Roy Cokayne
CARTRACK Holdings, the fleet management, stolen vehicle recovery and insurance telematics group that listed on the JSE in December, is making progress with its expansion drive through Africa, Europe, the Middle East and Asia.
Isaias Jose Calisto, the global chief executive of Cartrack, said yesterday new offices were opened in Indonesia, Malaysia, Hong Kong and the Philippines in the year to February, using the well established office in Singapore as the hub.
Calisto said an office was also opened in the United Arab Emirates and a number of Cartrack licensees in Africa and Europe were acquired during the year.
These new operating entities contributed expected losses of R4.9 million for the year, but their profitability was anticipated to improve in the short- to medium-terms as these businesses gained traction in their respective markets.
Calisto added that Cartrack Singapore was awarded a prison tracking tender, which was a highlight of the group’s financial year, given the high reputation and standards of the Singaporean government. “We see this being a great reference and giving significant credibility to Cartrack’s presence in the region,” he said.
Revenue from non-South African operations increased to 26 percent in the year to February from 17 percent in the previous year. Cartrack yesterday reported a 12 percent growth in headline earnings a share to 65c in the year to February from 58c in the previous year. Revenue rose by 32 percent to R843.7m from R637m.
Global sales
The 24 percent growth in Cartrack’s subscriber base to more than 430 000 units increased the annuity revenue to 84 percent of total revenue, while fleet management products accounted for 64 percent of total global sales compared to 52 percent in the prior year.
Operating profit increased by 16 percent to R298.9m from R258.1m despite the operating margin deteriorating to 35 percent from 41 percent.
Calisto attributed the margin reduction primarily to lower trading margins in the entities acquired in Africa and Europe during the year, the set-up costs associated with the newly established Asian operations that were yet to break even, and the once-off listing costs. Net cash from operating activities grew by 24 percent to R265.95m from R214.45m. A final dividend of 30c was declared.
Calisto said the results primarily reflected Cartrack’s focus on revenue growth and the establishment and integration of new international operations, but group profits exceeded those forecast in the group’s prelisting statement.
He said Cartrack had continued to grow its stolen vehicle recovery services despite the relative contribution of these services increasingly reflecting a smaller share of the total business because of strong growth in fleet management services.
Calisto said subscriber and revenue growth was in the short- to medium-term expected to be consistent with that achieved in the past few years and sustainable growth anticipated in all its operations. “The global expansion will generate a greater share of revenue and profit from operations located outside South Africa, although the new Asian/Middle East operations will only achieve break-even in the medium term,” he said.
Cartrack shares listed on the JSE yesterday rose 0.22 percent to R9.02.