Karooooo Ltd. (“Karooooo”), that owns 100% of Cartrack Holdings
(“Cartrack”), today reported financial results for the first
quarter of its 2022 financial year (“2022”), ended May 31, 2021 and
announced the appointment of new independent director.
“Despite the pandemic, our 2022 financial year
commenced on a solid note as the strong growth in net subscriber
additions continued.
New customer additions across a broad base of
industries are at historical highs demonstrating our ability to
innovate and to provide a differentiated fleet management platform
corroborating the strength of our mission to build the leading
mobility SaaS platform that maximizes the value of data.
The global vehicle parc continues to grow, and
customers seek to reduce operating costs, optimize the use of
resources, improve the efficiency of fragmented workflows and
enhance safety, risk management and eco compliance.
Our comprehensive fleet management platform and
vertically integrated business model differentiates us from
competitors. Our focus on product development and distribution has
led to our continued growth with limited industry or customer
concentration risk.
As we think beyond the pandemic, it is
imperative that we are positioned for expansion to meet the growing
customer demand for our SaaS platform. After curtailed investment
for expansion in the first two quarters of our 2021 financial year
when the pandemic emerged, we entered a phase of investing for
growth in November 2020. We increased our headcount by 761
employees in the last three quarters positioning us well for the
expected expansion to come. This planned recruitment drive focused
on customer acquisition in South Africa, general expansion in Asia
and research and development (“R&D”). The contraction in
operating margins during the quarter is in line with our growth
strategy.
We are delighted to report strong subscriber and
subscription revenue growth for our first quarter despite the
ongoing operating restrictions imposed due to the pandemic.”
Zak Calisto, CEO and Founder
Karooooo
Ltd.
Announces First Quarter 2022 Unaudited Financial
Results
First Quarter 2022
Highlights:(All comparisons relative to the First Quarter
2021)
SCALE● 1,366,470 subscribers in
total, up 21% (Q1 2021: 1,133,547) ● Net
subscriber additions increased 760% to 60,470 (Q1 2021: 7,032)
GROWTH ● Total revenue increased 17% to ZAR626
million (Q1 2021: ZAR535 million) ● Total revenue
increased 22% on a constant currency basis
● Subscription revenue increased 15% to ZAR606
million (Q1 2021: ZAR526 million) ● Subscription
revenue increased 20% on a constant currency basis
● Subscription annualized recurring revenue
(“ARR”), a non-IFRS measure, increased 18% to ZAR2,491 million as
at May 2021 (May 2020: ZAR2,106 million)
Karooooo achieved excellent revenue growth of
17% in the first quarter of 2022. The South African Rand (“ZAR”)
significantly strengthened against the basket of currencies in
which Karooooo operates. Subscription revenue growth was driven by
Karooooo’s robust business model that delivered 21% growth in the
number of subscribers to 1,366,470. On a constant currency basis
revenue grew 22% and subscription revenue by 20%. The ZAR
appreciated by 19% against the US Dollar (“USD”) and on average 16%
compared to the rest of the group’s operating currencies.
New customer additions contributed significantly
to the first quarter 2022 net increase of 60,470 in subscribers
(vehicles or other mobile assets on our platform), meaningfully
higher than the first quarter of 2021 where subscribers increased
by 7,032. Sales and marketing basic salaries and marketing costs
are a major component of the cost of acquiring new customers and
are not expensed over the expected life span of a customer, but
rather expensed when incurred. This component of operating
expenditure was significantly higher by ZAR37 million in this
quarter compared to the first quarter of 2021 and we believe the
negative effect on operating profit in this quarter places us well
for future margin expansion.
Operating expenditure related to sales and
marketing increased 71% in the first quarter of 2022 as the group
continues to enhance its vertically integrated sales and marketing
teams and drive customer acquisition. R&D operating expenditure
increased 44% compared to the first quarter of 2021, supporting the
continued enrichment and expansion of our SaaS platform. General
and administration expenditure increased 21% compared to the first
quarter of 2021.
The group delivered operating profit of ZAR168
million (Q1 2021: ZAR182 million) and Adjusted EBITDA, a non-IFRS
measure, of ZAR275 million (Q1 2021: ZAR 266 million) for the first
quarter of 2022, an 8% decrease and 3% increase respectively,
compared to the first quarter of 2021. In line with our growth
plans for this financial year, the Adjusted EBITDA margin, a
non-IFRS measure, dropped to 44% compared to 50% in the first
quarter of 2021.
First Quarter 2022 Financial
Overview
Subscription Revenue and Total Revenue
Total revenue increased 17% to ZAR626 million.
Karooooo has high revenue visibility with subscription revenue
accounting for 97% of total revenue in the first quarter of 2022.
Subscription revenue increased 15% to ZAR606 million driven by 21%
growth in the number of subscribers to 1,366,470 compared to the
first quarter of 2021. Subscription ARR increased 18% to ZAR2,491
million in May 2021, compared to ZAR2,106 million in May 2020. In
USD, subscription ARR increased 51% (USD181.2 million in May 2021,
compared to USD119.7 million in May 2020), driven in part by rand
appreciation with the ZAR to USD exchange rate of ZAR13.75 at the
end of May 2021 compared to ZAR17.60 at the end of May 2020.
