EROAD/Announcement
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EROAD on track to meet FY25 financial guidance

Half Year Results24 November 2024ERDIndustrials

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EROAD on track to meet FY25 financial guidance

AUCKLAND, 25 November 2024: Transportation technology services company EROAD Limited

(NZX/ASX: ERD), with its purpose of ‘delivering intelligence you can trust, for a better world tomorrow’,

today released its financial results for the 6 months ended 30 September 2024.

All numbers are stated in New Zealand dollars (NZ$) and relate to the six months ended 30 September

2024 (H1 FY25), unless stated otherwise. Comparisons relate to the six months ended 30 September

2023 (H1 FY24).


Financial Highlights

1


• Positive Free Cash Flow (to the firm) of $0.1m in H1 FY25 compared to negative free cash

flow (to the firm) $0.2m in H1 FY24. The company is now consistently free cash flow positive.

This is the result of growth in units, price increases and cost control. When normalised for the

temporary impact of the 4G upgrade program, free cash flow (to the firm) was $6.2m in H1

FY25 compared to $2.8m in H1 FY24.

• Revenue increased to $95.9m for H1 FY25 from $88.9m in H1 FY24. This represents a 8%

increase against the prior comparable period. Growth in revenue was delivered across all

markets.

• Annualised Recurring Revenue increased by $8.8m (+5%) to $177.9m in H1 FY25 from

$169.1m in H1 FY24, reflecting growth across all markets. On a constant currency basis, ARR

increased $13.0m (+8%).

• EBIT of $2.4m in H1 FY25 compared to $0.1m in H1 FY24

2

. Normalised

3

EBIT increased to

$4.7m in H1 FY25 up from $1.6m in H1 FY24

2

. Normalised for 4G hardware upgrade costs of

$2.3m and $1.5m in H1 FY25 and H1 FY24, respectively.


Operational Highlights

• Customer Retention of Contracted Units remains high at 92.8% in H1 FY25 (NZ 94%; AU

88%; NA 92%), compared to 94.2% in H1 FY24.

• Key enterprise customer wins and expansions during the period. A large Australasian

customer renewed (+6k connections) their New Zealand fleet and expanded their Australian


1

EROAD has presented certain non-GAAP financial measures as part of its H1 FY25 results, which EROAD’s directors

and management believe provide useful information as they exclude any impacts of one-offs which can make it difficult to

compare and assess EROAD’s performance. The non-GAAP financial measures EROAD has used in this document are

Annualised Recurring Revenue (ARR), EBIT, Normalised EBIT, Normalised Revenue and Free Cash Flow. A detailed reconciliation

of non-GAAP measures to EROAD’s reported financial information is included on EROAD’s website

(http://www.eroadglobal.com/global/investors/). General information about EROAD’s use of non-GAAP financial information is

included on page 2 of the H1 FY25 Investor Presentation.


2

Restated. Refer to Summary of Significant Accounting Policies (e) in the 30 September 2024 audited financial statements.

3

Normalised for the recognition of costs associated with the 4G hardware upgrade program in H1 FY25 and H1 FY24.


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FREE 0800 4 EROAD Auckland, New Zealand eroad.co.nz

fleet (+5k connections). In North America, secured renewals and expanded services to

Medline, ABC Trucking and US Foods generating $1.8m of new incremental total contract

revenue.

• Partnership with Geotab to expand product offering. Integration of global telematics

leader Geotab’s affordable hardware with EROAD’s advanced fleet management platform

allows EROAD to tap into a largely underserved segment of the market .


Chair Susan Paterson said, “The half year results confirm that, despite macro-economic headwinds in

New Zealand, Australia and the US, EROAD has now established a track record of disciplined

operational cost management and consistent free cash flow generation. This provides a strong and

sustainable foundation to expand the services we provide to new and existing customers.

“We remain on track to meet guidance on the key financial measures, and are updating the forecast

R&D spend to $35m (from $32m). We are working to achieve our long-term targets particularly as

economic conditions improve and as the rebuilt sales pipeline in North America begins to develop

further.”

Co-CEO's Mark Heine and David Kenneson were pleased with the progress EROAD is making, “It's

been another six months of solid execution against our strategy, with the core business in Australia and

New Zealand delivering excellent free cash flow, costs well managed, and significant work put into

strengthening the North America sales pipeline.

“We’ve expanded our product suite, including the new and innovative AI dashcam. Our recent

strategic partnership with Geotab also illustrates how we can grow our addressable market by

partnering to augment our product solutions and meet diverse fleet needs.

“While pleased, we have a long way to go to meet our ambitions for sustainable, long-term growth in

shareholder value. For the remainder of the FY25 year, we will be maintaining our focus on customers,

on disciplined execution, on cost control, on targeting sustainable growth opportunities and on

building out the sales and conversion pipeline.”


Outlook & Guidance

Heine and Kenneson added, “As we enter the second half of FY25, we remain confident in EROAD’s

clear focus on complex fleet operations, disciplined growth, and commitment to delivering value

through innovation. We are firmly on track to deliver against our full-year financial guidance,

supported by a strategy that prioritises high-quality revenue and effective execution.”

• FY25 Revenue guidance of $190m to $195m

• FY25 EBIT guidance of $5m to $10m, normalised for the 4G hardware upgrade program

• EROAD expects to be free cash flow positive in FY25

• Forecast R&D spend increased to $35m, from $32m previously


TEL +64 9 927 4700 PO Box 305 394

FAX +64 9 927 4701 Triton Plaza, North Shore 0757 Page 3

FREE 0800 4 EROAD Auckland, New Zealand eroad.co.nz

ENDS

Authorised for release to the NZX and ASX by EROAD’s Board of Directors.


Webinar details

EROAD’s Co-Chief Executive Officers, Mark Heine and David Kenneson, and Chief Financial Officer,

Margaret Warrington, will give a presentation on the financial and operational performance for H1

FY25 via webinar on Monday 25 November 2024 at 12:00pm NZT / 10am AEDT.



Register in advance for this webinar:


When: Monday 25 November 2024

Time: 12:00pm NZT / 10am AEDT

Topic: EROAD H1 FY25 Financial Results

Link:

www.eroad.co.nz/investor-presentation/


After registering, you will receive a confirmation email containing information about joining the

webinar. A recording of this webinar will be available once it has been uploaded to the EROAD

website under ‘presentations’ on www.

eroadglobal.com/investors/


For Investor enquiries please contact:

Jason Kepecs

jason.kepecs@eroad.com

NZ contact: +64 21 990 474

AU contact: +61 47 7711 136

For Media enquiries please contact:

Richard Llewellyn

richard@shanahan.nz

+64 27 523 2362



About EROAD

EROAD is a fully integrated technology, tolling and services provider, based in Auckland, New Zealand, and

serving customers in New Zealand, Australia and North America. They were the first company in the world to

implement a GNSS/cellular-based road charging solution across an entire country. They design and manufacture

in-vehicle hardware, operate secure payment and merchant gateways and offer web based value-added services.

EROAD modernises road charging and compliance for road transport by replacing paper-based systems with easy-

to-use electronic systems. They are the largest provider of road user charges (RUC) compliance in New Zealand,

and a leading provider of health and safety compliance and fleet management solutions. EROAD is listed on the

New Zealand Stock Exchange (NZX) and Australian Stock Exchange (ASX) under the stock symbol of ERD.

www.eroad.co.nz

---

1
EROAD (NZX: ERD ASX: ERD)FinancialResults

For the 6 months ended 30 September 2024 (H1 FY25)

25 November 2024

2
Important Information

The information in this presentation is of a general nature and does not

constitute financial product advice, investment advice or any

recommendation. Nothing in this presentation constitutes legal,

financial, tax or other advice.

This presentation may contain projections or forward-looking statements

regarding a variety of items. Such projections or forward-looking

statements are based on current expectations, estimates and

assumptions and are subject to a number ofrisks, uncertainties and

assumptions.

All numbersrelate to the 6 monthsended 30September 2024(H1 FY25)

and comparisons relate to the 6 months ended 30September2023 (H1

FY24), unless otherwise stated. All dollar amounts are in NZD, unless

otherwise stated.

There is no assurance that results contemplated in any projections or

forward-looking statements in this presentation will be realised. Actual

results may differ materially from those projected in this presentation. No

person is under any obligation to update this presentation at any time

after its release to you or to provide you with further information about

EROAD.

While reasonable care has been taken in compiling this presentation,

EROAD or its subsidiaries, directors, employees, agents or advisers (to the

maximum extent permitted by law) do not give any warranty or

representation (express or implied) as to the accuracy, completeness or

reliability of the information contained in it or take any responsibility for

it. The information in this presentation has not been and will not be

independently verified or audited.

Non-GAAP Measures

EROAD has presented certain non-GAAP financial measures as part of its

H1 FY25results, which EROAD’s directors and management believe

provide useful information as they exclude any impacts of one-offs which

can make it difficult to compare and assess EROAD’s performance. Non-

GAAP financial measures are not prepared in accordance with NZ IFRS

(New Zealand International Financial Reporting Standards) and are not

uniformly defined, therefore the non-GAAP financial measures reported

in this presentation may not be comparable with those that other

companies report and should not be viewed in isolation or considered as

a substitute for measures reported by EROAD in accordance with NZ

IFRS. Non-GAAP financial measures are not subject to audit or review.

The non-GAAP financial measures EROAD has used in this presentation

are identified and defined in the Glossary on page 43 of this presentation.

A detailed reconciliation of non-GAAP measures to EROAD’s reported

financial information is included on EROAD’s website

http://www.eroadglobal.com/global/investors/

33
Agenda

Result Overview

Operational Overview & Key Metrics

Geographic

Financial

4G Hardware UpgradeProgram

EROADStrategy

Strategic Priorities

Partnerships

New Products

Light Vehicle eRUCOpportunity

Outlook & FY25 Guidance

4
QUALITY FOODSTRONG FOUNDATIONSCONNECTIVITYSUSTAINABLE FUTURES

Trusted by the companies who keep society moving

Deliveringintelligence you can trustfor a better world tomorrow

OUR PURPOSE:

5
01

HI FY25

Results Overview

PAGE 5

6
H1 FY25 Financial Results

On track to meet financial guidance on all key measures

Reported Revenue

$95.9m

+8% H1 FY24

of $88.9m

Reported EBIT

$2.4m

$0.1mH1 FY24

(1)

Free Cash Flow

$0.1m

($0.2m)H1 FY24

ARR

(2)

$177.9m

+8% constant currency

+5% reported H1 FY24

ARPC

$17.8k

(Average Revenue Per

Customer)

Asset Retention

92.8%

94.2% in H1 FY24

1

Restated. Refer to Summary of Significant Accounting Policies (e) in the 30 September 2024 audited financial statements.

2

Formerly known as Annualised Monthly Recurring Revenue (AMRR). Definition is unchanged. See Glossary on page 43 for further detail.

7
•Continued focus on existing customers

with fleet growth opportunity

•Piloting multi-product adoption with key

customers to expand within existing

fleets

•Secured and expanded key North

American customers, adding

approximately $1.8m of total contract

revenue

(1)

•Leveraging NZ brand and experience to

win Australian fleet (5k units) and renew

New Zealand fleet (6k units) of Trans-

Tasmanenterprise customer

•New AI camera for growth via new and

existing customers.

•On track to deliver FY25 financial

guidance

•Annual price increases in July 2024

increase revenue by $2.8m annually

to better reflect product value

•Consistently free cash flow positive,

ahead of guidance.

•Generated normalisedfree cash flow

of $6.2m, adjusted for planned 4G

hardware upgrade to conclude in

FY26.

•Partnershipwith Geotab in New

Zealand expands offering, opening

untapped market and upgrade

path for new customers.

•Releaseof enterprise-centric

products to drive penetration into

existing customers

•New logo pipeline build supported

by recent very large enterprise win

•Changes in New Zealand RUC

regime opening upnew

opportunities for EROAD

Positive results affirm FY25 guidance

Building Momentum for Growth

SOLID FOUNDATIONSCONSISTENT EXECUTION OF STRATEGY

Delivering core business

Drive customer expansion

Pathway to growth

1

Total contract revenue for this transaction represents the annual recurring revenue (ARR) expected to be received over the termof the contract.

8
Product Expansion &

Interoperability

Customer-Centric

Sales Strategy

Ecosystem

Partnerships for

Market Reach

Data-Driven Insights

and AI Innovations

Drive multi-product adoption by

enhancing the all-in-one

platform.

Expand customer base with a

focus on high-value, complex

accounts with growing fleets.

Leverage partnerships to

broaden reach and serve diverse

customer needs.

Increase customer value

through actionable data and

predictive technology.

Strategic Priorities for Sustainable Growth

Build a scalable, customer-centered platform driving sustainable ARR growth across global markets.

9
Customer Mix

Weighting to Enterprise segment an opportunity to expand with our customers

NZ $100k+ ARR

Customers

NZ $10 -$100k ARR

Customers

NZ <$10K ARR

Customers

195

1,812

7,983

54%

of revenue

34%

of revenue

13%

of revenue

$490k

ARPC

$33k

ARPC

$3k

ARPC

•EROAD’s largest 195 customers

account for 54% of revenue.

•These enterprise customers

represent potential for product

line expansion into existing fleets.

•Larger, more resilient fleets offer

long-term growth opportunities,

enabling EROAD to scale

alongside them as they expand

their operations and fleet

volumes.

•Further potential exists in

expanding EROAD products into

existing customers’ other vehicles

that are not currently EROAD

enabled.

10% average organic

growth in US Large

Enterprise customers

compared to HY1 FY24

10
ARR

(1)

Expansionvia ProductAdoption

Pricing based on a mix of billing & list price data for the past 12 months on assumed 36 month contract with USD-NZD FX as at September 30 2024 closing date.

Heavy Transport

100 Trucks

The value in offering an all-in-one platform modelled on illustrative fleetof 100 US trucks

Other

$53k

Average ARR

(1)

SaaS opportunity

for single product

in a 100 truck fleet

Base SaaS & devices are

entry level products

meeting legislative

requirements and core

needs with no add-ons.

Within the truck, driver &

manager segments add-ons

increase potential ARR

(1)

opportunity by 249% vs base

SaaS & device fees alone.

Base

SaaS

$53k

Base

Device

$72k

$18k

SaaS

upgrades

$110k

$39k

Device

upgrades

$186k

$75k

Base SaaS

$224k

$39k

SaaS

upgrades

$333k

$68k

Device

upgrades

$359k

$25k

$41k

$265k

Base Devices

Light

Commercial

Higher product

adoption = higher

ARR

(1)

potential

In-Cab ARR

(1)

OpportunityTrailer & Load ARR Opportunity

Expanding our presence with

customers into trailer and load

monitoring, the potential ARR

opportunity increases by 575%

compared to base SaaS & Device.

Whole Fleet

1

Formerly known as Annualised Monthly Recurring Revenue (AMRR). Definition is unchanged. See Glossary on page 43 for further detail.

Trailer & Load

100 Reefer + 50 Dry Trailer

Whole Fleet

Operations

11
H1 FY25New Zealand

HIGHER VALUE

Generated $25.3m of free cash flow

(2)

FCF increased 15.5% YoY, ARPU

increased 2.2%

CUSTOMER LOYALTY

Renewal ofkey enterprise customer

for 6,000 units plus expansionto their

AU operations

CUSTOMER OPPORTUNITY

Partnership with Geotab to provide

these customer with an attractive

alternative for light commercial.

