Wrap Text
Group financial results for the quarter and year ended March 31, 2017
MiX Telematics Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1995/013858/06)
JSE share code: MIX NYSE code: MIXT ISIN: ZAE000125316
("MiX Telematics" or "the Company" or "the Group")
GROUP FINANCIAL RESULTS FOR THE QUARTER AND YEAR ENDED MARCH 31, 2017
MiX Telematics announces financial results for fourth quarter and full 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 R13.4124 per $1.00, which was the R/$ exchange rate reported by Oanda.com
as at March 31, 2017.
Highlights:
Fourth quarter fiscal 2017:
- Net subscriber additions of 16,700
- Subscription revenue of R322 million ($24 million), ahead of guidance
- Adjusted EBITDA of R87 million ($7 million), representing a 22% Adjusted EBITDA margin
- Operating profit of R41 million ($3 million), representing a 10% margin
- Net cash from operating activities of R129 million ($10 million)
Fiscal year 2017:
- Net subscriber additions of over 55,800 bringing the total to over 622,000 subscribers at March 31, 2017, an increase of 10% year over year
- Subscription revenue of R1,240 million ($92 million), ahead of guidance
- Adjusted EBITDA of R302 million ($22 million), representing a 20% margin and ahead of guidance. Reported Adjusted EBITDA margins have improved
over the course of fiscal 2017 and were as follows: Q1 2017 15.9%, Q2 2017 18.0%, Q3 2017 21.9% and Q4 2017 22.3%.
- Operating profit of R138 million ($10 million), representing a 9% margin
- Net cash from operating activities of R324 million ($24 million)
Midrand, South Africa, May 25, 2017 - 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 fourth quarter and for its full fiscal year 2017, which ended March 31, 2017.
"Our fourth quarter marked a strong end to the year. MiX’s ability to exceed expectations was driven by ongoing strength
across the portfolio globally which resulted in a return to double digit subscription revenue growth on a constant currency
basis,” said Stefan Joselowitz, Chief Executive Officer of MiX Telematics. “During fiscal 2017, the company reached an
inflection point in regards to margin accretion, particularly as MiX is moving out of a heavy investment cycle into a phase
where we are starting to enjoy the returns on these investments. We are scaling the overall operations and have entered
fiscal 2018 with very good momentum. We expect a year of strong subscription revenue growth and margin expansion, and
looking forward we are confident in our ability to execute our strategic initiatives to achieve our targeted adjusted EBITDA
margin of 30% over the long term.”
Financial performance for the three months ended March 31, 2017
Subscription revenue: Subscription revenue was R321.7 million ($24.0 million), an increase of 4.8% compared with R307.1 million
($22.9 million) for the fourth quarter of fiscal 2016. Double digit subscription revenue was achieved on a constant currency
basis. Subscription revenue benefited from an increase of over 55,800 subscribers, which resulted in an increase in subscribers
of 9.9% from March 2016 to March 2017.
Total revenue: Total revenue was R391.4 million ($29.2 million), an increase of 1.9% compared to R384.0 million ($28.6 million)
for the fourth quarter of fiscal 2016. Hardware and other revenue was R69.7 million ($5.2 million), a decrease of 9.4% compared
to R76.9 million ($5.7 million) for the fourth quarter of fiscal 2016.
Gross margin: Gross profit was R265.0 million ($19.8 million), as compared to R285.0 million ($21.3 million) for the fourth
quarter of fiscal 2016. Gross profit margin was 67.7%, compared to 74.2% for the fourth quarter of fiscal 2016. As reported
in our previous results announcements for the first three quarters of fiscal 2017, infrastructure costs have increased due
to the Company commencing its transition from legacy data centers, where we owned certain equipment, towards cloud-based
infrastructure and services. This transition also supports the roll out of our new back-end platform, MiX Lightning, and
new products such as Journey Management, Hours of Service and MiX Go, which we expect to drive increased ARPU as well as
accelerated subscriber growth. In the fourth quarter of fiscal 2016 hardware margins were higher than those achieved in the
fourth quarter of fiscal 2017. These margins vary according to the geographic origin of the sale and the distribution channels
through which the hardware revenue was generated.
Operating margin: Operating profit was R40.9 million ($3.1 million), compared to R45.7 million ($3.4 million) for the fourth
quarter of fiscal 2016. Operating profit margin was 10.5%, compared to 11.9% for the fourth quarter of fiscal 2016. Despite
the 6.5% decline in the gross profit margin described above the operating profit margin only declined by 1.4% as a result of
strict cost management which has been implemented as management progress towards achieving accelerated growth in Adjusted EBITDA
margins.
In the fourth quarter of fiscal 2017 administration and other costs included restructuring costs of R15.0 million ($1.1 million)
as a result of restructuring plans implemented in both the Europe and the Middle East and Australasia segments. The Company
expects the related cost savings and resultant operating profit margin improvement to take effect in the first quarter of fiscal 2018.
Adjusted EBITDA: Adjusted EBITDA, a non-IFRS measure, was R87.1 million ($6.5 million) compared to R77.6 million ($5.8 million)
for the fourth quarter of fiscal 2016. Adjusted EBITDA margin, a non-IFRS measure, for the fourth quarter of fiscal 2017 was 22.3%,
compared to 20.2% for the fourth quarter of fiscal 2016.
Profit for the period and earnings per share: Profit for the period was R31.2 million ($2.3 million), compared to R13.8 million
($1.0 million) in the fourth quarter of fiscal 2016. Profit for the period includes a net foreign exchange loss of R5.1 million
($0.4 million) before tax, primarily relating to U.S. Dollar cash reserves which are sensitive to R:$ exchange rate movements.
A net foreign exchange loss of R27.9 million ($2.1 million), also primarily relating to U.S Dollar cash reserves was incurred in
the fourth quarter of fiscal 2016.
Earnings per diluted ordinary share were 5 South African cents, compared to 2 South African cents in the fourth quarter of fiscal
2016. For the fourth quarter of fiscal 2017, the calculation was based on diluted weighted average ordinary shares in issue of
568.2 million compared to 760.6 million diluted weighted average ordinary shares in issue during the fourth quarter of fiscal 2016.
The diluted weighted average ordinary shares in issue during the fourth quarter of fiscal 2017 were lower than in the fourth quarter
of fiscal 2016 primarily as a result of the repurchase of 200.8 million ordinary shares during the second quarter of fiscal 2017.
The Company’s effective tax rate for the quarter was 15.0% in comparison to 29.6% in the fourth quarter of fiscal 2016. During the
fourth quarter of fiscal 2017 the Group recognized a deferred tax asset of R5.3 million ($0.4 million) in respect of a portion of
the available tax losses in the Europe segment. These tax losses were incurred in prior years. An ongoing improvement in the region’s
results has resulted in this deferred tax asset being recognized in respect of the future utilization of the historical tax loss
considered probable at period end. The recognition of this deferred tax asset reduced the Company’s effective tax rate in the quarter
by 14.5%.
On a U.S. Dollar basis, and using the March 31, 2017 exchange rate of R13.4124 per U.S. Dollar, and at a ratio of 25 ordinary
shares to one American Depositary Share ("ADS"), profit for the period was $2.3 million, or 10 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
R30.0 million ($2.2 million), compared to R28.8 million ($2.1 million) in the fourth quarter of the 2016 fiscal year. Adjusted
earnings per diluted ordinary share, also a non-IFRS measure, were 5 South African cents, compared to 4 South African cents in
the fourth quarter of fiscal 2016.
On a U.S. Dollar basis, and using the March 31, 2017 exchange rate of R13.4124 per U.S. Dollar, and at a ratio of 25 ordinary shares
to one ADS, adjusted profit for the period was $2.2 million, or 10 U.S. cents per diluted ADS, compared to $2.1 million, or 7 U.S cents
per diluted ADS in the fourth quarter of fiscal 2016.
Statement of financial position and cash flow: At March 31, 2017, the Company had R375.8 million ($28.0 million) of cash and cash
equivalents, compared to R877.1 million ($65.4 million) at March 31, 2016. The decline in cash and cash equivalents is mainly
attributable to the repurchase of 200.8 million ordinary shares which resulted in a cash outflow of R473.7 million ($35.3 million)
during the second quarter of fiscal 2017.
The Company generated R129.0 million ($9.6 million) in net cash from operating activities for the three months ended March 31, 2017
and invested R75.0 million ($5.6 million) in capital expenditures during the quarter, including investments in in-vehicle devices,
leading to free cash flow of R54.0 million ($4.0 million) for the fourth quarter of fiscal 2017, compared with free cash flow of
R31.0 million ($2.3 million) for the fourth quarter of fiscal 2016.
Financial performance for the fiscal year ended March 31, 2017
Subscription revenue: Subscription revenue increased to R1,239.9 million ($92.4 million), up 7.1% from R1,158.2 million ($86.4 million)
for fiscal 2016. Subscription revenue benefited from an increase of over 55,800 subscribers since the end of fiscal 2016, which resulted
in an increase in subscribers of 9.9% from March 2016 to March 2017.
Total revenue: Total revenue for fiscal 2017 was R1,540.1 million ($114.8 million), an increase of 5.1% compared to R1,465.0 million
($109.2 million) for fiscal 2016. Hardware and other revenue was R300.1 million ($22.4 million), compared to R306.8 million
($22.9 million) for fiscal 2016, constituting a decrease of 2.2% year on year.
Gross margin: Gross profit for fiscal 2017 was R1,041.3 million ($77.6 million), an increase compared to R1,025.7 million
($76.5 million) for fiscal 2016. Gross profit margin was 67.6%, down from 70.0% for fiscal 2016. As reported above,
increased infrastructure costs due to the Company commencing its transition from legacy data centers, where we owned
equipment, towards cloud-based infrastructure and services have been the most significant contributor to the lower gross
margin in fiscal 2017.
