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MIX TELEMATICS LIMITED - MiX Telematics announces financial results for first quarter of fiscal year 2017

Release Date: 04/08/2016 08:00
Code(s): MIX     PDF:  
Wrap Text
MiX Telematics announces financial results for first quarter of fiscal year 2017

MiX Telematics Limited
(Incorporated in the Republic of South Africa)
(Registration number 1995/013858/06)
JSE code: MIX NYSE code: MIXT ISIN: ZAE000125316
(“MiX Telematics” or “the Company” or “the Group”)


MIX TELEMATICS ANNOUNCES FINANCIAL RESULTS FOR FIRST QUARTER OF FISCAL YEAR 2017


References in this announcement to “R” are to South African Rand and references to “U.S. Dollars” and “$” are to United States Dollars.
Unless otherwise stated MiX Telematics has translated U.S. Dollar amounts from South African Rand at the exchange rate of R14.7838 per
$1.00, which was the R/$ exchange rate reported by Oanda.com as of June 30, 2016.

First Quarter Highlights:
    • Subscription revenue of R306 million ($21 million), grew 13% year over year
    • Subscribers increased by 10% year over year, bringing the total to 578,000 subscribers at June 30, 2016
    • Operating profit of R23 million ($2 million), representing a 6% margin
    • Adjusted EBITDA of R60 million ($4 million), representing a 16% Adjusted EBITDA margin
    • Company maintains guidance for Subscription revenue, Total revenue and Adjusted EBITDA for the full 2017 fiscal
      year which ends March 31, 2017.

Midrand, South Africa, August 4, 2016 - MiX Telematics Limited (NYSE: MIXT, JSE: MIX), a leading global provider of fleet and
mobile asset management solutions delivered as Software-as-a-Service ("SaaS"), today announced financial results for its first quarter of
fiscal year 2017, which ended June 30, 2016.

“We sustained double digit revenue growth within our guidance range, double digit Adjusted EBITDA margins and solid operating cash
flow in the first quarter of fiscal year 2017. I am proud of our ability to grow profitably in challenging times, but was disappointed to see
continued deterioration in the energy sector, currency headwinds muting our revenue and new uncertainty from Brexit in the quarter,” said
Stefan Joselowitz, Chief Executive Officer of MiX Telematics. “We haven't got off to the start we were hoping for, but it is early in the
fiscal year and we remain focused on catching up and achieving our full year targets.” Joselowitz continued, “We are pleased with the
result of the general meeting of the shareholders of the Company earlier this week approving our repurchase of all the MiX Telematics
ordinary shares held by Imperial Corporate Services, by way of a special resolution. The transaction is expected to close at the end of
August. At the time we announced our intent to do the buyback, we noted that we could see no better acquisition opportunity than investing
in our own business, so we are indeed gratified with the outcome.”

Financial performance for the three months ended June 30, 2016
Subscription revenue: Subscription revenue was R306.2 million ($20.7 million), an increase of 12.7% compared with R271.8 million
($18.4 million) for the first quarter of fiscal year 2016. Subscription revenue benefited from an increase of over 54,000 subscribers, which
resulted in an increase in subscribers of 10.4% from June 2015 to June 2016.

Total revenue: Total revenue was R379.1 million ($25.6 million), an increase of 10.2% compared to R344.1 million ($23.3 million) for the
first quarter of fiscal year 2016. Hardware and other revenue was R72.9 million ($4.9 million), an increase of 0.8% compared to
R72.3 million ($4.9 million) for the first quarter of fiscal year 2016.

Gross margin: Gross profit was R255.8 million ($17.3 million), as compared to R241.9 million ($16.4 million) for the first quarter of
fiscal year 2016. Gross profit margin was 67.5%, compared to 70.3% for the first quarter of fiscal year 2016. Infrastructure costs have
increased due to the Company commencing its transition from legacy data centers, where we traditionally co-located using our own
equipment, towards cloud-based infrastructure and services. This accounts for approximately half of the decline on our gross profit
margin. This move provides benefits to customers and the Company alike in the form of improved up-times, service and redundancy. The
investment has also enabled us to start rolling out the first phases of our new highly scalable, cloud-based back-end platform, called MiX
Lightning, which is designed to support the anticipated growth in our subscriber base. The remaining decline is as a result of lower margins
on hardware and other revenue in the first quarter of fiscal year 2017, primarily as a result of a change in product mix.

Operating margin: Operating profit was R22.9 million ($1.5 million), compared to R32.6 million ($2.2 million) for the first quarter of
fiscal year 2016. Operating margin was 6.0%, compared to 9.5% for the first quarter of fiscal year 2016. 2.8% of the decline relates to the
margin contraction described above and the balance relates to an increase in operating expenses primarily as a result of a weaker South
African Rand and inflation, mainly in South Africa.
Adjusted EBITDA: Adjusted EBITDA, a non-IFRS measure, was R60.4 million ($4.1 million) compared to R65.1 million ($4.4 million)
for the first quarter of fiscal year 2016. Adjusted EBITDA margin, a non-IFRS measure, for the first quarter of fiscal year 2017 was 15.9%,
compared to 18.9% for the first quarter of fiscal year 2016.