Operating Expenses
As planned, operating expenses increased 38% to
ZAR250 million compared to the first quarter of 2021 in preparation
for future growth with a significant recruitment drive focused
mainly on sales, customer experience and R&D.
● Sales and marketing expenses
as a percentage of subscription revenue increased to 14.6% compared
to 9.9% in the first quarter of 2021.
● R&D expenses as a
percentage of subscription revenue increased to 5.4% compared to
4.3% in the first quarter of 2021.
● General and administration
expenses as a percentage of subscription revenue increased
marginally to 21.2% compared to 20.2% in the first quarter of
2021.
Operating Profit, Adjusted Profit and Adjusted
Earnings per Share
The group delivered operating profit of ZAR168
million for the period (Q1 2021: ZAR182 million), 8% lower than the
first quarter of 2021. Customer acquisitions, resulting in net
subscriber additions of 60,470 during the quarter, were
meaningfully higher compared to the first quarter of 2021 in which
the net subscriber additions were 7,032. The significant increase
in net subscriber additions provides context to the increased
investment in sales and marketing expenditure which takes
approximately 6 months to translate into customer acquisition.
While the investment into sales and marketing headcount has
materialized in part, management expects to see the full benefit
thereof, via growth in customer acquisition, by the end of the
fourth quarter of 2022. Adjusted profit, a non-IFRS
measure, decreased 11% to ZAR118 million partially due to the
higher effective tax rate of 31% in the first quarter of 2022
compared to 27% in 2021, primarily attributable to once-off IPO
costs that are not tax deductible. The ZAR10 million difference
between adjusted profit and profit relates to once-off IPO costs
expensed during the quarter. Similarly adjusted earnings per share,
a non-IFRS measure, decreased 10% to ZAR3.90 in the first quarter
of 2022 compared to ZAR4.32 in the first quarter of 2021.
The total IPO costs (including underwriters
fees) have amounted to ZAR85 million of which ZAR36 million has
been expensed (ZAR26 million in the fourth quarter of 2021 and
ZAR10 million in the first quarter of 2022) and ZAR49 million has
been set-off against share capital.
Adjusted EBITDA and Adjusted EBITDA margin
Adjusted EBITDA, a non-IFRS measure, increased
3% to ZAR275 million. The Adjusted EBITDA margin, a non-IFRS
measure, margin was 44% for the first quarter of 2022 compared to
50% in the first quarter of 2021, attributable to higher operating
expenses as Karooooo invests for future growth. Management expects
Adjusted EBITDA margin to revert to levels of more than 45% for the
full financial year.
Management’s Assessment of
Subscriber Unit
Economics
ARPU
ARPU measures the monetization of Karooooo’s
SaaS platform and is an indicator of pricing efficiency,
competitiveness and market positioning. It is calculated on a
quarterly basis by dividing the cumulative subscription revenue for
the quarter by the average of the opening subscriber balance at the
beginning of the quarter and closing subscriber balance at the end
of the quarter and dividing this by three.
The group’s ARPU of ZAR151 for the first quarter
of 2022 was marginally lower than ZAR155 for first quarter of 2021
largely as result of the recent strength of the ZAR against our
regional operating currencies and the COVID-19 related support to
loyal customers. The group’s ARPU has been fairly consistent since
inception more than 15 years ago and management believes that ARPU
at these levels provides attractive margins and sustainable growth
in most countries.
Cost of Acquiring a Subscriber
The cost of acquiring a subscriber (vehicles or
other mobile assets on our platform) includes the cost of the
telematics device together with any labor related costs for our
automotive technicians and the cost of the direct sales commission.
Karooooo’s low cost of subscriber acquisition benefits from its
vertically integrated business model, which allows it to control
service levels, costs, improve efficiencies and be in direct
contact with customers instead of relying on third parties.
Management’s assessment of the cost of acquiring
a subscriber for the first quarter of 2022 was ZAR2,005 compared to
ZAR2,636 for the first quarter of 2021, a 24% improvement due to
the lower relative cost of Karooooo’s next-generation telematics
devices and the increased efficiency of its sales team.
Subscriber Contract Life Cycle
The average life cycle of a subscriber is an
important indicator of the group’s ability to drive margin
expansion. Based upon its latest internal actuarial assessment, the
estimated average useful life of a subscriber contract is 60
months. When customers hold their vehicles on Karooooo’s SaaS
platform for longer than 60 months, subscription revenue gross
profit margins improve further.
|
|
|
|
QUARTER ONE |
|
|
|
|
|
2022 |
|
|
2021 |
|
|
|
|
|
|
|
|
|
|
Average revenue per subscriber
per month (“ARPU”) |
|
ZAR |
|
|
151 |
|
|
|
155 |
|
Subscriber contract life
cycle |
|
Months |
|
|
60 |
|
|
|
60 |
|
Management’s assessment of
cost of acquiring a subscriber |
|
ZAR |
|
|
2,005 |
|
|
|
2,636 |
|
Sales commission and
telematics devices (Capitalized) |
|
ZAR |
|
|
1,489 |
|
|
|
1,624 |
|
Sales and marketing operating
expenses (Non-capitalized) |
|
ZAR |
|
|
516 |
|
|
|
1,012 |
|
Subscription revenue gross
profit margin |
|
Percentage |
|
|
72 |
% |
|
|
74 |
% |
Life cycle contribution per
subscriber1 |
|
ZAR |
|
|
6,523 |
|
|
|
6,882 |
|
1.ARPU multiplied by the contract life cycle
months, multiplied by the subscription revenue gross margin
percentage which is defined as subscription revenue divided by
gross profit.
