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Transense plunges as analysts speculate a fundraising might be on the cards

“The increase in demand for the iTrack II services will place pressure on working capital due to the time lag between investment in kit and the recoupment of its cost”

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Transense’s full-year were solid; revenues were up, margins stronger and losses smaller

Transense Technologies PLC (LON:TRT) shares plunged early Tuesday as investors speculated that a fundraising could be on the cards in the near future.

The sensors maker reported a small rise in revenue to £2.05mln in the 12 months ended June 30 (2017: £2.00mln) while the pre-tax loss narrowed to £1.91mln from £2.16mln a year earlier.

Transense said much of the growth was down to stronger demand for its iTrack II tyre pressure monitoring system.

Solid results

finnCap analyst David Buxton described the results as “solid”, although he suggested that the increased demand for iTrack II could lead to the company needing to fill a hole in its finances.

“In the short to medium term, the group is expected to have sufficient funds,” said Buxton.

“However, the increase in demand for the iTrack II services will place pressure on working capital due to the time lag between investment in kit and the recoupment of its cost.”

Net cash used in operations amounted to £1.11mln last year (2017: £0.87mln) as Transense finished the year with £1.59mln of cash (2017: £2.52mln).

Shares dived 14.5% to 39p in mid-morning trading on Tuesday.

Quick facts: Transense Technologies

Price: 76 GBX

AIM:TRT
Market: AIM
Market Cap: £12.39 m
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