Profit for the period and earnings per share: Profit for the period was R31.9 million ($2.2 million), compared to R31.1 million
($2.1 million) for the first quarter of fiscal year 2016. Profit for the period includes a net foreign exchange gain of R19.9 million
($1.3 million) before tax primarily relating to U.S. Dollar IPO proceeds which are sensitive to R:$ exchange rate movements. During May
2016, $30.4 million of the U.S. Dollar IPO proceeds was converted to R474.0 million at an exchange rate of R15.5900 to the U.S. Dollar in
anticipation of the specific repurchase of shares from a related party which is discussed in note 11 of the accompanying financial results.
This will reduce the impact of foreign exchange gains or losses from the IPO proceeds in future reporting periods. Earnings per diluted
ordinary share were 4 South African cents, which is consistent with the first quarter of fiscal year 2016. For the first quarter of fiscal year
2017, the calculation was based on diluted weighted average ordinary shares in issue of 763.5 million compared to 803.7 million diluted
weighted average ordinary shares in issue during the first quarter of fiscal year 2016.

The Company's effective tax rate for the quarter was 33.5% in comparison to 31.7% for the first quarter of fiscal year 2016.

On a U.S. Dollar basis, and using the June 30, 2016 exchange rate of R14.7838 per U.S. Dollar, and at a ratio of 25 ordinary shares to one
American Depositary Share ("ADS"), profit for the period was $2.2 million, or 7 U.S. cents per diluted ADS.

Adjusted earnings for the period and adjusted earnings per share: Adjusted earnings for the period, a non-IFRS measure, was
R17.3 million ($1.2 million), compared to R23.7 million ($1.6 million) for the first quarter of fiscal year 2016 and excludes a net foreign
exchange gain of R19.9 million ($1.3 million). During the first quarter of fiscal year 2016, a net foreign exchange gain of R11.0 million
($0.7 million) was recorded. Adjusted earnings per diluted ordinary share, also a non-IFRS measure, were 2 South African cents, compared
to 3 South African cents in the first quarter of fiscal year 2016.

On a U.S. Dollar basis, and using the June 30, 2016 exchange rate of R14.7838 per U.S. Dollar, and at a ratio of 25 ordinary shares to one
ADS, adjusted earnings for the period was $1.2 million, or 4 U.S. cents per diluted ADS.

Statement of financial position and cash flow: At June 30, 2016, the Company had R845.8 million ($57.2 million) of cash and cash
equivalents, compared to R877.1 million ($59.3 million) in the fourth quarter of fiscal year 2016. The Company generated R28.1 million
($1.9 million) in net cash from operating activities for the three months ended June 30, 2016 and invested R62.2 million ($4.2 million) in
capital expenditures during the quarter, leading to negative free cash flow, a non-IFRS measure, of R34.1 million ($2.3 million) for the first
quarter of fiscal year 2017, compared with negative free cash flow of R3.1 million ($0.2 million) for the first quarter of fiscal year 2016.

An explanation of non-IFRS measures used in this press release is set out in the Non-IFRS financial measures section. A reconciliation of
these non-IFRS measures to the most directly comparable IFRS measures is provided in the financial tables that accompany this press
release.

Business Outlook
MiX Telematics has translated U.S. Dollar amounts in this Business Outlook paragraph from South African Rand at the exchange rate of
R13.8913 per $1.00, which was the R/$ exchange rate reported by Oanda.com as of August 1, 2016.

Based on information as of today, August 4, 2016, the Company is issuing the following financial guidance for the full 2017 fiscal year:

    •    Subscription revenue - R1,311 million to R1,330 million ($94.4 million to $95.7 million), which would represent subscription
         revenue growth of 13.2% to 14.8% compared to fiscal year 2016.

    •    Total revenue - R1,575 million to R1,606 million ($113.4 million to $115.6 million), which would represent revenue growth of
         7.5% to 9.6% compared to fiscal year 2016.

    •    Adjusted EBITDA - R317 million to R337 million ($22.8 million to $24.3 million), which would represent an increase in Adjusted
         EBITDA of 14.4% to 21.6% compared to fiscal year 2016.

    •    Adjusted earnings per diluted ordinary share of 11.3 to 13.1 South African cents based on 765 million diluted ordinary shares in
         issue, and based on an effective tax rate of 29% to 33%. At a ratio of 25 ordinary shares to one ADS, this equates to adjusted
         earnings per diluted ADS of 20 to 24 U.S. cents.

    •    If the specific repurchase of shares from a related party, as described in Note 11 of the accompanying financial results, is
         completed in August 2016 as expected, Adjusted earnings per diluted ordinary share guidance for the full fiscal 2017 year is
         expected to be 13.5 to 15.7 South African cents based on a weighted average of 640 million diluted ordinary shares in issue, and
         based on an effective tax rate of 29% to 33%. At a ratio of 25 ordinary shares to one ADS, this equates to adjusted earnings per
         diluted ADS of 24 to 28 U.S. cents. This calculation assumes that the expected completion of the specific repurchase of
         201 million ordinary shares in August 2016 would reduce the weighted average number of ordinary shares in issue by 125 million
         for the 2017 fiscal year and does not take into account any other accounting adjustments that may arise from the transaction.