Outlook
Karooooo has a history of consistent organic
growth, scalability, strong earnings and financial discipline. The
company has been highly cash generative with most of its revenues
recurring in nature and has operated with high operating and EBITDA
margins.
Operating in a growing and materially
underpenetrated global automotive market coupled with a growing
vehicle parc and the trend of customers seeking digitalized
software solutions to address higher operating costs, unproductive
use of resources and inefficient workflows, we believe Karooooo
remains well positioned for growth. The group offers a key “must
have” service to its customers, driving efficiency through a
powerful and differentiated digital platform that is feature-rich
and vertically integrated.
Karooooo has multiple levers for expansion and
continues to enhance and optimize the Cartrack platform for the
evolving future of mobility to drive sustained profitable growth,
supported and enhanced by its unleveraged balance sheet and strong
cash position.
As a result of the numerous uncertainties
associated with the ongoing impact of COVID-19, it is difficult to
provide guidance with certainty. However, Karooooo’s growth
expectation ranges for full year 2022 compared to full year 2021
remain unchanged to what was reported previously in the results
announcement on May 6, 2021. Management expects the following
ranges for full year 2022:
● Number of subscribers between
1,500,000 and 1,600,000
● Subscription revenue between
ZAR2.5 billion and ZAR 2.7 billion
● Adjusted EBITDA margin
between 45% and 50%
Actual results may differ materially from
Karooooo’s Financial Outlook as a result of the pandemic and
exchange rate fluctuations, among other factors described under
“Forward-Looking Statements” below.
Balance Sheet,
Liquidity and cash flow
Karooooo has a robust balance sheet with ample
capacity to fund organic growth and remains disciplined in its
approach to capital allocation and cash management. Notwithstanding
the significant and continuing investment in research, operations
and distribution Karooooo has remained highly cash generative with
a strong cash flow targets for the foreseeable future:
● Karooooo’s highly cash
generative business model resulted in cash generated from
operations of ZAR224 million compared to ZAR187 million reported
for the first quarter of 2021.
● The group generated Free Cash
Flow, a non-IFRS measure, of ZAR106 million for the first quarter
of 2022 compared to ZAR121 million in the first quarter of
2021.
● After the group paid a
dividend of ZAR253 million in FY21 Q3 and the corporate
reorganization and listing in FY22 Q1 raising net proceeds of R396
million, Karooooo ended the quarter with ZAR554 million in cash and
cash equivalents, significantly higher compared to ZAR246 million
at the end of the first quarter of 2021.
● The group has a ZAR925
million unutilized bank facility with The Standard Bank of South
Africa Limited should it be required for strategic growth
initiatives or other general corporate purposes
Karooooo’s paid-up share capital of ZAR7.1
billion consists of 20,332,894 shares comprising 1,000 Singaporean
dollars plus USD194,242,000 and a further issuance in April 2021 of
10,618,212 shares accounting for an additional USD311,714,659 in
paid-up share capital.
The negative reserve of ZAR5.4 billion comprises ZAR1.3 billion
of retained earnings less the common control reserve of ZAR2.7
billion plus ZAR4.0 billion relating to the buyout of 95,350,657
Cartrack shares at ZAR42.00 per share from minorities and ZAR44
million in the foreign currency translation reserve.
First Quarter 2022 Segmental
Overview
South Africa
During the pandemic, Karooooo focused and
leveraged its strong position and well-established national
distribution network in South Africa which enabled solid growth in
the quarter, contributing to Karooooo’s robust financial
performance.
Revenue and subscription revenue in South Africa
increased 28% and 25% respectively, compared to the first quarter
of 2021. Subscription revenue earned in South Africa remains the
main contributor to the group’s total subscription revenue
accounting for more than 70% thereof in the first quarter of 2022.
This result is encouraging and corroborates management’s strategic
decision to invest for future growth.
At the end of the first quarter of 2022, South
Africa had 1,064,005 subscribers, up 23% compared to the first
quarter of 2021.
Based on our estimates, we are the largest and
fastest growing enterprise mobility SaaS provider for commercial
fleets in South Africa.
With South Africa officially in its third wave
of COVID-19 infections and the social unrest situation experienced
in some parts of the country last week, management remains focused
on navigating the operating environment in the second quarter of
2022.
