#Karooooo Reports Q1 Fiscal 2027 Results
Karooooo Ltd. (NASDAQ: KARO) (JSE: KRO), the Singapore-based operational intelligence company that owns 100% of Cartrack and 81% of Karooooo Logistics, reported unaudited results for its first quarter of fiscal 2027, ended May 31, 2026, including record operating profit of ZAR410 million and a record 142,472 net Cartrack subscriber additions.
Karooooo reports its financial results in South African rand but holds its cash reserves in US dollars and files statutory accounts in Singapore in US dollars. The rand strengthened against the dollar over the period, to ZAR16.2088 from ZAR18.0319 a year earlier, which reduced reported rand growth relative to the group's US dollar figures.
The group provides vehicle tracking and fleet telematics on a subscription basis, and services more than 125,000 commercial customers across more than 20 countries.
#Cartrack Subscription Revenue Rises 19% to ZAR1.35 Billion
Cartrack's subscription revenue increased 19% to ZAR1,351 million, from ZAR1,138 million a year earlier. In constant currency, the metric rose 21%.
Cartrack's annualized recurring revenue increased 19% to ZAR5,432 million, from ZAR4,574 million. On a US dollar basis, ARR rose 32% to USD335 million.
Group subscription revenue for Karooooo increased 19% to ZAR1,354 million, from ZAR1,141 million. Karooooo Logistics reported delivery-as-a-service revenue of ZAR177 million, up 46% from ZAR121 million.
#Record Net Subscriber Additions Reach 142,472
Cartrack added a net 142,472 subscribers during the quarter, up 70% from 84,013 a year earlier. The company attributed the increase to demand for its Cartrack-Tag and Video products.
Total Cartrack subscribers rose 18% to 2,804,694, from 2,386,249. South Africa net subscriber additions increased 92%.
"FY2027 has commenced with strong, accelerated growth, underpinned by Cartrack constant currency subscription revenue growth of 21% and a record 142,472 net subscriber additions in the quarter," said Zak Calisto, CEO and Founder, in the earnings release.
#Operating Profit Climbs 16% as Margin Narrows
Karooooo's operating profit increased 16% to ZAR410 million, from ZAR352 million. Adjusted earnings per share increased 11% to ZAR9.53, from ZAR8.55.
Cartrack's operating profit margin was 28%, down from 30% a year earlier. Karooooo Logistics's operating profit rose 50% to ZAR15 million, with its margin unchanged at 8%.
Free cash flow, a non-IFRS measure, was ZAR60 million, down from ZAR338 million a year earlier. The company said this reflected increased investment in in-vehicle IoT devices and working capital to support subscriber growth. Net cash generated from operating activities decreased 16% to ZAR537 million.
Karooooo reported net cash and cash equivalents of ZAR755 million at May 31, 2026, compared with ZAR746 million at February 28, 2026. Debtor collection days stood at 31, within the company's stated historical range.
#Karooooo Reaffirms FY2027 Earnings Guidance
The company reaffirmed its full-year fiscal 2027 guidance, which it said assumes current exchange rates. Karooooo guided to Cartrack subscription revenue of ZAR5,700 million to ZAR6,000 million, implying growth of 18% to 24%.
The company guided to earnings per share of ZAR38.50 to ZAR40, implying EPS growth of 18% to 23% against fiscal 2026 adjusted EPS, which excludes secondary offering costs. It also guided to a Cartrack gross profit margin of 70% to 72% and an operating profit margin of 27% to 30%.
Karooooo said it expects a slowdown in hiring during the year as it drives sales-force efficiency, and pointed to scale benefits and AI adoption as support for earnings growth. The company declared an interim dividend of USD1.50 per share for the quarter, payable July 20 to shareholders on the South African register and July 27 to Nasdaq shareholders.
Calisto said the group remained optimistic about opportunities across its regions and positioned to build on first-quarter momentum. Karooooo cautioned that actual results may differ from its outlook, citing a contracting gross profit margin forecast for the year, foreign exchange movements, and risks detailed in its annual report on Form 20-F filed with the SEC.