South Africa - Durban - 11 August 2020 - Hundreds of trucks along roads leading to the Durban Container Terminal causing huge traffic backlogs in the south of Durban. Picture Leon Lestrade/African News Agency(ANA).
South Africa - Durban - 11 August 2020 - Hundreds of trucks along roads leading to the Durban Container Terminal causing huge traffic backlogs in the south of Durban. Picture Leon Lestrade/African News Agency(ANA).

MiX Telematics in 18.2% decline of first quarter subscription revenue

By Sandile Mchunu Time of article published Aug 12, 2020

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JOHANNESBURG - MiX Telematics, a leading global provider of fleet and mobile asset management solutions, yesterday reported an 18.2percent decline in subscription revenue to $25.9 million (R458m) for the first quarter to end June.

The group said the decline was primarily due to the impact of pricing concessions granted to customers and the contraction in its subscriber base as a result of the Covid-19 pandemic, adding that its subscriber base contracted by 30700 subscribers during the quarter.

MiX Telematics has a net subscriber base of more than 787000 subscribers in 120 countries across the globe.

The group's subscription revenue represents 94.1percent of total revenue.

The majority of its revenues and subscription revenues were derived from currencies other than the US dollar.

“Accordingly, the strengthening of the US dollar against these currencies, in particular against the rand, following currency volatility arising from the economic disruption, has negatively impacted our revenue and subscription revenues reported in US dollars.

"The rand weakened by 25percent against the dollar compared to the first quarter of 2020,” the group said.

The rand/dollar exchange rate averaged R17.97 in the first quarter, compared to R14.38 in the first quarter of last year.

Total revenue declined by 24.2percent to $27.5m, while hardware and other revenues were down by 65.1 percent to $1.6m during the quarter.

Chief executive Stefan Joselowitz said MiX Telematics’ first quarter performance was relatively solid, given the challenges presented by the Covid-19 pandemic.

“I am pleased by the progress we made on our three core goals this year of providing the best-in-class software and support to our customers, preserving profitability and continuing to invest in our strategic growth initiatives,” Joselowitz said.

The group also reported $2.7m as income from operations and a 60percent decline in diluted earnings per share to 0.4 US cents a share.

On a ratio of 25 ordinary shares to one American Depositary Share (ADS), earnings per diluted ADS was 11 US cents compared to 21 US cents in the first quarter of 2020.

Its adjusted earnings before interest, tax, depreciation and amortisation fell by 26percent to $10.1m.

At the end of the quarter, the group reported cash and cash equivalents of $24.5m, up from $18m compared to the quarter to end March.

MiX Telematics declared a dividend of 4cents a share (South African) and R1 a share per ADS.

Looking ahead, the group said due to the uncertainty surrounding the level of business disruption as a result of the spread of the Covid-19, it was suspending its practice of issuing financial guidance for the full 2021 financial year as well as the second quarter of financial year 2021.

MiX Telematics shares closed 0.74percent lower at R6.79 on the JSE yesterday.

BUSINESS REPORT

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