For the second quarter of fiscal year 2017 the Company expects subscription revenue to be in the range of R305 million to R308 million
($22.0 million to $22.2 million) which would represent subscription revenue growth of 7.1% to 8.1% compared to the second quarter of
fiscal year 2016.

The key assumptions used in deriving the forecast are as follows:
    • Growth in subscription revenue and vehicles under subscription are based on expected growth rates related to market conditions
        and takes into account growth rates achieved previously.

    •    Achieving hardware sales according to expectations. Hardware sales are dependent on the volumes of bundled solutions selected
         by customers.

    •    An average forecast exchange rate for the 2017 fiscal year of R15.8000 per $1.00. The results are sensitive to exchange rate
         fluctuations, particularly volatility in respect of the South African Rand against the U.S. Dollar (R13.8913 per $1.00 per
         Oanda.com as of August 1, 2016) and the British Pound (R18.3572 per GBP 1.00 per Oanda.com as of August 1, 2016). If these
         current exchange rates continue throughout the remainder of the fiscal 2017 year, the Total revenue and Subscription revenue for
         the full 2017 fiscal year could decline by approximately R45.0 million and R30.0 million respectively.

The forecast is the responsibility of the board of directors and has not been reviewed or reported on by the Company’s external auditors.
The Company’s policy is to give guidance on a quarterly basis, if necessary, and does not update guidance between quarters.

The information disclosed in this “Business Outlook” paragraph complies with the disclosure requirements in terms of paragraph 8.38 of
the JSE Listings Requirements which deals with profit forecasts.

Quarterly Reporting Policy in respect of JSE Listings Requirements
Following the listing of the Company’s ADSs on the New York Stock Exchange, the Company has adopted a quarterly reporting policy. As
a result of such quarterly reporting the Company is, in terms of paragraph 3.4(b)(ix) of the JSE Listings Requirements, not required to
publish trading statements in terms of paragraph 3.4(b)(i) to (viii) of the JSE Listings Requirements.

Conference Call Information
MiX Telematics management will also host a conference call and audio webcast at 8:00 a.m. (Eastern Daylight Time) and 2:00 p.m. (South
African Time) on August 4, 2016 to discuss the Company's financial results and current business outlook:

    •    The live webcast of the call will be available at the “Investor Information” page of the Company’s website,
         http://investor.mixtelematics.com.
    •    To access the call, dial 1-888-576-4387 (within the United States) or 0 800 999 558 (within South Africa) or 1-719-457-2085
         (outside of the United States). The conference ID is 5639447.
    •    A replay of this conference call will be available for a limited time at 1-877-870-5176 (within the United States) or 1-858-384-
         5517 (within South Africa or outside of the United States). The replay conference ID is 5639447.
    •    A replay of the webcast will also be available for a limited time at http://investor.mixtelematics.com.

About MiX Telematics Limited
MiX Telematics is a leading global provider of fleet and mobile asset management solutions delivered as SaaS to customers in
approximately 120 countries. The Company’s products and services provide enterprise fleets, small fleets and consumers with solutions for
safety, efficiency, risk and security. MiX Telematics was founded in 1996 and has offices in South Africa, the United Kingdom, the United
States, Uganda, Brazil, Australia, Romania, Thailand and the United Arab Emirates as well as a network of more than 130 fleet partners
worldwide. MiX Telematics shares are publicly traded on the Johannesburg Stock Exchange (JSE: MIX) and MiX Telematics American
Depositary Shares are listed on the New York Stock Exchange (NYSE: MIXT). For more information visit www.mixtelematics.com.

Forward-Looking Statements
This press release includes certain “forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of
1995, including without limitation, statements concerning our financial guidance for the second quarter and full year of fiscal year 2017,
our position to execute on our growth strategy, our specific repurchase of shares from a related party, and our ability to expand our
leadership position. These forward-looking statements reflect our current views about our plans, intentions, expectations, strategies and
prospects, which are based on the information currently available to us and on assumptions we have made. Actual results may differ
materially from those described in the forward-looking statements and will be affected by a variety of risks and factors that are beyond our
control including, without limitation, those described under the caption “Risk Factors” in the Company’s Annual Report on Form 20-F filed
with the Securities and Exchange Commission (the "SEC") for the fiscal year ended March 31, 2016, as updated by other reports that the
Company files with or furnishes to the SEC. The Company assumes no obligation to update any forward-looking statements contained in
this press release as a result of new information, future events or otherwise.