FLEET RESIZING

Fleet resizing due to weak economic

conditions in NZ has contributed to

half of the unit reduction –primarily

across SMB customers.

4G Upgrade Program

expected to temporarily

lead to increased churn

as units are swapped out

Strong cash generative market with a focus on multi-product

adoption

New Zealand

NZ$13.8k

ARPC

NZ$59.47

Monthly SaaS ARPU

2.2%

94.1%

Asset Retention Rate

4G Hardware Upgrade

Programme slightly elevating

churn

H1 FY23H2 FY23H1 FY24H2 FY24H1 FY25

Net Units AddedGross Units Added

8,559

6,690

5,028

1,628

NZ$49.8m

Revenue

11.4%

8,213

5,364

6,504

4,175

5,506

2,934

Revenue continues

steady growth – up

11.4% YoY supported by

consistent sales delivery

in tight market

conditions and price

increases

1

Formerly known as Annualised Monthly Recurring Revenue (AMRR). Definition is unchanged. See Glossary on page 43 for further detail.

2

Free cash flow is before corporate and development allocations. See page 38 for regional breakout of free cash flow

12
NZ$39.6m

Revenue

H1 FY25North America

Solid foundations forenterprise growth and customer expansion

North America

NZ$29k

ARPC

US$18.7k

NZ$59.49

Monthly SaaS ARPU

USD$36.18

1.2%

2.6%

92.2%

Asset Retention

Rate

ENTERPRISE SALES CYCLES

Moved to pilot across several

enterprise accounts

RENEWALS AND EXPANSIONS

Focused on securing renewals and

product expansion at existing

customers including Medline, ABC

Trucking, and US Foods generating

$1.8m of incremental total contract

revenue

(2)

.

FLEET RESIZING

Approximately 40% of unit reduction

is related to fleet resizing. US trucking

activity and spot contract rates

remain tepid.

CUSTOMER CHURN

Impacted primarily by one large

account. Remaining churn is in line

with strategy shift toward higher

value accounts

,

2,914

4,462

8,335

3,467

(366)

H1 FY23H2 FY23H1 FY24H2 FY24H1 FY25

Net Units AddedGross Units Added

12,936

7,344

Strategic refocusing on securing

and expanding with key enterprise

customers

and away from lower profitability

customers as new logo pipeline is

built out

3,665

7,416

8,050

1

Formerly known as Annualised Monthly Recurring Revenue (AMRR). Definition is unchanged. See Glossary on page 43 for further detail.

2

Total contract revenue for this transaction represents the annual recurring revenue (ARR) expected to be received over the termof the contract

1.8%

constant currency

13
544

993

2,372

1,605

1,778

H1 FY23H2 FY23H1 FY24H2 FY24H1 FY25

Net Units AddedGross Units Added

H1 FY25Australia

Unit count not yet reflecting

full 5,000+ unit contract signed.

Rollout has commenced and

unitfigures and revenue

impact willupdate alongside

that progress

Stronggrowth with momentum building in enterprise

Australia

NZ$48.13

Monthly SaaS ARPU

AU$44.05

88.2%

Asset Retention

Rate

Focused sales efforts lead

to strong revenue growth

of 16% vs H1 FY24

TRANS TASMAN ENTERPRISE

Expansion of ~5k units from existing

NZ enterprise customer not

reflected in revenue and partially in

unitsales countwith ~70% still to

come

DRIVING VALUE

2.0% lift in ARPU driven by mix of

pricing and sales focus on higher

value opportunities & sustainable

growth.

CUSTOMERCHURN

Unit reduction primarilycomes from

an enterprise customerwho

provided notice in Dec 2023.

Remaining majorityis across SMB &

in line with expectations & strategy

3,368

2,614

NZ$6.5m

Revenue

3.1%

2.0%

constant currency

1,136

2,424

849

16.1%

NZ$25k

ARPC

AU$23k

1

Formerly known as Annualised Monthly Recurring Revenue (AMRR). Definition is unchanged. See Glossary on page 43 for further detail.

14
H1 FY25

Financials

Medline

The largest owned transportation fleet of any

healthcare product distributor in the U.S.

1,900+ fleet. Recently signed a renewal for a 41

month term at a 6% increase in ARPU.

15
SaaS

$83.5m

SaaS

$89.7m

H1 FY24H1 FY25

HardwareFeeOther

H1 FY24H1 FY25

Reported Operating CostsReported Revenue

Benefits from $20m cost-out program in

FY23 and FY24 continue to be maintained.

Increased costs reflect variable costs to

serve customer growth and wage inflation

Revenue of $95.9m is up 8% on

H1 FY24 reflecting the impact of

growth including the final Sysco

rollout and annual price

increases

Reported EBIT

EBIT of $2.4m reflects positive unit

growth, price increases and impact

of cost-out program over FY23 and

FY24.

$88.9m

$95.9m

$0.1m

$2.4m

H1 FY24H1 FY25

$63.3m

$66.7m

Financial results on-track for guidance, demonstrating our commitment to deliver on our promises

Revenue & EBIT

(1)

1

Restated. Refer to Summary of Significant Accounting Policies (e) in the 30 September 2024 audited financial statements.

16
Operating cost as a % of revenueOperating costs as a % of revenue have

continued to decline

Operating costs as a % of revenue havenow flattened

reflecting the cost out program over FY23 and FY24.

Further operating leverage to be driven by revenue

growth while maintaining fixed costs.

Operating costcontrol has been maintained with

investment in North American growth infrastructure

being offset by savings in a number of other categories.

H1 FY24H1 FY25

Cost-out program to deliver cost base for profitable growth

Operating Costs

82%

75%

71%

70%

69%

H1 FY23H2 FY23H1 FY24H2 FY24H1 FY25

* Sales and Marketing in the above chart represents non-personnel costs such as conferences and communications

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

17
Cost to service & support

as a % of revenue

Variable and fixed costs

as a % of revenue

Cost to acquire customers

as a % of revenue

Variable costs

(1)

have been reduced due to

efficiencies from costs savings. Fixed

costs

(2)

as a % of total cost is expected to

reduce as the business scales.

Customer acquisition costs remain

steady with a higher component

being expenses as investment is

made in North America

Costs to support has remained steady

11%

11%

12%

H1 FY24H2 FY24H1 FY25

CAC ExpensedCAC Capitalised

5.9%

6.4%6.4%

H1 FY24H2 FY24H1 FY25

Management focus on gaining efficiency across all cost measures

Operational Efficiency

41%

42%

30%

27%

71%

69%

H1 FY24H1 FY25

Fixed costsVariable costs

1

Variable costs include cost of goods sold, delivery, and cost to support and service

2

Fixed costs include cost to acquire (sales & marketing), general and administrative, and research and development

18
9.6

11.3

8.6

5.1

6.8

7.9

17%

19%

17%

0%

5%

10%

15%

20%

25%

30%

0.0

10.0

20.0

30.0

40.0

50.0

H1 FY24H2 FY24H1 FY25

R&D - CapitalisedR&D - ExpensedR&D % of revenue (RHS)

R&D as % of revenue

NZ$m

R&D % of revenue being held firm as re-focusing initiatives drive ROI and speed to market

Research & Development

•Total R&D spend of $16.5m

in H1 FY25, 17% of revenue.

•Compares to $14.7m, or 17%

of revenue, in H1 FY24.

•Forecast R&D of $35m in

FY25 equates to 18% of the

mid-point of FY25 revenue

guidance ($190-195m).

19
Positive free cash flow to the firm trajectory

Average monthly cash burn

continues to reduce

Cash flow continues to improve through execution

Cash Flow Trend

-14.6

-30.5

-21.7

-8.2

-0.2

1.5

0.1

H1 FY24H1 FY25

$0.9m

1

$0.5m

H1 FY22H2 FY22H1 FY23H2 FY23H1 FY24H2 FY24


Reported freecash flow to the firm expected to grow in H2 FY25 based on current forecasts, price uplifts,

phasing in annual upfront billing and profile of 4G hardware upgrade program.

EROAD delivered $6.2m of free cash flow to the firm in H1 FY25 when normalisedfor the one-time 4G

hardware upgradeprogram.​

​Cash burn continues to decrease due to maintenance of cost control​

1

Normalisedfor capital raised during the period

H1 FY25

20
$(14.6)

$(30.5)

$(21.7)

$(8.2)

$2.8

$8.0

$6.2

$(35.0)

$(30.0)

$(25.0)

$(20.0)

$(15.0)

$(10.0)

$(5.0)

$-

$5.0

$10.0

$15.0

H1 FY22H2 FY22H1 FY23H2 FY23H1 FY24H2 FY24H1 FY25

Normalised for the

temporary impact of the

4G upgrade program

Normalised Free Cash Flow Growth

Building a profitable business with strong fundamentals

STRONG FCF GENERATING

CAPACITY

EROAD’S core operations generated

$14m of normalised free cash flow over

the last 12 months

This represents a ~7.5% FCF yield,

when normalised for one-time costs

related to the 4G hardware upgrade

program.

ONE-TIME 4G UPGRADE SPEND

Spend is on track and in budget with

approximately $3m4G upgrade spend

expected in remaining FY25 and an

additional $8–10m in FY26. These costs

are self-funded from existing cash flow

TIMING

From January 2026, the program is

expected to be complete and reported

free cash flow will converge with

normalised free cash flow.

NZ$m

$0.1$1.5

$(0.2)

ReportedNormalised for 4G program

21
NZ$mFY25FY26

Expected investment

(Hardware + Program costs)

$7–$9m$8–$10m

One-off accelerated replacement program costs relate

specifically to the 3G Network shutdown

UPGRADES TO ANZ NETWORK

•One NZ announced it would further postpone shutdown of

the 3G network to December 2025.

Unit replacement program progressing to plan and on budget, 67% of all units in ANZ already 4G compatible

4G Hardware Upgrade Program ANZ

Active 4G

units in ANZ

67%

Units still

to replace

Rollout

progress

October, 2024

Telstra 3G Shutdown AU

Completed

December, 2025

One NZ 3G & 2G Shut Off

Starts - NZ

Key dates

PROGRAM COSTS

•Total program costs remains in-line with previously

announced expectations of $24m-$30m.

•One NZ’s multiple postponements of the 3G shutdown date

has delayed customer upgrades & impacts spend timeline

22
02

Strategy

Update

Clarity Edge Camera

Pictured is the AI enabled Clarity Edge dashcam

which is now in general release.

23
COMPLIANCE &

ASSURANCE

•Road user charges

•Fuel tax

•Cold-chain assurance

•Construction assurance

PRODUCTIVITY

•Trip routing

•Driver allocation

•Asset utilisation

•Job allocation

SUSTAINABILITY

•EV support

•Carbon emissions

•Fuel reduction

•Fleet benchmarking

EROAD PLATFORM

VIDEOFORMSDRIVER APPSTRACKINGWORKFLOWSROUTING

AI AND MACHINE LEARNING

Data Rich Fleet Operations Platform

INTEGRATIONS

•Partner

•OEM

•Third party data

23

•Driver coaching

•Vehicle health

•Incident prevention

•Speed reduction

HEALTH & SAFETY

DATA COLLECTED

24
Build a scalable, customer-centered platform driving sustainable ARR growth across global markets.

Strategic Priorities for Sustainable Growth

Priority

Product Suite Expansion &

Interoperability

Customer-Centric Sales

Strategy

Ecosystem Partnerships for

Market Reach

Data-Driven Insights and AI

Innovations

Goal

Drive multi-product adoption

by enhancing the all-in-one

platform.

Expand customer base with a

focus on high-value, complex

accounts with growing fleets.

Leverage partnerships to

broaden reach and serve

diverse customer needs.

Increase customer value

through actionable data and

predictive technology.

Key

Focus

Areas

•Improve interoperability across

fleet management needs, from

safety to compliance.

•Prioritise modular

enhancements that enable

customers to adopt new features

as their needs grow.

•Target complex fleets and high-

growth sectors with focused

sales.

•Align account management and

onboarding to drive multi-

product adoption.

•Prioritise customers with fleet

growth potential to drive organic

growth alongside expansion.

•Partner with leading technology

and industry players to bring

best-in-class solutions to

EROAD’s platform.

•Strengthen OEM and third-party

partnerships to deliver value-

added integrations.

•Expand AI capabilities in safety

and predictive maintenance to

provide proactive insights.

•Develop data tools that allow

customers to optimize fleet

performance and manage risks

effectively.

Why it

matters

Enables customers to consolidate

their operations within EROAD’s

ecosystem, increasing ARR per

account.

Focused sales efforts maximise

revenue potentialby prioritising

customers with fleet growth

opportunities, driving organic

expansion alongside increased

multi-product adoption.

Partnerships allow EROAD to offer

comprehensive solutions that

optimise R&D resourcing. Enables

broader product range and

customer base, from entry-level

customers in ANZ to sophisticated

enterprise accounts in all markets.

Advanced insights enhance

customer loyalty and support

premium pricing, boosting ARR.

25
Partnerships: Geotab

Introducing a simple, low-cost light commercial solution to the platform with EROAD Locate

Primary global customer set

BENEFITS

•Expanded reach:

Affordable, entry-levelsolution for

the light commercial vehicle

market, launched rapidly through

a strategic partnership

•Pathway to growth:

Low-cost solution introduces new

customers to the EROAD

ecosystem, creating opportunities

for upsell and multi-product

adoption.

•ARR expansion:

Augments existing product range

with a simple solution as an add-

on for existing customer. Part of

our strategy to increase ARR

(1)

.

Light Commercial

High-cost assets critical to customer

operations need hard wearing devices and

advanced functionality.

Mixed use assets –often operating

alongside heavy vehicles. Can be

served well by simple solutions.

OPPORTUNITY

4.8m

Light commercial

vehicles in ANZ.

~48%

not currently using

telematics

EROAD has partnered with Geotab to introduce EROAD Locate

- a new low-cost device for light commercial vehicles for ANZ.

By leveraging the hardware from Geotab, we increase our

product offering while maintaining engineering focus on our

core product development needs.

1

Formerly known as Annualised Monthly Recurring Revenue (AMRR). Definition is unchanged. See Glossary on page 43 for further detail.

26
Heavy VehiclesLight Vehicles

PapereRUC

86%

of all eRUC

transactions in heavy

vehicles use EROAD

$1.32b

$822m

Light Vehicle eRUCOpportunity

Growth potential across light vehicles where eRUCadoption is low

Annual RUC collected by NZ Government

June 2024 $2.15b

Total

eRUC

LIGHT COMMERCIAL

OPPORTUNITY:

•91% of RoadUser Charges for light

vehicles are not collected via eRUC

•EROAD Locate via Geotab partnership

offers an entry level product for this

segment to switch from paper

•Proposed government changes to

fuel excise would see this segment

expand further

•Increasing the volume of transactions

that choose eRUCover paper is a large

opportunity

72%

28%

9%

91%

27
Clarity Edge: AI powered real-time safety

AI enhanced video detection with real-time voice coaching

85%69%63%61%60%

Data from a US customer pilot shows

Clarity Edge in-cab voice coaching

activelyenhances driver safety in

real time, reducing risky behaviours

and creating safer roads

Real impact for real drivers.

