Locate Technologies Narrows Losses but Faces Margin Pressure in Zoom2u Segment
Locate Technologies Limited reported a significant reduction in losses for FY2025, driven by strong growth in its Locate2u segment and effective cost management.
- 5% overall revenue growth to nearly $6 million
- Locate2u revenue up over 13% year-on-year
- Zoom2u revenue declined slightly, offset by 2u Enterprises growth
- Normalised EBITDA loss narrowed by 86% to $89,075
- No dividends declared; audited financials with unmodified opinion
Solid Revenue Growth Amidst Challenging Market
Locate Technologies Limited has reported a 5% increase in group operating revenue for the year ended 30 June 2025, reaching $5.99 million. This growth was largely fueled by the Locate2u business, which saw revenues climb by more than 13% compared to the previous year. The company’s diversified portfolio, including Zoom2u and 2u Enterprises, contributed to a mixed but overall positive revenue picture.
Zoom2u Faces Headwinds, Offset by Enterprise Expansion
While the Zoom2u segment experienced a 5% decline in gross merchandise volume and a 2% drop in revenue, this was partially balanced by increased contributions from 2u Enterprises. Notably, the Shred2u business and digital marketing services within 2u Enterprises posted revenue gains, helping to stabilize the overall revenue stream despite margin pressures from larger enterprise customers in Zoom2u.
Significant Improvement in Profitability Metrics
Perhaps most striking is the company’s progress in reducing losses. The consolidated loss after tax narrowed to $1.8 million, down 41% from $3.06 million the previous year. Even more impressive is the near 86% reduction in the normalised EBITDA loss, which shrank to just $89,075 from $621,297. This improvement reflects both increased revenues and a more optimized cost base, signaling enhanced operational efficiency.
No Dividends, Stable Corporate Governance
Locate Technologies did not declare or pay any dividends during the period, consistent with its focus on reinvestment and growth. The company’s financial statements were audited and received an unmodified opinion, underscoring the reliability of the reported figures. There were no changes in control over entities during the year, indicating stability in the company’s corporate structure.
Looking Ahead
With Locate2u’s momentum and a leaner cost structure, Locate Technologies appears to be on a path toward improved financial health. However, the slight revenue decline in Zoom2u and the shift toward lower-margin enterprise customers suggest ongoing challenges in balancing growth with profitability. Investors will be watching closely to see if this positive trajectory can be sustained in the coming quarters.
Bottom Line?
Locate Technologies’ FY2025 results mark a turning point, but sustaining growth amid shifting segment dynamics remains the key challenge.
Questions in the middle?
- Can Locate2u maintain its strong growth momentum in FY2026?
- Will Zoom2u’s shift toward enterprise customers improve or pressure margins further?
- What cost optimization strategies will the company deploy next to achieve profitability?