Non-IFRS financial measures
Adjusted EBITDA
To provide investors with additional information regarding its financial results, the Company has disclosed Adjusted EBITDA within this
press release. Adjusted EBITDA is a non-IFRS financial measure; it does not represent cash flows from operations for the periods indicated
and should not be considered an alternative to profit for the period as an indicator of the Company's results of operations or as an alternative
to cash flows from operations as an indicator of liquidity. Adjusted EBITDA is defined as the profit for the period before income taxes, net
finance income/(costs) including foreign exchange gains/(losses), depreciation of property, plant and equipment including capitalized
customer in-vehicle devices, amortization of intangible assets including capitalized in-house development costs and intangible assets
identified as part of a business combination, share-based compensation costs, transaction costs arising from the acquisition of a business or
investigating strategic alternatives, restructuring costs, profits/(losses) on the disposal or impairments of assets or subsidiaries, certain non-
recurring initial public offering ("IPO") costs, insurance reimbursements relating to impaired assets and certain litigation costs.

The Company has included Adjusted EBITDA and Adjusted EBITDA margin in this press release because it is a key measure that the
Company's management and Board of Directors use to understand and evaluate its core operating performance and trends; to prepare and
approve its annual budget; and to develop short- and long-term operational plans. In particular, the exclusion of certain expenses in
calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons of the Company's core business. Accordingly,
the Company believes that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating its
operating results.

The Company's use of Adjusted EBITDA has limitations as an analytical tool, and you should not consider this performance measure in
isolation from or as a substitute for analysis of our results as reported under IFRS. Some of these limitations are:

    •    although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced
         in the future, and Adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new
         capital expenditure requirements;
    •    Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;
    •    Adjusted EBITDA does not consider the potentially dilutive impact of equity-based compensation;
    •    Adjusted EBITDA does not reflect tax payments that may represent a reduction in cash available to the Company; and
    •    other companies, including companies in our industry, may calculate Adjusted EBITDA differently, which reduces its usefulness
         as a comparative measure.

Because of these limitations, you should consider Adjusted EBITDA alongside other financial performance measures, including operating
profit, profit for the period and our other results.

Adjusted Earnings and Adjusted Earnings Per Share
Adjusted earnings per share is defined as profit attributable to owners of the parent, MiX Telematics Limited, excluding net foreign
exchange gains/(losses) net of tax, divided by the weighted average number of ordinary shares in issue during the period.

We have included Adjusted earnings per share in this press release because it provides a useful measure for period-to-period comparisons of
the Company's core business by excluding net foreign exchange gains/(losses) from earnings. Accordingly, we believe that Adjusted
earnings per share provides useful information to investors and others in understanding and evaluating the Company's operating results.

Free cash flow
Free cash flow is determined as net cash generated from operating activities less capital expenditure per investing activities.

Investor Contact:
Sheila Ennis
ICR for MiX Telematics
ir@mixtelematics.com
1-(855) 564-9835

August 4, 2016

JSE sponsor
Java Capital

MIX TELEMATICS LIMITED
CONDENSED CONSOLIDATED INCOME STATEMENTS

                                                       South African Rand               United States Dollar
                                                   Three months    Three months       Three months  Three months
                                                          ended           ended           ended            ended
                                                        June 30,       June 30,         June 30,        June 30,
Figures are in thousands unless otherwise stated           2016            2015            2016             2015
                                                      Unaudited       Unaudited        Unaudited       Unaudited
Revenue                                                 379,096         344,128           25,643          23,277
Cost of sales                                          (123,319)       (102,246)          (8,341)         (6,916)
Gross profit                                            255,777         241,882           17,302          16,361
Other income/(expenses) - net                               459            (598)              31             (40)
Operating expenses                                     (233,366)       (208,717)         (15,786)        (14,118)
    -Sales and marketing                                (48,530)        (46,581)          (3,283)         (3,151)
    -Administration and other charges                  (184,836)       (162,136)         (12,503)        (10,967)
Operating profit                                         22,870          32,567            1,547           2,203
Finance income/(costs) - net                             25,115          12,957            1,699             876
    -Finance income                                      25,401          13,311            1,718             900
    -Finance costs                                         (286)           (354)             (19)            (24)
Profit before taxation                                   47,985          45,524            3,246           3,079
Taxation                                                (16,065)        (14,453)          (1,087)           (978)
Profit for the period                                    31,920          31,071            2,159           2,101

Attributable to:
     Owners of the parent                                31,925         31,238             2,159          2,112
     Non-controlling interests                               (5)          (167)               *             (11)
                                                         31,920         31,071             2,159          2,101

*    Amounts less than $1,000

MIX TELEMATICS LIMITED
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

                                                   South African Rand            United States Dollar
                                                   June 30,       March 31,       June 30,       March 31,
Figures are in thousands unless otherwise stated       2016            2016          2016            2016
                                                  Unaudited         Audited      Unaudited      Unaudited
ASSETS
Non-current assets
Property, plant and equipment                       253,393         235,584        17,140         15,935
Intangible assets                                   846,797         846,851        57,279         57,282
Available-for-sale financial asset                       —               —             —              —
Finance lease receivable                                116             167             8             11
Deferred tax assets                                  33,020          30,005         2,234          2,030
Total non-current assets                          1,133,326       1,112,607        76,661         75,258

