28 FEBRUARY 2017 1 TABLE OF CONTENTS About Cartrack 3 Business - - PowerPoint PPT Presentation

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ANNUAL RESULTS PRESENTATION FOR THE YEAR ENDED 28 FEBRUARY 2017

TABLE OF CONTENTS

About Cartrack 3 Business trends 6 Strategy overview 8 Segmental performance 15 Financial review 23 Outlook 29 Annexures 32

WE ARE CARTRACK

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RETURN ON EQUITY OF 55%

Operations across five continents Geographically diverse base > 600 000 subscribers Among the largest telematics companies globally Resilient, annuity-based business Rapidly growing industry High cash conversion Proven proprietary technology platform Strong financial metrics Strong investment in distribution capacity

WE ARE CARTRACK

Represented in 24 countries

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WHAT WE DO

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• Launched in 2007
• Strong ROI value

proposition

• Strong demand in

highly regulated economies

• Substantially

broader than just logistics

• Launched in 2004
• 93% audited

recovery rate

• Proprietary

recovery infrastructure

• Strong demand in

developing economies

• Launched in

2016/2017

• Growing

demand for the service

• Strong

applications within SME

• Launched in 2015
• Various

applications around high value items

Fleet management Stolen Vehicle Recovery Mobile asset solutions Workforce

• ptimisation

Insurance telematics

• Launched in 2014
• Driver risk

assessment

• fferings
• Utility of big data

applications

Business trends

• Global growth – expanding needs with low penetration – transportation mobility technology

growing at an estimated 20% per annum (Gartner Inc.)

• Largest market is the Asia-Pacific (APAC) region. APAC set to grow rapidly, due to the increasing

number of vehicles in use

• Growing regulatory compliance requirements
• Improvements in networks and coverage provide access to larger data sets and new applications
• Data analytics and value-added products and services
• Emerging Smart Transportation rapidly gaining momentum
• Insurance telematics a growing field
• OEMs partnering with established telematics vendors
• Fragmented industry – consolidation trends evident
• Stronger SVR demand in high-crime countries
• Barriers to entry increasing due to rapid technology development and requirement for substantial

recovery infrastructure

A RAPIDLY EXPANDING INDUSTRY

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Strategy Review

CONSISTENT STRATEGY FOR DRIVING SHAREHOLDER VALUE

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Shareholder value

Robust subscriber and revenue growth Value add through data and innovative technology Strong cash flow and disciplined capital allocations Sustainable profit margins

Highly scalable business model and technology platform

MOVING FROM FLEET MANAGEMENT TO BECOMING AN INTEGRAL PART OF CUSTOMERS’ BUSINESS/LIVES

STRATEGIC DRIVER - DIVERSIFYING THE BUSINESS

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209 680 246 348 295 104 348 231 430 386 502 894 600 610

50 000 100 000 150 000 200 000 250 000 300 000 350 000 400 000 450 000 500 000 550 000 600 000 650 000 2011 2012 2013 2014 2015 2016 2017

Number of subscribers

Diversified across a broad spectrum of subscribers Diversifying subscriber base - FM vs SVR vs Other

1% 31% 68%

2012

61% 35% 4% FM SVR (No FM) Other

2017

STRATEGIC DRIVER - DIVERSIFYING THE BUSINESS

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Geographical revenue spread

91% 9% SA Rest of world

2012

75% 10% 9% 6% SA Africa Europe Asia

2017

50 000 100 000 150 000 200 000 250 000 300 000 350 000 400 000 450 000 500 000 550 000 600 000 650 000 2012 2013 2014 2015 2016 2017

Number of subscribers

Subscribers by geography

South Africa Africa Europe Asia Pacific

STRATEGIC DRIVER – VERTICAL INTEGRATION

CARTRACK’S INDUSTRY-LEADING MARGINS ARE THE RESULT OF A FULLY INTEGRATED BUSINESS MODEL

78% 81% 80% 43% 46% 46% 35% 34% 32% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 2015 2016 2017

Margins

Gross margin % EBITDA % Operating profit %

ROA OF 35%

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GROWTH STRATEGY - 2018 STRATEGIC INITIATIVES

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• Product evolution and

features

• Data analytics
• Complete in-field

business solutions

• Mobile apps
• Sell value added services
• Triple the spend on

research and development

• Increase distribution

substantially

• Expand training facilities

BUILD SUFFICIENT INFRASTRUCTURE AND DISTRIBUTION CAPACITY PRODUCT DEVELOPMENT SUSTAINABLE REVENUE & SUBSCRIBER GROWTH, GENERATING STRONG MARGINS & RETURNS NEW REVENUE STREAMS BUILD CUSTOMER PARTNERSHIPS

• Systems integration
• CRM
• Workflow management
• Integral customer

partnerships

• customer

centric/entrenchment

TECHNOLOGY – A COMPETITIVE ADVANTAGE

DATA SHARING

Stolen Vehicle Recovery Fleet Management Insurance telematics Mobile asset solutions Workforce

• ptimisation

Mobile apps 3G to 4G Software integration New front end Platform improvements

World-class SaaS platform TECH DEVELOPMENTS

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Segmental performance

2017 IN PERSPECTIVE

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Subscriber base increased by 100 000 Significant investment in infrastructure and skills Sold 185 000 telematics units – a 26% increase on 2016 Strong focus on R&D Robust expansion in SA, Europe and Asia Total dividend payment of ZAR165 million or 55 cents per share

FIVE YEARS OF COMPOUNDED SUBSCRIBER GROWTH AT 20% p.a.