Overspeed

instances

Distracted

driving

Yawning

Failure to

stop

Cellphone

usage

Our new Clarity Edge camerascombine

AI and voice coaching to create safer

fleets through real-time driver

engagement and intervention.

Clarity Edge is more than a dash-cam, it’s

a critical component of our product

strategy to lead in AI-driven safety

solutions.

By adding value through advanced AI

features, we strengthen customer loyalty

and product adoption - driving ARR

growth as customers expand their use of

EROAD’s product suite.

28
03

Trends

& Guidance

29
GoalMetricFY23FY24H1 FY25

Strategy

FY26 Targets

SaaS

Quality

ARR

2

$153.7m$177.8m$177.9m

Grow customer base in-line with

estimated market growth

3

11% - 13% CAGR

Churn

5%5%7%Maintain historical churn rate

5% - 7%

4

Average Lease Duration

Remaining (years)

1.31.41.5

Rebalance toward longer-dated

enterprise contracts

1.5 – 2.0

5

InvestmentR&D as % of revenue

23%18%17%Focus on projects with near-term ROI

13% - 15%

6

Return

NormalisedFree Cash

Flow

1,8

Margin

-18%6%6%Improve cash efficiency and drive NA growth

9%+

7

1

A non-GAAP measure representing operating cash flow and investing cash flow reported in the Statement of Cash Flows (excluding net interest paid).

2

Formerly known as AnnualisedMonthly Recurring Revenue (AMRR). Definition is unchanged. See Glossary on page 43 for further detail. Annual recurring revenue includes negative FX impact of $4.2m in H1 FY25

3

Targeted growth in-line with blended market growth in North America and ANZ.; ANZ fleet management unit market is estimated to grow at a 16% CAGR (2019-2024); North America private fleet telematics market is expected to grow by 11%

per year until 2030 (Sources: ACT Research, I.H.S., Berg, Expert interviews).

4

In-line with historical churn rates (based on FY20-22A range).

5

Assumes that average lease duration remaining (years) increases with weighting to longer dated enterprise contracts.

6

Decrease in R&D as % of revenue is driven by streamlining of activities towards projects with near-term ROI.

7

Driven by additional cash efficiencies and growth in North America. Includes effects from roll-off of the switch program, leverage (holding fixed costs as we grow) and the anticipated $20m cost-out.

8

Normalisedfor 4G hardware upgrade costs

On track for Free Cash Flow

1

positive fiscal year 2025

Implementation of refreshed strategy provides pathway to sustainable, profitable growth

Focused execution delivers results against refreshed strategy

Key Metrics Trend

30
H1 FY25 results affirm year-end financial guidance

Half-year FY25 results together with recent renewals, expansions and rollout of

previously announced new customer contracts support achievement of FY25

financial guidance.

Reiterating FY25 Financial Guidance, updating R&D guidance

•Revenue growth reflects targeting large enterprise customers with long

sales cycle

•EBIT of $5m to $10m normalisedfor 4G hardware upgrade programme

•Free cash flow positive

•R&D spend increased to $35m, from $32m previously

Outlook

Grow our existing customer base in North America utilisingdedicated North

American sales teams focused on new logo acquisition and expansion of existing

relationships.

Continued growth in New Zealand with increased opportunity to leverage brand

recognition to capture new enterprise accounts. Proposed government policies

for eRUCrepresent significant medium/long-term opportunity.

Building on momentum gained in Australia and launching expanded product

suite beyond existing customers.

On track to delivering a path to sustainable, profitable growth

Guidance

FY25 Guidance

Revenue$190m – $195m

Normalised EBIT$5m to $10m

Free cash flowPositive

R&D spend$35m

31
04

Appendix

32
Reported Revenueincreased $7.0m primarily

due to unit growth of approximately 11,000

units since 30 Sep 2024.

Strength of the USD has resulted in increased

revenue of approximately $0.2m.

EBITDAincreased $3.6m reflecting higher

revenues and cost reductions with operating

expenses decreasing year on year as a

percentage of revenue.

D&A decreased $1.3m despite accelerated

depreciation on the units impacted by the 4G

hardware upgrade program.

Interestdecreased $2.2m consistent with

lower borrowing in the period following the

repayment of debt last year as well as

movements in borrowing rates.

NZ$mH1 FY25H1 FY24

(1)

Change ($)

Revenue95.988.97.0

Operating expenses

(66.7)(63.3)

(3.4)

Earnings before interest, taxation, depreciation

and amortisation

29.225.6

3.6

Depreciation of property, plant and equipment(11.0)(11.0)0.0

Amortisation of intangible assets(10.4)(9.6)(0.8)

Amortisation of contract and customer aquisition

assets

(5.4)(4.9)(0.5)

Earnings/(loss) before interest and taxation

2.40.1

2.3

Net financing costs

(2.5)(4.7)

2.2

Profit/(loss) before tax

(0.1)(4.6)

4.5

Income tax benefit/(expense)(1.4)3.2(4.6)

Profit(loss) after tax for the period attributable to

the shareholders

(1.5)(1.4)

(0.1)

Items that are or may be reclassified subsequently to

profit or loss

(9.5)8.8(18.3)

Total comprehensive income / (loss) for the period(11.0)7.4(18.4)

Statement of Income

1

Restated. Refer to Summary of Significant Accounting Policies (e) in the 30 September 2024 audited financial statements.

33
NZ$mH1 FY25H1 FY24Change ($)

Cash received from customers96.188.57.6

Payments to suppliers and employees(71.4)(58.4)(13.0)

Investment in contract fulfilment assets(5.1)(5.6)(0.5)

Net interest(2.2)(3.8)(1.6)

Income taxes paid(0.1)-(0.1)

Cash flows from operating activities17.3 20.7(3.4)

Property, plant & equipment(9.1)(12.8)3.7

Investment in intangible assets(8.8)(9.8)1.0

Contract fulfilment and customer acquisition assets(1.5)(2.1)(0.6)

Cash flows from investing activities(19.4)(24.7)5.3

Bank loans-2.0(2.0)

Payment of lease liability(1.0)(1.1)0.1

Issue of equity-34.3(34.3)

Cost of raising capital-(2.5)(2.5)

Cash flows from financing activities(1.0)12.7(13.7)

Net increase (decrease) in cash held(3.1)8.7(11.8)

Cash at the beginning of the financial period14.58.16.4

Effects of exchange rate changes on cash(0.1)-(0.1)

Closing cash and cash equivalents11.316.8(5.5)

Cash Flow Statement

Operating Cash Flowdecreased $3.4m

primarily due to a reduction in working

capital items.

Investing Cash Flow increased $5.3m

primarily due to the utilisation of existing

inventory for new hardware.

Financing Cash Flowdecreased $13.7m

relative to the prior year in which new capital

was raised.

34
Balance Sheet

Cashdecreased slightly by $3.2m primarily

reflecting financing costs and lease liabilities.

Property, plant and equipmentdecreased

$3.5m due to a decrease in inventory as the

4G hardware upgrade program is rolled out.

Inventory balance at 30 September 2024 was

$27.6m.

Costs to acquire and contract fulfillment

costs increased$0.9m reflecting growth and

renewals.

Borrowingswere basically unchanged at

$36.7m as cash burn continues to decrease

and operations are primarily funded from

internally generated cash flow.

NZ$mH1 FY25FY24

(1)

Change ($)

Cash11.314.5(3.2)

Restricted bank accounts25.117.87.3

Costs to acquire and contract fulfilment costs9.78.21.5

Other32.533.2(0.7)

Total current assets78.673.74.9

Property, plant and equipment85.388.8(3.5)

Intangible assets253.9264.4(10.5)

Costs to acquire and contract fulfillments costs8.38.9(0.6)

Other17.717.70.0

Total non-current assets365.2379.8(14.6)

Total assets443.8453.5(9.7)

Payable to transport agencies25.117.87.3

Contract liabilities

23.323.6(0.3)

Borrowings36.736.60.1

Other liabilities46.954.2(7.3)

Total liabilities132.0132.2(0.2)

Net assets311.8321.3(9.5)

1

Restated. Refer to Summary of Significant Accounting Policies (e) in the 30 September 2024 audited financial statements.

35
1

Under new refinanced facility agreement executed on 29 September 2023

Secured new 3-year $80m bank facility in

October 2023 in conjunction with capital raise.

Amortisationwill reduce the facility limit to $60m

at end of the 3-year commitment

$80m

Bank Facility

Added NZ domestic bank (Kiwibank) in addition to

two existing lenders (ANZ, BNZ)

New facility provides added duration and flexibility,

with headroom to covenants

Net leverage ≤ 1.50x reducing to 1.25x by September 2025 and

1.00x by June 2026. Interest coverage ratio ≥ 4.00x

3

NZ bank

lenders

Provides company with total liquidity of $54.6m.

Sufficient liquidity to grow and achieve free cash

flow positive without the need for further capital

$54.6m

Total liquidity

Strong balance sheet for strategic execution

Liquidity

Bank Facilities

Sufficient liquidity to fund strategic plan

36
NZ$Local $

NZ$mH1 FY25H1 FY24H1 FY25H1 FY24

North American ARPU

NZ$59.49NZ$60.23US$36.18US$36.85

New Zealand ARPU

NZ$59.47NZ$58.17NZ$59.47NZ$58.17

Australian ARPU

NZ$48.13NZ$46.67A$44.05A$43.16

ARPU Trend

37
9,973

14,332

19,264

24,041

28,140

32,452

38,129

41,939

49,802

59,843

65,285

71,446

75,674

80,366

84,526

87,892

93,639

106,916

112,280

116,455

121,483

124,417

126,045

1,513

2,120

2,373

2,874

5,072

14,099

14,643

15,636

18,008

19,613

21,391

600

1,990

3,158

4,501

5,301

6,102

9,736

17,757

20,955

24,660

31,227

34,002

35,294

35,437

33,992

87,682

90,596

95,058

103,393

106,860

106,494

9,973

14,332

19,864

26,031

31,298

36,953

43,430

48,041

59,538

77,600

86,240

96,106

108,414

116,488

122,193

126,203

132,703

208,697

217,519

227,149

242,884

250,890

253,930

H1 FY14H2 FY14H1 FY15H2 FY15H1 FY16H2 FY16H1 FY17H2 FY17H1 FY18H2 FY18H1 FY19H2 FY19H1 FY20H2 FY20H1 FY21H2 FY21H1 FY22H2 FY22H1 FY23H2 FY23H1 FY24H2 FY24H1 FY25

New Zealand

Australia

North America

Unit count

38
NEWZEALAND

$25.3m

NORTHAMERICA

$6.9m

AUSTRALIA

$(2.5)m

CORPORATE& DEVELOPMENT

$(36.0)m

H&A Assets - Hardware & Accessory Assets •CA Assets - Customer Acquisition Assets • CE EBITDA –Corporate and Elimination EBITDA •H&A under Construction - Hardware & Accessories +/_ Inventories

Inflows

Outflows

Total

Free Cash Flow to the Firm By Region

39
Strategic R&D allocations across retention and growth areas globally

•Ongoing maintenance

spend in platforms and

systems for existing

customers for retention.

•Targeted investment in

new offerings increases

value by opening new

customer opportunities

and expansion within

existing.

•Our R&D priorities vary

from period to period in

response to customer

and market needs.

•Appointed highly

experienced NZ-based

CTO who started in June

2024.

R&D Investments for Growth

49%

Total R&D investment

is for net new growth

Capex Breakdown

46%

New to EROAD

21%

Planned

enhancements

13%

Reliability,

availability,

serviceability

and scalability

20%

Other

OpexBreakdown

44%

Reliability,

availability,

serviceability

and scalability

30%

Quality/bugs

6%

Planned

enhancements

20%

Other

47%42%

11%

42%

New Zealand

Includes new gen trailer

tracker, decarbonisation

tool and 4G swap out

11%

Australia

Includes features to

retain existing

enterprise customers

including AU fatigue

management tool

47%

North America

Includes expanding

capabilities to support

new enterprise

customers, and

supportenhancements

for US tax and fatigue

products

Capex

Total

R&D

R&D by

Region

40
Compliance and assurance

•RUC and fuel tax compliance

•Electronic, automated RUC

purchases and claims

•Fuel tax reporting and IRP1

registration

•Industry-specific solutions

•Cold chain assurance

•Construction assurance

•Waste and recycling assurance

Dashcams

Iothubs

Trackers and sensors

2

Proprietary and 3

rd

party hardware

Health & Safety

•Driver behaviour

monitoring and feedback

•Electronic logbook

•Vehicle inspections

•Speed monitoring

•Incident detection, alerting

and replay

Productivity

•GPS tracking and

geofencing

•Fleet maintenance

•Fuel management and

idling reports

•Vehicle inspections

Sustainability

•Fuel management and

idling reports

•Fleet utilisation

•Decarbonisation

assessment & insights

1

Powered by

2

EROAD provides a complete connected network that turns disparate customer data into action

Integrated solutions overview

41
Significant growth achievable through market share gain

Market Opportunity

NEW ZEALAND

Value proposition

New Zealand’s leading transport

technology platform for compliance,

productivity, health & safety, logistics

and sustainability.

REVENUE

2

NZ$99.6m

TAM

2

NZ$0.5b

Trusted by:

Largest operator in NZ

6.9% CAGR

1

since Nov-21

Cash generative geography with

leading market position in

target verticals

AUSTRALIA

Value proposition

Trusted transport technology platform for

health & safety, cold chain and

construction assurance.

Trusted by:

#1Integrated Construction

Material Co

16.2% CAGR

1

since Nov-21

Opportunity to leverage leading

New Zealand market position for

trans-Tasman fleets

REVENUE

2

NZ$13.0m

TAM

2

NZ$2.2b

NORTH AMERICA

8.1% CAGR

1

since Nov-21

Largest market with

significant long-term

growth prospects

REVENUE

2

NZ$79.2m

TAM

3

NZ$10.0b

Value proposition

Insights, workflow and productivity solutions help

enterprise customers manage complexity through

complete integration and vertical specialisation.

Trusted by:

Top 2 food shippers in North America

Opportunityto drive

revenue in North

America through

market share gains

from referenceable

customers such as

Sysco

1

Growthof contracted units since acquisition of Coretex

2

Revenue figures are first half FY25 annualised

3

Total addressable market, inclusive of light vehicle market in NZ and AU source: ACT Research, I.H.S, Berg, Expert interviews, Fleet manager interviews, reported financials

42
Market Trend

Despite increasing pressure to reduce

environmental impact, sustainability

efforts across our markets are limited by:

•Lack of EV charging infrastructure

•Price and supply chain limitations

on EV fleets

•Limited range in current EVs

Immediate and meaningful emission

and footprint reductions within their

existing control include:

•Fuel usage

•Driver behaviour

•Vehicle performance

•Reduced product waste

EROAD core products already track,

measure and control leading indicators

for key areas of carbon emissions.

Layering carbon reduction targets into

existing efficiency and cost saving benefits

adds value to customers, and the planet.

