JSE-listed vehicle telematics company Cartrack has delivered a strong set of financial results for the six months ended 31 August 2019, reaching a million subscribers for the first time and growing headline earnings per share by 28%.

Subscription revenue climbed 26% to R897-million — now representing 96% of total revenue from the 90% achieved at year-end six months ago, it said on Wednesday. Total revenue was R938-million, with cash generated from operations up a massive 70% to R446-million.

In a statement, Cartrack CEO Zak Calisto describing passing the million-subscriber milestone as “significant” and one that “places us among a select group of global leaders in mobility solutions”.

“We have consistently delivered double-digit revenue growth and our subscription revenue has now reached a record level of 96% of total revenue. This growth is driven by a vibrant customer-centric sales culture and the increased adoption of our platforms.”

The company said its growth in Asia and Europe has “augmented the consistent growth and performance of our South African business in delivering this expected result”.

Regions outside of South Africa now account for 27% of the group’s revenue, with “increased appetite for sophisticated data and business mobility solutions”.

Earnings before interest, tax, depreciation and amortisation rose to 51% from 48% at the 2019 financial year end. Operating profit margin rose to 34% from 32% previously.

Asia-Pacific

Asia-Pacific is the second largest revenue contributor after South Africa and the fastest-growing segment in the group, with subscription revenue up by 46% to R105-million after an increase of 39% in subscribers.

“The region presents the greatest potential in the long term as markets remain considerably under-penetrated due to fragmented market participants delivering entry-level telematics offerings,” it said. “Cartrack is able to exploit its sophisticated and more reliable solutions and customer-centric services to outperform local participants.”

The European segment delivered subscriber growth of 16% and subscription revenue growth of 20% to R80-million.

It said it has developed a “new generation” of smart telematic devices with enhanced features at a lower cost, allowing it to carry a higher device inventory at a lower value than at year-end 2019.

“These new devices will capture richer data allowing for a further expansion of Cartrack’s data offerings as it continues to position itself at the forefront of smart transportation. The inventory levels are prudently optimised to meet distribution and production lead times.

“Cartrack remains focused on smart mobility, actionable business intelligence and the expansion of the Internet of things. The group will continue to drive innovation through interaction with customers as well as strategic research activities. Management expects the second-half 2020 subscription revenue, subscriber growth and earnings to be in line with our first-half 2020 performance and foresees double-digit subscription revenue growth in the foreseeable future.”

The group has declared a dividend of 20c/share.