Asia Pacific, Middle East and United States
Asia Pacific is the second largest revenue
contributor and we believe presents the greatest potential in the
medium to long term as markets remain considerably underpenetrated
due to fragmented market participants delivering entry-level
offerings. During the first quarter of 2022 Asia experienced
increased lock down restrictions with less travel given the new
COVID-19 variants prevailing in this market. When these
restrictions ease, management expects accelerating growth in the
Asia segment. Asia is an attractive market given its size, low
penetration, and favorable competitive environment. The highly
fragmented market offers a meaningful opportunity for Karooooo to
capture market share. Preparing for beyond the pandemic, we
significantly increased our headcount by 157 employees in the last
three quarters in Southeast Asia.
On a constant currency basis revenue in this
region increased 10% compared to the first quarter of 2021, even in
the context of ongoing COVID-19 related impacts in the Asia Pacific
markets driven by the 17% increase in the number of net subscribers
to 124,617 in the first quarter of 2022. Revenue growth reported in
ZAR was negatively impacted by the ZAR strengthening significantly
and discounts allowed to loyal customers which remain affected by
the pandemic, resulting in a 7% decrease in revenue compared to the
first quarter of 2021.
The group’s strategic office in the United
States continues to yield many key insights that have positively
contributed to the group.
Europe
The European segment delivered subscription
revenue growth of 14% on a constant currency basis which
corresponds to the net subscriber growth of 14%. This result was
offset by currency headwinds with the ZAR strengthening
significantly against the EURO, with revenue earned unchanged
compared to the first quarter of 2021. Karooooo’s intended
expansion strategy in Europe remains encouraging and it now has
114,767 subscribers in Europe. Looking ahead, the opportunity to
add new enterprise customers in Europe appears promising as
increased economic activity following the pandemic is expected.
Africa (excluding South Africa)
This segment remains a positive cash generator
and is strategic to Karooooo’s operations in Southern Africa. The
number of subscribers increased 5% to 63,081 however revenue
decreased 10% on a constant currency basis. The effects of the
pandemic in this region lagged that of other regions and
deteriorated further during the first quarter of 2022. The group’s
results in Africa continue to be impacted by the discounts allowed
to loyal customers who remain severely affected by the
pandemic.
Change to the Board of directors
of Karooooo
(“Board”)
Mrs Siew Koon Ong (Mrs Siew Koon Lim) has been
appointed as an independent non-executive director to the Board and
member of the Audit and Risk Committee with immediate effect.
Siew Koon Ong (Siew Koon Lim) holds a
Bachelor of Accountancy degree from the National University of
Singapore and is a Chartered Accountant and fellow member of the
Institute of Singapore Chartered Accountants.
Siew Koon has 37 years of experience in
providing audit and business advisory services to local companies
as well as major public listed companies in a wide range of
industries, including banks. She has led initial public offerings
of companies in the retail and lifestyle, manufacturing,
construction and property development industries.
She joined Ernst & Young LLP (then known as
Ernst & Whinney) in April 1982 and was a partner of the firm
from July 1998 to June 2019, acting as Chief Financial Officer
(CFO) for a period of 3 years with the responsibility for the
firm’s financial and management accounts. Currently, she is an
independent director of Nanofilm Technologies International
Limited, which is listed on the Mainboard of the SGX, serving as
the Lead Independent Director and Chairperson of the Audit
Committee and member of the Risk Committee and Nominating
Committee.
In addition to Siew Koon’s global financial
expertise and deep understanding of regulatory and technical
compliance in a listed environment, her extensive local knowledge
and experience would be of much value to the Board.
Commenting on this appointment Zak
Calisto, CEO and Founder of Karooooo
said, “Siew Koon is the consummate professional with many years of
exposure to international businesses and financial reporting. Apart
from her obvious technical and leadership skills, her experience in
the ever-evolving environmental, social and governance milieu would
add immense support to Karooooo.”
Conference Call Information
Karooooo management will host a conference call and audio
webcast on Tuesday July 20, 2021 at 8:00 a.m. (Eastern Daylight
Time), 2:00 p.m. (South African Time) and 8:00 p.m. (Singaporean
Time) to discuss the group’s financial results and current business
outlook.
Webcast: Registration is
available at https://edge.media-server.com/mmc/p/knmvwv59. A live
and archived webcast of the conference call will also be available
on the Investors section of the Company’s website at
www.karooooo.com.
Conference call: Listeners may
access the live conference call by dialing the following numbers
and are advised to dial in approximately 10 minutes prior to the
start of the call:
United States Toll Free: 1 844 760
0770International: +65 671 353 30Singapore Toll Free:
800 616 2392South Africa Toll Free: 0800 999 946United Kingdom
Toll Free: 0800 051 4241
Access Code: 8473126
IFRS Accounting
We prepare our consolidated financial statements
in accordance with IFRS as issued by the IASB. The summary
consolidated financial information presented has been derived from
the consolidated financial statements of Karooooo.