Current assets
Inventory                                               69,134        64,489        4,676          4,362
Trade and other receivables                            301,100       293,045       20,367         19,822
Finance lease receivable                                   573           984           39             67
Taxation                                                10,141         8,886          686            601
Restricted cash                                         21,744        21,134        1,471          1,430
Cash and cash equivalents                              845,804       877,136       57,212         59,331
Total current assets                                 1,248,496     1,265,674       84,451         85,613
Total assets                                         2,381,822     2,378,281      161,112        160,871

EQUITY
Stated capital                                       1,325,484     1,320,955       89,658         89,352
Other reserves                                          62,304        74,262        4,214          5,023
Retained earnings                                      542,780       526,082       36,715         35,585
Equity attributable to owners of the parent          1,930,568     1,921,299      130,587        129,960
Non-controlling interest                                (1,658)       (1,491)        (112)          (101)
Total equity                                         1,928,910     1,919,808      130,475        129,859
LIABILITIES
Non-current liabilities
Deferred tax liabilities                               125,934      120,981         8,518          8,183
Provisions                                               3,622        3,514           245            238
Total non-current liabilities                          129,556      124,495         8,763          8,421
Current liabilities
Trade and other payables                               269,343      282,647        18,220         19,118
Borrowings                                                 741        1,103            50             75
Taxation                                                13,776        2,795           932            189
Provisions                                              25,809       31,059         1,746          2,101
Share-based payment liability                            1,064           —             72             —
Bank overdraft                                          12,623       16,374           854          1,108
Total current liabilities                              323,356      333,978        21,874         22,591
Total liabilities                                      452,912      458,473        30,637         31,012
Total equity and liabilities                         2,381,822     2,378,281      161,112        160,871

MIX TELEMATICS LIMITED
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                               South African Rand                  United States Dollar
                                                            Three months   Three months           Three months Three months
                                                                   ended          ended                ended           ended
                                                                 June 30,       June 30,             June 30,        June 30,
Figures are in thousands unless otherwise stated                    2016           2015                 2016            2015
                                                               Unaudited      Unaudited            Unaudited       Unaudited
Operating activities
Cash generated from operations                                  29,073           36,777               1,967           2,488
Net financing income                                             3,354            1,890                 227             128
Taxation paid                                                   (4,326)          (3,476)               (293)           (235)
Net cash generated from operating activities                    28,101           35,191               1,901           2,381
Cash flows from investing activities
Capital expenditure                                            (62,227)         (38,277)             (4,209)         (2,589)
Deferred consideration paid                                       (362)            (201)                (24)            (14)
Proceeds on sale of property, plant and equipment                   —               157                   —              11
Contingent consideration paid                                       —           (18,000)                  —          (1,218)
(Increase)/decrease in restricted cash                          (1,554)          18,568                (105)          1,256
Net cash used in investing activities                          (64,143)         (37,753)             (4,338)         (2,554)
Cash flows from financing activities
Proceeds from issuance of ordinary shares                        4,528              —                   306             —
Dividends paid to Company's shareholders (Note 8)              (15,212)             —                (1,029)            —
Net cash used in financing activities                          (10,684)             —                  (723)            —
Net decrease in cash and cash equivalents                      (46,726)          (2,562)             (3,160)           (173)
Net cash and cash equivalents at the beginning of the period   860,762          927,415              58,223          62,732
Exchange gains on cash and cash equivalents                     19,145           15,324               1,295           1,036
Net cash and cash equivalents at the end of the period         833,181          940,177              56,358          63,595

MIX TELEMATICS LIMITED
OTHER FINANCIAL AND OPERATING DATA
                                                                         South African Rand                        United States Dollar
                                                                     Three months       Three months        Three months       Three months
                                                                            ended              ended               ended              ended
                                                                          June 30,           June 30,            June 30,           June 30,
 Figures are in thousands except for subscribers                             2016                2015               2016               2015
                                                                         Unaudited          Unaudited          Unaudited          Unaudited
 Subscription revenue                                                       306,174           271,790             20,710             18,384
 Adjusted EBITDA                                                             60,449            65,103             4,088               4,404
 Cash and cash equivalents                                                  845,804           959,223            57,212              64,883
 Net cash (1)                                                               832,440           937,874            56,308              63,439
 Capital expenditure incurred                                                62,830            37,085             4,250               2,508
 Total development costs incurred                                            37,230            27,387             2,518               1,853
      Development costs capitalized                                          19,309            11,533             1,306                 780
      Development costs expensed within administration and other
      charges                                                                17,921            15,854             1,212               1,073
 Subscribers (number)                                                       577,950           523,344           577,950             523,344

(1)
       Net cash is calculated as being net cash and cash equivalents, excluding restricted cash less interest bearing borrowings.
Notes to condensed consolidated income statements, statements of financial position, statements of cash flows and other
financial and operating data

1. Accounting policies
The condensed consolidated statements of financial position, income statements and statements of cash flows included in these financial
results have been prepared in accordance with IFRS accounting policies. The accounting policies are consistent in all material respects with
those applied in the preparation of the consolidated financial statements for the year ended March 31, 2016. No new or revised accounting
pronouncements that became effective during fiscal year 2017 have had a material impact on the Group.

The results have not been audited or reviewed by the Group's external auditors.