Operating margin: Operating profit for fiscal 2017 was R137.9 million ($10.3 million), compared to R139.1 million ($10.4 million)
posted in fiscal 2016. The operating profit margin for fiscal 2017 was 9.0%, compared to the 9.5% posted in fiscal 2016. The
decline in the gross profit margin of 2.4% described above was offset by strict cost management which has resulted in the operating
profit margin decline being limited to 0.5%. Fiscal 2017 sales and marketing costs represented 11.8% of revenue compared to 13.9%
of revenue in fiscal 2016, which are aligned with our estimates contained in our Form 20-F for the fiscal year ended March 31, 2016,
where we advised that in future periods we expected these costs to remain relatively constant as a percentage of revenue i.e.11% to
12% of revenue.
Adjusted EBITDA: Adjusted EBITDA was R301.6 million ($22.5 million) compared to R277.2 million ($20.7 million) for fiscal 2016.
The Adjusted EBITDA margin for fiscal 2017 was 19.6%, compared with the 18.9% in fiscal 2016.
Profit for the year and earnings per share: Profit for fiscal 2017 was R121.4 million ($9.1 million), compared to
R182.5 million ($13.6 million) in fiscal 2016. Profit for the year includes a net foreign exchange gain of R1.5 million
($0.1 million) before tax. During the fiscal 2016 year, a net foreign exchange gain of R144.0 million ($10.7 million) was
recorded which included R143.6 million ($10.7 million) relating to a foreign exchange gain on U.S. Dollar cash reserves.
Earnings per diluted ordinary share were 19 South African cents, compared to 23 South African cents in fiscal 2016.
For fiscal 2017, the calculation was based on diluted weighted average ordinary shares in issue of 631.8 million, compared
to 783.4 million diluted weighted average ordinary shares in issue during fiscal 2016. The diluted weighted average
ordinary shares in issue during fiscal 2017 were lower than in fiscal 2016 due to the weighted average impact of both the
repurchase of 40.0 million ordinary shares in fiscal 2016 and the repurchase of 200.8 million ordinary shares during the
second quarter of fiscal 2017.
The Company’s effective tax rate for fiscal 2017 was 18.1% in comparison to 36.9% in fiscal 2016.
Adjusted earnings for the year and adjusted earnings per share: Adjusted earnings for fiscal 2017, a non-IFRS measure,
was R104.7 million ($7.8 million), compared to R87.6 million ($6.5 million) in fiscal 2016. Adjusted earnings per
diluted ordinary share were 17 South African cents, compared to 11 South African cents in fiscal 2016.
On a U.S. Dollar basis, and using the March 31, 2017 exchange rate of R13.4124 per U.S. Dollar, and at a ratio of 25
ordinary shares to one ADS, adjusted profit for fiscal 2017 was $7.8 million, or 31 U.S. cents per diluted ADS, compared
to $6.5 million, or 21 U.S. cents per diluted ADS in fiscal 2016.
Ignoring the impact of net foreign exchange gains and losses, and related tax consequences, the effective tax rate, which is used
in calculating adjusted earnings, was 28.7% compared to 40.1% in fiscal 2016. The recognition of the deferred tax asset in respect
of historical tax losses in the Europe segment of R5.3 million ($0.4 million) and a R9.7 million ($0.7 million) benefit from
Section 11D research and development allowances, as described in the financial tables, reduced the effective tax rate by 10.2%.
Cash flow: The Company generated R323.6 million ($24.1 million) in net cash from operating activities for fiscal 2017 and invested
R295.5 million ($22.0 million) in capital expenditures during the period, leading to free cash flow of R28.0 million ($2.1 million)
for fiscal 2017, compared with negative free cash flow of R1.4 million ($0.1 million) for fiscal 2016.
Capital expenditure payments increased by R53.7 million ($4.0 million) in fiscal 2017 compared to fiscal 2016 due to increased
investments in both development costs and in-vehicle devices.
The Company utilized R519.6 million ($38.7 million) in financing activities, compared to R223.2 million ($16.6 million) utilized
during fiscal 2016. The cash utilized in financing activities in fiscal 2017 includes the repurchase of 200.8 million ordinary
shares which resulted in a cash outflow of R473.7 million ($35.3 million) and dividends paid of R53.0 million ($3.9 million). In
fiscal 2016, the cash utilized in financing activities included share repurchases of R123.8 million ($9.2 million) and dividends
paid of R107.2 million ($8.0 million).
An explanation of non-IFRS measures used in this press release is set out in the Non-IFRS financial measures section of this press
release. A reconciliation of these non-IFRS measures to the most directly comparable IFRS measures is provided in the financial
tables that accompany this release.
Segment commentary for the fiscal year ended March 31, 2017
The segment results below are presented on an integral margin basis. In respect of revenue, this method of measurement
entails reviewing the segmental results based on external revenue only. In respect of Adjusted EBITDA (the profit measure
identified by the Group), the margin generated by our Central Services Organization ("CSO"), net of any unrealized
inter-company profit, is allocated to the geographic region where the external revenue is recorded by our Regional Sales
Offices ("RSOs").
CSO continues as a central services organization that wholesales our products and services to our RSOs who, in turn, interface
with our end-customers and distributors. CSO is also responsible for the development of our hardware and software platforms and
provides common marketing, product management, technical and distribution support to each of our other operating segments. CSO’s
operating expenses are not allocated to each RSO.
Each RSO’s results reflect the external revenue earned, as well as the Adjusted EBITDA earned (or loss incurred) by each operating
segment before the CSO and corporate costs allocations.
For further information in this regard please refer to note 3 of the Group financial results for the fiscal year ended
March 31, 2017.
Total
Subscription Revenue Revenue Adjusted EBITDA Adjusted EBITDA
Fiscal % change Fiscal Fiscal % change Margin
2017 on prior 2017 2017 on prior Fiscal
Segment R’000 year R’000 R’000 year 2017
Africa 772,224 8.6% 859,169 344,077 7.4% 40.0%
The subscriber base has grown by 11.2% since March 31, 2016. This resulted in subscription revenue growth
of 8.6% which was the primary driver of revenue growth in the segment. Total revenue increased by 6.3%.
The region reported an Adjusted EBITDA margin of 40% which is consistent with the margin achieved in the
2016 fiscal year.
Europe 113,223 2.7% 177,331 52,369 48.1% 29.5%
The region’s subscriber base grew by 6.9% since March 31, 2016 and, in constant currency, subscription
revenue growth was 8.9%. Total revenue increased on a constant currency basis by 16.0% due to higher
hardware revenues compared to fiscal 2016. The revenue growth resulted in a 48.1% increase in Adjusted
EBITDA. The region reported an Adjusted EBITDA margin of 29.5%, an improvement of 7.7% from fiscal 2016.
Americas 121,462 5.2% 160,419 26,804 821.7% 16.7%
The region’s subscriber base declined by 0.2% since March 31, 2016 due to customer fleet size contraction
mainly in the oil and gas vertical in the first half of fiscal 2017. Despite this contraction, constant
currency subscription revenue growth was 3.2% as subscription revenue was assisted by the market’s
preference for bundled deals across new and existing customers. Total revenue grew by 0.2% on a constant
currency basis. In fiscal 2017 the region reported an Adjusted EBITDA margin of 16.7% compared to a margin
of 1.9% in fiscal 2016. The improvement is primarily due to stringent cost control measures, which have been
implemented due to the economic climate in the oil and gas sector which resulted in subscriber contraction
in fiscal 2016 and the first half of fiscal 2017. In the second half of fiscal 2017 trading conditions in
the oil and gas sector have improved and as a consequence the subscriber base grew by 11.4% during this
period.
Middle East and Australasia 199,474 (1.3%) 304,450 91,149 (15.0%) 29.9%
The region’s subscriber base grew by 2.5% from March 31, 2016 while subscription revenue declined by 4.2%
on a constant currency basis. The overall decline in subscription revenue is attributable to economic
headwinds experienced by the segment, due to its primary focus being on the mining and oil and
gas sectors. Total revenue in constant currency declined by 5.9% as hardware revenue was also lower than
in fiscal 2016. The region reported an Adjusted EBITDA margin of 29.9%, compared to the fiscal 2016
Adjusted EBITDA margin of 34.2%. During the fourth quarter of fiscal 2017 management have implemented
restructuring plans in the Middle East and Australasia segment which are expected to drive increased
Adjusted EBITDA margins in this region going forward.
Brazil 32,653 80.8% 37,811 9,394 386.5% 24.8%
Subscribers increased by 40.3% since March 31, 2016 and subscription revenue, on a constant currency basis,
increased by 63.0%, due to an increase in the number of bundled subscriptions. On a constant currency basis,
total revenue increased by 47.4%. The segment reported Adjusted EBITDA of R9.4 million in fiscal 2017, at
an Adjusted EBITDA margin of 24.8%, compared to fiscal 2016 Adjusted EBITDA of R1.9 million which represented
an Adjusted EBITDA margin of 8.3%.
Central Services Organization 878 (22.4%) 878 (127,828) (12.7%) -
CSO is responsible for the development of our hardware and software platforms and provides common
marketing, product management, technical and distribution support to each of our other operating
segments. The negative Adjusted EBITDA reported arises as a result of operating expenses carried by
the segment.
Business Outlook
MiX Telematics has translated U.S. Dollar amounts in this Business Outlook paragraph from South African Rand at the
exchange rate of R13.2154 per $1.00, which was the R/$ exchange rate reported by Oanda.com as at May 22, 2017.
Based on information as of today, May 25, 2017, the Company is issuing the following financial guidance for the full
2018 fiscal year:
- Subscription revenue - R1,401 million to R1,421 million ($106.0 million to $107.5 million), which would represent
subscription revenue growth of 13.0% to 14.6% compared to fiscal 2017.
