London-listed AB Dynamics is in a strong position to pursue growth in offroad autonomy and other new markets, including via acquisitions, after lifting EBITDA 18% year-on-year to £20.5 million (US$26m) on 21% higher 2023 revenue of £100.8 million (US$128m) and starting 2024 with circa-US$40 million in cash.
The company, which recently established an Australian office to try to access the world’s largest mining-vehicle autonomy market, has made four acquisitions since 2019. The latest was its £23.8 million 2022 purchase of automotive simulator firm, Ansible Motion, which made a significant contribution to AB Dynamics’ 2023 results.
AB Dynamics said it had a “good pipeline of promising acquisition opportunities”.
“The market in which the group operates for acquisitions is relatively large and fragmented,” it said.
AB Dynamics currently derives about two-thirds of its revenues from vehicle test robots and track-testing software, and the balance from driving simulators and laboratory-based test equipment.
Subsidiary ABD Solutions was established to spearhead diversification into mining, defence and specialist vehicle markets with the group’s Indigo Drive automation technology.
The company finished 2023 with net cash of £32 million and £15m in a revolving credit facility.
“The group has further strengthened its platform for growth through both organic investments and acquisitions,” CEO Dr James Routh said.
“We see significant opportunity in our core markets in automotive, which are supported by long-term structural and regulatory growth drivers.
“In addition, we are investing in new technologies to diversify the business into attractive adjacent markets through ABD Solutions.”
The company said ABDS had “demonstrated its product offering in contrasting environments for potential customers in mining, defence and other specialist vehicles and successfully proved its concept and market solution, Indigo Drive”.
“A digital twin has been developed which provides operational environment validation and a platform for accelerated product testing.
“Its focus is transitioning from technology development to commercialisation with negotiations ongoing around mining-related contracts.
“The Japanese mining development contract is progressing as planned and a memorandum of understanding has been signed with Jevons Robotics in Australia for mining applications.
“In addition, ABD Solutions has been awarded a £1m contract for delivery during FY2024 of a retrofit pedestrian detection system for a UK customer for construction industry applications.”
AB Dynamics’ share price is down about 3% in 2024. The company has a current market value around £388m (US493m).
