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Short-form Announcement: Unaudited First Quarter 2025 Results and Dividend Declaration
Karooooo Ltd.
(a public company incorporated and registered in the Republic of Singapore)
(Unique Entity Number: 201817157Z)
JSE share code: KRO NASDAQ share code: KARO
ISIN: SGXZ19450089
("Karooooo")
Short-form Announcement: Unaudited First Quarter 2025 Results and Dividend Declaration
Karooooo, that owns 100% of Cartrack Holdings Limited ("Cartrack"), issued a press release announcing
its unaudited first quarter results for the three months ended 31 May 2024 and included such press
release as an exhibit to its form 6-K (the "Report on Form 6-K") dated 18 July 2024 furnished to the
United States Securities and Exchange Commission ("SEC"). Investors are referred to the full press
release as published and available on the Karooooo website at www.karooooo.com.
First Quarter 2025 Highlights:
(Comparisons are relative to Q1 2024, unless otherwise stated.)
Scale
- Cartrack subscribers up 17% to 2,047,442 at May 31, 2024 (Q1 2024: 1,757,452)
- Net Cartrack subscriber additions up 88% to 75,910 (Q1 2024: 40,375)
Growth
- Subscription revenue up 15% to ZAR964 million (Q1 2024: ZAR836 million)
- Subscription revenue up 15% on a constant currency basis (a non-IFRS measure)
Operating Profit and Earnings Per Share
Karooooo's operating profit grew by 34% to ZAR300 million (Q1 2024: ZAR224 million) and earnings per
share by 41% to ZAR7.17 (Q1 2024: ZAR5.09).
Cartrack delivered record operating profit of ZAR287 million, up 24% (Q1 2024: ZAR232 million). The
gross profit margin expanded to 73% (Q1 2024: 70%) and the operating profit margin expanded to 29%
(Q1 2024: 27%).
Karooooo Logistics delivered an operating profit of ZAR13 million (Q1 2024: ZAR5 million) as it continues
to scale.
Outlook
We believe Karooooo is strongly positioned for growth. We operate in a growing and largely
underpenetrated market, with strong demand from customers needing to to be competitive and digitalise
their ground operations.
Our proven, robust and consistently profitable business model, underpinned by a strong balance sheet
and healthy cash position, gives us multiple levers for expansion. We expect our continuous investment in
our AI products, platform and customer experience to generate robust results in the future.
We remain confident that our track record of success, specifically our ability to generate healthy cash
flows, is sustainable.
Our mission is to be a leading Operations Cloud service provider.
Actual results may differ materially from Karooooo's outlook due to various factors, including those
described under "Forward-Looking Statements" below and described under "Risk Factors" in our latest
Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission.
With Cartrack's revenue making up the majority of group revenue, the guidance below relates primarily to
Cartrack.
Our guidance for FY 2025 remains unchanged:
- Cartrack's number of subscribers expected to be between 2,200,000 and 2,400,000
- Cartrack's subscription revenue expected to be between ZAR3,900 million and
ZAR4,150 million
- Cartrack's operating profit margin expected to be between 27% and 31%
- Karooooo's Earnings Per Share expected to be between ZAR27.50 and ZAR31.00
Balance Sheet, Liquidity and Cash Flow
Our strategic approach to capital allocation supports Karooooo's strong growth at scale, profitability and
high cash-generation. Given our balanced capital structure and healthy operating profit margins, we have
ample runway to accelerate our customer acquisition strategy while remaining profitable.
At May 31, 2024, Karooooo's property, plant and equipment had increased by ZAR94 million to ZAR2,127
million (February 29, 2024: ZAR2,033 million). This was primarily due to an increase of ZAR48 million in in-
vehicle capitalized telematic devices, an increase of ZAR5 million in telematic devices available for future
sales and an investment of ZAR37 million in building the South African central office. Karooooo's property,
plant and equipment of uninstalled telematic devices for future sales was ZAR351 million (February 29,
2024: ZAR346 million).
In line with business growth and currency fluctuations, trade and other payables increased to ZAR466
million (February 29, 2024: ZAR446 million). Trade and other receivables and prepayments decreased to
ZAR596 million (February 29, 2024: ZAR985 million). At February 29, 2024, fixed deposits placed with
banks amounting to ZAR486 million, which matured in June and July 2024, were included in other
receivables.