•Idle controls

•Vehicle maintenance

•Routing – fuel usage, fresh delivery

•Optimisedpre-cool for cold-chain

•Temperature control (food quality)

•Speed governors - fuel usage

Developed in conjunction with EECA

MyEROADSustainability Module is just

one step in making emissions reduction

as commonplace for our customers as

safety measures and cost improvements.

EROAD IntelligenceEROAD Better World

Positionedfor emerging social and environmental trends

Sustainability

43
ANNUAL RECURRING REVENUE (ARR) A non-

GAAPmeasure representingmonthly Recurring

Revenueforthelastmonthoftheperiod,multiplied

by12.It providesa 12monthforward viewofrevenue,

assumingunitnumbers,pricingand foreign

exchangeremainunchangedduringtheyear.

Formerly known as Annualised Monthly Recurring

Revenue (AMRR).

AVERAGE REVENUE PER CUSTOMER (ARPC)

A non-GAAP measure representing the average

revenue generated per customer, calculated using

Annualised Recurring Revenue (ARR) only. This

metric excludes any one-off payments, providing

insight into the typical sustained revenue generated

from ongoing customer relationships.

ASSET RETENTION RATE

Thenumber ofTotalContractedUnitsatthe

beginning ofthe12monthperiodandretainedas

TotalContractedUnitsattheendofthe12month

period,asa percentageofTotal ContractedUnitsat

the beginningofthe12monthperiod.

CHURN

The inverse of the asset retention rate.

COSTS TO ACQUIRE CUSTOMERS (CAC)

A non-GAAPmeasureofcoststoacquire

customers. TotalCACrepresentsallsales&

marketingrelated costs.CACcapitalisedincludes

incrementalsales commissionsfornewsales,

upgradesandrenewals whicharecapitalisedand

amortisedoverthelifeof thecontract.AllotherCAC

relatedcostsareexpensed whenincurredand

includedwithinCACexpensed.

COSTS TO SERVICE & SUPPORT (CTS)

A non-GAAPmeasureofcoststosupportandservice

customers.TotalCTSrepresentsall customersuccess

andproductsupportcosts. Thesecostsareincluded

in Administrative and otherOperatingExpenses.

EBIT

A non-GAAPmeasurerepresentingEarnings

before Interest andTaxation (EBIT).Referto

ConsolidatedStatementof Comprehensive

IncomeinFinancialStatements.

ENTERPRISE

A customer where the $ARR is more than $100k in

NZD for the Financial year reported

FREE CASH FLOW

A non-GAAPmeasurerepresentingoperatingcash

flowandinvestingcashflownet of interest paid and

received. reportedintheStatement ofCashFlows .

FREE CASH FLOW TO THE FIRM

A non-GAAPmeasurerepresentingoperatingcash

flowandinvestingcashflownet of interest paid and

received. For the purposes of this presentation,

payments for the acquisition of Coretexhave been

excluded.

FY (FINANCIAL YEAR)

Financialyearended31March.

H1 (HALF ONE)

Forthesixmonthsended30September.

H2 (HALF TWO)

Forthesixmonthsended31March.

LEASE DURATION

Future contracted income as a proportion of

reported revenue.

MONTHLY SAAS AVERAGE REVENUE PER UNIT

(ARPU)

A non-GAAPmeasurethatis calculatedbydividing

thetotalSaaSrevenuefortheyear(asreportedin

Note 2 ofthe FY24FinancialStatements) minus the

contract liability discounting gain (as reported in the

FY24 Reconciliation of Operating Cash Flows)bythe

TCUbalance attheendofeachmonthduringthe

year.

NORMALISED EBIT

Excludesone-off 4G hardware upgrade

programcosts and accelerated depreciation

NORMALISED FREE CASH FLOW

Excludesone-off 4G hardware upgrade

programcosts and associated hardware spend

ROAD USER CHARGES (RUC)

InNew Zealand,RUCis applicabletoHeavyVehicles

andallvehiclespoweredbya fuelnottaxedat source.

Thechargesarepaidintoa fundcalledtheNational

LandTransportFund,whichiscontrolledbyNZTA,

andgotowardsthecostof repairingtheroads.

SAAS

Softwareasa Service,a methodof softwaredelivery

inwhichsoftwareis accessed onlineviaa subscription

ratherthanbought andinstalledonindividual

computers.

TOTAL CONTRACT VALUE (TCV)

The total value of a customer contract over its entire

duration, including recurring revenue (e.g., ARR) and

any one-off payments

UNIT

A communicationdevicefittedin-caborona

trailer. Wherethereis morethanoneunitfitted

in-cabor ona trailer,it is countedasoneunit

(excluding PhilipsConnect).

Glossary

44
44

ASX & NZX: ERD

investors@eroad.com| eroadglobal.com/investors

EROAD acknowledges the TangataWhenua of New Zealand, the Indigenous

Nations and First Peoples of Australia, and the Custodians of the lands and

waterways in the United States of America where our offices are located. We

express our gratitude and appreciation to these peoples for sharing their culture

and traditions and for their stewardship of these lands. We recognise and pay

respect to their Elders, past, present, and emerging.​.

---

2025 INTERIM
REPORT

Contents
PAGE 3

LETTER FROM THE CHAIR

PAGE 5

LETTER FROM THE C0-CEOs

PAGE 8

FINANCIAL STATEMENTS

PAGE 15

NOTES TO FINANCIAL STATEMENTS

PAGE 36

INDEPENDENT REVIEW REPORT

PAGE 38

GLOSSARY

PAGE 40

DIRECTORY

Non-GAAP Measures

EROAD has used non-GAAP measures when discussing

financial performance in this document. The directors

and management believe that these measures provide

useful information as they are used internally to evaluate

performance of business units, to establish operational

goals and to allocate resources. Non-GAAP measures are

not prepared in accordance with NZ IFRS (New Zealand

International Financial Reporting Standards) and are not

uniformly defined, therefore the non-GAAP measures

reported in this document may not be comparable with

those that other companies report and should not be

viewed in isolation or considered as a substitute for

measures reported by EROAD in accordance with NZ

IFRS.

The non-GAAP measures EROAD have used are,

Annualised Recurring Revenue (ARR), Costs to Acquire

Customers (CAC), Costs to Service & Support (CTS),

EBITDA, Normalised EBITDA, EBITDA margin, Normalised

EBITDA margin, Normalised Revenue, Free Cash Flow and

Future Contracted Income (FCI).

EROAD 2025 INTERIM REPORT

PAGE 3
EROAD 2025 INTERIM REPORT

Dear Shareholders,

At the halfway point of FY25, EROAD has

delivered revenue of $95.9m, having achieved

growth across all three regions. With positive

free cash flow to the firm of $0.1m, EROAD

remains on track to meet its financial guidance.

This performance reflects disciplined execution

against strategic priorities and a focus on

delivering sustainable, profitable growth. Despite

a challenging macroeconomic environment, the

results highlight the resilience of the business

and its ability to adapt to market conditions,

positioning it well for the remainder of the year.

EROAD has evolved alongside its customers,

providing an integrated platform that extends

beyond standard telematics to address the

specific needs of complex fleets. From precise

temperature tracking for cold-chain logistics to

compliance tools for construction and industry-

specific solutions, the platform supports

efficiency, safety, and regulatory assurance.

With specialised modules for sustainability, tax

management, and other critical areas, EROAD

enables fleets to streamline operations within

a single ecosystem. As the leader in road user

charging technology in New Zealand, EROAD

also delivers extensive expertise in simplifying

compliance for its customers.

Letter from the Chair

EROAD 2025 INTERIM REPORT LETTER FROM THE CHAIR
PAGE 4

Strategic growth in a complex market

All three core markets continue to contribute to steady growth

in recurring revenue, driven by a focus on expanding multi-

product adoption and deepening customer engagement. This

reflects the growing value of EROAD’s integrated platform

across a diverse range of fleet operations.

The transport and logistics industry is currently experiencing a

period of significant adjustment, especially in North America.

Following the high demand during COVID-19, the U.S.

trucking sector is now undergoing a process of right-sizing.

Many smaller operators that expanded during the boom are

struggling to adapt to a lower-demand environment, leading

to consolidation within the industry. This reinforces the

importance of focusing on resilient, high-value customers who

benefit most from EROAD’s integrated platform.

In line with this focus, EROAD is actively managing its

customer portfolio, with a deliberate strategy to accept higher

unit reduction as the company prioritises fostering deeper

relationships with enterprise customers aligned to long-

term value creation. Larger fleets, in particular offer unique

advantages—their resilience and growth potential create

opportunities for EROAD to scale alongside them as their

operations expand.

By concentrating on customers who require more than basic

compliance tools, EROAD supports fleets with advanced

solutions that enhance safety, productivity, and operational

efficiency. This targeted approach ensures that value is

delivered where it has the most meaningful impact, helping

fleet operators optimise their operations sustainably and cost-

effectively.

Board priorities and strategic direction

The Board remains committed to EROAD’s vision of

sustainable growth, supporting a strategy that builds

operational strength while expanding its presence in core and

growth markets. This includes repositioning EROAD to deliver

long-term value through efficient growth, targeted customer

engagement, and realigned sales and marketing efforts

to deepen relationships with complex fleet operators. The

deliberate focus on quality of revenue over volume reflects

a strategy designed to build enduring partnerships with

customers in New Zealand, Australia, and North America.

In New Zealand, EROAD is well-positioned to respond to

proposed government initiatives, including the proposed

action plan for road user charges (RUC) and time-of-use

pricing. These policy shifts, which aim to modernise transport

funding, represent an opportunity to expand offerings within

the light commercial vehicle segment. With a proven track

record in RUC compliance, EROAD is prepared to leverage its

expertise to support New Zealand’s evolving infrastructure

needs as new policies come into effect.

Strengthening leadership and future

preparedness

This year, EROAD welcomed Duanne O’Brien as Chief

Technology Officer. Since joining, Duanne has brought focus

and direction to the product team, aligning technology efforts

closely with the company’s strategic goals. His leadership

is already enhancing product capabilities, and the Board

is confident that under his guidance, EROAD will continue

to advance its solutions to meet the changing demands

of modern fleets. This appointment reflects EROAD‘s

commitment to innovation strengthens its ability to maintain a

competitive edge.

Commitment to sustainability and responsible

growth

Sustainability remains a key priority for EROAD and is integral

to its growth strategy and the technologies it develops. The

Board supports ongoing investment in technologies that help

customers to reduce emissions, improve fuel efficiency, and

optimise fleet operations. This focus positions EROAD as a

responsible partner, addressing industry challenges while

delivering tangible benefits to customers and communities.

The Board also prioritises fostering a corporate culture

grounded in responsibility and integrity. This includes a

strong emphasis on compliance, effective risk management,

and robust data privacy protections. These high standards

ensure that EROAD continues to earn the trust of customers,

shareholders, and other stakeholders.

Confidence in our direction

As EROAD enters the second half of FY25, the Board remains

confident in the company’s strategic direction and its ability to

navigate the challenges and capitalise on opportunities. The

continued focus on high-value customers, scalable practices,

and sustainable growth strengthens EROAD’s position in a

competitive market. The results achieved in the first half of

the year affirm the effectiveness of this approach, and while

the road ahead will require continued adaptability and focus,

EROAD is well-positioned to deliver on its commitments to

shareholders and stakeholders. In line with this focus, we are

updating our R&D guidance to ensure continued investment in

innovation that supports long-term growth and differentiation.

On behalf of the Board, I extend my gratitude to shareholders

for their continued support and to the EROAD team for their

dedication. These combined efforts are building a resilient,

future-focused business that is well-positioned to create

lasting value for all.

Sincerely

Susan Paterson

Chair

PAGE 5
EROAD 2025 INTERIM REPORT

Letter from the Co-CEOs

Dear Shareholders,

We are pleased to report EROAD continues

to deliver positive results, achieving half year

revenue of $95.9m - an increase of 8% from HY

FY24. Annualised recurring revenue (ARR) has

grown across all three regions year-over-year,

reflecting our focus on sustainable profitable

growth. The company remains free cash flow

positive,with normalised free cash flow –

excluding the one-time expenses from the 4G

upgrade program in New Zealand - at $6.2m.

The discipline instilled across the business over

recent years has provided the foundations for

sustainable growth, even amid challenging

economic conditions in the trucking and

transportation sectors. By concentrating on our

strengths, we continue to serve larger, more

complex fleets, where our single platform solution

offers a distinct competitive advantage.

PAGE 6
EROAD 2025 INTERIM REPORT LETTER FROM THE C0-CEOs

Delivering solutions that meet diverse

fleet needs

EROAD’s platform is designed to meet the diverse needs of

fleets, from straightforward compliance tools to advanced

solutions for complex operations. Whether managing

refrigerated transport, delivering concrete, or optimising

last-mile logistics, our platform equips customers with the

tools they need to succeed.

While some fleets are satisfied with basic compliance

products, EROAD’s full platform offers distinct value for

operators with complex needs. By integrating critical

functions such as safety, compliance, asset tracking and

load monitoring into a single solution, we enable customers

to streamline operations and improve efficiency.

This ability to deliver tailored, high-value tools differentiates

EROAD in the market, especially within the transport,

construction, and refrigerated segments. It reflects our

commitment to helping customers address their most

critical challenges with solutions that create meaningful

operational improvements.

Expanding value through a balanced

revenue strategy

EROAD’s growth strategy combines expanding multi-product

adoption within our existing customer base alongside targeted

acquisition of new accounts. This two-pronged approach

enables us to deepen relationships with our current customers,

many of whom are larger fleets with significant growth

potential, while driving additional ARR growth through new

customer wins. We also continue to grow alongside existing

customers as their fleets expand, further strengthening

relationships and adding value organically.

In North America we have strengthened our sales capabilities

and are progressing with pilot programs among several key

accounts. These pilots represent important steps toward larger

partnerships as we’re seeing a growing interest in EROAD’s

platform among major fleet operators. While longer sales

cycles are typical in this segment, our history of success with

large-scale accounts, such as Sysco and US Foods reinforce

our credibility. Alongside these pilots, we are also focused on

expanding our reach within existing customers, driving ARR

growth through increased adoption of products such as our

AI-powered Clarity Edge cameras.

Leveraging partnerships to broaden

market reach

As part of our strategic approach to delivering a complete ran-

ge of solutions, EROAD has partnered with Geotab to address

the needs of light commercial fleets. Through this partnership,

we have introduced EROAD Locate, a low-cost, entry-level

telematics solution. With only 48% of the estimated 4.8

million light commercial vehicles in Australasia currently using

telematics, this partnership offers a significant growth oppor-

tunity. EROAD Locate allows us to engage new customers,

including those who may initially require only basic functiona-

lity, while keeping our own engineering resources focused on

EROAD’s core platform for more complex operations.

The partnership is particularly valuable for fleets with mixed

requirements. For example, heavy-vehicle customers may use

EROAD’s full platform for core fleet operations, adding ERO-

AD Locate to meet the needs of corporate or lighter vehicle

fleets. This gives EROAD the flexibility to meet a wider range

of customer needs and reinforces our reputation as a provider

for fleets with complex requirements.

Additionally, as New Zealand advances toward broader user

charging for roads, EROAD Locate is well-positioned to play

an important role in supporting this transition.

