Founded in 1999 by CEO Anwar Sukkarié and chief technology officer Cameron Fraser, both former Motorola executives with international experience, this provider of mobile telematics systems and services finally began emerging last fall. Its stock started September trading at $1.08, but then it was recognized on Deloitte's Technology Fast 50 list as one of Canada's fastest-growing companies. Three months later, it announced an order from its exclusive Brazilian reseller for 490,000 units, which will be pre-installed in Volkswagens as part of a national insurance incentive program to prevent vehicle theft. That deal is worth about $67 million over 12 months, substantially more than the $16.34 million in revenue it made during fiscal 2006 (ended July 31). The deal also helped lift revenue for the quarter ending Jan. 31 to a record $8.5 million, 119% higher than the previous quarter.
” WebTech's business model from Day 1 has been to be profitable. Then, this Volkswagen deal appears on top of that and everything flows straight to the bottom line,” says Bob McWhirter, president of Selective Asset Management Inc. in Toronto and manager of the Northwest Specialty Innovations fund, which as of press time held WebTech shares as its largest individual stock allocation. “This allows them to bring down their cost to manufacture.”
There may be bumps along the way, but analysts' median forecast for fiscal '08 is 36¢ earnings per share. More may be in the pipeline, too: Sukkarié says WebTech, in partnership with IBM, is in the running to win a contract for fleet telematics services from FedEx, and it has four other potential deals in the works, too. What has been a low-key company is now in the spotlight ? and it certainly won't hurt that as of April 26, WebTech graduated to the TSX.
