Cartrack lifts its dividend by 335%
CAPE TOWN - Cartrack Holdings, a global provider of mobility solutions for asset management and asset recovery, lifted its interim dividend 335 percent to 87cents per share in the half-year to August.
This after it reported robust interim results despite the weak global economy, with headline earnings per share up 21percent to 87.2c, while subscriber growth remained also robust, rising 13percent to 1175173.
Chief strategy officer Brendan Horan said the higher dividend was due to the group accumulating a large cash balances through the periods of Covid-19 restrictions and the fact that it remained debt free and cash generative.
The company, which operates in 23 countries and five continents, and which designs, manufactures and sells its own hardware and software, reported a strong performance across all of its key-growth-metrics.
And while Covid-19 was expected to have less of an impact on the third and fourth quarters of the 2021 financial year, new subscriber add-ons and subscription revenues were likely to experience solid growth when compared to the first half.
“Zak (Calisto, the chief executive and founder) has always said that he doesn’t want to have too much cash on hand, but also not too little,” Horan said in a telephone interview.
Revenue was up by 16percent to R1.1bn in the interim period. The last two of the period had seen the group’s best months of new subscriber additions.
Horan said the company would have liked to have performed better, but given the circumstances of the global pandemic, the results were good.
This was in spite of experiencing limited capacity to install the in-vehicle IoT technology due to Covid-19 operating and travel restrictions.
Operating profit increased 16percent to R368million.
Calisto said in a statement that many customers had faced cash flow and operational difficulties due to the global lockdowns and travel restrictions.
“We afforded them all reasonable assistance where possible. Despite this, the group had continued to experience strong demand for our Software-as-a-Service 'SaaS' platform", he said.
The telematics Software-as-a-Service platform delivers real-time data, visibility and impact for fleet operators.
Calisto said the territories where Cartrack operated remained materially underpenetrated, with significant growth potential, he said.
South Africa delivered subscription revenue growth of 17percent to R763m and subscriber growth of 13percent.
The South Africa segment reported 14percent year-on-year growth in earnings before interest, tax, depreciation and amortisation (Ebitda) of R386m.
Asia Pacific was the second largest revenue contributor and the fastest growing segment, with subscription revenue up 33percent to R140m and subscriber growth of 28percent.
Ebitda grew 66percent to R55m and the Asia Pacific region presented the greatest medium- to long-term potential, said Horan.
The European segment delivered subscription revenue growth of 34percent to R109m, subscriber growth of 11percent and an Ebitda of R60m with growth of 43 percent.
Cartrack continued to evaluate its strategy to expand into the rest of Europe.
The subscriber base in Africa (excluding South Africa) grew by 2percent and subscription revenue for the period was flat at R54m.
The region recorded an Ebitda of R23m with growth of 6percent, and remained a positive cash generator and strategic operations in Southern Africa.
Cartrack’s share price increased 3.41percent to R43.41 on the JSE yesterday morning, more than double the R17.50 it traded at in March. The share closed at R44.01.