About
Karooooo
Karooooo, headquartered in Singapore, is a
leading global provider of a mobility SaaS platform that maximizes
the value of automotive and workflow data by providing real-time
data analytics solutions for smart transportation to over 1.375
million connected vehicles. The Cartrack (wholly owned by Karooooo)
SaaS platform, provides customers with differentiated insights and
data analytics to optimize their business and workforce, increase
efficiency, decrease costs, improve safety, monitor environmental
impact, assist with regulatory compliance and manage risk. As
of May 2021, there were over 75,000 commercial customers using the
Cartrack platform. For more information, visit www.karooooo.com
Investor Relations Contact |
Media Contact |
IR@karooooo.com |
media@karooooo.com |
+27 84 512 5393 |
|
KAROOOOO LTD.
CONSOLIDATED STATEMENT OF PROFIT AND
LOSS(UNAUDITED)
|
|
QUARTER ONE |
|
|
|
2022 |
|
|
2021 |
|
|
|
(ZAR Thousands) |
|
|
|
|
|
Revenue |
|
|
626,193 |
|
|
|
534,991 |
|
Cost of sales |
|
|
(182,341 |
) |
|
|
(144,807 |
) |
Gross
profit |
|
|
443,852 |
|
|
|
390,184 |
|
Other income |
|
|
785 |
|
|
|
178 |
|
Expected credit losses on
financial assets |
|
|
(26,404 |
) |
|
|
(27,330 |
) |
Operating
expenses |
|
|
(250,109 |
) |
|
|
(180,762 |
) |
Sales and marketing |
|
|
(88,693 |
) |
|
|
(51,852 |
) |
General and administration |
|
|
(128,675 |
) |
|
|
(106,232 |
) |
Research and development |
|
|
(32,741 |
) |
|
|
(22,678 |
) |
Operating
profit |
|
|
168,124 |
|
|
|
182,270 |
|
Initial public offering costs
(“IPO”) |
|
|
(10,288 |
) |
|
|
- |
|
Finance income |
|
|
712 |
|
|
|
1,443 |
|
Finance costs |
|
|
(1,891 |
) |
|
|
(1,577 |
) |
Profit before
taxation |
|
|
156,657 |
|
|
|
182,136 |
|
Taxation |
|
|
(48,742 |
) |
|
|
(49,279 |
) |
Profit for the
period |
|
|
107,915 |
|
|
|
132,857 |
|
|
|
|
|
|
|
|
|
|
Profit attributable
to: |
|
|
|
|
|
|
|
|
Owners of the parent |
|
|
88,275 |
|
|
|
87,741 |
|
Non-controlling interest |
|
|
19,640 |
|
|
|
45,116 |
|
|
|
|
107,915 |
|
|
|
132,857 |
|
|
|
|
|
|
|
|
|
|
Earnings per
share |
|
|
|
|
|
|
|
|
Basic and diluted earnings per
share (ZAR) |
|
|
3.49 |
|
|
|
4.32 |
|
|
|
|
|
|
|
|
|
|
Adjusted Earnings per
share (a non-IFRS measure) |
|
|
|
|
|
|
|
|
Adjusted Basic and diluted
earnings per share (ZAR) (a non-IFRS measure) |
|
|
3.90 |
|
|
|
4.32 |
|
KAROOOOO LTD.
RECONCILIATION OF PROFIT TO ADJUSTED PROFIT (A NON-IFRS
MEASURE) (UNAUDITED)
|
|
QUARTER ONE |
|
|
|
2022 |
|
|
2021 |
|
|
|
(ZAR Thousands) |
|
Profit for the
period |
|
|
107,915 |
|
|
|
132,857 |
|
IPO costs |
|
|
10,288 |
|
|
|
- |
|
Adjusted
profit (a non-IFRS measure) |
|
|
118,203 |
|
|
|
132,857 |
|
KAROOOOO
LTD.CONSOLIDATED STATEMENT OF FINANCIAL
POSITION (UNAUDITED)
|
|
AS OFMAY
31,2021 |
|
|
AS OFFEBRUARY
28,2021 |
|
|
AS OFMAY
31,2020 |
|
ASSETS |
|
(ZAR Thousands) |
|
Non-current
assets |
|
|
|
|
|
|
|
|
|
|
|
|
Goodwill |
|
|
127,694 |
|
|
|
124,152 |
|
|
|
143,326 |
|
Intangible assets |
|
|
57,389 |
|
|
|
59,339 |
|
|
|
46,774 |
|
Property, plant and
equipment |
|
|
1,164,674 |
|
|
|
1,137,192 |
|
|
|
1,070,443 |
|
Capitalized commission
assets |
|
|
213,564 |
|
|
|
201,075 |
|
|
|
152,095 |
|
Deferred tax assets |
|
|
44,191 |
|
|
|
47,046 |
|
|
|
55,931 |
|
Loans to related parties |
|
|
19,400 |
|
|
|
19,400 |
|
|
|
11,000 |
|
Long-term prepayment |
|
|
11,472 |
|
|
|
- |
|
|
|
- |
|
Total non-current
assets |
|
|
1,638,384 |
|
|
|
1,588,204 |
|
|
|
1,479,569 |
|
Current
assets |
|
|
|
|
|
|
|
|
|
|
|
|
Inventories |
|
|
2,616 |
|
|
|
- |
|
|
|