- Total revenue - R1,632 million to R1,662 million ($123.5 million to $125.8 million), which would represent revenue
growth of 6.0% to 7.9% compared to fiscal 2017.
- Adjusted EBITDA - R364 million to R383 million ($27.5 million to $29.0 million), which would represent Adjusted EBITDA
growth of 20.7% to 27.0% compared to fiscal 2017.
- Adjusted earnings per diluted ordinary share of 18.2 to 20.2 South African cents based on a weighted average of
571 million diluted ordinary shares in issue, and based on an effective tax rate of 28.0% to 31.0%. At a ratio of 25
ordinary shares to one ADS, this equates to adjusted earnings per diluted ADS of 34 to 38 U.S. cents.
For the first quarter of fiscal 2018 the Company expects subscription revenue to be in the range of R331 million to
R336 million ($25.0 million to $25.4 million) which would represent subscription revenue growth of 8.2% to 9.8% compared
to the first quarter of fiscal 2017.
The key assumptions used in deriving the forecast are as follows:
- Growth in subscription revenue and subscribers 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 2018 fiscal year of R13.8000 per $1.00.
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 May 25, 2017 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 1-877-857-6177 (within the United States) or 0 800 982 293 (within South Africa) or
1-719-325-4773 (outside of the United States). The conference ID is 6590202.
- A replay of this conference call will be available for a limited time at 1-844-512-2921 (within the United States) or
1-412-317-6671 (within South Africa or outside of the United States). The replay conference ID is 6590202.
- 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
managing over 622,000 assets 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 first quarter
and full year of fiscal 2018, our position to execute on our growth strategy, 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 within
this press release, Adjusted EBITDA and Adjusted EBITDA margin. 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 net
income 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, 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 they are key
measures 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 and Adjusted EBITDA margin can provide a useful
measure for period-to-period comparisons of the Company’s core business. Accordingly, the Company believes that Adjusted
EBITDA and Adjusted EBITDA margin 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 the Company’s 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, the Company’s 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 the Company’s 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 year and the Company’s other results.
Headline Earnings
Headline earnings per share is a profit measure required for JSE-listed companies and is calculated in accordance with
circular 2/2015 issued by the South African Institute of Chartered Accountants. The profit measure is determined by
taking the profit for the year prior to certain separately identifiable re-measurements of the carrying amount of an asset
or liability that arose after the initial recognition of such asset or liability net of related tax (both current and
deferred) and related non-controlling interest.
Adjusted Profit 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.
Constant currency and US Dollar financial information
Financial information presented in United States Dollars ("U.S. Dollars" and "$") and constant currency financial
information presented as part of the segment commentary constitute pro forma financial information under the JSE Listings
Requirements. Unless otherwise stated, MiX Telematics has translated U.S. Dollar amounts from South African Rand ("R") at
the exchange rate of R13.4124 per $1.00, which was the R/$ exchange rate reported by Oanda.com as at March 31, 2017.
Constant currency information has been presented to illustrate the impact of changes in currency rates on the Group’s
results. The constant currency information has been determined by adjusting the current financial reporting year’s
results to the prior year’s average exchange rates, determined as the average of the monthly exchange rates applicable
to the year. The measurement has been performed for each of the Group’s currencies, including the U.S. Dollar and British
Pound. The constant currency growth percentage has been calculated by utilizing the constant currency results compared to
the prior year results.
This pro forma financial information is the responsibility of the Group’s board of directors and is presented for
illustrative purposes. Because of its nature, the pro forma financial information may not fairly present MiX Telematics’s
financial position, changes in equity, results of operations or cash flows. The pro forma financial information does not
constitute pro forma information in accordance with the requirements of Regulation S-X of the SEC or generally accepted
accounting principles in the United States. In addition, the rules and regulations related to the preparation of pro
forma financial information in other jurisdictions may also vary significantly from the requirements applicable in South
Africa. An assurance report has been prepared and issued by our auditors, PricewaterhouseCoopers Inc., in respect of the
pro forma financial information included in this announcement that is available at the registered office of the Company.
The reporting on the pro forma financial information by PricewaterhouseCoopers Inc. has not been carried out in
accordance with the auditing standards generally accepted in the United States ("U.S.") and accordingly should not be
relied upon by U.S. Investors as if it had been carried out in accordance with those standards or any other standards besides
the South African requirements mentioned above.
Investor Contact:
Seth Potter
ICR for MiX Telematics
ir@mixtelematics.com
1-855-564-9835
Sponsor
Java Capital
MIX TELEMATICS LIMITED
SUMMARY CONSOLIDATED INCOME STATEMENTS
South African Rand United States Dollar
Year ended Year ended Year ended Year ended
Figures are in thousands unless otherwise stated March 31, March 31, March 31, March 31,
2017 2016 2017 2016
Audited Audited Unaudited Unaudited
Revenue 1,540,058 1,465,021 114,823 109,229
Cost of sales (498,785) (439,305) (37,188) (32,754)
Gross profit 1,041,273 1,025,716 77,635 76,475
Other income/(expenses) - net 426 1,244 32 93
Operating expenses (903,837) (887,876) (67,388) (66,198)
-Sales and marketing (181,601) (203,767) (13,540) (15,192)
-Administration and other charges (722,236) (684,109) (53,848) (51,006)
Operating profit 137,862 139,084 10,279 10,370
Finance income/(costs) - net 10,391 150,327 775 11,208
-Finance income 16,068 152,164 1,198 11,345
-Finance costs (5,677) (1,837) (423) (137)
Profit before taxation 148,253 289,411 11,054 21,578
Taxation (26,812) (106,920) (1,999) (7,972)
Profit for the year 121,441 182,491 9,055 13,606
Attributable to:
Owners of the parent 121,458 182,989 9,056 13,643
Non-controlling interests (17) (498) (1) (37)
121,441 182,491 9,055 13,606
Earnings per share
-basic (R/$) 0.19 0.24 0.01 0.02
-diluted (R/$) 0.19 0.23 0.01 0.02
Earnings per American Depositary Share (Unaudited)
-basic (R/$) 4.82 5.90 0.36 0.44
-diluted (R/$) 4.81 5.84 0.36 0.44
Ordinary shares (‘000)(1)
-in issue at March 31 563,435 759,138 563,435 759,138
-weighted average 629,626 775,139 629,626 775,139
-diluted weighted average 631,819 783,414 631,819 783,414
Weighted average American Depositary Shares (‘000)(1) (Unaudited)
-in issue at March 31 22,537 30,366 22,537 30,366
-weighted average 25,185 31,006 25,185 31,006
-diluted weighted average 25,273 31,337 25,273 31,337
(1) Excludes 40,000,000 treasury shares held by MiX Telematics Investments Proprietary Limited ("MiX Investments"), a wholly owned
subsidiary of the Group (March 2016: 40,000,000).
MIX TELEMATICS LIMITED
SUMMARY CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
South African Rand United States Dollar
Year ended Year ended Year ended Year ended
Figures are in thousands unless otherwise stated March 31, March 31, March 31, March 31,
2017 2016 2017 2016
Audited Audited Unaudited Unaudited
Profit for the year 121,441 182,491 9,055 13,606
Other comprehensive income:
Items that may be subsequently reclassified to profit or loss
Exchange differences on translating foreign operations (80,870) 90,665 (6,030) 6,760
- Attributable to owners of the parent (80,820) 90,784 (6,026) 6,769
- Attributable to non-controlling interests (50) (119) (4) (9)
Taxation relating to components of other comprehensive income (59) (2,466) (4) (184)
Other comprehensive (loss)/income for the year, net of tax (80,929) 88,199 (6,034) 6,576
Total comprehensive income for the year 40,512 270,690 3,021 20,182
Attributable to:
Owners of the parent 40,579 271,307 3,026 20,228
Non-controlling interests (67) (617) (5) (46)
Total comprehensive income for the year 40,512 270,690 3,021 20,182
MIX TELEMATICS LIMITED
HEADLINE EARNINGS
Reconciliation of headline earnings
South African Rand United States Dollar
Year ended Year ended Year ended Year ended
Figures are in thousands unless otherwise stated March 31, March 31, March 31, March 31,
2017 2016 2017 2016
Audited Audited Unaudited Unaudited
Profit for the year attributable to owners of the parent 121,458 182,989 9,056 13,643
Adjusted for:
Loss on disposal of property, plant and equipment and intangible assets 262 208 20 16
Impairment of intangible assets 3,166 2,871 236 214
(Reversal of impairment)/impairment of property, plant and equipment (791) 1,905 (59) 142
Non-controlling interest effects on the above components 8 (244) 1 (18)
Income tax effect on the above components (661) 2 (50) *
Headline earnings attributable to owners of the parent 123,442 187,731 9,204 13,997
Headline earnings
Headline earnings per share
-basic (R/$) 0.20 0.24 0.01 0.02
-diluted (R/$) 0.20 0.24 0.01 0.02
Headline earnings per American Depositary Share (Unaudited)
-basic (R/$) 4.90 6.05 0.37 0.45
-diluted (R/$) 4.88 5.99 0.36 0.45
* Amount less than $1,000.
