Originally Posted by
Te Whetu
It's their biggest Australian customer, not their biggest customer.
Over the course of this calendar year, I estimate this one customer will add $1.5m+ annualised revenue (2500 units at $50+ revenue per month). EROAD tends to make around 65% EBITDA margin on additional revenue (prior to corporate and development, which I would not anticipate to be materially impacted by this one customer). Therefore, I expect this customer will add around $1m to annualised EBITDA. There might be an increase in depreciation and amortisation, but I would not anticipate a major increase.
Once fully implemented, I expect this customer will take the Australian operations from net losses to net profits.
I'm quite interested in seeing the Q4 unit numbers, which will presumably be released later this month. The net loss of 39 units in North America in Q3 was a bad sign. Hopefully we'll find out if that was a one-off blip, with growth returning, or if it signalled the point where the North American operations began to stagnate or (worse) decline.