- |
|
Trade and other receivables
and prepayments |
|
|
321,841 |
|
|
|
324,170 |
|
|
|
319,341 |
|
Taxation |
|
|
4,190 |
|
|
|
15,412 |
|
|
|
5,176 |
|
Cash and cash equivalents |
|
|
553,584 |
|
|
|
104,937 |
|
|
|
245,596 |
|
Other financial asset |
|
|
- |
|
|
|
882,420 |
|
|
|
|
|
Total current
assets |
|
|
882,231 |
|
|
|
1,326,939 |
|
|
|
570,113 |
|
Total
assets |
|
|
2,520,615 |
|
|
|
2,915,143 |
|
|
|
2,049,682 |
|
EQUITY AND
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
|
|
|
|
|
|
|
|
|
|
|
|
Share capital |
|
|
7,142,853 |
|
|
|
2,739,629 |
|
|
|
10 |
|
Reserves |
|
|
(5,440,302 |
) |
|
|
(1,884,316 |
) |
|
|
1,001,261 |
|
Equity attributable to
equity holders of parent |
|
|
1,702,551 |
|
|
|
855,313 |
|
|
|
1,001,271 |
|
Non-controlling interest |
|
|
18,057 |
|
|
|
427,133 |
|
|
|
405,756 |
|
Total
equity |
|
|
1,720,608 |
|
|
|
1,282,446 |
|
|
|
1,407,027 |
|
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
Term loans |
|
|
9,670 |
|
|
|
10,468 |
|
|
|
17,021 |
|
Lease liabilities |
|
|
69,914 |
|
|
|
60,283 |
|
|
|
63,764 |
|
Deferred revenue |
|
|
73,921 |
|
|
|
85,655 |
|
|
|
54,866 |
|
Deferred tax liabilities |
|
|
39,020 |
|
|
|
42,024 |
|
|
|
43,387 |
|
Total non-current
liabilities |
|
|
192,525 |
|
|
|
198,430 |
|
|
|
179,038 |
|
Current
liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
Term loans |
|
|
3,784 |
|
|
|
5,462 |
|
|
|
4,464 |
|
Trade and other payables |
|
|
297,646 |
|
|
|
281,882 |
|
|
|
176,074 |
|
Loans from related
parties |
|
|
6,578 |
|
|
|
891,977 |
|
|
|
8,891 |
|
Lease liabilities |
|
|
36,677 |
|
|
|
38,401 |
|
|
|
45,520 |
|
Taxation |
|
|
67,039 |
|
|
|
25,615 |
|
|
|
59,460 |
|
Provision for warranties |
|
|
2,057 |
|
|
|
981 |
|
|
|
1,565 |
|
Deferred revenue |
|
|
193,701 |
|
|
|
161,110 |
|
|
|
167,643 |
|
Bank overdraft |
|
|
- |
|
|
|
28,839 |
|
|
|
- |
|
Total current
liabilities |
|
|
607,482 |
|
|
|
1,434,267 |
|
|
|
463,617 |
|
Total
liabilities |
|
|
800,007 |
|
|
|
1,632,697 |
|
|
|
642,655 |
|
Total equity and
liabilities |
|
|
2,520,615 |
|
|
|
2,915,143 |
|
|
|
2,049,682 |
|
KAROOOOO LTD. CONDENSED
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
|
|
QUARTER ONE |
|
|
|
2022 |
|
|
2021 |
|
|
|
(ZAR Thousands) |
|
|
|
|
|
|
|
|
Net cash flows from operating
activities |
|
|
223,822 |
|
|
|
187,846 |
|
Net cash flows utilized by
investing activities |
|
|
(127,030 |
) |
|
|
(76,194 |
) |
Net cash flows from/(utilized
by) financing activities1 |
|
|
400,944 |
|
|
|
(19,067 |
) |
Net cash and cash equivalents
movements for the quarter |
|
|
497,736 |
|
|
|
92,585 |
|
Cash and cash equivalents as
at the beginning of the quarter |
|
|
76,098 |
|
|
|
146,591 |
|
Translation differences on
cash and cash equivalents |
|
|
(20,250 |
) |
|
|
6,420 |
|
Total cash and cash
equivalents at the end of the quarter |
|
|
553,584 |
|
|
|
245,596 |
|
1. Including net proceeds of the corporate action in April 2021
R396 million
KAROOOOO LTD.
RECONCILIATION OF PROFIT FOR THE QUARTER TO ADJUSTED EBITDA
(A NON-IFRS MEASURE) (UNAUDITED)
|
|
QUARTER ONE |
|
|
|
2022 |
|
|
2021 |
|
|
|
(ZAR Thousands) |
|
Profit for the
quarter |
|
|
107,915 |
|
|
|
132,857 |
|
Finance income |
|
|
(712 |
) |
|
|
(1,443 |
) |
Finance costs |
|
|
1,891 |
|
|
|
1,577 |
|
Taxation |
|
|
48,742 |
|
|
|
49,279 |
|
Depreciation
of property, plant and equipment and amortization of
intangible assets |
|
|
107,005 |
|
|
|
84,161 |
|
IPO costs |
|
|
10,288 |
|
|
|
- |
|
Adjusted
EBITDA (a non-IFRS measure) |
|
|
275,129 |
|
|
|
266,431 |
|
KAROOOOO LTD.