Debtor's collection days remain within our historical norms at 30 days (February 29, 2024: 29 days).
In line with the group's cash management policy, overseen by our capital allocation committee, Karooooo's
excess cash reserves are held in US Dollars.
Cash and cash equivalents
After allocating ZAR37 million to the new South African central office, Karooooo reported a net cash and
cash equivalents balance of ZAR950 million at May 31, 2024 (February 29, 2024: ZAR436 million). At
February 29, 2024, the net cash and cash equivalents balance would have been ZAR922 million if all the
bank fixed deposits had matured prior to May 31, 2024.
At May 31, 2024, the group had bank facilities for growth initiatives and other general corporate purposes
of ZAR275 million with Capitec Bank Limited.
Free Cash Flow (a non-IFRS measure)
As at February 29, 2024, there were bank fixed deposits of USD25.2 million maturing more than 3 months
after year end that were included in "Trade and other receivables and prepayments" on the balance sheet
The same bank fixed deposits are now presented as "Cash and cash equivalents" in the May 31, 2024
balance sheet. Hence, the group generated Free Cash Flow (a non-IFRS measure) of ZAR569 million for
the quarter ended May 31, 2024.
Excluding the effect of the bank fixed deposits of USD25.2 million, Free Cash Flow (a non-IFRS measure)
was ZAR83 million for this quarter (Q1 2024: ZAR158 million).
The Free Cash Flow (a non-IFRS measure) generated is in keeping with our planned capital allocation for
future growth.
Share Capital and Reserves
At the Annual General Meeting (AGM) held on July 12, 2023, 97.35% of Karooooo's shareholders passed
a resolution authorizing the repurchase of up to 10% of the company's shares. The board of directors
(Board) is duly authorized to implement this share buyback program in accordance with the requirements
outlined in the resolution.
Purchases of ordinary shares by the company may be made by way of market purchases on the Nasdaq
and/or the JSE. At our next AGM, we expect to seek approval for the renewal of our share repurchase
program on the same terms.
Karooooo repurchased 57,806 shares of its common stock in February 2024 and May 2024, at an average
purchase price of USD24.84 per share. We subsequently cancelled 51,106 shares on May 25, 2024. The
remaining 6,700 shares were cancelled on June 18, 2024.
At May 31, 2024, Karooooo had 30,900,000 ordinary shares in issue, with 30,893,300 shares outstanding,
and paid-up share capital of USD504,520,625 plus SGD1,000.
The negative common control reserve of ZAR2.7 billion on the balance sheet relates to a common control
transaction on November 18, 2020, in which the loan of USD194 million from Isaias Jose Calisto was
converted into Karooooo share capital. Consequently, Karooooo acquired control of Cartrack. On that date,
20,331,894 shares were issued to Isaias Jose Calisto and Karooooo registered ZAR2.7 billion in paid-up
capital, resulting in the common control reserve.
The ZAR3.6 billion other reserve on the balance sheet relates to the buyout of 95,350,657 Cartrack shares
at ZAR42.00 per share from minorities when Cartrack delisted from the JSE, totaling ZAR4.0 billion. This
was offset by the ZAR0.4 billion previously reported in the non-controlling interest. The ZAR0.4 billion
relates to the net asset value of 95,350,657 Cartrack minority shares acquired by Karooooo.
ZAR12 million of other reserve on the balance sheet relates to the cancellation of Karooooo treasury shares
and ZAR11.4 million of other reserve relates to the cancellation of Karooooo Logistics treasury shares.
Events in the First Quarter of 2025
In April 2024, the Board approved a resolution for Karooooo Logistics (Pty) Ltd to repurchase its ordinary
shares at a purchase price of ZAR15.2 million in accordance with the Companies Act of South Africa and
to cancel the repurchased shares. As a result, the group's effective shareholding in Karooooo Logistics
(Pty) Ltd is now 74.8%.
Events after the First Quarter of 2025
In June 2024, The Standard Bank of South Africa Limited extended a loan of ZAR 250 million to Purple
Rain Properties No.444 Proprietary Limited (the owner of the regional South Africa head office under
construction) at the South Africa Prime Interest Rate less 1.5%. The loan will mature on 21 December 2025
and these funds were used to settle loan from Cartrack Pty Ltd.