MIX TELEMATICS LIMITED
ADJUSTED EARNINGS
Reconciliation of adjusted earnings
South African Rand United States Dollar
Year ended Year ended Year ended Year ended
Figures are in thousands unless otherwise stated March 31, March 31, March 31, March 31,
2017 2016 2017 2016
Audited Audited Unaudited Unaudited
Profit for the year attributable to owners of the parent 121,458 182,989 9,056 13,643
Net foreign exchange gains (1,476) (144,038) (110) (10,739)
Income tax effect on the above component (15,307) 48,647 (1,141) 3,627
Adjusted earnings attributable to owners of the parent 104,675 87,598 7,805 6,531
Adjusted earnings
Adjusted earnings per share
-basic (R/$) 0.17 0.11 0.01 0.01
-diluted (R/$) 0.17 0.11 0.01 0.01
Adjusted earnings per American Depositary Share (Unaudited)
-basic (R/$) 4.16 2.83 0.31 0.21
-diluted (R/$) 4.14 2.80 0.31 0.21
MIX TELEMATICS LIMITED
SUMMARY CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
South African Rand United States Dollar
Figures are in thousands unless otherwise stated March 31, March 31, March 31, March 31,
2017 2016 2017 2016
Audited Audited Unaudited Unaudited
ASSETS
Non-current assets
Property, plant and equipment 294,120 235,584 21,929 17,565
Intangible assets 881,900 846,851 65,753 63,139
Finance lease receivable 22 167 2 12
Deferred tax assets (note 14) 28,130 30,005 2,097 2,237
Total non-current assets 1,204,172 1,112,607 89,781 82,953
Current assets
Inventory (note 6) 26,449 64,489 1,972 4,808
Trade and other receivables 260,576 293,045 19,428 21,849
Finance lease receivable 140 984 10 73
Taxation (note 14) 26,302 8,886 1,961 663
Restricted cash 13,268 21,134 989 1,576
Cash and cash equivalents 375,782 877,136 28,018 65,397
Total current assets 702,517 1,265,674 52,378 94,366
Total assets 1,906,689 2,378,281 142,159 177,319
EQUITY
Stated capital 854,345 1,320,955 63,698 98,488
Other reserves (4,370) 74,262 (324) 5,538
Retained earnings 594,514 526,082 44,326 39,224
Equity attributable to owners of the parent 1,444,489 1,921,299 107,700 143,250
Non-controlling interest (1,558) (1,491) (118) (113)
Total equity 1,442,931 1,919,808 107,582 143,137
LIABILITIES
Non-current liabilities
Deferred tax liabilities (note 14) 100,067 120,981 7,461 9,020
Provisions 1,833 3,514 137 262
Total non-current liabilities 101,900 124,495 7,598 9,282
Current liabilities
Trade and other payables (note 12) 309,110 282,647 23,046 21,073
Borrowings - 1,103 - 82
Taxation (note 14) 4,521 2,795 337 208
Provisions (note 12) 28,778 31,059 2,146 2,316
Bank overdraft 19,449 16,374 1,450 1,221
Total current liabilities 361,858 333,978 26,979 24,900
Total liabilities 463,758 458,473 34,577 34,182
Total equity and liabilities 1,906,689 2,378,281 142,159 177,319
Net cash (note 7) 356,333 859,659 26,568 64,094
Net asset value per share (R/$) 2.56 2.53 0.19 0.19
Net tangible asset value per share (R/$) 1.00 1.42 0.07 0.11
Capital expenditure
-incurred 289,418 252,734 21,578 18,843
-authorized but not spent 132,836 119,375 9,904 8,900
MIX TELEMATICS LIMITED
SUMMARY CONSOLIDATED STATEMENTS OF CASH FLOWS
South African Rand United States Dollar
Year ended Year ended Year ended Year ended
March 31, March 31, March 31, March 31,
Figures are in thousands unless otherwise stated 2017 2016 2017 2016
Audited Audited Unaudited Unaudited
Cash flows from operating activities
Cash generated from operations 377,115 293,808 28,117 21,906
Net finance income received 9,057 6,105 675 455
Taxation paid (62,601) (59,479) (4,667) (4,435)
Net cash generated from operating activities 323,571 240,434 24,125 17,926
Cash flows from investing activities
Capital expenditure payments (295,523) (241,860) (22,034) (18,033)
Proceeds on sale of property, plant and equipment and intangible assets 369 633 28 47
Acquisition of business, net of cash acquired - (18,000) - (1,342)
Deferred consideration paid (1,103) (1,361) (82) (101)
Decrease in restricted cash 6,951 19,346 518 1,442
Increase in restricted cash (3,588) (8,472) (268) (632)
Net cash used in investing activities (292,894) (249,714) (21,838) (18,619)
Cash flows from financing activities
Proceeds from issuance of ordinary shares 7,072 7,722 527 576
Share repurchase (note 8) (473,682) (123,760) (35,317) (9,227)
Dividends paid to Company’s owners (52,966) (107,150) (3,949) (7,989)
Repayment of borrowings - (41) - (3)
Net cash used in financing activities (519,576) (223,229) (38,739) (16,643)
Net decrease in cash and cash equivalents (488,899) (232,509) (36,452) (17,336)
Net cash and cash equivalents at the beginning of the year 860,762 927,415 64,177 69,146
Exchange (losses)/gains on cash and cash equivalents (15,530) 165,856 (1,158) 12,367
Net cash and cash equivalents at the end of the year 356,333 860,762 26,567 64,177
FREE CASH FLOW
Reconciliation of free cash flow to net cash generated from operating activities
South African Rand United States Dollar
Year ended Year ended Year ended Year ended
Figures are in thousands unless otherwise stated March 31, March 31, March 31, March 31,
2017 2016 2017 2016
Unaudited Unaudited Unaudited Unaudited
Net cash generated from operating activities 323,571 240,434 24,125 17,926
Capital expenditure payments (295,523) (241,860) (22,034) (18,033)
Free cash flow 28,048 (1,426) 2,091 (107)
MIX TELEMATICS LIMITED
SUMMARY CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED MARCH 31, 2017
Attributable to owners of the parent
South African Rand Non-
Figures are in thousands unless otherwise stated Stated Other Retained controlling Total
capital reserves earnings Total interest equity
Balance at March 31, 2015 (Audited) 1,436,993 (21,894) 450,347 1,865,446 (874) 1,864,572
Total comprehensive income - 88,318 182,989 271,307 (617) 270,690
Profit for the year - - 182,989 182,989 (498) 182,491
Other comprehensive income - 88,318 - 88,318 (119) 88,199
Total transactions with owners (116,038) 7,838 (107,254) (215,454) - (215,454)
Shares issued in relation to share options exercised 7,722 - - 7,722 - 7,722
Share-based payment - 7,838 - 7,838 - 7,838
Dividends declared - - (107,254) (107,254) - (107,254)
Share repurchase (123,760) - - (123,760) - (123,760)
Balance at March 31, 2016 (Audited) 1,320,955 74,262 526,082 1,921,299 (1,491) 1,919,808
Total comprehensive income - (80,879) 121,458 40,579 (67) 40,512
Profit for the year - - 121,458 121,458 (17) 121,441
Other comprehensive loss - (80,879) - (80,879) (50) (80,929)
Total transactions with owners (466,610) 2,247 (53,026) (517,389) - (517,389)
Shares issued in relation to share options exercised 7,072 - - 7,072 - 7,072
Share-based payment - 2,247 - 2,247 - 2,247
Dividends declared (note 9) - - (53,026) (53,026) - (53,026)
Share repurchase (note 8) (473,682) - - (473,682) - (473,682)
Balance at March 31, 2017 (Audited) 854,345 (4,370) 594,514 1,444,489 (1,558) 1,442,931
MIX TELEMATICS LIMITED
SUMMARY CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED MARCH 31, 2017
Attributable to owners of the parent
United States Dollar Non-
Figures are in thousands unless otherwise stated Stated Other Retained controlling Total
capital reserves earnings Total interest equity
Balance at March 31, 2015 (Unaudited) 107,139 (1,631) 33,577 139,085 (67) 139,018
Total comprehensive income - 6,585 13,643 20,228 (46) 20,182
Profit for the year - - 13,643 13,643 (37) 13,606
Other comprehensive income - 6,585 - 6,585 (9) 6,576
Total transactions with owners (8,651) 584 (7,996) (16,063) - (16,063)
Shares issued in relation to share options exercised 576 - - 576 - 576
Share-based payment - 584 - 584 - 584
Dividends declared - - (7,996) (7,996) - (7,996)
Share repurchase (9,227) - - (9,227) - (9,227)
Balance at March 31, 2016 (Unaudited) 98,488 5,538 39,224 143,250 (113) 143,137
Total comprehensive income - (6,030) 9,056 3,026 (5) 3,021
Profit for the year - - 9,056 9,056 (1) 9,055
Other comprehensive loss - (6,030) - (6,030) (4) (6,034)
Total transactions with owners (34,790) 168 (3,954) (38,576) - (38,576)
Shares issued in relation to share options exercised 527 - - 527 - 527
Share-based payment - 168 - 168 - 168
Dividends declared (note 9) - - (3,954) (3,954) - (3,954)
Share repurchase (note 8) (35,317) - - (35,317) - (35,317)
Balance at March 31, 2017 (Unaudited) 63,698 (324) 44,326 107,700 (118) 107,582
NOTES TO SUMMARY CONSOLIDATED FINANCIAL RESULTS
1. Basis of preparation and accounting policies
The summary consolidated financial statements are prepared in accordance with the requirements of the JSE Limited
Listings Requirements for preliminary reports and the requirements of the Companies Act applicable to summary financial
statements. The Listings Requirements require preliminary reports to be prepared in accordance with the framework concepts
and the measurement and recognition requirements of International Financial Reporting Standards (IFRS) and the SAICA
Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Pronouncements as issued by the
Financial Reporting Standards Council and to also, as a minimum, contain the information required by IAS 34 Interim
Financial Reporting.
The accounting policies applied in the preparation of the consolidated financial statements from which the summary consolidated
financial statements were derived are in terms of International Financial Reporting Standards and are consistent with those
accounting policies applied in the preparation of the previous consolidated annual financial statements, unless otherwise stated.
The summary consolidated financial statements do not include all the information and disclosures required in the financial
statements and should be read in conjunction with the Group’s financial statements for the year ended March 31, 2017, which have
been prepared in accordance with IFRS.