RECONCILIATION OF FREE CASH FLOW (A NON-IFRS
MEASURE) (UNAUDITED)
|
|
QUARTER ONE |
|
|
|
2022 |
|
|
2021 |
|
|
|
(ZAR Thousands) |
|
Net cash generated from
operating activities |
|
|
223,822 |
|
|
|
187,846 |
|
Less: purchase of property,
plant and equipment |
|
|
(118,163 |
) |
|
|
(66,589 |
) |
Free Cash
Flow (a non-IFRS measure) |
|
|
105,659 |
|
|
|
121,257 |
|
KAROOOOO LTD.
RECONCILIATION OF BASIC AND DILUTED EARNINGS AND ADJUSTED
EARNINGS PER SHARE (A NON-IFRS MEASURE)
(UNAUDITED)
|
|
QUARTER ONE |
|
|
|
2022 |
|
|
2021 |
|
|
|
(ZAR Thousands) |
|
Basic and diluted
earnings per share |
|
|
|
|
|
|
|
|
The calculation of basic and
diluted earnings per share has been based on the profit
attributable to ordinary shareholders and the weighted average
number of ordinary shares in issue. |
|
|
|
|
|
|
|
|
Basic and diluted
earnings per share |
|
|
|
|
|
|
|
|
Basic and diluted earnings per
share (ZAR) |
|
|
3.49 |
|
|
|
4.32 |
|
Weighted average number of
ordinary shares in issue at period end (000’s) |
|
|
25,305 |
|
|
|
20,333 |
|
|
|
|
25,305 |
|
|
|
20,333 |
|
Basic
earnings |
|
|
|
|
|
|
|
|
Profit attributable to
ordinary shareholders |
|
|
88,275 |
|
|
|
87,741 |
|
|
|
|
|
|
|
|
|
|
Profit attributable to
ordinary shareholders |
|
|
88,275 |
|
|
|
87,741 |
|
|
|
|
|
|
|
|
|
|
Adjusted basic and
diluted earnings per share (a non-IFRS measure) |
|
|
|
|
|
|
|
|
The calculation of adjusted
basic and diluted earnings per share (a non-IFRS measure) has been
based on the adjusted profit attributable to ordinary shareholders
(a non-IFRS measure) and the weighted average number of ordinary
shares in issue. |
|
|
|
|
|
|
|
|
Adjusted basic and
diluted earnings per share (a
non-IFRS measure) |
|
|
|
|
|
|
|
|
Adjusted basic and diluted
earnings per share (ZAR) (a non-IFRS measure) |
|
|
3.90 |
|
|
|
4.32 |
|
Weighted average number of
ordinary shares in issue at period end (000’s) |
|
|
25,305 |
|
|
|
20,333 |
|
|
|
|
25,305 |
|
|
|
20,333 |
|
Reconciliation between
basic earnings and adjusted earnings (a non-IFRS
measure) |
|
|
|
|
|
|
|
|
Profit attributable to
ordinary shareholders |
|
|
88,275 |
|
|
|
87,741 |
|
Adjust
for |
|
|
|
|
|
|
|
|
IPO costs |
|
|
10,288 |
|
|
|
- |
|
Tax effect on above |
|
|
- |
|
|
|
- |
|
Adjusted profit
attributable to ordinary shareholders (a non-IFRS
measure) |
|
|
98,563 |
|
|
|
87,741 |
|
Definitions
Adjusted Profit
Adjusted profit, a non-IFRS measure, is defined
as, profit after tax defined by IFRS excluding the impact of
non-recurring operational expenses relating to IPO costs of ZAR10
million expensed in the first quarter of 2022.
Adjusted Earnings per Share
Adjusted earnings per share, a non-IFRS measure,
is defined as, earnings per share defined by IFRS excluding the
impact of non-recurring operational expenses relating to IPO costs
of ZAR10 million expensed in the first quarter of 2022.
Adjusted EBITDA
We define Adjusted EBITDA, a non-IFRS measure,
as profit less finance income, plus finance costs, taxation,
depreciation and amortization, plus once-off IPO costs. In addition
to our results determined in accordance with IFRS, we believe
Adjusted EBITDA, a non-IFRS measure, is useful in evaluating our
operating performance. We use Adjusted EBITDA in our operational
and financial decision-making and believe Adjusted EBITDA is useful
to investors because similar measures are frequently used by
securities analysts, investors, ratings agencies and other
interested parties to evaluate our competitors and to measure
profitability. However, non-IFRS financial information is presented
for supplemental informational purposes only, has limitations as an
analytical tool and should not be considered in isolation or as a
substitute for financial information presented in accordance with
IFRS. Investors are encouraged to review the related IFRS financial
measure and the reconciliation of Adjusted EBITDA to profit, its
most directly comparable IFRS financial measure, and not to rely on
any single financial measure to evaluate our business.