Global performance and regional

contributions

New Zealand remains our stable, cash-generative

foundation, with revenue growing 11.4% year-over-year to

$49.8 million. While unit reductions have been influenced

by fleet resizing and the 4G upgrade program, the market

continues to demonstrate resilience and supports broader

strategic initiatives globally.

North America continues to build momentum as EROAD’s

primary growth market, with revenue increasing 2.6% year-

over-year to NZ$39.6 million. Recent renewals with Medline,

ABC Trucking, and US Foods included product expansions,

generating $2 million in additional contract value. While fleet

resizing has impacted unit counts, ARR and ARPU growth

reflect the strength of our enterprise relationships.

Australia has delivered strong results, with revenue

increasing 16.1% year-over-year to NZ$6.5 million. This

growth reflects the success of focused sales efforts on larger

fleets, including the ongoing rollout of a 5,000-unit trans-

Tasman contract, on track for completion by June 2025

with approximately 1,400 units deployed at half-year. This

progress highlights Australia’s position as a promising market

for long-term growth.

PAGE 7
EROAD 2025 INTERIM REPORT LETTER FROM THE C0-CEOs

Commitment to product innovation

Our focus on product innovation remains central to

delivering value for our customers. The recently released

Clarity Edge AI dashcams have already shown significant

safety improvements with early customers, reducing

instances of speeding, distracted driving, and cell phone

use. This product has quickly become part a core part of

our safety offering, resonating strongly with customers who

prioritise driver safety and regulatory compliance.

Since the arrival of Duanne O’Brien as Chief Technology

Officer, our product team has gained renewed focus

and momentum. His leadership has energised the team

to accelerate the delivery of tools that address the real-

world challenges faced by fleets today, ensuring EROAD

continues to meet the complex needs of our customers while

enhancing operational safety and efficiency.

Looking ahead

As we enter the second half of FY25, we remain confident

in EROAD’s clear focus on complex fleet operations,

disciplined growth, and commitment to delivering value

through innovation. To that end, we will be updating our

R&D guidance to ensure investment allocation is aligned

with strategic priorities. We are firmly on track to deliver

against our full-year guidance, supported by a strategy that

prioritises high-quality revenue and effective execution.

We would like to extend our sincere gratitude to the entire

EROAD team for their hard work, resilience, and dedication.

Their commitment enables us to make a meaningful

difference for our customers, supporting safer, more efficient,

and sustainable fleet operations.

On behalf of everyone at EROAD, we thank you, our

shareholders, for your continued support as we execute

against our strategy. EROAD is well-positioned to

deliver long-term sustainable value and capitalise on the

opportunities ahead.

Sincerely,

Mark Heine and David Kenneson

Co-CEOs, EROAD

PAGE 8
EROAD 2025 INTERIM REPORT

Financial

Statements

PAGE 9
EROAD 2025 INTERIM REPORT FINANCIAL STATEMENTS

Condensed Consolidated Statement of Comprehensive Income

For the six months ended 30 September 2024


30 Sep 2024

Restated*

30 Sep 2023

UnauditedUnaudited

Notes$M's$M’s

Revenue295.988.9

Operating expenses(66.7)(63.3)

Earnings before interest, taxation, depreciation and

amortisation

29.225.6

Depreciation of property, plant and equipment4(11.0)(11.0)

Amortisation of intangible assets5(10.4)(9.6)

Amortisation of contract and customer acquisition assets                  (5.4)                  (4.9)

Earnings before interest and taxation2.40.1

Finance expense(2.9)(4.9)

Finance income                   0.4                   0.2

Net financing costs(2.5)(4.7)

Loss before tax (0.1)(4.6)

Income tax benefit/(expense)8(1.4)                   3.2

Loss after tax for the period attributable to the shareholders(1.5)                  (1.4)

Other comprehensive income

Items that are or may be reclassified subsequently to profit or

loss

Cash flow hedges0.8                  (0.5)

Currency translation differences                   (10.3)9.3

                   (9.5)8.8

Total comprehensive income for the period                   (11.0)7. 4


Loss per share - Basic (cents)                    (0.82)(1.14)

Loss per share - Diluted (cents)                    (0.82)(1.13)

* Refer to Retrospective Restatement note (e) for further details.

The above Condensed Consolidated Statement of Comprehensive Income should be read in conjunction with the accompanying

notes.

PAGE 10
EROAD 2025 INTERIM REPORT FINANCIAL STATEMENTS

Condensed Consolidated Statement of Financial Position

As at 30 September 2024

30 Sep 2024

Restated*

31 Mar 2024

UnauditedAudited

Notes$M's$M’s

Current assets

Cash and cash equivalents311.314.5

Restricted bank accounts325.117.8

Derivative financial asset0.4-

Trade and other receivables32.133.2

Contract fulfilment costs7.15.8

Costs to obtain contracts2.62.4

Total Current Assets78.673.7

Non-current assets

Property, plant and equipment485.388.8

Intangible assets5253.9264.4

Derivative financial asset0.4-

Contract fulfilment costs6.06.2

Costs to obtain contracts2.32.7

Deferred tax assets1 7. 31 7. 7

Total Non-Current Assets365.2379.8

Total Assets443.8453.5

PAGE 11
EROAD 2025 INTERIM REPORT FINANCIAL STATEMENTS

Chair,

25 November 2024

Chair of the Finance, Risk and Audit Committee,

25 November 2024

Condensed Consolidated Statement of Financial Position (continued)

As at 30 September 2024

30 Sept 2024

Restated*

31 Mar 2024

UnauditedAudited

Notes$M's$M’s

Current liabilities

Borrowings65.02.5

Trade payables and accruals23.330.3

Payables to transport agencies325.117.8

Contract liabilities10.310.9

Lease liabilities1.31.2

Employee entitlements4.64.1

Derivative financial liabilities-0.3

Total Current Liabilities69.66 7.1

Non-current liabilities

Borrowings31.734.1

Contract liabilities13.012.7

Lease liabilities4.85.1

Derivative financial liabilities0.10.1

Deferred tax liabilities12.813.1

Total Non-Current Liabilities62.465.1

Total Liabilities132.0132.2

Net Assets311.8321.3

Equity

Share Capital7355.7353.5

Share capital premium/discount(19.9)(19.9)

Other reserves11.721.2

Accumulated losses(35.7)(33.5)

Total Shareholders' Equity311.8321.3

* Refer to Retrospective Restatement note (e) for further details.

The above Condensed Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.

PAGE 12
EROAD 2025 INTERIM REPORT FINANCIAL STATEMENTS

Condensed Consolidated Statement of Changes in Equity

For the six months ended 30 September 2024

Share

Capital

Share

Premium /

Discount

Accumulated

losses

Translation

Reserve

Hedging

Reserve

Total

$M’s$M’s$M’s$M’s$M’s$M’s

Balance as at 31 March 2023

(Audited) as previously reported

305.7(19.9)(36.0)(1.2)0.2248.8

Retrospective restatement (note (e))--(0.4)12.2-11.8

Restated balance as at 31 March 2023305.7(19.9)(36.4)11.00.2260.6

Loss after tax for the period--(1.4)--(1.4)

Other comprehensive income---9.3(0.5)8.8

Restated total comprehensive income--(1.4)9.3(0.5)7. 4

Transactions with owners of the Company

Equity settled share-based payments0.4-2.4--2.8

Share capital issued - net of costs26.7----26.7

Funds received in advance for shares5.1----5.1

Restated balance as at 30 Sep 2023

(Unaudited)

337.9(19.9)(35.4)20.3(0.3)302.6

Balance as at 31 March 2024 (Audited)

as previously reported

353.5(19.9)(32.7)                  2.5(0.4)303.0

Retrospective restatement (note (e))--(0.8)19.1-18.3

Restated balance as at 31 March 2024353.5(19.9)(33.5)                  21.6(0.4)321.3

Loss after tax for the period--(1.5)--(1.5)

Other comprehensive income---(10.3)0.8(9.5)

Total comprehensive income--(1.5)(10.3)0.8(11.0)

Transactions with owners of the Company

Equity settled share-based payments2.2-(0.7)--1.5

Balance as at 30 Sep 2024 (Unaudited)355.7(19.9)(35.7)11.30.4311.8

The above Condensed Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.

PAGE 13
EROAD 2025 INTERIM REPORT FINANCIAL STATEMENTS

Condensed consolidated Statement of Cash Flows

For the six months ended 30 September 2024

30 Sep 202430 Sep 2023

UnauditedUnaudited

Notes$M’s$M’s

Cash flows from operating activities

Cash received from customers96.188.5

Payments to suppliers and employees(71.4)(58.4)

Payments for contract fulfilment assets(5.1)(5.6)

Interest received0.40.2

Interest paid(2.6)(4.0)

Income taxes paid                  (0.1)                        -

Net cash inflow from operating activities                 17.3                 20.7

Cash flows from investing activities

Payments for investment in property, plant & equipment4(9.1)(12.8)

Payments for investment in intangible assets5(8.8)(9.8)

Payments for investment in cost to obtain contracts                  (1.5)                  (2.1)

Net cash outflow from investing activities                (19.4)                (24.7)

Cash flows from financing activities

Receipts from bank loans-2.0

Repayments of bank loans-(20.0)

Payment of lease liability(1.0)(1.1)

Receipts from issue of equity-29.2

Receipts in advance for equity raise-5.1

Payments for costs of raising equity                        -                  (2.5)

Net cash inflow from financing activities                  (1.0)                 12.7

Net increase/(decrease) in cash held(3.1)8.7

Cash at the beginning of the financial period14.58.1

Effects of exchange rate changes on cash and cash equivalents(0.1)-

Closing cash and cash equivalents11.316.8

The above Condensed Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.

PAGE 14 PAGE 14
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

Reconciliation of Operating Cash Flows with Reported Profit After Tax

For the six months ended 30 September 2024

30 Sep 2024

Restated*

30 Sep 2023

UnauditedUnaudited

$M’s$M’s

Reconciliation of operating cash flows with reported profit

after tax

Loss after tax for the six month period attributable

to the shareholders

(1.5)(1.4)

Add/(less) non-cash items

Tax asset recognised0.1(3.2)

Depreciation and amortisation26.825.5

Other non-cash expenses1.13.4

Unwinding of interest expense for discounted contract liabilities 0.6(0.4)

28.625.3

Add/(less) movements in other working capital items

Increase/(decrease) in trade and other receivables0.5(1.7)

Increase in current tax payables0.40.1

Increase in contract liabilities0.62.2

(Decrease)/increase in trade payables, interest payable

and accruals

(6.2)1.8

Increase contract fulfilment cost(5.1)(5.6)

 (9.8)                 (3.2)

Net cash from operating activities 17.3                20.7

* Refer to Retrospective Restatement note (e) for further details.

PAGE 15 PAGE 15
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

Notes to the Financial Statements

For the six months ended 30 September 2023

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The condensed consolidated interim financial statements presented for the six months ended 30 September 2024 are for EROAD

Limited (EROAD), and its subsidiaries (collectively referred to as the “Group”). The Group provides electronic on-board units and

software as a service to the transport industry.

EROAD Limited (the “Company”) is a company domiciled in New Zealand registered under the Companies Act 1993 and listed on the

New Zealand Stock Exchange (NZX) Main Board and Australian Stock Exchange (ASX). The Company is a FMC reporting entity for

the purposes of the Financial Markets Conduct Act 2013.

The condensed consolidated interim financial statements have been prepared in accordance with Generally Accepted Accounting

Practice in New Zealand (NZ GAAP). NZ GAAP in this instance being New Zealand Equivalents to International Financial Reporting

Standards (NZ IFRS) as appropriate for profit-oriented entities. These consolidated interim financial statements also comply with

the New Zealand equivalent to International Accounting Standard 34: Interim Financial Reporting (NZ IAS 34), and International

Accounting Standard 34: Interim Financial Reporting (IAS 34) and are prepared in accordance with the Financial Markets Conduct

Act 2013.

The condensed consolidated interim financial statements for the six months ended 30 September 2024 are unaudited and have

been the subject of review by the auditor, pursuant to NZ SRE 2410 (Revised): Review of Financial Statements Performed by the

Independent Auditor of the Entity as issued by the External Reporting Board.

These condensed consolidated interim financial statements have been prepared using the same accounting policies as, and

should be read in conjunction with the Group’s last annual consolidated financial statements as at and for the year ended 31

March 2024 (‘last annual financial statements’). These condensed consolidated interim financial statements do not include all of

the information required for a complete set of NZ IFRS financial statements. However, selected explanatory notes are included

to explain events and transactions that are significant to an understanding of changes in the Group’s financial position and

performance since the last annual financial statements. These financial statements have been approved for issue by the Board of

Directors on 25 November 2024.

(a) Basis of measurement

The financial statements are prepared on the historical cost basis, except for certain financial instruments carried at fair value.

(b) Presentation currency

The financial statements are presented in New Zealand dollars ($) which is the Group’s presentation currency, and all values are

rounded to million dollars to one decimal place ($M’s) except where stated. Items included in the financial statements of each

of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates

(the “functional currency”). The functional currency of the Company and its New Zealand subsidiaries is New Zealand dollars.

The functional currency of the Company’s Australian and North American subsidiaries are Australian dollars and United States

dollars respectively.

(c) Standards or interpretations issued but not yet effective and relevant to the Group

A number of new standards, amendments to standards and interpretations are effective for annual periods beginning on or

after 1 April 2024.

The Group has not adopted, and currently does not anticipate adopting, any standards prior to their effective dates.

(d) Critical accounting estimates and judgements

In applying the Group’s accounting policies, management continually evaluates judgements, estimates and assumptions based

on experience and other factors, including expectations of future events that may have an impact on the Group. All judgements,

estimates and assumptions made are believed to be reasonable based on the most current set of circumstances available to the

Group. Actual results may differ from the judgements, estimates and assumptions.

PAGE 16 PAGE 16
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

The significant judgements, estimates and assumptions made by management in the preparation of these financial statements are

outlined within the financial statement notes to which they relate. These are:

• Taxation - recognition and utilisation of tax losses

• Intangible assets - assumptions used in the impairment tests; capitalisation of development costs

• Property, plant and equipment - determining residual values and useful lives

(e) Retrospective restatement

During the half-year period to September 2024, the Group identified an error where goodwill and other acquired intangible

assets relating to the Coretex acquisition had been recorded in NZ$, rather than recorded in the functional currency of each of

the Group’s CGUs (US$ for North America and A$ for Australia), in its financial statements since 2022. This has been corrected by

restating each of the affected financial statement line items for prior periods. The following tables summarise the impact on the

Group’s condensed consolidated interim financial statements.

