the new shares, the total number of shares in issue will increase to 28,495,759. For the purposes of the Financial Conduct Authority's Disclosure and Transparency Rules ('DTRs'), the issued ordinary share capital of the Company following this allotment consists of 28,495,759 Ordinary Shares with voting rights attached (one vote per Share). There are no Shares held in treasury. This total voting rights figure may be used by shareholders as the denominator for the calculations by which they will determine whether they are required to notify their interests in, or a change to their interest in, Tracsis under the DTRs.

Enquiries:

Tracsis plc | Tel: [phone]
John McArthur, CEO
Max Cawthra, CFO

finnCap Ltd | Tel: [phone]
Christopher Raggett/Scott Mathieson, Corporate Finance
Andrew Burdis, Corporate Broking

The information communicated in this announcement is inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014.