Dividend Declaration
Considering the consistent strong earnings, healthy balance sheet and free cash flow of the Company and
in accordance with the dividend policy set out above, an interim dividend of USD1.08 per ordinary share,
pertaining to the first quarter of Karooooo's 2025 financial year, will be paid on Aug 12, 2024, to JSE
shareholders on record as at the close of business on Thursday, August 8, 2024 and on Aug 14, 2024 to
Nasdaq shareholders on record as at the close of business on August 8, 2024. Although Karooooo's
reporting currency is ZAR, its statutory filings in Singapore are reported in USD, as a result of which
dividends are declared in USD. The details with respect to the dividends declared for holders of our ordinary
shares are as follows:
NASDAQ JSE
Declaration date Thursday, July 18, Friday, July 19, 2024
2024
Finalization announcement, date of currency Monday, July 29, 2024 Monday, July 29, 2024
conversion and confirmation of record date
Last date to trade cum dividend Tuesday, August 6, Monday, August 5, 2024
2024
Shares commence trading Ex-dividend Thursday, August 8, Tuesday, August 6, 2024
2024
Record date Thursday, August 8, Thursday, August 8, 2024
2024
Dividend payment date Wednesday, August Monday, August 12, 2024
14, 2024
Shareholders registered on the South African section of the share register will not be allowed to
dematerialize or rematerialize their shareholdings between Tuesday, August 6, 2024 and Thursday, August
8, 2024, both dates inclusive, and transfers between the NASDAQ and South African register will not be
permitted between Monday, July 29, 2024 and Thursday August 8, 2024, both days inclusive.
A summary of the tax considerations applicable to South African shareholders will be included in the
currency conversion and confirmation of record date announcement which is expected to be published on
Monday, July 29, 2024.
Short-form Announcement
This short-form announcement is the responsibility of the directors of Karooooo. This short-form
announcement is only a summary of the information in the full announcement (defined below) and does
not contain full or complete details. Any investment decision by investors and/or shareholders should be
based on consideration of, inter alia, the full announcement.
The full announcement ("full announcement") includes the contents of the Report on Form 6-K as
furnished to the SEC dated 18 July 2024, being the press release incorporating the unaudited condensed
consolidated and combined financial statements of Karooooo for the first quarter ended 31 May 2024.
The full announcement has been released on SENS today, 19 July 2024 and is available for viewing on
the Company's website (www.karooooo.com) and at the following address:
https://senspdf.jse.co.za/documents/2024/jse/isse/KROE/Q12025.pdf
The full announcement is available for inspection at the offices of the Company (17 Kallang Junction
#0605/06 Singapore 339274) at no charge during normal office hours on business days from Friday, 19
July 2024 to Friday, 26 July 2024. Copies of the full announcement may also be requested from the
sponsor by emailing dg.mlsa_corporate_broking@bankofamerica.com.
Webinar Information
Karooooo management will host a Zoom webinar on Friday, July 19, 2024 at 08:00 a.m. Eastern Time
(02:00 p.m. South African time; 08:00 p.m. Singaporean time).
Investors are invited to join the Zoom at: https://us02web.zoom.us/j/82089929893
Webinar ID: 820 8992 9893
Telephone:
- US (New York) Toll-free: +1 646 558 8656
- South Africa Toll-free: +27 87 551 7702
A replay will be available at www.karooooo.com approximately three hours after the conclusion of the live
event.
About Karooooo
Karooooo is a provider of a leading operational IoT SaaS cloud that maximizes the value of operations
and workflow data by providing insightful real-time data analytics to thousands of enterprise customers by
digitally transforming their operations. The Cartrack (wholly owned by Karooooo) SaaS platform provides
customers with differentiated insights and data analytics to optimize their business operations. Cartrack
assists customers to sustainably improve workflows, manage field workers, increase efficiency, decrease
costs, improve safety, monitor environmental impact, assist with regulatory compliance and manage risk.
Currently there are over 2,100,000 connected vehicles and equipment on the Cartrack cloud.
For more information, visit www.karooooo.com.
Investor Relations Contact IR@karooooo.com
Media Contact media@karooooo.com
Johannesburg
Friday, 19 July 2024
Sponsor
Merrill Lynch South Africa Proprietary Limited
t/a BofA Securities
Date: 19-07-2024 07:18:00
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