Condensed consolidated statement of comprehensive income

30 September 2023

As previously

presentedAdjustmentRestated


$M’s$M’s$M’s

Amortisation of intangible assets(9.3)(0.3)(9.6)

Income tax benefit3.10.13.2

Loss after tax for the period attributable to the shareholders(1.2)(0.2)(1.4)

Items that are or may be reclassified subsequently to profit and loss

Currency translation differences3.26.19.3

Total comprehensive income for the year1.55.97. 4

Condensed consolidated statement of financial position

31 March 2024


As previously

presentedAdjustmentRestated

$M’s$M’s$M’s

Intangible assets244.420.0264.4

Total assets433.520.0453.5

Deferred tax liability(11.4)(1.7)(13.1)

Total liabilities(130.5)(1.7)(132.2)

Other reserves2.119.121.2

Accumulated losses(32.7)(0.8)(33.5)

Equity303.018.3321.3

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

PAGE 17 PAGE 17
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

Condensed consolidated statement of financial position (continued)

1 April 2023

As previously

presented

1 April 2023

AdjustmentRestated


$M’s$M’s$M’s

Intangible assets242.113.0255.1

Total assets402.813.0415.8

Deferred tax liability(17.9)(1.2)(19.1)

Total liabilities(154.0)(1.2)(155.2)

Other reserves

(1.0)12.211.2

Accumulated losses(36.0)(0.4)(36.4)

Equity248.811.8260.6

There is no material impact on the Group’s basic or diluted EPS and no impact on the total operating, investing or financing

cash flows for the period ended 30 September 2023. There is no change to the outcome of the impairment testing of the

Group’s North America or Australia CGUs at 31 March 2024.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

PAGE 18 PAGE 18
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

PERFORMANCE

This section focuses on the Group’s financial performance. This section includes the following notes:

NOTE 1 SEGMENT REPORTING

NOTE 2 REVENUE

NOTE 1 SEGMENT REPORTING

EROAD operating segments are based on geographic location for operating companies and corporate and development costs.

These operating segments equate to the Group’s strategic divisions and are reported in a manner consistent with the internal

reporting provided to the Chief Executive Officers (“CEOs”). The CEOs are considered to be the chief operating decision

makers (“CODM”).

The four segments/strategic divisions offer different services and are managed separately because they require different

technology, services and marketing strategies. For each strategic division, the CODM reviews internal management reports.

The following summary describes the operations in each of the Group’s segments.

• Corporate & Development: Corporate head office costs and R&D activities for development of new and existing products

and services

• North America: Operating companies serving customers in North America

• Australia: Operating companies serving customers in Australia

• New Zealand: Operating companies serving customers in New Zealand

Segment results that are reported to the CEO include items directly attributable to a segment as well as those that can be

allocated on a reasonable basis. Unallocated items comprise income tax, derivative financial instruments, finance income and

expenses.

Inter-segment pricing is determined on an arm’s length basis.

PAGE 19 PAGE 19
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

NOTE 1 SEGMENT REPORTING (CONTINUED)

Reportable segment information

Key information related to each reportable segment as provided to the CODM is set out below.

Corporate &

Development

North America New ZealandAustralia

30 Sep

2024

Unaudited

30 Sep

2023

Unaudited

30 Sep

2024

Unaudited

Restated

30 Sep

2023

Unaudited

30 Sep

2024

Unaudited

30 Sep

2023

Unaudited

30 Sep

2024

Unaudited

Restated

30 Sep

2023

Unaudited

$M's$M's$M's$M's$M's$M's$M's$M's

Revenue

Software as a Service (SaaS)

revenue

--38.436.545.042.06.35.0

Hardware revenue-0.11.01.8---0.4

Transaction fee revenue ----3.21.2--

Other revenue 140.7       26.7          0.7          0.3          1.3          1.5          0.2          0.2

Total revenue40.7       26.8       40.1       38.6       49.5       44.7          6.5          5.6

Earnings before interest,

taxation, depreciation &

amortisation

(17.4)(20.7)10.315.934.428.71.91.7

Depreciation of property, plant

& equipment

(0.6)(1.1)(4.8)(5.2)(4.8)(4.0)(0.8)(0.6)

Amortisation of intangible assets(6.7)(6.0)(3.0)(2.8)(0.4)(0.4)(0.3)(0.4)

Amortisation of contract and

customer acquisition assets

--(1.4)(1.5)(3.4)(3.1)(0.6)(0.4)

1

Revenue from Corporate & Development Markets includes R&D Grant Income of $0.9m (30 September 2024: $0.9m).


Corporate &

Development

North America New ZealandAustralia

30 Sep

2024

Unaudited

31 March

2024

Audited

30 Sep

2024

Unaudited

Restated

31 March

2024

Audited

30 Sep

2024

Unaudited

31 March

2024

Audited

30 Sep

2024

Unaudited

Restated

31 March

2024

Audited

$M's$M's$M's$M's$M's$M's$M's$M's

Total assets281.62 8 7. 2185.8205.1105.194.939.434.4

PAGE 20 PAGE 20
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

Reconciliation of information on reportable segments

30 Sep 2024

Unaudited

Restated

30 Sep 2023

Unaudited


$M’s$M’s

Revenue

Total revenue for reportable segments136.8115.7

Elimination of inter-segment revenue(40.9)(26.8)

Consolidated Revenue95.988.9


EBITDA

Total EBITDA for reportable segments29.225.6

Elimination of inter-segment EBITDA--

Consolidated EBITDA29.225.6

Depreciation

Total depreciation for reportable segments(11.0)(10.9)

Elimination of inter-segment depreciation-(0.1)

Consolidated Depreciation(11.0)(11.0)

Amortisation of intangible assets

Total amortisation for reportable segments(10.4)(9.6)

Elimination of inter-segment amortisation--

Consolidated Amortisation(10.4)(9.6)

30 Sep 2024

Unaudited

Restated

31 Mar 2024

Audited

Total assets

$M’s$M’s

Total assets for reportable segments

611.9621.6

Elimination of inter-segment balances(168.1)               (168.1)

Consolidated Total Assets443.8              453.5

Allocation of goodwill, property plant and equipment and other intangible assets

Included within Total Assets are Development Assets of $107.9M (Restated 31 March 2024: $109.0M) which for the purpose of the

segment note have been allocated to the Corporate & Development Market based on the ownership of intellectual property. The

amortisation for these assets are also presented in the Corporate & Development segment. The Group’s cash generating units

(CGUs) are North America, New Zealand and Australia. For impairment testing purposes management allocate the Development

Assets to the CGU based on the specific CGU that the Development Asset relates to, or if the Development Asset is developed for

use globally across all CGU’s, the asset is allocated to CGU’s based on the proportionate share of the Group’s Contracted Units.

Property plant and equipment and other finite intangible assets are also included and tested as part of impairment testing of

repective CGU’s

NOTE 1 SEGMENT REPORTING (CONTINUED)

PAGE 21 PAGE 21
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

NOTE 1 SEGMENT REPORTING (CONTINUED)

Also included in the total assets is the intangible assets acquired through the acquisition of the Coretex subsidiaries and resulting

goodwill. The allocation of these to cash-generating units has been done based on valuation expert advice as part of acquisition

accounting during the period ended 31 March 2022. 

The allocation of the Development Assets, goodwill and other intangibles to CGU’s within the following reportable segments for

the purpose of impairment testing was as follows:

Development AssetsGoodwillBrand

Customer

relationships

$M's$M's$M's$M's

30 Sep 2024 Unaudited

North America50.695.71.519.8

New Zealand50.65.7-1.0

Australia                  6.7                14.2                       -                  3.2

              107.9              115.6                  1.5                24.0

Restated 31 Mar 2024 Audited

North America52.6101.92.022.0

New Zealand50.35.7-1.0

Australia                  6.114.2                       -                  3.4

              109.0121.82.0                26.4

PAGE 22 PAGE 22
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

Geographic information

The geographic information below analyses the Group’s revenue and non-current assets by the Company’s country of domicile

and other countries. In presenting the following information revenue has been based on the geographic location of customers

and assets were based on the geographic location of the assets. These allocations are not aligned with the Group’s reportable

segments.

30 Sep 2024

Unaudited

30 Sep 2023

Unaudited

$M’s$M’s

Revenue

New Zealand49.844.7

All foreign countries:

USA39.638.6

Australia6.55.6

Total revenue95.988.9

30 Sep 2024

Unaudited

Restated

31 Mar 2024

Audited

$M’s$M’s

Non-current assets

New Zealand145.3145.2

All foreign countries:

USA169.31 8 7. 3

Australia32.929.6

Total non-current assets347.5362.1

Non-current assets exclude financial instruments and deferred tax assets.

30 Sep 2024

Unaudited

Restated

31 Mar 2024

Audited

$M’s$M’s

Reconciliation of geographical non-current assets

to total non-current assets

Geographical non-current assets347.5362.1

Deferred tax assets1 7. 31 7. 7

Derivative financial instruments0.4-

Total non-current assets365.2379.8

NOTE 1 SEGMENT REPORTING (CONTINUED)

PAGE 23 PAGE 23
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

NOTE 2 REVENUE

30 Sep 2024

Unaudited

30 Sep 2023

Unaudited


$M’s$M’s

Revenue from contracts with customers

Software as a service (SaaS) revenue89.783.5

Hardware revenue (subscription basis)1.02.3

Other

Transaction fee revenue3.21.2

Other revenue and income1.11.0

Grant income

                   0.9                   0.9

Total Revenues

                 95.9                 88.9

Set out above is the disaggregation of the Group’s revenue. The disaggregation reflects the nature, amount, timing and uncertainty of

revenue and cash flows are affected by economic factors.

Revenue recognition

Revenue is measured based on the consideration specified in a contract with a customer. The Group recognises revenue when it

transfers control over a good or a service to a customer.

The Group provides electronic on-board units to its customers, which comprise the provision of hardware and the rendering of

services.

The supply of electronic on-board units (leased or purchased outright), installation of the units and providing services are not distinct

and have one single performance obligation (linked to the service contract). Consequently, the Group does not recognise revenue

separately for these goods and services but recognises this revenue together as the provision of software as a service (SaaS) revenue

Each of the Group’s main sources of revenue are described in detail below:

Software as a service revenue

Software as a service (SaaS) revenue represents revenue earned from customer contracts for the sale or rental of hardware,

installation services, training and support services and provision of software services.  

As noted above, the Group has determined that for the majority of customers the supply and installation of units and the services

are not distinct and treated as one single performance obligation. That is, EROAD’s customers do not have the right to direct the

use of EROAD’s assets (such as the Ehubo, Corehub and TMU units) as EROAD continues to have the right and ability to change

how the asset operates during the customer’s contract period. These contracts are therefore accounted for as service contracts. The

Group generates revenue through the sale of hardware assets, rental of hardware assets, installation of hardware assets and provision

of software services as part of contracts with customers as part of a bundled package. These hardware units enable customers to

access the software platform offered by the Group. The transaction involving hardware and accessories do not convey a distinct good

or service. The sale does not transfer control to the customer as the Group provides a significant service of integrating the software

service to produce a combined output. The sale of the hardware, accessories and software service are referred to as Software

as a Service (SaaS) revenue, which is recognised on a straight line basis over the contract period to reflect the fulfilment of the

performance obligations as they arise. There are no variable consideration terms within the contracts.

The Group offers installation services as part of a number of promises to transfer goods and services within each contract. Installation

services do not convey a distinct good or service and therefore are not a separate performance obligation as the installation is a set-

up activity that does not provide the customer a direct benefit other than access to the software services. As a result, the installation

service is considered as part of the single performance obligation referred to as software as a service (SaaS) revenue, which includes the

software service and hardware sale or rental for which the customer simultaneously receives and consumes the benefit of the service.

A contract liability is recognised where consideration is received in advance of the completion of associated performance obligations.

The contract liability is derecognised over time evenly over the period of the contract as the customer derives the benefit evenly from

the services provided over the contract period. The majority of contracts are for 3 years and can be for a term of up to 5 years. As a result

there is a financing component which the group recognise as a finance cost when consideration is received in advance.

PAGE 24 PAGE 24
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

Hardware revenue (subscription)

Hardware revenue purchased with a subscription is recognized over the first month’s subscription. Hardware revenue reflects

hardware sales where a subscription must be separately purchased to utilise the hardware and obtain access to services. The

hardware together with the monthly subscription is considered a single performance obligation. A receivable is recognised by the

Group when the right to consideration becomes unconditional, as only the passage of time is required before payment is due.

The installation revenue associated with uncontracted hardware units is included in the hardware revenue line and recognised

when the installation is completed.

The services revenue associated with the uncontracted hardware units is included in the software as a service revenue line and is

recognised when the performance obligation is completed.

Transaction fees

Transaction fee revenue relates to the collection of Road User Charges (RUC) fees. The Group acts as an agent for transport

authorities in the market that is operates in. Where fees are collected on their behalf, the Group charges a commission. The

revenue recognised is the net amount of the commission fee earned by the Group.

Grant income

Government grants are recognised at fair value in the statement of comprehensive income over the same periods as the costs for

which the grants are intended to compensate. No unfulfilled conditions or contingencies exist related to the government grants.

Future contracted income

The Group reports the Non-GAAP measure, Future Contracted Income. The definition of Future Contracted Income includes all

future hardware and SaaS cash inflows relating to income under non-cancellable long-term agreements. The disclosure below

aligns with the Future Contracted Income reported by the Group.

Transaction price allocated to the remaining performance obligations

The below table represents the revenue allocated to performance obligations that are unsatisfied or partially unsatisfied at the

period end. The revenue amounts yet to be recognised under non-cancellable contract agreements at 30 September 2024 are

expected to be recognised by EROAD based on the time bands disclosed below. 


30 Sep 2024

Unaudited

30 Sep 2023

Unaudited

$M’s$M’s

Software as a Service (SaaS) revenue

No later than one year

98.993.9

Later than one year, no later than five years190.3132.3

Total price allocated to remaining performance obligations289.2226.2

NOTE 2 REVENUE (CONTINUED)

PAGE 25 PAGE 25
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

WORKING CAPITAL

This section provides information about the primary elements of the Group’s working capital. This section includes the

following note:

NOTE 3 CASH AND CASH EQUIVALENTS, RESTRICTED CASH AND PAYABLES TO TRANSPORT AGENCIES

NOTE 3 CASH AND CASH EQUIVALENTS, RESTRICTED CASH AND PAYABLES TO TRANSPORT AGENCIES

30 Sep 2024

Unaudited

31 Mar 2024

Audited

$M’s$M’s

Cash and cash equivalents11.314.5

Restricted bank accounts                25.1                17.8

                36.4                32.3

Cash and cash equivalents exclude restricted bank accounts. Restricted bank accounts are presented separately from cash and

cash equivalents on the face of the Statement of Financial Position and movements in restricted bank accounts are excluded from

the Statement of Cash Flows. The restricted bank accounts relate to Road Users tax collected from clients due for payment to the

appropriate government agency.


Payables to transport agencies(25.1)(17.8)

PAGE 26 PAGE 26
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

LONG-TERM ASSETS

This section provides information about the investment the Group has made in long-term assets to operate the business.