Adjusted EBITDA Margin
We define Adjusted EBITDA Margin, a non-IFRS
measure, as Adjusted EBITDA divided by revenue. In addition to our
results determined in accordance with IFRS, we believe Adjusted
EBITDA Margin, a non-IFRS measure, is useful in evaluating our
operating performance. We use Adjusted EBITDA Margin in our
operational and financial decision-making and believe Adjusted
EBITDA Margin is useful to investors because similar measures are
frequently used by securities analysts, investors, ratings agencies
and other interested parties to evaluate our competitors and to
measure profitability. However, non-IFRS financial information is
presented for supplemental informational purposes only, has
limitations as an analytical tool and should not be considered in
isolation or as a substitute for financial information presented in
accordance with IFRS.
Annualized Recurring Revenue (ARR)
ARR, a non-IFRS measure, is defined as the annual run-rate
subscription revenue of subscription agreements from all customers
at a point in time, calculated by taking the monthly subscription
revenue for all customers during that month and multiplying by
twelve.
Average Revenue per Subscriber per month
(ARPU)
ARPU, a non-IFRS measure, is calculated on a
quarterly basis by dividing the cumulative subscription revenue for
the quarter by the average of the opening subscriber balance at the
beginning of the quarter and closing subscriber balance at the end
of the quarter and dividing this by three.
Earnings per share
Basic earnings per share in accordance with
IFRS.
Free Cash Flow
We define Free Cash Flow, a non-IFRS measure, as
net cash generated from operating activities less purchases of
property, plant and equipment. Free Cash Flow margin is calculated
as Free Cash Flow divided by revenue. In addition to our results
determined in accordance with IFRS, we believe Free Cash Flow and
Free Cash Flow margin, which are non-IFRS measures, are useful in
evaluating our operating performance. We believe that Free Cash
Flow and Free Cash Flow margin are useful indicators of liquidity
and the ability of the company to turn revenues into Free Cash
Flow, respectively, that provide information to management and
investors about the amount of cash generated from our operations
that, after the investments in property and equipment and
capitalized internal-use software, can be used for strategic
initiatives, including investing in our business, and strengthening
our financial position. However, non-IFRS financial information is
presented for supplemental informational purposes only, has
limitations as an analytical tool and should not be considered in
isolation or as a substitute for financial information presented in
accordance with IFRS. Investors are encouraged to review the
related IFRS financial measure and the reconciliation of Free Cash
Flow and Free Cash Flow margin to net cash generated operating
activities and net cash generated from operating activities as a
percentage of revenue, their most directly comparable IFRS
financial measure, and not to rely on any single financial measure
to evaluate our business.
Forward-Looking Statements
This press release (which includes any oral
statements made in connection therewith, as applicable) includes
“forward-looking statements.” Forward-looking statements are based
on our beliefs and assumptions and on information currently
available to us, and include, without limitation, statements
regarding our business, financial condition, strategy, results of
operations, certain of our plans, objectives, assumptions,
expectations, prospects and beliefs and statements regarding other
future events or prospects. Forward-looking statements include all
statements that are not historical facts and can be identified by
the use of forward-looking terminology such as the words “believe,”
“expect,” “plan,” “intend,” “seek,” “anticipate,” “estimate,”
“predict,” “potential,” “assume,” “continue,” “may,” “will,”
“should,” “could,” “shall,” “risk” or the negative of these terms
or similar expressions that are predictions of or indicate future
events and future trends.
By their nature, forward-looking statements
involve risks and uncertainties because they relate to events and
depend on circumstances that may or may not occur in the future. We
caution you that forward-looking statements are not guarantees of
future performance and that our actual results of operations,
financial condition and liquidity, the development of the industry
in which we operate and the effect of acquisitions on us may differ
materially from those made in or suggested by the forward-looking
statements contained in this press release. In addition, even if
our results of operations, financial condition and liquidity, the
development of the industry in which we operate and the effect of
acquisitions on us are consistent with the forward-looking
statements contained in this press release, those results or
developments may not be indicative of results or developments in
subsequent periods.
Important factors that could cause actual
results, performance or achievements to differ materially from
those expressed or implied by these forward-looking statements are
disclosed under the “Risk Factors” and “Cautionary Statement
Regarding Forward-Looking Statements” sections of the Annual Report
on Form 20-F filed on June 28, 2021.
You are cautioned not to place undue reliance on
any forward-looking statements, which speak only as of the date of
this press release. We disclaim any duty to update and do not
intend to update any forward-looking statements, all of which are
expressly qualified by the statements in this section, to reflect
events or circumstances after the date of this press release.
Non-IFRS Financial Measures
This press release includes certain non-IFRS
financial measures, including Adjusted Profit, Adjusted EBITDA,
Adjusted EBITDA margin, adjusted earnings per share, Annualized
Recurring Revenue, Average Revenue per Subscriber per month, Free
Cash Flow and Free Cash Flow margin. These non-IFRS financial
measures are not measures of financial performance in accordance
with IFRS and may exclude items that are significant in
understanding and assessing our financial results. Therefore, these
measures should not be considered in isolation or as an alternative
or superior to IFRS measures. You should be aware that our
presentation of these measures may not be comparable to
similarly-titled measures used by other companies. Please see the
reconciliations included in this press release.
●
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