EROAD Limited Analysis

Overview

EROAD has created an electronic solution to manage and pay Road User Charges (RUC), support regulatory compliance and provide value-added commercial services to the heavy vehicle industry. In 2009, EROAD implemented the world's first network-wide GPS/cellular-based road user charging system, which modernised the existing paper-based RUC regime in New Zealand.

The EROAD system consists of a secure electronic distance recorder (Ehubo), combined with a bank-grade payment gateway and services portal. We undertake design and manufacture of our Ehubos, as well as software development, from our headquarters in Auckland.

EROAD's successful New Zealand reference site provided it with the opportunity to enter the international market. In 2014 we commercially launched in Oregon, becoming the first approved electronic Weight-Mile Tax (WMT) service provider in North America. We also entered the Australian market with a commercial services offering. For more information please visit www.eroad.com.

Performance

The following information was extracted from EROAD Limited full year results, released 25 May 2026

FY26 Summary

• Revenue of $195.2m, up 0.4% reflecting strong growth in Australia, steady growth in New Zealand and a decline in North America as the result of previously disclosed customer nonrenewal.

• Annualised Recurring Revenue was $174.3m in FY26, down 0.5%, with good ARR growth in New Zealand and Australia offset by a decline in North America.

• Free Cash Flow (to the firm) of $0.1m reflecting the temporary impact of the 4G upgrade program. When normalized for this, free cash flow (to the firm) was $14.4m (margin of 7.4%).

• Normalised EBIT 2 was $2.9m, reflecting higher operating costs, non-recurring expenses and lower capitalisation of R&D partially related to accounting policy adjustments.

• EBIT of negative $155.9m includes a non-cash impairment to the North American assets of $134.7m previously reported in October 2025. Net Loss After Tax was negative $161.1m.

• Liquidity remains strong at $49m with a $65m of credit facility limit against $16m of net debt to support growth and fund large enterprise deployments.

• Completed the 4G hardware upgrade program replacing 73k units in New Zealand over the last 3 years. This is expected to free up cash, sales and customer service capacity, enabling greater focus on delivering higher-value solutions to New Zealand transport operators.

• Cleanaway rollout progressed through FY26 and remains on track for completion November 2026, adding A$5m ARR fully deployed.

• New executive leadership team and appointment of John Scott as a director in March 2025, Executive Chair in October 2025 to lead the transformation program