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CalAmp Riding Full Throttle Towards Success!

10 Feb CalAmp Riding Full Throttle Towards Success!

CalAmp Corp (NASDAQ: CAMP), a pioneering telematics solutions provider for the connected economy, announced the adoption of its award-winning “Here Comes the Bus” School Bus Tracking technology by The Atlanta Public Schools (APS), that serves nearly 51,000 students across 87 schools and five programs. The app was developed by Synovia Solutions, a subsidiary of CalAmp, and is used by over two million users and 330 school districts across North America, including other peach state district institutions such as Cobb, Paulding, Troup County Schools, and Valdosta, helping them redefine the way student transportation is managed.

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Jeff Clark, senior vice president of product management for CalAmp, commented,

“We’re proud that a district as large, diverse and dynamic as Atlanta Public Schools has placed its trust in CalAmp’s Here Comes The Bus solution to provide improved services to its community.”.

The Atlanta Public Schools transport over 11,708 students everyday to and from school, homes and sports and social events. The buses will now be outfitted with CalAmp’s mobile GPS fleet intelligence devices and essential software that form a part of the Here Comes The Bus solution as per the Company. In addition, CalAmp will assist with improved compliance to state-mandated bus inspections through its tablet and trip inspection module.

The application which claims to the “undisputed leader of School Bus Tracking Mobile Applications” boasts of 2,134,762 downloads and 410,000+ Daily Active Users and offers an intuitive interface along with seamless integration.

Furthermore, In January 2021, the Company entered into a multi-year, enterprise agreement with Localiza, the largest car rental operator in South America to install smart telematics in Localiza’s fleet, by leveraging its AI-enabled connected vehicle technology.

CalAmp Corp. (NASDAQ: CAMP)

Market Cap: $404.3M; Current Share Price: 11.54 USDChart
Data by YCharts

Industry
The global automotive telematics industry is expected to reach over $320.6 billion by 2026, growing at a CAGR of 26% from $40.4 billion in 2018 according to a report by orion market reports. An increasing consumer demand for vehicles, growth of smartphones, integration of IoT in automotive industry, government regulations and the rise of ride sharing apps such as Uber and Ola will drive the growth in the market.

The automotive telematic market offers a wide-range of services such as on-road assistance, crash notification, vehicle tracking/recovery, location /tracking services and can be either embedded, tethered or integrated.

Ecommerce and logistics industries will contribute to the demand for these systems, owing to need for monitoring and transparency. Furthermore, customers seek the convenience offered by these systems that enable real-time traffic updates, alternate routes, places of interest nearby to name a few. The market for portable navigation devices that can be easily transferred from one vehicle to another will see the most growth owing to their cost and convenience. The industry is seeing ground breaking innovations and adaptation of advanced technologies to stay one step ahead of the competition.

The industry may face challenges in achieving its full growth potential due to presence of alternatives, lack of infrastructure in developing countries and tough competition.

Company
CalAmp is a telematics pioneer that is seeking to bring innovation to diverse industries such as connected cars, transportation and logistics, Industrial IoT, Governance and Education. LoJack, is a sophisticated vehicle relationship management solution that aids in dealer lot management, stolen vehicle recovery and consumer telematics. CalAmp’s iOn Vision, a part of its global transportation and logistics solution, offers integrated smart cameras, wi-fi enabled telematics devices and servers, to assist drivers get a holistic view of the road.

Furthermore, iOn Tag is a smart proximity sensor that can track assets through monitoring, analytics and alerts. CalAmp iOn is an enterprise-grade application that offers intelligence and analytic tools through a user-friendly interface, while iOn™ Suite Services is a telematic solution for fleet management. The Company also offers Telematics Cloud™ (CTC), a service that helps connect remote devices and assets to vertical applications and third-party services.

The Company’s subsidiary Synovia Solutions has a range of solutions that address challenges faced by K12 transportation by providing school bus tracking, contact tracing, hygiene verification and driver wellness checks. CoreGPS, a real time fleet tracking solution, provides historical reporting and geofence alerts, while its other offerings include, student ridership tracking, time and attendance tracking to simplify payroll and engine diagnostics solutions to deliver remote diagnostics.

CalAmp clients include leading global organizations such as ALD Automotive, Michelin, Toyota, Navman, Amazon, Fleetmatics, Verizon, Ford to name a few.

Key Remarks

  • CalAmp has built a robust intellectual property rights portfolio with over 300 global patents approved and 55 patents pending. Telematics is a rapidly evolving industry with increasing innovation and growing competition. Patent protection lends the Company, a leading-edge over its competitors.
  • The Company made over $88 Million in total revenue in Q3,2021, an increase of 5.4% but down year-over-year due to the effects of COVID-19 on its business. This includes 31 percent revenues from international operations. CalAmp wants to focus on SaaS business, which constituted 39 percent of the consolidated revenues in Q3,2021.  The SaaS revenue growth has enjoyed a CAGR of 26 percent over last 5 years and the Company intends to accelerate the growth rate further. The Company had $91.7 million in cash and cash equivalent at the end of the quarter and achieved a positive free cash flow of $6.7 million.
  • As part of its strategic plan the Company aims to engage with key customers, explore more profitable verticals and markets to improve EBITDA, improve its supply chain and most importantly shift hardware to a recurring telematics model. In addition, the Company is targeting a 10 percent YoY revenue growth, a 50 percent gross margin and 20 percent adjusted EBITDA over the long-term. The focus is primarily on driving growth of its SaaS solutions and data monetization opportunities.
  • The Company had earlier taken the decision to wind down the operations of LoJack in the U.S to refocus its resources on more profitable SaaS-based telematics line of business. LoJack provided stolen vehicle recovery (SVR) products operating on a radio frequency allocated by the FCC. The decision was taken as the sale of mostly hardware-based products and services, no longer aligns with its long-term strategic plans. However, the Company will continue to support law enforcement, while giving other customers sufficient time to find suitable alternatives. LoJack International, a subscription-based model will continue to operate as it is.
  • The Company has been developing strategic partnership such as its deal with Coastr, a technology start-up that aims to disrupt the car rental business through creation of an integrated digital eco system using CalAmp’s Telematics Cloud and edge computing on-board diagnostics (OBD) technology. Earlier in November 2020, the Company’s subsidiary Tracker, entered into a collaboration with Grove & Dean and Performance Direct, to reduce insurance premiums on account of stolen vehicles. These deals consolidate its positions as a pioneer in telematic solutions and open up new opportunities for growth and development.
  • Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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    References

    https://finance.yahoo.com/news/atlanta-public-schools-adopts-calamps-124500612.html

    https://finance.yahoo.com/news/calamp-localiza-sign-multi-agreement-124500950.html

    https://finance.yahoo.com/news/calamp-reports-fiscal-2021-third-120000010.html#:~:text=To%20that%20end%2C%20after%20an,and%20more%20predictable%20revenue%20streams.

    https://investor.calamp.com/home/default.aspx

    https://www.prnewswire.com/news-releases/calamp-and-tech-start-up-coastr-partner-to-revolutionize-the-worldwide-car-rental-industry-301188460.html

    https://www.prnewswire.com/news-releases/calamps-tracker-partners-with-grove–dean-to-protect-vehicles-and-reduce-motor-insurance-premiums-301178575.html

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