Cartrack subscriber growth accelerates


Cartrack subscriber growth accelerates

Published Date: 2019-05-29 | Source: Stephen Gunnion | Author: Stephen Gunnion

Cartrack subscriber growth accelerates

The fleet management and vehicle recovery group expects double-digit subscriber and annuity revenue growth to continue.

Cartrack is setting up a research and development centre in Singapore and has beefed up its team in Asia Pacific due to the massive growth potential the region offers the group.

It says an increasing number of large corporates in Asia Pacific and Europe are using its products and services to manage their fleets of vehicles, while in SA its audited recovery rate of 92% for stolen vehicles underpins the quality of its security technology.

Asia Pacific was the second-biggest contributor to revenue at the telematics group last year as turnover jumped 52% to R180 million, although profit growth didn't match due to the investment it made in distribution capabilities over the year. It says the Asia Pacific region remains underpenetrated due to fragmented market participants delivering entry-level vehicle tracking and fleet management offerings.

South Africa remains Cartrack's biggest market, growing revenue by 27% to R1.25 billion in the year to end-February as subscriber numbers rose 30%. Its European business delivered subscriber growth of 15% and total revenue growth of 27% to R148 million. Africa outside of South Africa remains the smallest segment, but Cartrack says it plays a critical role for customers that increasingly do cross-border travel. It increased subscribers by 4% and total revenue by 11$% to R116 million.

For the group as a whole, subscriber numbers increased by 28% to 960,798, helping drive a 30% increase in subscription revenue to R1.52 billion. Total revenue rose 28% to R1.69 billion. Operating profit rose by a lesser 15% to R500 million as it invested in future growth. Headline earnings per share were also up 15%, at 116c, and it's declared a dividend of 12c per share, down from 28c last year, as it retains capital to fund its growth ambitions.

The company said it expected annuity revenue and subscriber growth to continue growing in the double digits for the foreseeable future.

Its shares rose 15% to R17.80 yesterday.

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