Home Listed Tech Uber and competitors aside, Cabcharge sees ‘substantial' opportunities ahead for growth

Uber and competitors aside, Cabcharge sees ‘substantial' opportunities ahead for growth

Taxi payments company Cabcharge sees substantial opportunities for growth in taxi, rideshare and hire car trips in the current Australian market for these services, markets in which all taxi companies are under growing pressure from newcomer Uber.

Cabcharge chief executive Andrew Skelton told the company’s AGM on Thursday that Cabcharge expected the Australian taxi and ride-share market will continue its growth trajectory as population, mobility and tourism continue to grow.

And, retiring chairman, Russell Balding said that despite state and territory governments introducing regulatory changes to accommodate ride share — creating an uneven playing field for the taxi industry — he still sees the industry growing, and backed new chairman Rick Millen to lead the business through a period of further growth.

“I do not believe state and territory governments around Australia truly understand the taxi industry, as the regulatory changes they have introduced to accommodate ride share have not resulted in a level playing field - quite to the contrary.,” he said.

Skelton said that, “as we move away from a cash based society and increasingly towards digital, there is a significant payments opportunity”, reminding shareholders that to capture the “tail winds of a growing market, in terms of both trips and electronic transactions” the company must evolve and invest.

He sees Cabcharge’s move into handheld terminals as a way of capturing more of the payments market.

“We are also launching handheld terminals — Spotto for taxi drivers and Giraffe for hire cars — and we see this as a significant growth area.

“As I outlined at the beginning of my presentation, 35% of the payments market is currently processed by handheld terminals which travel with the driver, not the  car. Having a payments processing solution in this growing sector of the market is an important part of Cabcharge’s growth strategy and a key value proposition for drivers.

“During FY16 we continued to make strong progress on our five strategic priorities. We have integrated our networks, committed to a key brand, linked booking and payments, and we’re actively supporting our merchant partners and looking after our customers."

Skelton also said the company’s successes over the last year included the fifth consecutive year of fleet growth, which saw the addition of 189 cars to the company’s taxi fleets, an increase of 2.9% in taxi fares processed, and the launch of 13CABS brand in Sydney, consolidating a number of brands and call centre services.

“With our guiding purpose of ‘Connecting You with People and Places,’ our five-year vision is to be Australia’s leading personal transport business and to become the first choice for passengers, the preferred network and payment partner for drivers, and the employer of choice in the personal transport sector.”

Skelton said Cabcharge was well placed to build on its strengths in the “ever-evolving and complex financial service, taxi and consumer technology industries”, after posting a statutory net profit of $25.6 million in 2016.

Cabcharge reported a drop in revenue in 2016 to $168 million, down 10.2% on the previous year.

Skelton says the current market places Cabcharge in a “strong position to implement its future strategy in the competitive sector”.

“We are ready to keep the momentum behind the evolution of the business, and we are confident that the appointment of Mr Millen will continue to drive vision and strength within the company.” Skelton concluded.

Cabcharge has appointed a new chairman, Rick Millen, who replaces retiring chairman Balding who took up the post in 2014.

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Peter Dinham

Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).