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Cartrack puts pedal to metal
Vehicle-tracking group Cartrack will hire 300 people in the next 12 months to meet the demand for its products.
© Leon Swart via www.123RF.com
Earnings at Cartrack, a global provider of fleet management, stolen vehicle recovery, and insurance telematics, soared in the six months to August 2017. Subscribers grew 21% to more than 666,000 in the period as subscription revenue rose 19%.
CEO Zak Calisto said the group was growing at a steady pace and investing in capacity to respond to market demand.
To this end, it would employ 300 more technicians and salespeople within the next year, bringing staff numbers up to 2,200 people.
Cartrack's revenue was up 14% to R630m with earnings before interest, tax, depreciation and amortisation jumping 26% to R297m. Headline earnings per share shot up 20%, with an interim dividend per share of 18c. Cash generated from operating activities was R178m.
"I think our biggest earner right now is fleet management," Calisto said, referring to markets in Southeast Asia and Europe.
He said earnings in SA, the group's biggest market, were split 50-50 between fleet and stolen vehicle recovery operations. The group has more than 500,000 subscribers in SA.
Cartrack now operates across five continents, with South Africa, Europe, and the Asia-Pacific region the biggest contributors to growth.
South Africa, Asia-Pacific, and Europe contributed 19%, 122% and 24% to subscriber growth, respectively. Annuity income made up to 88% of total group revenue, the group said.
"SA performed admirably and the business case for Asia-Pacific is now well entrenched. Europe also delivered strong subscriber growth.
"We are constantly upgrading our market offering to our customers through our innovative and reliable products and services," Calisto said.
"We are part of an under-penetrated and high-growth industry and view ourselves as still being in a growth phase across all continents," he said.
The rest of Africa, excluding the South Africa segment, delivered a resilient performance despite sluggish regional economic conditions, Cartrack said.
The segment now had a new management structure and a refreshed strategy, which was expected to deliver benefits over the next six to 18 months.
In Europe, investment in distribution and operating capacity was set to continue.
Startup costs were being incurred as Cartrack expanded into Thailand, Malaysia, the Philippines, and Indonesia. Breakeven across these markets was expected in the next three to four years.
The group said that Singapore operations - now four years old - were consistently contributing towards growth in revenue and operating profit.
Cartrack continued to invest in technology in its US operations to secure its position in a competitive market, it said.
Source: Business Day
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