The Group has adopted all the new, revised or amended accounting pronouncements as issued by the International Accounting
Standards Board (IASB) which were effective for the Group from April 1, 2016, none of which had a material impact on the Group.
Presentation currency and convenience translation
The Group’s presentation currency is South African Rand. In addition to presenting these summary consolidated financial results
in South African Rand, supplementary information in U.S. Dollars has been prepared for the convenience of users of the Group
financial results. Unless otherwise stated, the Group has translated U.S. Dollar amounts from South African Rand at the exchange
rate of R13.4124 per $1.00, which was the R/$ exchange rate reported by Oanda.com as at March 31, 2017. The U.S. Dollar figures
may not compute as they are rounded independently.
The supplementary information prepared in U.S. Dollars constitutes pro forma financial information under the JSE Listings
Requirements. This pro forma financial information is the responsibility of the Group’s board of directors and is
presented for illustrative purposes. Because of its nature, the pro forma financial information may not fairly present MiX
Telematics’s financial position, changes in equity, results of operations or cash flows. The pro forma financial
information does not constitute pro forma information in accordance with the requirements of Regulation S-X of the SEC or
generally accepted accounting principles in the United States. In addition, the rules and regulations related to the
preparation of pro forma financial information in other jurisdictions may also vary significantly from the requirements
applicable in South Africa. An assurance report has been prepared and issued by our auditors, PricewaterhouseCoopers Inc.,
in respect of the pro forma financial information included in this announcement that is available at the registered office
of the Company. The reporting on the pro forma financial information by PricewaterhouseCoopers Inc. has not been carried
out in accordance with the auditing standards generally accepted in the U.S. and accordingly should not be relied upon
by U.S. investors as if it had been carried out in accordance with those standards or any other standards besides the
South African requirements mentioned above.
The Group’s summary consolidated financial statements were prepared under the supervision of the Interim Group Chief
Financial Officer, P Dell CA(SA). The results were made available on May 25, 2017.
2. Independent audit
The summary consolidated financial statements (excluding the commentary, pro forma financial information presented in
U.S. Dollars, basic and diluted earnings and basic and diluted headline earnings information relating to American
Depository Shares, the free cash flow reconciliation to net cash generated from operating activities and the disclosure
included in notes 5 and 15 (relating to subscriber numbers) and the Unaudited Group financial results for the quarter ended
March 31, 2017 hereinafter defined as audited summary consolidated financial statements, for the year ended March 31, 2017
have been derived from the audited consolidated financial statements. The directors of MiX Telematics Limited take full
responsibility for the preparation of the summary consolidated financial statements and that the financial information
has been correctly derived from the underlying audited consolidated financial statements. These audited summary
consolidated financial statements for the year ended March 31, 2017 have been audited by PricewaterhouseCoopers Inc., who
expressed an unmodified opinion thereon. The auditor also expressed an unmodified opinion on the financial statements from
which these audited summary consolidated financial statements were derived.
A copy of the auditor’s report on the audited summary consolidated financial statements and of the auditor’s report on
the consolidated financial statements are available for inspection at MiX Telematics Limited’s registered office,
together with the financial statements identified in the respective auditor’s reports.
The auditor’s report does not necessarily report on all of the information contained in these financial results.
Shareholders are therefore advised that in order to obtain a full understanding of the nature of the auditor’s engagement
they should obtain a copy of the auditor’s report together with the accompanying financial information from MiX Telematics
Limited’s registered office.
3. Segment information
Our operating segments are based on the geographical location of our Regional Sales Offices ("RSOs") and also include
our Central Services Organization ("CSO"). CSO is our central services organization that wholesales our products and
services to our RSOs who, in turn, interface with our end-customers, distributors and dealers. CSO is also responsible for
the development of our hardware and software platforms and provides common marketing, product management, technical and
distribution support to each of our other operating segments.
The chief operating decision maker ("CODM") reviews the segment results on an integral margin basis as defined by
management. In respect of revenue, this method of measurement entails reviewing the segmental results based on external
revenue only. In respect of Adjusted EBITDA (the profit measure identified by the CODM), the margin generated by CSO, net
of any unrealized intercompany profit, is allocated to the geographic region where the external revenue is recorded by
our RSOs. The costs remaining in CSO relate mainly to research and development of hardware and software platforms,
common marketing, product management and technical and distribution support to each of the RSOs. CSO is a reportable segment
of the Group because it produces discrete financial information which is reviewed by the CODM and has the ability to
generate external revenues.
Each RSO’s results therefore reflect the external revenue earned, as well as the Adjusted EBITDA earned (or loss
incurred) by each operating segment before the remaining CSO and corporate costs allocations. Segment assets are not
disclosed as segment information is not reviewed on such a basis by the CODM.
SUMMARY SEGMENTAL ANALYSIS
Subscription Hardware and Total Adjusted
South African Rand revenue other revenue revenue EBITDA
Figures are in thousands unless otherwise stated
Year ended March 31, 2017 (Audited)
Regional Sales Offices
Africa 772,224 86,945 859,169 344,077
Europe 113,223 64,108 177,331 52,369
Americas 121,462 38,957 160,419 26,804
Middle East and Australasia 199,474 104,976 304,450 91,149
Brazil 32,653 5,158 37,811 9,394
Total Regional Sales Offices 1,239,036 300,144 1,539,180 523,793
Central Services Organization 878 - 878 (127,828)
Total Segment Results 1,239,914 300,144 1,540,058 395,965
Corporate and consolidation entries - - - (94,352)
Total 1,239,914 300,144 1,540,058 301,613
South African Rand Subscription Hardware and Total Adjusted
Figures are in thousands unless otherwise stated revenue other revenue revenue EBITDA
Year ended March 31, 2016 (Audited)
Regional Sales Offices
Africa 711,208 96,699 807,907 320,466
Europe 110,251 51,736 161,987 35,359
Americas 115,413 41,527 156,940 2,908
Middle East and Australasia 202,163 111,764 313,927 107,279
Brazil 18,063 5,066 23,129 1,931
Total Regional Sales Offices 1,157,098 306,792 1,463,890 467,943
Central Services Organization 1,131 - 1,131 (113,403)
Total Segment Results 1,158,229 306,792 1,465,021 354,540
Corporate and consolidation entries - - - (77,325)
Total 1,158,229 306,792 1,465,021 277,215
SUMMARY SEGMENTAL ANALYSIS
Subscription Hardware and Total Adjusted
United States Dollar revenue other revenue revenue EBITDA
Figures are in thousands unless otherwise stated
Year ended March 31, 2017 (Unaudited)
Regional Sales Offices
Africa 57,575 6,482 64,057 25,654
Europe 8,442 4,780 13,222 3,905
Americas 9,056 2,905 11,961 1,998
Middle East and Australasia 14,872 7,827 22,699 6,796
Brazil 2,435 384 2,819 700
Total Regional Sales Offices 92,380 22,378 114,758 39,053
Central Services Organization 65 - 65 (9,530)
Total Segment Results 92,445 22,378 114,823 29,523
Corporate and consolidation entries - - - (7,034)
Total 92,445 22,378 114,823 22,489
United States Dollar Subscription Hardware and Total Adjusted
Figures are in thousands unless otherwise stated revenue other revenue revenue EBITDA
Year ended March 31, 2016 (Unaudited)
Regional Sales Offices
Africa 53,026 7,210 60,236 23,893
Europe 8,220 3,857 12,077 2,636
Americas 8,605 3,096 11,701 217
Middle East and Australasia 15,073 8,333 23,406 7,998
Brazil 1,347 379 1,726 144
Total Regional Sales Offices 86,271 22,875 109,146 34,888
Central Services Organization 83 - 83 (8,455)
Total Segment Results 86,354 22,875 109,229 26,433
Corporate and consolidation entries - - - (5,765)
Total 86,354 22,875 109,229 20,668
4. Reconciliation of Adjusted EBITDA to Profit for the year
South African Rand United States Dollar
Year ended Year ended Year ended Year ended
Figures are in thousands unless otherwise stated March 31, March 31, March 31, March 31,
2017 2016 2017 2016
Audited Audited Unaudited Unaudited
Adjusted EBITDA 301,613 277,215 22,489 20,668
Add:
Decrease in restructuring costs provision - 333 - 25
Reversal of impairment (1) 791 - 59 -
Less:
Depreciation (2) (98,508) (75,037) (7,345) (5,594)
Amortization (3) (44,734) (47,586) (3,335) (3,548)
Impairment (4) (3,166) (4,776) (236) (355)
Share-based compensation costs (3,311) (5,820) (247) (434)
Equity-settled share-based compensation costs (2,247) (7,838) (168) (584)
Cash-settled share-based compensation costs (1,064) 2,018 (79) 150
Net loss on sale of property, plant and equipment and intangible assets (262) (208) (20) (16)
Increase in restructuring costs provision (5) (14,561) - (1,086) -
Transaction costs arising from investigating strategic alternatives - (5,037) - (376)
Operating profit 137,862 139,084 10,279 10,370
Add: Finance income/(costs) - net 10,391 150,327 775 11,208
Less: Taxation (26,812) (106,920) (1,999) (7,972)
Profit for the year 121,441 182,491 9,055 13,606
(1) The reversal of impairment of R0.8 million ($0.06 million) relates to in-vehicle devices in the Brazil segment. The
improvement in trading conditions in the Brazil segment resulted in the re-assessment of its recoverable amount in fiscal
2017. In fiscal 2017 the assessment indicated that the recoverable amount was higher than its carrying value which led to
the aforementioned impairment reversal. A 1% increase in the discount rate or 5% decrease in the cash flows
utilized in the value in use calculation would have resulted in an impairment of R2.7 million ($0.2 million) or R0.5 million
($0.04 million), respectively, rather than the reversal recorded.
