Singapore-based Karooooo reported a 3% increase in profit and 24% revenue growth for the first quarter of the 2024 financial year. However, its Carzuka business made a loss of R12.06 million.
Karooooo recently published its first-quarter results for the 3 months ended 31 May 2023, which showed significant revenue and subscriber growth.
The company owns 100% of Cartrack, 100% of Carzuka and 70.1% of Karooooo Logistics.
In Q1 2024, Karooooo’s revenue grew 24% to R997 million. Subscription revenue grew 18% to R836 million.
In South Africa, the company saw its subscribers increase by 13% to 1,339,905, translating into 10% subscriber revenue growth.
In the Asia Pacific, Middle East and United States, Karooooo saw subscriber growth of 24% to 193,557, which led to subscription revenue growth of 53%.
The company’s earnings per share also increased to R5.09 for Q1 2024 from R4.96 in Q1 2023.
Free cash flow for Q1 2024 increased 39% to R158 million from R113 million in Q4 2023.
The company declared a record cash dividend of US$ 26.3 million – or US$0.85 per share.
Karooooo’s most profitable segment was its Cartrack business, which grew its operating profit by 5% year-on-year to R231.90 million.
KarooLogistics went from a R93,000 loss in Q1 2023 to an operating profit of R4.53 million in Q1 2024.
However, Carzuka made an operating loss of R12 million, a significant drop from the R4 million operating loss the business made in Q1 2023.
Karooooo attributed this loss to its investment in “infrastructure and brand building”.
“We continue to exercise caution and pragmatism as we invest to grow this business. We consider this an asset-light investment, given the returns we expect once Carzuka exceeds R300 million in quarterly revenue,” it said.