South African mogul Zak Calisto’s Karooooo to pay shareholders $17.7 million in dividends

Karooooo Limited, a leading mobility platform led by South African businessman Zak Calisto, plans to pay out a $17.7-million dividend to shareholders at the end of its 2022 fiscal year, following a profit of R476.61 million ($29.7 million) during the reporting period.

“Given our profitability, inherently cash-generative business model, and strong balance sheet, the board declared a dividend of $0.6 (R9.52) per share, payable entirely out of Karooooo’s retained earnings,” Calisto, Karooooo’s CEO and founder, said.

The $17.7-million dividend will be paid from the group’s retained earnings of R1.28 billion ($79.8 million), and it will be the company’s first dividend since it went public on March 31, 2021, in an IPO that raised gross proceeds of $29.4 million from 1,050,000 ordinary shares at a price of $28 per share.

The company revealed that it has sufficient cash and cash equivalents to invest for accelerated growth in 2023, reporting a net cash and cash equivalents balance of R718 million ($44.9 million) at the end of 2022 after raising R349 million ($21.8 million) in net proceeds when it was listed on the NASDAQ in 2021 and paying R70 million ($4.38 million) when it acquired Picup in September 2021.

While commenting on plans to scale Karooooo’s operation through acquisition, Calisto revealed that if additional investment for growth is required in the 2024 fiscal year, the company will consider optimizing its capital structure by utilizing its available funding line.

Karooooo is a global mobility SaaS platform that helps to maximize the value of automotive and workflow data by providing real-time data analytics solutions for smart transportation to more than 1.3 million connected vehicles.

Calisto owns a 75-percent stake in the Singapore-based technology firm, which he founded in 2001 with the primary goal of providing stolen car recovery services in South Africa.

At the end of its 2022 fiscal year, the mobility platform that operates Cartrack, its wholly-owned subsidiary, reported impressive growth across all operating segments, adding a total of 219,972 subscribers to its customer base, up 23 percent from the previous year’s 179,485 subscribers.

Despite a 20-percent increase in revenue, the group’s profit fell by four percent from R497.42 million ($31.12 million) in 2021 to R476.61 million ($29.8 million) at the end of its fiscal year in 2022.

Aside from an increase in recurring expenses, the decrease in profit was caused by non-recurring operational expenses relating to IPO costs of R36 million ($2.25 million) expensed, as well as a once-off write-off of capitalized commission assets of nearly $1 million.