Karooooo Ltd. · NASDAQ:KARO
Karooooo — Q3 FY2022 Earnings Presentation
23 slides from Karooooo's earnings presentation, Jan 19, 2022
Slide 1: Earnings Presentation Q3 FY22
Earnings Presentation Q3 FY22 1
Slide 2: Disclaimer
DISCLAIMER Forward-Looking Statements The information in this presentation (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 availabl
Slide 3: Founded in South Africa, now headquartered in Singapore
NASDAQ TICKER “KARO” JSE TICKER “KRO” 100% Founded in South Africa, now headquartered in Singapore 3
Slide 4: To establish the leading on-the-ground operations cloud
TODAY WE ARE INVESTING FOR DECADES TO COME Mobility is core to all on-the-ground operations As customer needs evolve at pace, we think beyond connected vehicles & equipment To establish the leading on-the-ground operations cloud 4
Slide 5: We solve problems by digitally transforming on-the-ground operations
WE SOLVE PROBLEMS BY DIGITALLY TRANSFORMING ON-THE-GROUND OPERATIONS Fleet & Logistics & Field Worker Video ESG Risk Warehouse Secure Vehicle Competitively Equipment Delivery Management Based Safety Compliance Mitigation & Other Buying & Priced Management Operations & Reporting Systems Selling Insur
Slide 6: Open operations cloud with seamless integrations
OPEN OPERATIONS CLOUD WITH SEAMLESS INTEGRATIONS & Telematics fleet management AI powered video telematics Proprietary APIs & Delivery management in-vehicle third-party systems Smart-Devices receive & push data DIFFERENTIATED DATA-DRIVEN Smart fleet administration SaaS PLATFORM Business intelligence
Slide 7: Untapped network effect of our platform
UNTAPPED NETWORK EFFECT OF OUR PLATFORM THE SCALE OF DATA ON OUR CLOUD IS VAST & GROWING (1)For the month of November 2021
Slide 8: Early stage of a large & long-term growth opportunity
EARLY STAGE OF A LARGE & LONG-TERM GROWTH OPPORTUNITY Mobility is core to all on-the-ground operations A massive opportunity (2) of global GDP 1,141,112 138, 337 124,102 66,834 Q3 FY22 Q3 FY22 Q3 FY22 Q3 FY22 IoT DATA IS KEY TO IMPROVING OPERATIONS (1)Management’s best estimate based on market resea
Slide 9: Robust & consistently profitable business model
ROBUST & CONSISTENTLY PROFITABLE BUSINESS MODEL SaaS ARR growth ZAR M Compound annual growth rate Vertically integrated business model USD 172.5M (1) 2,760 End-to-end all inclusive IoT cloud software platform 2,373 Established infrastructure 1,981 Expanding distribution network 1,613 Ability to exec
Slide 10: Performance for Q3 FY22
iN A KAROOOOO Performance for Q3 FY22
Slide 11: Consistently growing subscription revenue
CONSISTENTLY GROWING SUBSCRIPTION REVENUE Subscriber Subscription Revenue Growth on a Growth constant currency basis Q3 FY22 1.470M Q3 FY22 ZAR 677M Q3 FY21 1.246M Q3 FY21 ZAR 567M Subscription Revenue Revenue Growth on a as a % of Total Revenue constant currency basis Q3 FY22 Q3 FY22 ZAR 734M Q3 FY
Slide 12: A history of consistent execution
A HISTORY OF CONSISTENT EXECUTION Subscribers Subscription Revenue Operating Profit 000s ZAR M ZAR M 1,470 664 205 198 1,409 182 185 178 1,366 628 168 606 163 163 161 1,306 147 574 1,246 567 542 1,175 526 1,134 1,127 503 1,089 488 1,039 455 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