2. Presentation currency and convenience translation
The Group’s presentation currency is South African Rand. In addition to presenting these condensed consolidated financial results for the
quarter ended June 30, 2016 in South African Rand, supplementary information in U.S. Dollars has been prepared for the convenience of
users of these financial results. Unless otherwise stated, the Group has translated U.S. Dollar amounts from South African Rand at the
exchange rate of R14.7838 per $1.00, which was the R/$ exchange rate reported by Oanda.com as of June 30, 2016. The U.S. Dollar figures
may not compute as they are rounded independently.

3. Earnings per share/ADS data
                                                                        South African Rand                   United States Dollar
                                                                         Three months   Three months            Three months  Three months
                                                                                ended          ended                 ended           ended
                                                                              June 30,       June 30,              June 30,        June 30,
                                                                                 2016           2015                  2016             2015
                                                                            Unaudited      Unaudited             Unaudited        Unaudited
    Earnings per share
        Basic (R/$)                                                            0.04              0.04                  #                 #
        Diluted (R/$)                                                          0.04              0.04                  #                 #
    Earnings per American Depositary Share
        Basic (R/$)                                                            1.05              0.99               0.07              0.07
        Diluted (R/$)                                                          1.05              0.97               0.07              0.07
    Adjusted earnings per share
        Basic (R/$)                                                            0.02              0.03                  #                 #
        Diluted (R/$)                                                          0.02              0.03                  #                 #
    Adjusted earnings per American Depositary Share
        Basic (R/$)                                                            0.57              0.75               0.04              0.05
        Diluted (R/$)                                                          0.57              0.74               0.04              0.05
    Ordinary shares ('000)(1)
       In issue at June 30                                                  763,088           792,838            763,088           792,838
       Weighted average                                                     760,078           792,838            760,078           792,838
       Diluted weighted average                                             763,479           803,709            763,479           803,709
    American Depositary Shares ('000)(1)
       In issue at June 30                                                   30,524             31,714            30,524            31,714
       Weighted average                                                      30,403             31,714            30,403            31,714
       Diluted weighted average                                              30,539             32,148            30,539            32,148

#        Amount less than $0.01
(1)                                                                                                                 
         Excludes 40,000,000 treasury shares held by MIX Telematics Investments Proprietary Limited ("MiX Investments"), a wholly owned
         subsidiary of the Group (June 2016: Nil).

4. Reconciliation of Adjusted Earnings
Reconciliation of Adjusted Earnings to Profit for the Period
                                                                        South African Rand                    United States Dollar
                                                                    Three months      Three months             Three months Three months
                                                                           ended             ended                  ended           ended
                                                                         June 30,          June 30,               June 30,        June 30,
Figures are in thousands unless otherwise stated                            2016              2015                   2016             2015
                                                                       Unaudited         Unaudited           Unaudited           Unaudited
Profit for the period attributable to owners of the parent                31,925            31,238               2,159               2,112
Net foreign exchange gains                                               (19,917)          (11,044)             (1,347)               (747)
Income tax effect on net foreign exchange gains                            5,256             3,482                 356                 236
Adjusted earnings attributable to owners of the parent                    17,264            23,676               1,168               1,601

Reconciliation of earnings per share to adjusted earnings per share
Basic earnings per share ($/R)                                              0.04              0.04                #                  #
Net foreign exchange gains                                                 (0.03)            (0.01)               #                  #
Income tax effect on net foreign exchange gains                             0.01                 #                #                  #
Basic adjusted earnings per share ($/R)                                     0.02              0.03                #                  #

#       Amount less than R0.01/$0.01

5. Reconciliation of Adjusted EBITDA to Profit for the Period
                                                                        South African Rand                    United States Dollar
                                                                    Three months     Three months             Three months  Three months
                                                                           ended            ended                  ended           ended
                                                                         June 30,         June 30,               June 30,        June 30,
Figures are in thousands unless otherwise stated                            2016             2015                   2016             2015
                                                                                          Restated                               Restated
                                                                       Unaudited         Unaudited           Unaudited          Unaudited
Adjusted EBITDA                                                           60,449            65,103               4,088              4,404
Add:
Decrease in restructuring cost provision                                     431               638                  29                 43
Less:
Depreciation (1)                                                           (20,939)         (16,570)             (1,416)          (1,121)
                (2)
Amortization                                                               (13,532)         (12,986)              (915)             (878)
Share-based compensation costs                                              (3,479)           (1,576)             (235)             (107)
    Equity-settled share-based compensation costs                           (2,415)           (1,576)             (163)             (107)
    Cash-settled share-based compensation costs                             (1,064)                —               (72)                —
Net loss on sale of property, plant and equipment                              (60)               (2)               (4)                *
Transaction costs arising from investigating strategic
alternatives                                                                   —             (2,040)               —                (138)
Operating profit                                                            22,870            32,567               1,547           2,203
Add: Finance income/(costs) - net                                           25,115            12,957               1,699             876
Less: Taxation                                                             (16,065)          (14,453)             (1,087)           (978)
Profit for the period                                                       31,920            31,071               2,159           2,101
(1)
        Includes depreciation of property, plant and equipment (including in-vehicle devices).
(2)     Includes amortization of intangible assets (including product development costs and intangible assets identified as part of a
        business combination).
*       Amounts less than $1,000

