MiX gets all starry-eyed and spangled about expansion
Fleet manager and vehicle tracker earns its US stripes
Vehicle tracking and fleet management specialist MiX Telematics has targeted the US to be its biggest geographic market in the medium term.
Speaking after the release of year to end March results on Thursday, MiX CEO Stefan Joselowitz said the company’s fast-growing US operations could represent a third of revenue within five years. “We’d like to see a rough spread of a third of the business from the US, a third from Africa and a third from the rest of the world … with the US likely to become our biggest market.”
Joselowitz said the US operations had seen the fastest subscriber growth in the period under review – albeit off a low base. MiX’s JSE-listed rival Cartrack also entered the US market recently.
MiX reported R195-million in subscriber revenue from the US operations, which is a 74% gain over the previous financial year on a constant currency basis.Subscribers in the US increased by 32% over the financial year with ebitda (earnings before interest, tax, depreciation and amortisation) rocketing to R79-million on a sturdy margin of almost 35%.
Joselowitz said US subscription revenue was assisted by the market’s ongoing preference for bundled deals across new and existing customers.
Asked whether successes in the US would spur considerations around seeking a full listing on the New York Stock Exchange or Nasdaq, Joselowitz said the company continued to look at ways of streamlining operations and unlocking value. At present the company trades on the NYSE as an American Depositary Receipt (ADR).
He believed a full US listing might only be triggered by a meaningful corporate event – possibly a large acquisition or merger.
Overall, MiX – which also has operations in Australia, Brazil, Europe and the Middle East – saw a 19% gain in subscription revenue to R1.43-billion on a constant currency basis.
MiX is not actively followed by institutional investors. But market watchers have noted the strong surge in MiX’s JSE share price in recent months might signal increasing mainstream investor interest.