Slide 13: Strong growth with CAGR of >20%
STRONG GROWTH WITH CAGR OF >20% Revenue Earnings per share ZAR M ZAR 720 4.72 Strong unit economics 659 616 626 589 4.32 4.30 535 551 4.12 4.17 Robust operating margins 511 493 3.90 3.85 470 3.81 3.73 (2) Consistently beaten Rule of 40 3.07 Unlevered balance sheet Strong cash position Q2 Q3 Q4 Q1 Q2
Slide 14: Net subscriber additions
NET SUBSCRIBER ADDITIONS COVID-19 164,385 70,916 61 776 60,470 59,911 127,947 119,574 48,897 49,775 42,139 41,626 37,770 29,275 7,032 FY20 FY21 FY22 FY20 FY21 FY22 FY20 FY21 FY22 FY20 FY21 FY22 FY20 FY21 FY22 Q1 Q2 Q3 Q4 Nine Months CONSISTENTLY GROWING OUR SUBCRIBER BASE 14
Slide 15: Strong unit economics
STRONG UNIT ECONOMICS Constantly evaluate trade-off Unit Economics vs. Accelerated Growth Lifetime Value of Low Cost of Acquiring a Strong Comparative (1) Customer Relationships Customer (2) Benefits from ▲ ▼ Economies of Scale LTV to CAC WELL POSITIONED TO MATERIALLY INCREASE INVESTMENT FOR GROWTH
Slide 16: Cartrack's low cost of acquiring a subscriber
CARTRACK’S LOW COST OF ACQUIRING A SUBSCRIBER Average Cost of adding a Subscriber to our cloud (1) (4) & ZAR FY22 Q3 1,967 1,981 Despite continued strategic 571 OpEx investment for long-term growth OpEx 697 Lifetime value of a subscriber Q3 FY21 Q3 FY22 ARPU (ZAR) 156 153 1,396 CapEx 1,284 CapEx Sub
Slide 17: Continued expansion despite COVID-19
CONTINUED EXPANSION DESPITE COVID-19 Q3 Q3 Q3 Q3-o-Q3 ‘000s Subscribers FY20 FY21 FY22 change Subscribers 841 962 1,141 19% Subscribers 92 115 138 20% Subscribers 95 108 124 15% Subscribers 60 62 67 8% 17
Slide 18: Building for the future
BUILDING FOR THE FUTURE Sales & Marketing R&D G&A ZAR M ZAR M ZAR M 37 133 121 80 65 21 ▲ ▲ ▲ Q3 FY21 Q3 FY22 Q3 FY21 Q3 FY22 Q3 FY21 Q3 FY22 STRATEGIC & DISCIPLINED CAPITAL ALLOCATION 18
Slide 19: Robust operating metrics
ROBUST OPERATING METRICS Investing for the future Long-term Q3 FY21 Q3 FY22 Targets (1) Research & Development as a % of Subscription Revenue 4% 6% 4-6% Sales & Marketing as a % of Subscription Revenue 12% 12% 17-19% General & Administration as a % of Subscription Revenue 21% 20% 12-16% (2) Adjusted
Slide 20: Free cash flow
FREE CASH FLOW Balancing our significant & continued strategic investment into customer acquisition & long-term growth whilst exercising caution in allocating capital during the pandemic Operating Activities Investing Activities: PPE Free Cash Flow(1) ZAR M ZAR M ZAR M 794 445 411 750 383 306 Strong
Slide 21: Our strong cash position
OUR STRONG CASH POSITION Cash on hand ZAR M 799 ▲ FY22 Q3 67 YTD Q3 FY21 YTD Q3 FY22 SUPPORTED BY PROPRIETARY COLLECTION MANAGEMENT SOFTWARE (1) A non-IFRS measure & is after provisioning for expected credit losses due to COVID-19 (2) YTD refers to the nine months ended November 21
Slide 22: Outlook for FY22 remains unchanged despite pandemic
OUTLOOK FOR FY22 REMAINS UNCHANGED DESPITE PANDEMIC Geared for growth and scalability with strong financial discipline and earnings Year-to-date FY20 FY21 (Q3) FY22 FY22 Outlook Number of subscribers (000s) 1,127 1,306 1,470 1,500 – 1,600 Subscription Revenue (ZAR M) 1,888 2,209 1,897 2,500 – 2,700
Slide 23: Thank You
yon A KAROOOOO Thank You