A record year of growth for the Auckland-based fleet tracking technology company Eroad has propelled its founder and chief executive, Steven Newman, back into the Rich List.
Listed on the NZX in 2014, Eroad has endured something of a bumpy ride in recent times as it struggled to break into the critical US market. However, a 2017 federal government mandate requiring all interstate trucks above 10 tonnes to be equipped with an electronic logging device or ELD has changed the game.
In the year to March 2018, Eroad’s North American sales soared by 191% and contributed to an overall 57% hike in revenues to $51.5 million. With the global trend toward electronic road user charging also accelerating due to the commercialisation of electric trucks and vans, Newman says “the experiences gained from a rapid scale-up in sales and customer support mean Eroad is in a good position for the year ahead.”
The turnaround in fortunes hasn’t been missed by investors. In the space of 12 months, Eroad’s share price rose by more than 125% and boosted the company’s market capitalisation to $250m, which valued Newman’s 21.7% stake at about $55m.
The share price has recently dipped again but Newman’s holding is still valued around $50m.
Underpinning the company performance was a successful $15.5m equity raising in late 2017 and a renegotiated credit facility with BNZ which, according to Newman, “means Eroad is well-placed to fund continued growth and expansion of its business to capitalise on these considerable opportunities.”
Declaring that he remains fully committed to the business, Newman nevertheless took the opportunity to sell $5m worth of shares in the placement, which will no doubt compensate for a reduced remuneration package of $555,859 in 2018 because the company did not meet its 2017 targets.
Newman is no stranger to transport technology success. Along with Peter Maire, he co-founded Navman, which became a global brand before being sold to the US firm Brunswick Technologies in 2003/04 for $108m. According to Companies Office records, Newman held a 5% stake before the sale.
2017 also saw Newman and his wife Colette move from their Coatesville lifestyle block to a smaller 1ha property at nearby Waimauku, though the couple still owns another 15ha lifestyle block worth $4.5m near the Goat Island Marine Reserve north of Leigh.