South African Billionaire Zak Calisto's Karooooo Posts 86.1 Million In Quarterly Revenue

Karooooo Ltd. reported faster growth at its Cartrack telematics unit in the third quarter, saying recurring revenue and subscriber gains picked up as customers added more video and asset tracking services. Cartracks software as a service annualized recurring revenue rose 22 from a year earlier to 5.106 billion rand 311.9 million, using an exchange rate of 16.37 rand to 1. In dollar terms, the company said SaaS ARR grew 28 from a year earlier, underscoring momentum beyond local currency moves this quarter. Subscription revenue increased 20 to 1.236 billion rand 75.5 million, while net subscriber additions climbed 29 to a record 111,478, the company said in an unaudited update. The results suggest Karooooo is finding room to grow even as fleet management and vehicle tracking markets get more crowded, with operators pressing suppliers for better safety tools and clearer returns on spending. Cartrack sells tracking and fleet management subscriptions across South Africa and other markets, pitching savings on theft risk, fuel, maintenance and compliance. Chief Executive Officer Zak Calisto said the quarter reflects a strategy of pushing growth harder, even if that means a short term gap between sales costs and the revenue they generate later. He credited customer expansion and stronger uptake of Cartracks Video and Cartrack Tag products for the acceleration. Our Q3 performance reflects our consistent and disciplined track record of growing our business at scale, Calisto said. He added that the company is investing in distribution capacity and expects those investments to create advantages that extend beyond the current financial year. Karooooo said this quarters pace improved from a year earlier, when subscription revenue and annualized recurring revenue each rose 14. The 22 ARR increase also marks an acceleration from the previous quarters 20 growth rate, the company said, signaling that its installed base is expanding and that more customers are taking additional products. Investors track ARR because it offers a forward view of revenue that should recur, a key metric for subscription businesses. Karooooo also reported SaaS ARR in dollars at 298 million. Using the stated exchange rate, the rand figure implies about 311.9 million. The record subscriber adds offer another data point. Net additions of 111,478 suggest sales teams are winning business at a faster clip, while also keeping churn in check. Cartrack has been using add on products, including in cabin cameras and asset tags, to deepen relationships and lift revenue per customer, especially among fleet operators that need more tools to monitor driver behavior and cargo. Calisto said accelerated growth creates timing differences between upfront expenses such as sales and marketing and the realization of future revenue. Still, he said the company believes pushing growth is the right call when it is done efficiently and supported by strong unit economics and a healthy balance sheet. The quarters figures were unaudited and presented in rand. Karooooo highlighted scale and recurring revenue as the core of its model as it seeks to broaden its footprint and keep adding subscribers at a rapid pace.