(2) Includes depreciation of property, plant and equipment (including in-vehicle devices).
(3) Includes amortization of intangible assets (including capitalized in-house development costs and intangible assets
identified as part of a business combination).
(4) Asset impairments relate to the impairment of capitalized product development costs of R2.6 million ($0.2 million) in
the Africa segment and R0.5 million ($0.04 million) in the CSO segment. In 2016, includes R2.9 million ($0.2 million)
impairment of in-house software and R1.9 million ($0.1 million) related to in-vehicle devices.
(5) Restructuring costs incurred are described in note 12.
5. Reconciliation of Adjusted EBITDA margin to Profit for the year margin
Year ended Year ended
March 31, March 31,
2017 2016
Unaudited Unaudited
Adjusted EBITDA margin 19.6% 18.9%
Add:
Decrease in restructuring costs provision - 0.0%
Reversal of impairment 0.1% -
Less:
Depreciation (6.4%) (5.1%)
Amortization (3.0%) (3.3%)
Impairment (0.2%) (0.3%)
Share-based compensation costs (0.2%) (0.4%)
Equity-settled share-based compensation costs (0.1%) (0.5%)
Cash-settled share-based compensation costs (0.1%) 0.1%
Net loss on sale of property, plant and equipment and intangible assets (0.0%) (0.0%)
Increase in restructuring costs provision (0.9%) -
Transaction costs arising from investigating strategic alternatives - (0.3%)
Operating profit margin 9.0% 9.5%
Add: Finance income/(costs) - net 0.7% 10.3%
Less: Taxation (1.8%) (7.3%)
Profit for the year margin 7.9% 12.5%
6. Inventory
The decline in the inventory balance is primarily attributable to a shift towards bundled deals, in terms of which the
related hardware and accessories are accounted for as uninstalled in-vehicle devices under property, plant and
equipment.
7. Net Cash
Net cash is calculated as being net cash and cash equivalents, excluding restricted cash less interest bearing
borrowings.
8. Specific Share Repurchase 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, to repurchase all 200,828,260 of the Company’s shares held by Imperial Corporate
Services (the "repurchase shares") at R2.36 ($0.18) per repurchase share, for an aggregate repurchase consideration of
R474.0 million or $35.3 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 , at which point the transaction was accounted for in terms of IFRS. The repurchase was implemented on August 29,
2016. Subsequent to the repurchase, the shares were delisted and now form part of the authorized unissued share capital
of the Company.
The financial effect of the transaction is as follows:
Year ended Year ended
March 31, March 31,
2017 2017
South African Rand United States Dollar
Audited Unaudited
Aggregate repurchase consideration 473,955 35,337
Impact of discounting related to the fiscal 2017 share repurchase transaction (3,222) (240)
Transaction costs capitalized 2,949 220
Total share repurchase cost 473,682 35,317
9. Dividends
During fiscal 2016 the Board decided to reintroduce the Company’s policy of paying regular dividends. Dividend
payments are currently considered on a quarter-by-quarter basis.
The following dividends were declared by the Company in fiscal 2017 (excluding dividends paid on treasury shares):
- In respect of the fourth quarter of fiscal 2016, a dividend of R15.2 million ($1.1 million) was declared on
May 24, 2016 and paid on June 20, 2016. Using shares in issue of 761,337,500 (excluding 40,000,000 treasury shares),
this equated to a dividend of 2 South African cents or 0.1 U.S. cents per share.
- In respect of the first quarter of fiscal year 2017, a dividend of R15.3 million ($1.1 million) was declared on
August 4, 2016 and paid on August 29, 2016. Using shares in issue of 763,087,500 (excluding 40,000,000 treasury shares),
this equated to a dividend of 2 South African cents or 0.1 U.S. cents per share.
- In respect of the second quarter of fiscal year 2017, a dividend of R11.3 million ($0.8 million) was declared on
November 3, 2016 and paid on November 28, 2016. Using shares in issue of 563,434,240 (excluding 40,000,000 treasury
shares), this equated to a dividend of 2 South African cents and 0.1 U.S. cents per share.
- In respect of the third quarter of fiscal year 2017, a dividend of R11.2 million ($0.8 million) was declared on
February 2, 2017 and paid on February 27, 2017. Using shares in issue of 563,434,240 (excluding 40,000,000 treasury
shares), this equated to a dividend of 2 South African cents and 0.1 U.S. cents per share.
The following dividends were declared by the Company in fiscal 2016:
- In respect of the 2015 fiscal year, a dividend of R61.5 million ($4.6 million) was declared on August 25, 2015 and
paid on September 21, 2015. Using shares in issue of 768,601,150 (excluding 24,573,850 treasury shares), this equated
to a dividend of 8 South African cents and 0.6 U.S. cents per share.
- In respect of the first quarter of fiscal year 2016 which ended on June 30, 2015, a dividend of R15.4 million
($1.1 million) was declared on August 25, 2015 and paid on September 21, 2015. Using shares in issue of 768,601,150
(excluding 24,573,850 treasury shares), this equated to a dividend of 2 South African cents and 0.1 U.S. cents per share.
- In respect of the second quarter of fiscal year 2016 which ended on September 30, 2015, a dividend of R15.3 million
($1.1 million) was declared on November 5, 2015 and paid on November 30, 2015. Using shares in issue of 764,140,181
(excluding 30,334,819 treasury shares), this equated to a dividend of 2 South African cents and 0.1 U.S. cents per share.
- In respect of the third quarter of fiscal year 2016 which ended on December 31, 2015, a dividend of R15.1 million
($1.1 million) was declared on February 4, 2016 and paid on February 29, 2016. Using shares in issue of 755,137,500
(excluding 40,000,000 treasury shares), this equated to a dividend of 2 South African cents and 0.1 U.S. cents per share.
10. Fair values of financial assets and liabilities measured at amortized cost
The fair values of trade and other receivables, restricted cash, cash and cash equivalents, trade payables, accruals,
bank overdrafts and other payables approximate their book values as the impact of discounting is not considered material
due to the short-term nature of both the receivables and payables.
11. Contingencies
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
R48.4 million ($3.6 million). No loss is considered probable under this arrangement.
12. Provisions and trade and other payables
Provisions
During March 2017, restructuring plans were implemented by the Europe and Middle East and Australasia segments. The
total cost of the restructuring plans is expected to approximate R15.0 million ($1.1 million). These costs consist of
estimated staff costs in respect of affected employees. By March 31, 2017, R2.7 million ($0.2 million) of the expected
restructuring costs had been incurred and the remaining provision of R11.5 million ($0.9 million) is expected to be fully
utilized over the next 12 months.
Trade and other payables
The increase in trade and other payables is primarily attributable to an increase in accruals of R20.8 million ($1.6 million)
relating to employee and third party costs.
13. Change in estimate of useful lives of product development costs capitalized
During fiscal 2017 the CSO segment extended the useful lives of certain projects where on average the useful lives
were increased from 4.9 years to 7.5 years. The extension of the useful lives resulted in a R9.0 million ($0.7 million)
reduction in the product development amortization expense relative to what it would have been in fiscal 2017 had the change
not occurred. R2.0 million ($0.1 million), R1.4 million ($0.1 million), R1.6 million ($0.1 million), R1.2 million
($0.1 million), R0.9 million ($0.1 million), R0.9 million ($0.1 million), R0.8 million ($0.1 million) and R0.2 million
($0.01 million) of this amortization reduction is expected to be charged to the income statement in the 2018, 2019, 2020,
2021, 2022, 2023, 2024 and 2025 fiscal years, respectively.
14. Taxation
Section 11D Allowances relating to tax assets recognized
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 No. 58
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 in the 2013 and 2014 fiscal years did not, in the DST’s opinion,
constitute qualifying expenditure in terms of the Act. MiX International, through due legal process, had formally
requested a review of the DST’s decision not to approve this expenditure. While approvals were obtained for a portion of this
project expenditure as a result of a further review performed by the DST in February 2017, we continue to seek approval
for the remaining projects and as such the legal process is ongoing. In addition to the approvals that were subject to
the legal process, further approvals have been obtained for certain project expenditure, relating to both current and
prior financial years. However, at period end, an uncertain tax position remains in relation to S11D deductions in respect
of which approvals remain pending.
Since the introduction of the DST pre-approval process, the Group has recognized in the income statement cumulative
tax incentives in addition to the incurred cost of R18.2 million ($1.4 million) in respect of S11D deductions, of which
R9.7 million ($0.7 million) was recognized in the current financial year. R15.4 million ($1.1 million) relates to
deductions in respect of development project expenditure which has been approved by the DST. R2.8 million ($0.2 million) relates
to an uncertain tax position in respect of projects where approvals have not yet been received from the DST. If the
Group is unsuccessful in this regard, the Group will not recover the R2.8 million ($0.2 million) raised at March 31, 2017.
Deferred tax asset on assessed loss
During fiscal 2017 the Group raised a deferred tax asset of R5.3 million ($0.4 million) in respect of a portion of the
tax losses available in the Europe segment. These tax losses were incurred in prior years. Since fiscal 2015, the
entity started returning to profitability resulting in a re-assessment of its ability to utilize the tax losses and the
recognition of a deferred tax asset for a portion thereof.
Taxation receivable
The taxation receivable includes amounts due of R14.9 million ($1.1 million) in respect of S11D tax incentives at
March 31, 2017.
Deferred tax liability
The decline in the deferred tax liability is primarily as a result of the effect of exchange rate movements.
