Karooooo, the JSE-listed multinational with an outstanding 15% average earnings growth over 10 years, is optimistic about its prospects in South Africa, both in capturing market share and in growing new market, chief executive Zak Calisto said yesterday.
The founder of the vehicle tracking and asset management company said in an interview that the group, which also has fast-growing operations in Asia-Pacific, Europe and the rest of Africa, had invested R450 million in infrastructure in the past year in South Africa.
“We believe this country is a great destination to invest in. We have about 40% of the South African market, and we believe we can grow this,” Calisto said.
They employed about 4 500 people globally, and he expected this might increase by 1 000 by the end of their new financial year to February 2025, of which there would likely be about 600 new employees in the South Africa operations.
The vehicle tracking and asset management company Cartrack’s revenue makes up most of the group’s revenue, and Karooooo management forecast that its number of subscribers would increase to between 2.2 million and 2.4m for the 2025 financial year.
In the fourth quarter to February 29, Cartrack’s subscribers increased by a substantial 15%, to 1.97m. Karooooo’s earnings per share surged by 45% to R6.81 for the fourth quarter.
Geographically, Cartrack’s number of subscribers in South Africa increased 14%, to 1.49m, at February 29, with 14% subscription revenue growth.
A culture that embraced entrepreneurship, innovation and customer-centricity – and a prudent capital allocation strategy focused on sustainable expansion – was driving earnings growth, the group said.
Subsidiary Carzuka boosted earnings per share by R0.16 in the fourth quarter, but it was not expected to impact future operations much, as it was being integrated into Cartrack and “we have taken the punishment” on the business after the decision in the third quarter to reduce Carzuka’s operations as a third party vehicle trading platform, said Calisto.
He said Karooooo Logistics, formerly called Picup, was well positioned to continue to grow at scale across diverse industries.
“We operate in a growing and largely under-penetrated market, with strong demand coming from customers needing to differentiate and digitalise themselves.”
We expect our continuous investment in our AI products, platform and customer experience to continue to generate robust results in the future,” said Calisto.
Karooooo Logistics grew revenue by 65% to R93m and Calisto said they could grow this figure substantially. Karooooo Logistics focuses on delivery-as-a-service (DaaS) through selected third-party. crowd-sourced drivers and logistics companies, and charges per delivery.
Karooooo Logistics’ technology stack was being integrated into the Cartrack platform, so the group could operate off one platform, said Calisto.
In the Asia-Pacific, Middle East and US, Cartrack’s number of subscribers increased 24% to 230 141 during the past year.
Southeast Asia presented the most compelling growth opportunity in the medium to long term.
Europe Cartrack’s number of subscribers increased 16%, to 166 845, at February 29. Leading OEMs had partnered to give their customers access to Cartrack’s platform, seamlessly integrating their connected vehicle data.
BUSINESS REPORT