Low demand and severe economic headwinds in Africa-Other segment Currency fluctuations had a R27 million negative impact

• n 2017 operating profit

PERFORMANCE IN RAND PERFORMANCE IN CONSTANT CURRENCY COMMENT Revenue + 15% + 15%

• Investment in distribution

resulting in market penetration Subscribers + 17% + 17%

• Strong annuity based income

Operating profit + 13% + 13%

• Closely managed cost base

OUTLOOK AND INITIATIVES

• Resilient market and signs of increased demand
• Cartrack increasing penetration of target market
• Underpenetrated lower value SVR and SME fleet segments
• Future revenue opportunity in vast accumulated telematics data

SOUTH AFRICA – A SOLID PERFORMER

REPRESENTATION Operations across South Africa

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Mozambican Metical

AFRICA-OTHER – CURRENCY VOLATILITY

Kenyan Shilling Nigerian Naira Tanzanian Shilling

0,1 0,2 0,3 0,4 Feb'15 Aug'15 Feb'16 Aug'16 Feb'17 0,05 0,1 0,15 0,2 Feb'15 Aug'15 Feb'16 Aug'16 Feb'17 0,02 0,04 0,06 0,08 0,1 Feb'15 Aug'15 Feb'16 Aug'16 Feb'17 0,002 0,004 0,006 0,008 Feb'15 Aug'15 Feb'16 Aug'16 Feb'17

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AFRICA-OTHER – OPERATIONALLY SOUND

OUTLOOK AND INITIATIVES

• Increase distribution infrastructure
• Stronger focus on staff training
• Improve service levels
• Access new sales channels and expand product offering

PERFORMANCE IN RAND PERFORMANCE IN CONSTANT CURRENCY COMMENT Revenue

• 22%

+1%

• Challenging economic conditions

Subscribers

• 2%
• 2%
• Subscriber base maintained

Operating profit

• 30%

+11%

• Highly profitable in local currency

REPRESENTATION Angola Botswana Kenya Malawi Mozambique Namibia Nigeria Rwanda Swaziland Tanzania Zimbabwe

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EUROPE – STRONG GROWTH IN COMPETITIVE ENVIRONMENT

OUTLOOK AND INITIATIVES

• Continued strong subscriber growth
• Accessing new channels to the market
• Competition remains strong
• Insurance telematics emerging as a focus area

REPRESENTATION Poland Portugal Spain

PERFORMANCE IN RAND PERFORMANCE IN CONSTANT CURRENCY COMMENT Revenue + 14% + 10%

• Good subscriber and revenue growth

Subscribers + 27% + 27%

• Continued investment in distribution and
• perating capacity

Operating profit

• 19%
• 24%
• EBITDA increased by 20% - significant

impact from capitalised rentals and related depreciation

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ASIA PACIFIC AND ME – BUSINESS CASE PROVEN

OUTLOOK AND INITIATIVES

• Continued strong subscriber growth
• Steady progression through all operations, to strengthen

infrastructure, sales force and sales drive PERFORMANCE IN RAND PERFORMANCE IN CONSTANT CURRENCY COMMENT Revenue + 147% + 134%

• Continued investment in distribution

and operating capacity

Subscribers + 226% + 226%

• Start-up entities gaining traction

Operating profit + 104% + 78%

• Singapore to act as strategic hub

REPRESENTATION Hong Kong Indonesia Malaysia New Zealand Philippines Singapore Thailand UAE

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OUTLOOK AND INITIATIVES

• Offices opened in California and executive team in

place

• Development and field testing still in progress
• Estimated 3,1 million vehicles still require ELD telematics

(Driscoll & Associates 2016) to comply with regulations

• Cartrack will benefit from operating in a highly

technology driven society

UNITED STATES – REGULATIONS SPUR DEMAND

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Financial Review

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COMPOUND REVENUE GROWTH OF 18% p.a.