During the 2016 fiscal year, the Adjusted EBITDA definition was amended to exclude all foreign exchange gains/losses. The amended
measure is the profit measure reviewed by the chief operating decision maker ("CODM"). Prior period figures have been restated as follows
to reflect this change:

                                                                                                       South African     United States
                                                                                                               Rand             Dollar
                                                                                                       Three months      Three months
                                                                                                              ended             ended
                                                                                                            June 30,          June 30,
Figures are in thousands unless otherwise stated                                                               2015              2015
                                                                                                          Unaudited         Unaudited
Adjusted EBITDA (As previously reported)                                                                     65,288             4,416
Net realized foreign exchange gains                                                                            (185)              (12)
Adjusted EBITDA (Restated)                                                                                   65,103             4,404



6. Reconciliation of Adjusted EBITDA Margin to Profit for the Period Margin
                                                                                                       Three months      Three months
                                                                                                              ended             ended
                                                                                                            June 30,          June 30,
                                                                                                               2016              2015
                                                                                                                             Restated
                                                                                                          Unaudited         Unaudited
Adjusted EBITDA margin                                                                                         15.9%             18.9%
Add:
Decrease in restructuring cost provision                                                                        0.1%              0.2%
Less:
Depreciation                                                                                                   (5.5%)            (4.8%)
Amortization                                                                                                   (3.6%)            (3.7%)
Share-based compensation costs                                                                                 (0.9%)            (0.5%)
  Equity-settled share-based compensation costs                                                                (0.6%)            (0.5%)
  Cash-settled share-based compensation costs                                                                  (0.3%)              —
Net loss on sale of property, plant and equipment                                                              (0.0%)            (0.0%)
Transaction costs arising from investigating strategic alternatives                                              —               (0.6%)
Operating profit margin                                                                                         6.0%              9.5%
Add: Finance income/(costs) - net                                                                               6.6%              3.7%
Less: Taxation                                                                                                 (4.2%)            (4.2%)
Profit for the period margin                                                                                    8.4%              9.0%



7. Reconciliation of Free Cash Flow to Net Cash Generated from Operating Activities

                                                                      South African Rand                         United States Dollar
                                                                    Three months     Three months            Three months    Three months
                                                                           ended            ended                   ended           ended
                                                                         June 30,        June 30,                 June 30,        June 30,
Figures are in thousands unless otherwise stated                            2016             2015                    2016             2015
                                                                       Unaudited         Unaudited             Unaudited         Unaudited
Net cash generated from operating activities                              28,101            35,191                 1,901             2,381
Capital expenditure                                                      (62,227)          (38,277)               (4,209)           (2,589)
Free cash flow                                                           (34,126)           (3,086)               (2,308)             (208)

8. Dividend Paid
In respect of the fourth quarter of fiscal year 2016, a dividend of 2 South African cents or 0.1 U.S. cents per share was declared during
the period and paid on June 20, 2016. No dividend was paid nor declared during the first quarter of fiscal year 2016.

9. Contingent Liabilities
Service agreement
In terms of an amended network services agreement with Mobile Telephone Networks Proprietary Limited (“MTN”), MTN is entitled to
claw back payments from MiX Telematics Africa Proprietary Limited in the event of early cancellation of the agreement or certain base
connections not being maintained over the term of the agreement. No connection incentives will be received in terms of the amended
network services agreement. The maximum potential liability under the arrangement is R52.0 million or $3.5 million. No loss is considered
probable under this arrangement.

10. Taxation
MiX Telematics International Proprietary Limited (“MiX International”), a subsidiary of the Group, historically claimed a 150% allowance
for research and development spend in terms of section 11D (“S11D”) of the South African Income Tax Act of 1962 (“the Act”). As of
October 1, 2012, the legislation relating to the allowance was amended. The amendment requires pre-approval of development project
expenditure on a project specific basis by the South African Department of Science and Technology (“DST”) in order to claim a deduction
of the additional 50% over and above the expenditure incurred (150% allowance). Since the amendments to S11D of the Act, MiX
International had been claiming the 150% deduction resulting in a recognized tax benefit. MiX International has complied with the
amended legislation by submitting all required documentation to the DST in a timely manner, commencing in October 2012.
In June 2014, correspondence was received from the DST indicating that the research and development expenditure on certain projects for
which the 150% allowance was claimed did not, in the DST’s opinion, constitute qualifying expenditure in terms of the Act. MiX
International continues, through due legal process, to formally seek a review of the DST’s decision not to approve the expenditure. The
process is ongoing. Consequently, at June 30, 2016, MiX International has an uncertain tax position relating to S11D deductions. The
Group has considered this uncertain tax position and recognized a tax asset of R9.6 million ($0.6 million) at June 30, 2016. If the Group is
unsuccessful in obtaining DST approval in this specific matter, the Group may not recover the full tax asset and an additional taxation
expense relating to the additional 50% claimed may be incurred.