This section includes the following notes:

NOTE 4 PROPERTY, PLANT AND EQUIPMENT

NOTE 5 INTANGIBLE ASSETS

NOTE 4 PROPERTY, PLANT AND EQUIPMENT

Right of

use assets

Hardware

assets

Plant and

equipment

Leasehold

improvements

Motor

vehicles

Office

equipment

ComputersTotal

$M’s$M's$M's$M's$M's$M's$M's$M's

Year ended 31 Mar 2024 (Audited)

Opening net book

amount

5.768.70.11.60.20.60.977.8

Additions0.333.0----0.533.8

Disposals-(1.3)-----(1.3)

Depreciation charge(1.5)(20.3)-(0.4)(0.1)(0.2)(0.7)(23.2)

Effect of movement in

exchange rates

0.21.5-----1.7

Closing net book

amount

4.781.60.11.20.10.40.788.8

Cost8.6135.20.82.90.42.05.3155.2

Accumulated

depreciation

(3.9)(53.6)(0.7)(1.7)(0.3)(1.6)(4.6)(66.4)

Net book amount4.781.60.11.20.10.40.788.8

PAGE 27 PAGE 27
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

Right of

use assets

Hardware

assets

Plant and

equipment

Leasehold

improvements

Motor

vehicles

Office

equipment

ComputersTotal

$M's$M’s$M’s$M’s$M’s$M’s$M’s$M’s

Six months ended 30 Sep 2024 (Unaudited)

Opening net book

amount

4.781.60.11.20.10.40.788.8

Additions0.79.1----0.210.0

Disposals-(0.4)-----(0.4)

Depreciation charge(0.7)(9.8)-(0.1)-(0.1)(0.3)(11.0)

Effect of movement in

exchange rates

(0.2)(1.9)-                       ----(2.1)

Closing net book

amount

4.578.60.1                   1.10.10.30.685.3

At 30 Sep 2024

Cost8.4136.30.82.90.51.95.5156.3

Accumulated

depreciation

(3.9)(57.7)(0.7)                 (1.8)(0.4)(1.6)(4.9)(71.0)

Net book amount4.578.60.1                   1.10.10.30.685.3

Included in the Hardware Assets is equipment under construction to be leased or sold of $27.6M (31 March 2024: $33.2M). Due to

the majority of the equipment under construction being ultimately sold under contract and forming part of hardware assets on the

Group‘s fixed asset register it has been accordingly classified under hardware assets.

Items of plant and equipment are stated at cost, less accumulated depreciation and impairment losses. Cost includes the purchase

consideration, and those costs directly attributable to bringing the asset to the location and condition necessary for its intended

use. Where an item of plant and equipment is disposed of, the gain or loss recognised in the statement of comprehensive income

is calculated as the difference between the net sales price and the carrying amount of the asset.

The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease

payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to restore the

underlying asset or the site on which it is located, less any lease incentives received.

Subsequent costs

The Group recognises in the carrying amount of an item of property, plant and equipment the cost of replacing part of such an

item when that cost is incurred if it is probable that the future economic benefits embodied within the item will flow to the Group

and the cost of the item can be measured reliably. All other costs are recognised in the statement of comprehensive income as an

expense in the period they are incurred.

Impairment

Property plant and equipment is tested for impairment when there are indicators of impairment. It is not possible to identify sepa-

rately identifiable cash flows for property, plant and equipment as hardware assets are sold together with various SaaS services as

a package. Property plant and equipment is allocated to the Group‘s CGU‘s as described in note 1 for the purposes of impairment

testing. 

NOTE 4 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)

PAGE 28 PAGE 28
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

Depreciation

Depreciation begins when the asset is in the location and condition necessary for it to be capable of operating in the manner

intended by management.

The following rates have been used on a straight line basis:

Leasehold improvements 3 to 9 years

Hardware assets 3 to 6 years

Plant and equipment 3 to 11 years

Computer/Office equipment 1 to 5 years

Motor vehicles 3 to 5 years

Right of use assets 3 to 9 years

The above rates reflect the estimated useful lives of the respected categories. Consideration was given to how long assets can be

deployed and any expected network changes. Leasehold improvements are depreciated over the contracted lease term.

NOTE 5 INTANGIBLE ASSETS

DevelopmentSoftwareGoodwillBrandCustomer

relationships

Patents,

trademarks and

other rights

Total

$M’s$M’s$M’s$M’s$M’s$M’s$M’s

Year ended 31 Mar 2024 (Audited)

Restated opening net book amount102.65.8116.72.62 7. 30.1255.1

Additions21.00.3----21.3

Effect of movement in foreign

exchange rate

1.2-5.10.11.27. 6

Amortisation charge(15.8)(1.0)-(0.7)(2.1)                        -(19.6)

Restated closing net book amount109.05.1121.82.0                 26.4                   0.1264.4

Cost179.712.4121.83.832.30.1350.1

Accumulated amortisation(70.7)(7.3)-(1.8)(5.9)                        -(85.7)

Restated net book amount109.05.1121.82.0                 26.4                   0.1264.4

Six months ended 30 Sep 2024 (Unaudited)

Restated opening net book amount109.05.1121.82.026.40.1264.4

Additions8.50.3----8.8

Amortisation charge(8.4)(0.6)-(0.4)(1.0)-(10.4)

Effect of movement in foreign

exchange rate

(1.2)-(6.2)(0.1)(1.4)-(8.9)

Restated closing net book amount               107.9 4.8115.61.524.0 0.1253.9

Cost186.412.7115.63.530.70.1349.0

Accumulated amortisation(78.5)(7.9)-(2.0)(6.7)-(95.1)

Net book amount               107.94.8115.61.524.00.1253.9

The useful lives of the Group’s Intangible Assets are assessed to be finite except for goodwill. Assets with finite lives are amortised

over their useful lives and tested for impairment whenever there are indications that the assets may be impaired.

NOTE 4 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)

PAGE 29 PAGE 29
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

Research and Development

Expenditure on research activities, undertaken with the prospect of gaining new technical knowledge and understanding, is

recognised in the statement of comprehensive income when incurred.

Development activities involve a plan or design for the production of new or substantially improved products and processes.

Development expenditure is capitalised only if development costs can be measured reliably, the product or process is

technically and commercially feasible, future economic benefits are probable, and the Group intends to and has sufficient

resources to complete development and to use or sell the asset. The expenditure capitalised includes the cost of materials,

direct labour and overhead costs that are directly attributable to preparing the asset for its intended use. Other development

expenditure is recognised in the statement of comprehensive income when incurred. There is judgement involved in relation to

whether a project meets the capitalisation criteria, and whether the expenditure can be directly attributable to the respective

project.

Capitalised development expenditure is measured at cost less accumulated amortisation and accumulated impairment losses.

Other intangible assets

Other intangible assets, including customer relationships, brand, patents and trademarks, that are acquired by the Group and

have finite useful lives are measured at cost less accumulated amortisation and any accumulated impairment losses.

Subsequent expenditure

Subsequent expenditure is capitalised when it increases the future economic benefits embodied in the specific asset to

which relates. All other expenditure, including expenditure on internally generated goodwill and brands, is recognised in the

statement of comprehensive income when incurred.

Amortisation

Patents 10 to 20 years

Development Hardware & Platform 7 to 15 years

Development Products 5 to 10 years

Software 5 to 7 years

Customer relationships 15 years

Brand 5 years

Impairment

The acquisition of Coretex on 1 December 2021, meant goodwill was recognised for the excess between the fair value of conside-

ration paid and the fair value of the net assets acquired. Net assets acquired included finite life intangibles assets such as customer

relationships, brands, software and development assets. The goodwill and finite life intangibles were then allocated to the cash

generating units of the business with the assistance of external specialists. When goodwill is acquired in a business combination,

under the accounting standards, NZ IAS 36 requires an impairment test to be completed annually (for cash-generating units

in which goodwill has been allocated) irrespective of whether there is any indication of impairment. An impairment test is also

required when there is an indicator of impairment identified each reporting period. Refer to note 1 for the allocation of goodwill,

property plant and equipment and other finite life intangible assets to cash generating units (CGUs). The CGU‘s are considered

the lowest level for which there are separately identifiable cashflows. Corporate costs attributable to the CGUs are allocated to the

respective CGUs as part of impairment testing. Unallocated corporate costs and assets are also tested for impairment using a top

down approach.

Impairment testing of CGU’s

Under the accounting standards one of the external sources of information that may indicate that an impairment exists is when

the carrying amount of the net assets of the entity exceeds the entity’s market capitalisation. At 30 September 2024 this is the

case for the EROAD Group. The share price of EROAD at 30 September 2024 being $1.16 equating to a market capitalisation of

$217.0 million compared to net assets of $311.8million at the same date.

To complete the impairment testing management assessed the recoverable amount of each of the cash-generating units

(‘CGU’) of which goodwill, property plant and equipment and finite life intangible assets have been allocated by reference to

its value in use (‘VIU’) determined using a discounted cash flows model. The recoverable amounts of the CGU were estimated

based on the following significant assumptions:

NOTE 5 INTANGIBLE ASSETS (CONTINUED)

PAGE 30 PAGE 30
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

Amount the VIU exceeds

the carrying value $M’s

(functional currency)

Connected unit

CAGR

ARPU CAGRWACC

New Zealand190.75.80%0.13%12.25%

North America58.411.29%1.47%11.00%

Australia13.918.35%1.06%10.75%

The inputs used for the growth in connected units and ARPU in the CGUs reflect past experience and the forecast performance

of the group.

Terminal growth rate of 2.0% for New Zealand and 2.5% for North America and Australia and was applied to 2029 and

thereafter.

Sensitivity analysis was undertaken which concluded that New Zealand results are not particularly sensitive to changes in the

underlying assumptions. Australia and North America are sensitive to the achievement of forecast unit growth, ARPU and

changes in the discount rate.

Results of the sensitivity analysis as follows:

Input required for the VIU to equate to the carrying value

Connected unit

CAGR

ARPU CAGRWACC

New ZealandNot sensitiveNot sensitiveNot sensitive

North America7. 7 0 %(1.84)%13.30%

Australia14.95%(1.60)%12.24%

The Group concluded that the recoverable amount of each of the CGU were higher than their respective carrying values and

therefore no impairment was considered necessary at 30 September 2024.

NOTE 5 INTANGIBLE ASSETS (CONTINUED)

PAGE 31 PAGE 31
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

DEBT AND EQUITY

This section outlines the Group’s capital structure and the related financing costs. This section includes the

following notes:

NOTE 6 BORROWINGS

NOTE 7 EQUITY

NOTE 6 BORROWINGS

30 Sep 2024

Unaudited

31 Mar 2024

Audited

$M’s$M’s

Current borrowings

Term Loans5.02.5

5.02.5

Non-current borrowings

Term Loans20.022.5

Revolving Credit Facility12.312.3

Capitalised borrowings cost                 (0.6)                 (0.7)

                31.7                34.1

Terms and debt repayment schedule

30 Sep 2024

Unaudited

30 Sep 2024

Unaudited

31 Mar 2024

Audited

31 Mar 2024

Audited

Nominal

Interest

Year of

Maturity

Face

Value

$M’s

Carrying

amount

$M’s

Face

Value

$M’s

Carrying

amount

$M’s

Term Loans8.94%202625.025.025.025.0

Revolving credit facility8.94%202612.312.312.312.3

Capitalised borrowing costs-(0.6)-(0.7)

3 7. 336.73 7. 336.6

The above nominal interest rate represents the weighted average rate of the entire facility.

At 30 September 2024, EROAD had the following in place:

$25.0M (NZD) Term Loan Facility A – to refinance debt from the prior facility. The Term Loan has a term of 36 months from 4

October 2023 refinance effective date, with the facility having a maturity date in October 2026. The interest rate is variable with

reference to a base rate (BKBM bid rate) for the selected interest period plus a margin of 3.75%. EROAD may select an interest

period of 1,2,3 or 6 months. On 31 December 2024, total facility commitments will reduce $1.25m on a quarterly basis until the

maturity of the facility. Accordingly, $5.0m of debt has been classified as current. The full outstanding balance is payable on the

termination date.

PAGE 32 PAGE 32
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

$50.0M (NZD) Revolving Credit Facility B – to refinance debt from the prior facility and for general corporate purposes. The

Revolving Credit Facility has a term of 36 months from 4 October 2023 effective refinance date with a periodic roll over feature

at the end of each interest period (90 days) that is subject to continued compliance with the terms of the loan agreement, with

the facility having a maturity date in October 2026. Funds may be drawn in NZ Dollars, AU Dollars, or US Dollars. The interest rate

is variable with reference to the base rate (BKBM bid rate for NZ Dollar drawings, BBSY bid rate for AU Dollar drawings, and US

Federal Open Market Committee short-term interest rate target for US Dollar drawings) for the selected interest period plus a

margin of 2.25% where the company’s net leverage ratio is below 1.0x and 2.45% where the company’s net leverage ratio is above

1.0x. EROAD may select an interest period of 1,2,3 or 6 months. In addition, a Commitment Fee of 2.25% per annum is payable

where the company’s net leverage ratio is below 1.0x, and 2.45% per annum is payable where the company’s net leverage ratio

is above 1.0x. Commitment fee is payable on the committed balance of the facility quarterly in arrears. On 31 December 2024,

total facility commitments will reduce $1.25m on a quarterly basis until the maturity of the facility. The full outstanding balance is

payable on the termination date.

$5.0M Multi-option working capital facility – for capital expenditure and general working capital purposes. This is an on demand

facility with the interest rate to be agreed between the lender and borrower at the time of borrowing plus a margin of 2.25%. In

addition, a Commitment Fee of 2.25% per annum is payable on the committed balance of the facility quarterly in arrears. The full

outstanding balance is payable on the termination date.

EROAD’s operating covenants to support the above facilities include Interest Cover Ratio, Leverage Ratio and Obligor Assets to

Group Assets. EROAD was compliant with covenants during the period and at 30 September 2024.

The security package for the Multi-Option Credit Facility Agreement includes an all obligations cross-guarantee granted by

EROAD Financial Services Limited, EROAD Australia Pty Limited, EROAD Inc, Coretex Limited, Imarda Pty Limited, Coretex

Australia Pty Limited, Coretex NZ Limited, and Coretex USA Inc in favour of the BNZ (in its capacity of Security Trustee for the

banking syndicate). In respect of the obligations of EROAD Limited, and a General Security Agreements granted by EROAD

Limited, EROAD Financial Services Limited, EROAD Inc, EROAD Australia Pty Limited, Coretex Limited, Imarda Pty Limited,

Coretex Australia Pty Limited, Coretex NZ Limited, and Coretex USA Inc in favour of the BNZ (in its capacity of Security Trustee for

the banking syndicate).

Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalised as

part of the cost of that asset. Other borrowing costs are recognised as an expense in the period in which they are incurred.

NOTE 6 BORROWINGS (CONTINUED)

PAGE 33 PAGE 33
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

NOTE 7 EQUITY

Paid up capital

All issued shares are fully paid up and have equal voting rights and share equally in dividends and surplus on winding up.


Number of

ordinary shares

Issue price

$

Issued Capital

$

31 Mar 2024 (Audited)184,821,022353.5

Shares issued to employees2,228,5360.952.2

355.7

30 Sep 2024 (Unaudited) 187,049,558355.7

At 30 September 2024 there was 187,049,558 authorised and issued ordinary shares (31 March 2024: 184,821,022). 386,166 (31

March 2024: 386,166) shares are held in trust for employees in relation to the long-term incentive plan and are accounted for as

treasury stock.

The calculation of both basic and diluted loss/profit per share at 30 September 2024 was based on the loss attributable to

ordinary shareholders of ($1.5m) (Restated 30 September 2023: loss of $1.4m). The weighted number of ordinary shares on 30

September 2024 was 185,642,091 (30 September 2023: 115,364,078) for basic earnings per share and 185,653,538 for diluted

earnings per share (30 September 2023: 116,342,633).