200 400 600 800 1 000 1 200 2012 2013 2014 2015 2016 2017 R million

Revenue

Revenue Subscription revenue

• Robust subscriber growth of 19% to 600 610
• Subscriber revenue up 16%
• Total revenue up 13% to R1 141 million
• Continued strong investment in operating

capacity

• EBITDA of R523 million, up 13%
• EBITDA margin of 46%
• Normalised EPS (NEPS) of 85 cents, up 12%
• Basic earnings per share (EPS) of 86 cents,

up 8%

• Headline EPS (HEPS) of 85 cents, up 6%
• Return on Equity of 55%
• Final dividend per share of 35 cents
• Cash generated from operating activities
• f R387 million, up 48%
• Currency fluctuations had a R27 million

negative impact on 2017 operating profit

SALIENT FEATURES

EARNINGS AND DIVIDENDS

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64 81 85 46 55 55 10 20 30 40 50 60 70 80 90 2015 2016 2017

Cents

HEPS and DPS

HEPS DPS 64 80 86 64 75 85 10 20 30 40 50 60 70 80 90 100 2015 2016 2017

Cents

EPS and Normalised EPS*

EPS NEPS

*Normalised EPS removes non-operational forex gains/losses

CASH GENERATION AND UTILISATION

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34% 27% 17% 66% 73% 83% 0% 20% 40% 60% 80% 100% FY 15 FY 16 FY 17 New sales – cash vs rental Cash Rental

• 50 000

50 000 100 000 150 000 200 000 250 000 300 000 350 000 400 000 450 000 500 000 Cash at 1 March 2016 Cash from

• perating

activities Capitalised rentals Capitalised other fixed assets Dividends paid Other cash payments and receipts Cash at 28 Feb 2017 R 000

Clear dashed items represents FY16 comparatives

Current ratio

1.0

ROE 55% ROA 35% Adequate stock levels for 6 – 9 months of trading Quick ratio

0.7

Clean debtors book – debtors days 31 Cash generated from operating activities of

R387 million

STRONG BALANCE SHEET POSITIONED FOR GROWTH

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P 28 I Strictly private and confidential

Outlook

➢ The telematics industry is experiencing an explosion of expanding opportunities. Cartrack is playing a very active part in this evolution. ➢ We have a substantial active subscriber base, a significant addressable market with a strong appetite for our services, an award-winning technology platform and a brand that is growing in stature and reputation. ➢ Sales are increasing significantly and our order book is filled to capacity. ➢ We are confident that our increased investment in capacity and R&D will position Cartrack for continued strong growth. ➢ Our operations in technology driven societies keeps us innovating and globally relevant.

A ROBUST OUTLOOK

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Well-positioned for growth and strong operating results

International Offices

Angola Botswana Hong Kong Indonesia Kenya Malaysia Malawi Mozambique Namibia New Zealand Nigeria Philippines Poland Portugal Rwanda Singapore South Africa Spain Swaziland Thailand Tanzania UAE USA Zimbabwe

Annexures

• Strong recurring earnings profile
• A proven track record of

profitability

• Strong financial metrics
• Strong cash generation & cash

conversion

• Low gearing
• Globally, a high-growth industry
• Proven and scalable technology

platform

• A large and diversified

subscriber base

• Experienced management
• Annuity-based earnings model

WHAT WE OFFER INVESTORS

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• Strategically acquired CTM
• A substantial increase in inventory

levels

• An increase in debtors days
• Decrease in

debtors days

• Increase in

creditors’ days

A CONSISTENTLY HIGH CASH CONVERTER

• Annuity business with

strong revenue visibility

• Strong track record of

returning excess cash to the shareholders

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0% 20% 40% 60% 80% 100% 120% 50 100 150 200 250 300 350 400 2012 2013 2014 2015 2016 2017

Percentage operating profit converted to cash R million

Operating profit Net cash from operating activities Cash conversion ratio

77%

13% 9% 1%

2016

76% 17% 6% 1%

2016

74% 14% 9% 3%

2016

75% 10% 9% 6% South Africa Africa – other Europe Asia and Middle East USA

2017

83% 11% 5%

• 1%

South Africa Africa – other Europe Asia and Middle East USA

2017

79% 8% 10% 2%

• 1%

South Africa Africa – other Europe Asia and Middle East USA

2017

Revenue 2017 2016 Change South Africa 861 455 748 600 15% Africa – Other 108 610 139 197 (22)% Europe 102 745 90 037 14% Asia and Middle East 68 167 27 647 147% USA 12

• Total

1 140 989 1 005 481 13% Profit before tax South Africa 312 222 274 711 14% Africa – Other 41 834 60 110 (30)% Europe 19 369 23 477 (17)% Asia and Middle East 448 3 968 (89%) USA (4 248)

• Total

369 625 362 266 2% EBITDA South Africa 420 033 355 776 18% Africa – Other 42 212 59 169 (29)% Europe 51 239 42 212 21% Asia and Middle East 9 926 5 981 66% USA (4 248)

• Total

519 175 463 139 12%

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SEGMENTAL GROWTH

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Subscriber base

CARTRACK’S TECHNOLOGY HISTORY

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2007 Launch Fleet Management (FM) 2004 Launch Stolen Vehicle Recovery services (SVR) In process:

• Data analytics
• Field technology

partner of choice

• SaaS platform for

OEMs 2014 Launch Insurance telematics 2015 Launch Prisoner Tracking 2009 Launch FM incorporating SVR 2010 Launch evolved SaaS platform 2013 Launch Flash product 2016/17 Launch mesh radio frequency for data and SVR