11. Specific Repurchase of Shares from Related Party
On April 29, 2016, the Company entered into an agreement (the “share repurchase agreement”) with Imperial Holdings Limited (“Imperial
Holdings”) and Imperial Corporate Services Proprietary Limited ("Imperial Corporate Services”), a wholly owned subsidiary of Imperial
Holdings, which currently holds 25.01% of the Company’s issued share capital, to repurchase all 200,828,260 of the Company’s shares held
by Imperial Corporate Services (the “repurchase shares”) at R2.36 ($0.16) per repurchase share, for an aggregate repurchase consideration
of R474.0 million or $32.1 million (the “repurchase”). At the general meeting held on August 1, 2016, shareholders of the Company
approved the repurchase in terms of the JSE Listings Requirements and the South African Companies Act, No.71 of 2008 ("Companies
Act"). The repurchase remains subject to the fulfilment, or waiver, as the case may be, of the following conditions precedent:
    •    that the resolution authorizing the repurchase is approved by a court by August 31, 2016 in the event that the provisions of section
         115(3)(b) of the Companies Act are timeously invoked, provided that this condition precedent will be deemed to have been
         fulfilled if no court has granted any shareholder who voted against the resolution leave to apply to court for a review of the
         transaction within 10 business days after the date of the general meeting; and

    •    that the Company obtains the necessary approvals for the repurchase from the Takeover Regulation Panel (“TRP”) by
         August 31, 2016.

The Company will make an application to the JSE to delist the repurchase shares acquired by the Company which will again form part of
the authorized but unissued share capital of the Company upon repurchase resulting in the Company having 562,259,240 ordinary shares of
no par value in issue (excludes 40,000,000 treasury shares held by MiX Investments).

The share repurchase agreement includes a restraint in favor of the Company whereby the Imperial group undertakes not to acquire a
business which competes with the Company for a period of two years and non-solicitation undertakings as well as warranties and
undertakings which are normal for a transaction of this nature.

In respect of the repurchase shares, Imperial Corporate Services will be entitled to receive any dividend which is declared after
April 29, 2016, the record date for which falls prior to the date the repurchase is implemented.

12. Dividend Declared
On August 4, 2016, the Board declared that in respect of the first quarter of fiscal year 2017, which ended on June 30, 2016, a dividend of 2
South African cents (0.1 U.S. cents) per ordinary share to be paid on Monday, August 29, 2016.

The details with respect to the dividends declared for ordinary shareholders are as follows:

Last day to trade cum dividend                                  Tuesday, August 23, 2016
Securities trade ex dividend                                    Wednesday, August 24, 2016
Record date                                                     Friday, August 26, 2016
Payment date                                                    Monday, August 29, 2016

Share certificates may not be dematerialized or rematerialized between Wednesday, August 24, 2016 and Friday, August 26, 2016, both
days inclusive.

Shareholders are advised of the following additional information:
    • the dividend has been declared out of income reserves;
    • the local dividends tax rate is 15%;
    • there are no Secondary Tax on Companies credits utilized against the dividend;
    • the gross local dividend amounts to 2 South African cents per ordinary share;
    • the net local dividend amount is 1.7 South African cents per ordinary share for shareholders liable to pay dividends tax;
    • the issued ordinary share capital of MiX Telematics is 803,087,500 ordinary shares of no par value; and
    • the Company’s tax reference number is 9155/661/84/7.

The details with respect to the dividends declared for holders of our ADSs are as follows:

Ex dividend on New York Stock Exchange (NYSE)                   Wednesday, August 24, 2016
Record date                                                     Friday, August 26, 2016
Approximate date of currency conversion                         Monday, August 29, 2016
Approximate dividend payment date                               Monday, August 29, 2016

13. Development costs historical data
The table below sets out development costs incurred and capitalized for each of the last eight quarters including the period ending June 30,
2016.


                                                                 South African Rand
Figures are in thousands                                         Three months ended
                   June 30,       March 31,     December 31,     September       June 30,       March 31,        December 31,     September
                                                                        30,                                                            30,
                       2016           2016             2015            2015         2015            2015             2014            2014
Total
development
costs incurred       37,230        28,693            28,016           31,806       27,387        28,765            22,586           24,771
Development
costs
capitalized          19,309        12,136            16,308           18,892       11,533        18,621            11,967           11,232
Development
costs expensed
within
administration
and other
charges              17,921        16,557            11,708           12,914       15,854        10,144            10,619           13,539
                                                      
                                                                 United States Dollar
                                                                 Three months ended
                 June 30,        March 31,     December 31,      September     June 30,      March 31,         December 31,       September
                                                                       30,                                                              30,
                    2016             2016             2015            2015         2015          2015                 2014            2014
Total
development
costs incurred     2,518            1,941            1,895           2,151        1,853         1,946                1,528           1,676
Development
costs
capitalized        1,306              821            1,103           1,278          780         1,260                  809            760
Development
costs expensed
within
administration
and other
charges            1,212            1,120             792               873        1,073         686                    719          916

Date: 04/08/2016 08:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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