“MiX has started the year with solid sales momentum in many regions. However, first quarter net additions to our vehicles under subscription fell short of our expectations as we faced difficult macroeconomic conditions in South Africa and political unrest in the Middle East,” commented Stefan Joselowitz, chief executive officer of [DATA MIX:MIX Telematics Limited], on the group’s financial results for the first quarter of 2015.
MiX Telematics, a global provider of fleet and mobile asset management solutions, offer products and services such as enterprise fleets, small fleets and security solutions like vehicle tracking.
The group’s subscriber base also grew by 23 per cent year over year, bringing the total to over 462,700 subscribers at the end of June 2014.
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Adjusted earnings before Interest, taxes, depreciation, and amortization (EBITDA) increased by 16 per cent to 52 million rand, representing a 16 per cent adjusted EBITDA margin.
On the other hand, the group’s hardware and other revenue declined significantly by 20.8 per cent from 104.2 million rand for the first quarter of 2014 to 82.6 million rand this quarter.
Operating profit also took a knock, falling from 37.3 million rand to 22.5 million rand while operating margin was 7.1 per cent compared to 12.5 per cent for the previous comparable quarter.
Due to the losses, the company said that it had executed its strategy of investing in sales and marketing, resulting in an increased cost of 11.2 million rand while administration charges increased to 17.6 million rand.
“We are pleased with our investments in sales and marketing and the strengthening of our management team which combined with our solid pipeline should aid us in achieving our plan for the 2015 fiscal year. We are mindful that South Africa is more than 50 per cent of our revenue and are monitoring the macroeconomic environment carefully, added Joselowitz.
Profit for the period fell from 26.3 million rand to 16.1 million rand while earnings per diluted ordinary share declined from four cents to two cents.
For the second quarter of 2015, MiX Telematics expects subscription revenue to be in the range of 240 million rand and 243 million rand, an increase between 15.9 per cent and 17.4 per cent compared to the previous quarter.
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“Having built what we believe to be the industry’s largest global distribution capability and broadest line of solutions, we are confident we have what it takes to capitalize on the growing demand for fleet management solutions globally,” concluded Joselowitz.