15. Other operating and financial data
South African Rand United States Dollar
Year ended Year ended Year ended Year ended
Figures are in thousands except for subscribers March 31, March 31, March 31, March 31,
2017 2016 2017 2016
Audited Audited Unaudited Unaudited
Subscription revenue 1,239,914 1,158,229 92,445 86,355
Adjusted EBITDA 301,613 277,215 22,489 20,668
Cash and cash equivalents 375,782 877,136 28,018 65,397
Net cash 356,333 859,659 26,568 64,094
Capital expenditure incurred 289,418 252,734 21,579 18,843
Property, plant and equipment expenditure 170,010 167,387 12,676 12,480
Intangible asset expenditure 119,408 85,347 8,903 6,363
Total development costs incurred 142,112 115,902 10,596 8,642
Development costs capitalized 78,020 58,869 5,817 4,390
Development costs expensed within administration and other charges 64,092 57,033 4,779 4,252
Subscribers (Line unaudited) 622,062 566,177 622,062 566,177
Exchange Rates
The following major rates of exchange were used:
South African Rand: United States Dollar
-closing 13.41 14.83
-average 14.06 13.78
South African Rand: British Pound
-closing 16.75 21.31
-average 18.42 20.63
The Group’s functional and presentation currency is South African Rand. The strengthening of the closing rate of the
South African Rand against the functional currencies of the Group’s foreign operations contributed significantly to the
decrease in assets and liabilities and the resulting foreign currency translation reserve reduction of R80.9 million
($6.0 million) since March 31, 2016.
16. Changes to the Board
With effect from June 1, 2016, Ian Jacobs was appointed as an independent non-executive director to the Board of
Directors.
With effect from August 18, 2016, Mark Lamberti and George Nakos (non-executive alternate director to Mark Lamberti)
resigned from the Board of Directors in accordance with the terms of the specific repurchase of shares from Imperial
Corporate Services (note 8).
With effect from October 3, 2016, Robin Frew was appointed Chairman of the Board of Directors. Richard Bruyns, the
outgoing Chairman, remained on the Board and was appointed to the new role of Lead Independent non-executive Director.
Richard Bruyns has also taken on the role of Chairman of the Remuneration and Nomination Committee.
With effect from February 9, 2017, Paul Dell was appointed to the Board of Directors as Interim Group Chief Financial
Officer of the Company. Paul Dell replaced Megan Pydigadu who tendered her resignation as Group Chief Financial Officer
and member of the Board on November 15, 2016 to pursue a new career opportunity in a non-competitive industry.
17. Changes to the Company Secretary
With effect from January 3, 2017, Java Capital Trustees and Sponsors Proprietary Limited resigned as company secretary
to the Company and Jennifer de Vos was appointed as the new company secretary.
With effect from May 17, 2017, Jennifer de Vos resigned as company secretary to the Company and Java Capital Trustees
and Sponsors Proprietary Limited was appointed as the new company secretary on an interim basis with immediate effect,
until a new company secretary is appointed.
18. Events after the reporting period
Other than the items below, the directors are not aware of any matter material or otherwise arising since March 31, 2017
and up to the date of this report, not otherwise dealt with herein.
Share Buy Back
Shareholders are advised that the MiX Telematics Board has approved, on May 23, 2017, a share repurchase programme
of up to R270 million ($20.1 million) under which the Company may repurchase its ordinary shares, including American
Depositary Shares ("ADSs"). The Company may repurchase its shares from time to time in its discretion through open market
transactions and block trades, based on ongoing assessments of the capital needs of the Company, the market price of its
securities and general market conditions. This share repurchase programme may be discontinued at any time by the Board of
Directors, and the Company has no obligation to repurchase any amount of its securities under the programme. The repurchase
programme will be funded out of existing cash resources.
The repurchase programme will extend from May 29, 2017 unless and until discontinued by the Directors or the date when the
R270 million ($20.1 million) limit is exhausted. Any repurchases effected under the share repurchase programme will be in
accordance with the general authority granted by special resolution of the Company’s shareholders passed at the Company’s
annual general meeting held on September 14, 2016. Subject to the passing of a special resolution at the Company’s annual
general meeting to be held on September 20, 2017, the repurchase programme will continue to be effected under the general
authority granted by shareholders at that meeting. Should the special resolution, granting the general authority to
repurchase shares, not be passed at the Company’s annual general meeting to be held on September 20, 2017, the repurchase
programme will end on September 20, 2017.
Share repurchases may be made by the Company from time to time in open market transactions at prevailing market prices and
in accordance with the Company's insider trading policy. With respect to repurchases of ADSs on the New York Stock Exchange,
the Company will effect such transactions in compliance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended.
In accordance with JSE listing rules, repurchases effected on the JSE will be at a price not greater than 10% above the
volume weighted average trading price of the Company’s shares on the JSE over the five business days immediately preceding
any particular repurchase.
Any repurchases made are subject to the Company performing the solvency and liquidity tests required by the Companies Act
in South Africa.
Dividend declared
On May 23, 2017 the board declared in respect of the fourth quarter of fiscal 2017 which ended on March 31, 2017, a dividend
of 2 South African cents (0.1 U.S. cents) per ordinary share to be paid on June 19, 2017.
Details of Dividend Declared
The details with respect to the dividends declared for ordinary shareholders are as follows:
Last day to trade cum dividend Monday, June 12, 2017
Securities trade ex dividend Tuesday, June 13, 2017
Record date Thursday, June 15, 2017
Payment date Monday, June 19, 2017
Share certificates may not be dematerialized or rematerialized between Tuesday, June 13, 2017 and Thursday, June 15, 2017,
both days inclusive.
Shareholders are advised of the following additional information:
- the dividend has been declared out of income reserves;
- with effect from February 22, 2017, the local dividends tax rate increased from 15% to 20%;
- the gross local dividend amounts to 2 South African cents per ordinary share;
- the net local dividend amount is 1.6 South African cents per ordinary share for shareholders liable to pay dividends
tax;
- the issued ordinary share capital of MiX Telematics is 603,434,240 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) Monday, June 12, 2017
Record date Thursday, June 15, 2017
Approximate date of currency conversion Monday, June 19, 2017
Approximate dividend payment date Monday, June 19, 2017
Annual general meeting
The annual general meeting of shareholders of MiX Telematics Limited will be held at Matrix Corner, Howick Close, Waterfall
Park, Midrand, Johannesburg on Wednesday, September 20, 2017 at 11:30 a.m. (South African time). For South African
shareholders, the last day to trade in order to be eligible to participate in and vote at the annual general meeting is
Tuesday, September 12, 2017 and the record date for voting purposes is Friday, September 15, 2017.
Taxation
As advised in our March 2016 Annual Report on Form 20-F as filed with the SEC, the Group’s effective tax rate may be
impacted by certain non-deductible/(non-taxable) foreign exchange movements. This has had a significant impact on our
tax rate in fiscal 2017. The impact of these foreign exchange movements and related tax effects is shown below:
South African Rand Year ended March 2017 Year ended March 2016
Unaudited Unaudited
Profit for Foreign exchange Adjusted Profit for Foreign exchange Adjusted
the period gains earnings the period gains earnings
Profit before tax 148,253 (1,476) 146,777 289,411 (144,038) 145,373
Taxation (26,812) (15,307) (42,119) (106,920) 48,647 (58,273)
Profit after tax 121,441 (16,783) 104,658 182,491 (95,391) 87,100
Attributable to:
Owners of the parent 121,458 (16,783) 104,675 182,989 (95,391) 87,598
Minority Interest (17) - (17) (498) - (498)
121,441 (16,783) 104,658 182,491 (95,391) 87,100
Effective tax rate 18.1% - 28.7% 36.9% - 40.1%
United States Dollar Year ended March 2017 Year ended March 2016
Unaudited Unaudited
Profit for Foreign exchange Adjusted Profit for Foreign exchange Adjusted
the period gains earnings the period gains earnings
Profit before tax 11,054 (110) 10,944 21,578 (10,739) 10,839
Taxation (1,999) (1,141) (3,140) (7,972) 3,627 (4,345)
Profit after tax 9,055 (1,251) 7,804 13,606 (7,112) 6,494
Attributable to:
Owners of the parent 9,056 (1,251) 7,805 13,643 (7,112) 6,531
Minority Interest (1) - (1) (37) - (37)
9,055 (1,251) 7,804 13,606 (7,112) 6,494
Effective tax rate 18.1% - 28.7% 36.9% - 40.1%
Excluding the impact of foreign exchange gains and losses and its related tax consequences, the effective tax rate is
11.4% lower than fiscal 2016.
For and on behalf of the board:
R Frew SB Joselowitz
Midrand
May 24, 2017
MIX TELEMATICS LIMITED
CONDENSED CONSOLIDATED INCOME STATEMENTS
South African Rand United States Dollar
Three months ended Three months ended Three months ended Three months ended
Figures are in thousands unless otherwise stated March 31, March 31, March 31, March 31,
2017 2016 2017 2016
Unaudited Unaudited Unaudited Unaudited
Revenue 391,427 384,024 29,184 28,632
Cost of sales (126,384) (98,977) (9,423) (7,380)
Gross profit 265,043 285,047 19,761 21,252
Other income/(expenses) - net (136) 471 (10) 35
Operating expenses (223,994) (239,861) (16,701) (17,883)
-Sales and marketing (35,260) (55,503) (2,629) (4,138)
-Administration and other charges (188,734) (184,358) (14,072) (13,745)
Operating profit 40,913 45,657 3,050 3,404
Finance income/(costs) - net (4,142) (26,110) (309) (1,947)
-Finance income 1,790 2,210 133 165
-Finance costs (5,932) (28,321) (442) (2,112)
Profit before taxation 36,771 19,547 2,741 1,457
Taxation (5,525) (5,785) (412) (431)
Profit for the period 31,246 13,762 2,329 1,026
Attributable to:
Owners of the parent 31,246 13,922 2,329 1,038
Non-controlling interests * (160) - (12)
31,246 13,762 2,329 1,026
Earnings per share
-basic (R/$) 0.06 0.02 # #
-diluted (R/$) 0.05 0.02 # #
Earnings per American Depositary Share
-basic (R/$) 1.39 0.46 0.10 0.03
-diluted (R/$) 1.37 0.46 0.10 0.03
Adjusted earnings per share
-basic (R/$) 0.05 0.04 # #
-diluted (R/$) 0.05 0.04 # #
Adjusted earnings per American Depositary Share
-basic (R/$) 1.33 0.95 0.10 0.07
-diluted (R/$) 1.32 0.95 0.10 0.07
Ordinary shares (‘000)(1)
-in issue at March 31 563,435 759,138 563,435 759,138
-weighted average 563,435 755,940 563,435 755,940
-diluted weighted average 568,216 760,629 568,216 760,629
Weighted average American Depositary Shares (‘000)(1)
-in issue at March 31 22,537 30,366 22,537 30,366
-weighted average 22,537 30,238 22,537 30,238
-diluted weighted average 22,729 30,425 22,729 30,425
# Amount less than $0.01.
* Amount less than R1,000.