Share capital premium/discount

This account is for the difference between the issued share price and the trading share price (or fair value share price) on date

of issue and includes contigent consideration portion classified as equity related to the acquisition of Coretex. There have been

no changes since 31 March 2024.

Other components of equity include:

• Translation reserve - comprises foreign currency translation differences arising from the translation of financial statements

of the Group’s foreign subsidiaries into New Zealand dollars.

• Hedging reserve - the hedging reserve is used to record gains or losses on instruments used as cash flow hedges. The

amounts are recognised in profit and loss when the hedged transaction affects profit and loss.

• Retained earnings - includes all current and prior period retained profits and losses and share-based employee remuneration.

PAGE 34 PAGE 34
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

OTHER

This section contains additional notes and disclosures that aid in understanding the Group‘s position and performance but do not

form part of the primary sections. This section includes the following notes:

NOTE 8 INCOME TAX EXPENSE

NOTE 9 RELATED PARTY TRANSACTIONS

NOTE 10 CAPITAL COMMITMENTS

NOTE 11 CONTINGENT LIABILITIES

NOTE 12 NET TANGIBLE ASSETS PER SHARE

NOTE 13 EVENTS SUBSEQUENT TO BALANCE DATE


NOTE 8 INCOME TAX EXPENSE

30 Sep 2024

Unaudited

Restated

30 Sep 2023

Unaudited

$M’s$M’s

(a) Reconciliation of effective tax rate

Loss before income tax(0.1)(4.6)

Income tax using the Company's domestic tax rate of 28% -(1.3)

Non-deductible expense/(non-assessable income)-(0.3)

Adjustment related to prior period0.6(2.1)

Utilisation of tax losses previously unrecognised and tax losses not recognised0.80.6

Effect of different tax rates of subsidiaries operating overseas                        -                  (0.1)

Income tax expense/(benefit)1.4(3.2)

(b) Current tax expense

Current year0.7                   0.1

0.7                   0.1

(b) Deferred tax expense

Current year0.1(1.2)

Adjustments in respect of prior periods0.6                  (2.1)

0.7                  (3.3)

Income tax expense1.4                  (3.2)

At 30 September 2024 there were no imputation credits available to shareholders (31 March 2024: Nil)

Income tax expense comprises current and deferred tax. Current tax and deferred tax is recognised in profit or loss except to the

extent that it relates to a business combination, or items recognised directly in equity or in other comprehensive income.

Current tax is the expected tax payable or receivable on the taxable income or loss for the period, using tax rates enacted or

substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous periods. Current tax

payable also includes any tax liability arising from the declaration of dividends.

PAGE 35
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

PAGE 35

EROAD 2025 INTERIM REPORT INDEPENDENT REVIEW REPORT

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial

reporting purposes and the amounts used for taxation purposes. Deferred tax is measured at the tax rates that are expected to be

applied to temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the

reporting date.

Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they

relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to

settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realised simultaneously.

A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences, to the extent that it

is probable that future taxable profits will be available against which they can be utilised. Deferred tax assets are reviewed at

each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised.

NOTE 9 RELATED PARTY TRANSACTIONS

Related party transactions are consistent in nature with those reported in 31 March 2024.

NOTE 10 CAPITAL COMMITMENTS

(a) Capital commitments

As at 30 September 2024 the Group had confirmed purchase orders open with its third party manufacturer of hardware units

amounting to $3.7M (31 March 2024: $12.2M).

NOTE 11 CONTINGENT LIABILITIES

As at 30 September 2024 the Company had no contingent liabilities or assets (31 March 2023:$Nil).

NOTE 12 NET TANGIBLE ASSETS PER SHARE

30 Sep 2024

Unaudited

Restated

30 Sep 2023

Unaudited

Restated

31 Mar 2024

Audited

$M’s$M’s$M’s

Net assets (equity)311.8302.4321.3

Less Intangibles(253.9)(261.9)(264.4)

Total net tangible assets57. 940.556.9

Net tangible assets per share ($)0.310.260.31

The non-GAAP measure above is disclosed for consistency with the information disclosed in EROAD’s results announced under

the NZX listing rules.

NOTE 13 EVENTS SUBSEQUENT TO BALANCE DATE

There were no further events occurring subsequent to balance date which require adjustment to or disclosure in the

financial statements.

NOTE 8 INCOME TAX EXPENSE (CONTINUED)

PAGE 36
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

PAGE 36

EROAD 2025 INTERIM REPORT INDEPENDENT REVIEW REPORT


© 2024 KPMG, a New Zealand Partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited,

a private English company limited by guarantee. All rights reserved.

Document classification: KPMG Public


Independent Auditor’s Review

Report

To the shareholders of EROAD Limited (Group)

Report on the interim condensed consolidated financial statements

Conclusion

Based on our review, nothing has come to our

attention that causes us to believe that the interim

condensed consolidated financial statements on

pages 9 to 35 do not:

‒ present fairly, in all material respects, the

Group’s financial position as at 30

September 2024 and its financial

performance and cash flows for the 6 month

period then ended and comply with New

Zealand Equivalent to International

Accounting Standard 34 Interim Financial

Reporting (NZ IAS 34) issued by the New

Zealand Accounting Standards Board.


We have completed a review of the accompanying

interim condensed consolidated financial statements

which comprise:

‒ the interim condensed consolidated

statement of financial position as at 30

September 2024;

‒ the interim condensed consolidated

statements of comprehensive income,

changes in equity and cash flows for the 6

month period then ended; and

‒ notes, including material accounting policy

information.

Basis for conclusion

We conducted our review of the financial statements in accordance with NZ SRE 2410 (Revised) Review of

Financial Statements Performed by the Independent Auditor of the Entity (NZ SRE 2410 (Revised)). Our

responsibilities are further described in the Auditor's Responsibilities for the Review of the interim condensed

consolidated financial statements section of our report.

We are independent of EROAD Limited in accordance with the relevant ethical requirements in New Zealand

relating to the audit of the annual financial statements and we have fulfilled our other ethical responsibilities in

accordance with these ethical requirements.

Our firm has provided other services to the Group in relation to tax compliance and transfer pricing services.

Subject to certain restrictions, partners and employees of our firm may also deal with the Group on normal terms

within the ordinary course of trading activities of the business of the Group. These matters have not impaired our

independence as auditor of the Group. The firm has no other relationship with, or interest in, the Group.

Use of this Independent Auditor’s Review Report

This report is made solely to the shareholders. Our review work has been undertaken so that we might state to

the shareholders those matters we are required to state to them in the Independent Auditor’s Review Report and

for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone

other than the shareholders for our review work, this report, or any of the conclusions we have formed.

PAGE 37
EROAD 2025 INTERIM REPORT NOTES TO FINANCIAL STATEMENTS

PAGE 37

EROAD 2025 INTERIM REPORT INDEPENDENT REVIEW REPORT



Responsibilities of Directors for the interim condensed consolidated

financial statements

The Directors on behalf of the Group are responsible for:

‒ the preparation and fair presentation of the interim condensed consolidated financial statements in

accordance with NZ IAS 34; and

‒ implementing necessary internal control to enable the preparation of interim condensed consolidated

financial statements that is fairly presented and free from material misstatement, whether due to fraud or

error.

Auditor's responsibilities for the review of the interim condensed

consolidated financial statements


Our responsibility is to express a conclusion on the interim condensed consolidated financial statements based

on our review.

NZ SRE 2410 (Revised) requires us to conclude whether anything has come to our attention that causes us to

believe that the interim condensed consolidated financial statements, taken as a whole, are not prepared, in all

material respects, in accordance with NZ IAS 34.

A review of the interim condensed consolidated financial statements prepared in accordance with NZ SRE 2410

(Revised) is a limited assurance engagement. The auditor performs procedures, consisting of making enquiries,

primarily of persons responsible for financial and accounting matters, and applying analytical and other review

procedures.

The procedures performed in a review are substantially less than those performed in an audit conducted in

accordance with International Standards on Auditing (New Zealand) and consequently does not enable us to

obtain assurance that we might identify in an audit. Accordingly, we do not express an audit opinion on the

financial statements.

The engagement partner on the review resulting in this independent auditor's review report is Matthew Diprose.


For and on behalf of:


KPMG

Auckland

25 November 2024

PAGE 38
EROAD 2025 INTERIM REPORT GLOSSARY

ANNUALISED RECURRING REVENUE (ARR)

A non-GAAP measure representing monthly Recurring

Revenue for the last month of the period, multiplied by 12. It

provides a 12 month forward view of revenue, assuming unit

numbers, pricing and foreign exchange remain unchanged

during the year. Formerly known as Annualised Monthly

Recurring Revenue (AMRR).

AVERAGE REVENUE PER CUSTOMER (ARPC)

A non-GAAP measure representing the average revenue

generated per customer, calculated using Annualised

Monthly Recurring Revenue (AMRR) only. This metric

excludes any one-off payments, providing insight into

the typical sustained revenue generated from ongoing

customer relationships.

ASSET RETENTION RATE

The number of Total Contracted Units at the beginning of

the 12 month period and retained as Total Contracted Units

at the end of the 12 month period, as a percentage of Total

Contracted Units at the beginning of the 12 month period.

CHURN

The inverse of the asset retention rate.

COSTS TO ACQUIRE CUSTOMERS (CAC)

A non-GAAP measure of costs to acquire customers. Total

CAC represents all sales & marketing related costs. CAC

capitalised includes incremental sales commissions for

new sales, upgrades and renewals which are capitalised

and amortised over the life of the contract. All other CAC

related costs are expensed when incurred and included

within CAC expensed

COSTS TO SERVICE & SUPPORT (CTS)

A non-GAAP measure of costs to support and service

customers. Total CTS represents all customer success

and product support costs. These costs are included in

Administrative and other Operating Expenses. 

EBIT

A non-GAAP measure representing Earnings before Interest

and Taxation (EBIT). Refer to Consolidated Statement of

Comprehensive Income in Financial Statements.

ENTERPRISE

A customer where the $AMRR is more than $100k in NZD

for the Financial year reported

FREE CASH FLOW

A non-GAAP measure representing operating cash flow

and investing cash flow reported in the Statement of Cash

Flows.

FREE CASH FLOW TO THE FIRM

A non-GAAP measure representing operating cash flow

and investing cash flow net of interest paid and received.

For the purposes of this presentation, payments for the

acquisition of Coretex have been excluded.

FY (FINANCIAL YEAR)

Financial year ended 31 March.

H1 (HALF ONE)

For the six months ended 30 September.

H2 (HALF TWO)

For the six months ended 31 March.

LEASE DURATION

Future contracted income as a proportion of reported

revenue.

MONTHLY SAAS AVERAGE REVENUE PER UNIT (ARPU)

A non-GAAP measure that is calculated by dividing the

total SaaS revenue for the year (as reported in Note 2 of

the FY24 Financial Statements) minus the contract liability

discounting gain (as reported in the FY24 Reconciliation of

Operating Cash Flows) by the TCU balance at the end of

each month during the year.

Glossary

PAGE 39
EROAD 2025 INTERIM REPORT GLOSSARY

NORMALISED EBIT

Excludes one-off 4G hardware upgrade program costs and

accelerated depreciation

NORMALISED FREE CASH FLOW

Excludes one-off 4G hardware upgrade program costs and

associated hardware spend

ROAD USER CHARGES (RUC)

In New Zealand, RUC is applicable to Heavy Vehicles and all

vehicles powered by a fuel not taxed at source. The charges

are paid into a fund called the National Land Transport

Fund, which is controlled by NZTA, and go towards the cost

of repairing the roads.

SAAS

Software as a Service, a method of software delivery in

which software is accessed online via a subscription rather

than bought and installed on individual computers.

TOTAL CONTRACT VALUE (TCV)

The total value of a customer contract over its entire

duration, including recurring revenue (e.g., ARR) and any

one-off payments

UNIT

A communication device fitted in-cab or on a trailer. Where

there is more than one unit fitted in-cab or on a trailer, it is

counted as one unit (excluding Philips Connect). 

Glossary(continued)

PAGE 40 PAGE 40
EROAD 2025 INTERIM REPORT DIRECTORY

Directory

Registered Office

in New Zealand

Registered Office

in North America

Registered Office

in Australia

Level 3, 260 Oteha Valley Road,

Albany, Auckland, New Zealand

15110 Avenue of Science,

Suite 100, San Diego,

United States of America 92128

Level 36, Tower 2 Collins Square

727 Collins Street, Docklands,

VIC 3008, Australia

Investor Relations

and Sustainability

Enquires

Managing your

Shareholding Online

Share Register -

New Zealand

Address: EROAD Limited,

PO Box 305 394 Triton Plaza,

North Shore,

Auckland

Email: investors@eroad.com

Telephone: 0800 437 623

Changes in address and investment

portfolios can be viewed and updated

online:

www.computershare.co.nz/

investorcentre.

You will need your CSN and FIN

numbers to access this service.

Computershare Investments Services

Limited

Private Bag 92119, Victoria Street, West

Auckland 1142, New Zealand

Email: enquiry@computershare.co.nz

Telephone: +64 9 488 8777

Website: www.computershare.co.nz/

investorcentre

Legal Advisors Bankers

Chapman Tripp

Level 34 Commercial Bay

Auckland 1010

PO Box 2206, Auckland 1140

Telephone: +64 9 357 9000

ANZ

ASB

Bank of New Zealand

HSBC

Wells Fargo

---

TEL +64 9 927 4700 PO Box 305 394
FAX +64 9 927 4701 Triton Plaza, North Shore 0757 Page 1

FREE 0800 4 EROAD Auckland, New Zealand eroad.co.nz

Results for announcement to the market

Name of issuer EROAD Limited

Reporting Period 6 months to 30 September 2024

Previous Reporting Period 6 months to 30 September 2023

Currency New Zealand Dollars

Amount (000s) Percentage change

Revenue from continuing

operations

95,857 8%

Total Revenue 95,857 8%

Net profit/(loss) from

continuing operations

749 2839%

Total net profit/(loss) -1,527 -6%

Interim/Final Dividend

Amount per Quoted Equity

Security

No dividend declared

Imputed amount per Quoted

Equity Security

Not applicable

Record Date Not applicable

Dividend Payment Date Not applicable

Current period Prior comparable period

Net tangible assets per Quoted

Equity Security

0.28 0.08

A brief explanation of any of

the figures above necessary to

enable the figures to be

understood

For commentary on the result, please refer to the Interim Report for

the six months ended 30 September 2024. The prior period has

been restated, refer to the retrospective note (e) in the Interim report

for further details.

Authority for this announcement

Name of person authorised to

make this announcement

Margaret Warrington

Contact person for this

announcement

Margaret Warrington

Contact phone number (09) 927 4700

Contact email address margaret.warrington@eroad.com

Date of release through MAP 25 November 2024


Audited financial statements for the half year ended 30 September 2024 accompany this

announcement.

Data sourced from publicly available filings. Our datasets may not be complete. Automated analysis can produce errors. If you believe any data on this page is incorrect, please contact us at hello@nzxplorer.co.nz. For informational purposes only. Not investment advice.

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