Acusensus puts foot on profit accelerator as road safety technology gains traction

AI-based road safety technology company Acusensus (ASX: ACE) put its foot on the accelerator in the first half of FY24 with underlying earnings growing at a faster pace than revenue.

The company, which operates mobile phone and seatbelt monitoring cameras in Australia and is growing its presence in the US and UK, has posted a 35 per cent increase in EBITDA to $2.5 million.

Underlying profit grew at a faster pace that revenue which rose 25 per cent to $24.7 million in the six months to the end of December.

Gross profit also rose 32 per cent to $11.1 million although a $2.2 million increase in costs has translated to a bottom-line loss of $241,430, which is a marginal improvement on the previous corresponding period.

The solid earnings performance has been largely delivered by the Australian market with just 6 per cent of Acusensus’ revenue generated from offshore markets. This is up from 2 per cent a year earlier.

The latest result has been supported by an expansion of the company’s contracts in Queensland and NSW totalling $14 million during the period.

These come on the heels of Acusensus in January announcing an agreement with the South Australian Government to debut its mobile phone detection cameras to the state’s roads in a deal worth $5 million.

“It has been an exciting half-year for the team as we continued to expand the number of systems and contracts in operation to deliver on our road safety goals,” says Acusensus CEO and co-founder Alexander Jannink, who was named Trailblazer and Technology winner in the 2023 Australian Young Entrepreneur of the Year Awards.

“Acusensus maintained its trajectory of top-line growth in revenue and gross profit, while investing to support and fulfil future growth expectations.”

Jannink says the investment has given the company capability to support its operations globally on a 24/7 basis.

“Domestically, the signing of the contract with the South Australian Government will result in half of Australia’s states and territories using Acusensus Heads Up to address distracted driving,” says Jannink.

“Internationally, we have made strides in educating the market about our solutions and are seeing increased engagement in borth the UK and US.”

Acusensus announced two weeks ago that it secured ‘apparent successful vendor’ status for a speed safety camera program for the Washington State Department of Transportation in the US. This builds on an existing contract the company secured in North Carolina last year.

Acusensus operates mobile phone detection cameras across most of the jurisdictions in which it operates, including the ACT, while in Queensland it also has deployed cameras to detect the seatbelt usage.

The company says that with the new and extended contracts announced, it has secured $165 million in contracted revenue for enforcement services and trials since the company was founded in 2018.

In the UK, Acusensus is in discussions with road and police authorities for pilot programs, while it has secured an ongoing relationship with Devon and Cornwall Police following a successful pilot at the beginning of the current financial year.

The company reports that research continues to improve image quality being delivered to enforcement authorities and the accuracy of its AI technology to detect errant driver behaviour.

Among the new advanced products it is developing include mobile phone awareness and tailgating monitoring, as well as road-worker protection and impaired driving detection – with demonstrations for the first two products planned for the current half year.

Acusensus says it plans to focus on international opportunities to drive growth and to establish its presence as a global leader in high-tech road safety solutions.

The company forecasts FY24 revenue of between $49 million and $51 million and EBITDA of between $4 million and $5 million.

Today’s earnings performance pushed Acusensus shares to a record high of $1.18 after taking into account a four-for-one share split that was completed in August last year. The shares, which were issued at $4 each in the $100 million IPO, would carry a nominal value of $1 each after the split.