(1) Excludes 40,000,000 treasury shares held by MiX Investments, a wholly owned subsidiary of the Group (March 2016: 40,000,000).
NOTES TO CONDENSED CONSOLIDATED FINANCIAL RESULTS
1. Basis of preparation and accounting policies
Financial results for the fourth quarter of fiscal year 2017
Further to the Group’s financial results for the year ended March 31, 2017, additional financial information in respect of
the fourth quarter of fiscal year 2017 has been presented together with the relevant comparative information. The quarterly
information comprises a condensed consolidated income statement, a reconciliation of adjusted earnings to profit for the
period attributable to owners of the parent (note 3), a reconciliation of Adjusted EBITDA to profit for the period (note 4)
and a reconciliation of Adjusted EBITDA margin to profit for the period margin (note 5) and other financial and operating
data (note 6).
The accounting policies used in preparing the financial results for the fourth quarter of fiscal year 2017 are consistent in
all material respects with those applied in the preparation of the Group’s annual financial statements for the year ended
March 31, 2016.
The quarterly financial results have not been audited or reviewed by the Group’s external auditors. The condensed
unaudited Group quarterly financial results do not include all the information and disclosures required in the annual
financial statements and should be read in conjunction with the Group’s annual financial statements for the year ended March
31, 2017, which have been prepared in accordance with IFRS.
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 March 31, 2017 in South African Rand, supplementary information in U.S. Dollars has
been prepared for the convenience of users of this report. Unless otherwise stated, the Group has translated U.S. Dollar
amounts from South African Rand at the exchange rate of R13.4124 per $1.00, which was the R/$ exchange rate reported by
Oanda.com as at March 31, 2017. The U.S. Dollar figures may not compute as they are rounded independently.
3. Reconciliation of adjusted earnings
South African Rand United States Dollar
Three months ended Three months ended Three months ended Three months ended
Figures are in thousands unless otherwise stated March 31, March 31, March 31, March 31,
2017 2016 2017 2016
Unaudited Unaudited Unaudited Unaudited
Profit for the period attributable to owners of the parent 31,246 13,922 2,329 1,038
Net foreign exchange losses 5,106 27,869 381 2,078
Income tax effect on the above component (6,335) (13,024) (472) (971)
Adjusted earnings attributable to owners of the parent 30,017 28,767 2,238 2,145
Adjusted earnings per share
-basic (R/$) 0.05 0.04 # #
-diluted (R/$) 0.05 0.04 # #
Adjusted earnings per American Depositary Share
-basic (R/$) 1.33 0.95 0.10 0.07
-diluted (R/$) 1.32 0.95 0.10 0.07
# Amount less than $0.01.
4. Reconciliation of Adjusted EBITDA to Profit for the Period
South African Rand United States Dollar
Three months ended Three months ended Three months ended Three months ended
Figures are in thousands unless otherwise stated March 31, March 31, March 31, March 31,
2017 2016 2017 2016
Unaudited Unaudited Unaudited Unaudited
Adjusted EBITDA 87,110 77,615 6,495 5,786
Add:
Reversal of impairment (1) 791 - 59 -
Less:
Depreciation (2) (27,100) (21,207) (2,021) (1,581)
Amortization (3) (5,514) (5,247) (411) (391)
Impairment (4) (3,011) (4,776) (224) (356)
Share-based compensation costs 3,746 (147) 279 (11)
Equity-settled share-based compensation costs(5) 3,746 (2,165) 279 (161)
Cash-settled share-based compensation costs - 2,018 - 150
Net loss on sale of property, plant and equipment and intangible assets (117) (131) (9) (10)
Increase in restructuring costs provision(6) (14,992) (365) (1,118) (27)
Transaction costs arising from investigating strategic alternatives - (85) - (6)
Operating profit 40,913 45,657 3,050 3,404
Add: Finance income/(costs) - net (4,142) (26,110) (309) (1,947)
Less: Taxation (5,525) (5,785) (412) (431)
Profit for the period 31,246 13,762 2,329 1,026
(1) The reversal of impairment relates to the reversal of impairment of in-vehicle devices of R0.8 million ($0.06 million) in the Brazil
segment.
(2) Includes depreciation of property, plant and equipment (including in-vehicle devices).
(3) Includes amortization of intangible assets (including capitalized in-house development costs and intangible assets identified as
part of a business combination).
(4) Includes impairment of capitalized product development costs of R2.6 million ($0.2 million) in the Africa segment and R0.4 million
($0.04 million) in the CSO segment.
(5) The reversal of equity-settled share-based payment expense in the 4th quarter of fiscal 2017 is a result of share options forfeited by
participants.
(6) During March 2017, Europe and Middle East and Australasia segments implemented restructuring plans. The total cost of the restructuring
plans is expected to be approximately R15.0 million ($1.1 million) which was recognized in profit and loss during the period.
5. Reconciliation of Adjusted EBITDA margin to Profit for the Period margin
Three months ended Three months ended
March 31, March 31,
2017 2016
Unaudited Unaudited
Adjusted EBITDA margin 22.3% 20.2%
Add:
Reversal of impairment 0.2% -
Less:
Depreciation (6.9%) (5.5%)
Amortization (1.4%) (1.4%)
Impairment (0.8%) (1.2%)
Share-based compensation costs 1.0% (0.1%)
Equity-settled share-based compensation costs 1.0% (0.6%)
Cash-settled share-based compensation costs - 0.5%
Net loss on sale of property, plant and equipment and intangible assets (0.1%) (0.0%)
Increase in restructuring costs provision (3.8%) (0.1%)
Transaction costs arising from investigating strategic alternatives - (0.0%)
Operating profit margin 10.5% 11.9%
Add: Finance income/(costs) - net (1.1%) (6.8%)
Less: Taxation (1.4%) (1.5%)
Profit for the period margin 8.0% 3.6%
6. Other operating and financial data
South African Rand United States Dollar
Three months ended Three months ended Three months ended Three months ended
Figures are in thousands except for subscribers March 31, March 31, March 31, March 31,
2017 2016 2017 2016
Unaudited Unaudited Unaudited Unaudited
Subscription revenue 321,708 307,095 23,986 22,896
Adjusted EBITDA 87,110 77,615 6,495 5,786
Cash and cash equivalents 375,782 877,136 28,018 65,397
Net cash 356,333 859,659 26,568 64,094
Capital expenditure incurred 81,617 77,357 6,085 5,768
Total development costs incurred 32,152 28,693 2,397 2,139
Development costs capitalized 17,268 12,136 1,287 905
Development costs expensed within administration and other charges 14,884 16,557 1,110 1,234
Subscribers 622,062 566,177 622,062 566,177
Three months ended Three months ended
March 31, March 31,
2017 2016
Unaudited Unaudited
Exchange Rates
The following major rates of exchange were used:
South African Rand: United States Dollar
-closing 13.41 14.83
-average 13.23 15.82
South African Rand: British Pound
-closing 16.75 21.31
-average 16.38 22.33
7. Development costs historical data
The table below sets out development costs incurred and capitalized for each of the last eight quarters including the
period ended March 31, 2017.
South African Rand
Figures are in thousands (Unaudited) Three months ended
March 31, December 28, September 30, June 30, March 31, December 31, September 30, June 30,
2017 2016 2016 2016 2016 2015 2015 2015
Total development costs incurred 32,152 36,696 36,034 37,230 28,693 28,016 31,806 27,387
Development costs capitalized 17,268 20,415 21,028 19,309 12,136 16,308 18,892 11,533
Development costs expensed within
administration and other charges 14,884 16,281 15,006 17,921 16,557 11,708 12,914 15,854
United States Dollar
Figures are in thousands (Unaudited) Three months ended
March 31, December 28, September 30, June 30, March 31, December 31, September 30, June 30,
2017 2016 2016 2016 2016 2015 2015 2015
Total development costs incurred 2,397 2,736 2,687 2,776 2,139 2,089 2,372 2,042
Development costs capitalized 1,287 1,522 1,568 1,440 905 1,216 1,409 860
Development costs expensed within
administration and other charges 1,110 1,214 1,119 1,336 1,234 873 963 1,182
For more information please visit our website at: www.mixtelematics.com
Registered office
Matrix Corner, Howick Close, Waterfall Park, Midrand
Directors
RA Frew* (Chairman), SB Joselowitz (CEO), EN Banda*, CH Ewing*, SR Bruyns* (Lead Independent Director), P Dell, I Jacobs*,
CWR Tasker, AR Welton*
* Non-executive
Company secretary
Java Capital Trustees and Sponsors Proprietary Limited
Auditors
PricewaterhouseCoopers Inc.
Sponsor
Java Capital
May 25, 2017
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