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Lesaka Reports Fourth Quarter 2022 Results

·20 min read
Lesaka Technologies, Inc.
Lesaka Technologies, Inc.

JOHANNESBURG, South Africa, Sept. 09, 2022 (GLOBE NEWSWIRE) -- Lesaka Technologies, Inc. (Nasdaq: LSAK; JSE: LSK) today released results for the fourth fiscal quarter and year ended June 30, 2022.

Highlights:

Performance for the quarter ended June 30, 2022 (Q4 2022)

  • Group revenue of $121.8 million in Q4 2022, compared to $34.5 million for the quarter ended June 30, 2021 (Q4 2021), driven by the inclusion of Connect from April 14, 2022 which added $86.2 million to the Group’s revenue and 23% growth in revenue in the existing merchant business. On a constant currency basis, the existing merchant business grew revenue 35% in Q4 2022 to ZAR304 million1.

  • The Group’s operating loss of $10.1 million in Q4 2022 improved from an operating loss of $13.6 million for Q4 2021.

  • Segment Adjusted EBITDA (before corporate/eliminations) for Q4 2022 improved to a profit of $6.1 million compared to a loss of $6.7 million in Q4 2021, demonstrating progress made on the transformative journey to build the leading South African fintech platform, bringing financial inclusion and digitization. Looking forward, the Group is well positioned for growth.

  • The Connect acquisition closed early in Q4 2022 and the Connect business continued to deliver strong growth during the quarter, slightly ahead of expectations. The integration process of the two groups has been very encouraging, with tangible results already achieved.

Performance for the year ended June 30, 2022

  • Successful execution of our strategy outlined last year, demonstrated by the closing of the Connect acquisition and progress on the Consumer segment turnaround.

  • Revenue for the year increased to $222.6 million, from $130.8 million driven by the inclusion of Connect from April 14, 2022 which added $86.2 million to the Group’s revenue and 13% growth in revenue in the existing merchant business.

  • Consumer business revenues were flat in 2022, where our focus was primarily on right-sizing the cost base. It is encouraging that cost savings were achieved whilst growing our active account base and maintaining transaction volumes and revenues in the Consumer business.

  • The Group’s operating loss of $40.2 million for the year reflects a 25% improvement compared to the operating loss of $53.9 million reported for the year ended June 30, 2021.

  • Normalized EBITDA (before corporate/eliminations) after normalizing for $12.4 million of once off adjustments improved 57% to a $18.6 million loss from a $42.9 million loss in the previous year, driven by increased revenue in our existing Merchant segment, continued execution on cost saving initiatives and the contribution of Connect during the final quarter.

  • Cost optimization initiatives and restructuring the operations of the Consumer business in 2022 delivered cost saving in excess of original expectations, with approximately $19.7 million (ZAR300 million1) in costs removed from the Consumer business cost base on an annualized basis, of which $13.7 million (ZAR208 million1) was realized in this year ended June 30, 2022.

  1. Translated at the average exchange rate of ZAR 15.20 to $1 for fiscal 2022 and ZAR15.56 to $ for Q4 2022.

“We are delighted with the Group’s achievements over the past year. The strategy set by our new Board in 2020 and communicated to the market over the past 12 months is being effectively executed. With the Connect acquisition, Lesaka now has a complete product offering to the underserved consumers and merchants in Southern Africa, which advances our vision to build the leading South African full-service fintech platform. What has been most encouraging is the way the Lesaka and Connect teams are working together to explore and execute opportunities to increase revenues, improve performance and deliver better value to our customers through our unique dual-sided ecosystem. Great progress has also been made in the Consumer segment turnaround, which is now very close to breakeven. We will continue to focus on optimizing cost structures as well as account growth and cross-selling opportunities to increase ARPU. After a year of tremendous change and transformation, the Group is well positioned to take advantage of the high growth opportunities our market presents,” said Chris Meyer, Lesaka Group CEO.


Summary Financial Metrics

Three months ended

 

Three months ended

 

 

 

 

 

 

 

 

 

Jun 30,
2022

 

Jun 30,
2021

 

Mar 31,
2022

 

Q4 ’22 vs
Q4 ’21

 

Q4 ’22 vs
Q3 ’22

 

Q4 ’22 vs
Q4 ’21

 

Q4 ’22 vs
Q3 ’22

(All figures in USD ‘000s except per share data)

USD ‘000’s
(except per share data)

 

% change in USD

 

% change in ZAR

Revenue

 

121,789

 

 

 

34,517

 

 

 

35,202

 

 

 

253

%

 

 

246

%

 

 

288

%

 

 

245

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP operating loss

 

(10,122

)

 

 

(13,600

)

 

 

(9,421

)

 

 

(26

%)

 

 

7

%

 

 

(18

%)

 

 

7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA (loss)(1)

 

1,337

 

 

 

(8,208

)

 

 

(2,828

)

 

 

nm

 

 

 

nm

 

 

 

nm

 

 

 

nm

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP (loss) income per share ($)

 

(0.25

)

 

 

0.03

 

 

 

(0.06

)

 

 

nm

 

 

 

327

%

 

 

nm

 

 

 

326

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fundamental loss per share ($)(1)

 

(0.09

)

 

 

(0.18

)

 

 

(0.05

)

 

 

(50

%)

 

 

80

%

 

 

(45

%)

 

 

79

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fully-diluted shares outstanding (‘000’s)

 

61,619

 

 

 

56,937

 

 

 

57,791

 

 

 

8

%

 

 

7

%

 

 

n/a

 

 

 

n/a

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average period USD / ZAR exchange rate

 

15.56

 

 

 

14.17

 

 

 

15.61

 

 

 

10

%

 

 

(0

%)

 

 

n/a

 

 

 

n/a

 


Year ended

 

Year ended

 

 

 

 

 

 

 

 

 

June 30,
2022

 

June 30
2021

 

 

F2022 vs
F2021

 

 

 

F2022 vs
F2021

 

(All figures in USD ‘000s except per share data)

USD ‘000’s
(except per share data)

% change in USD

 

% change in ZAR

Revenue

 

222,609

 

 

 

130,786

 

 

 

70

%

 

 

65

%

 

 

 

 

 

 

 

 

GAAP operating loss

 

(40,195

)

 

 

(53,872

)

 

 

(25

%)

 

 

(28

%)

 

 

 

 

 

 

 

 

Adjusted EBITDA loss(1)

 

(18,637

)

 

 

(42,907

)

 

 

(57

%)

 

 

(58

%)

 

 

 

 

 

 

 

 

GAAP loss per share ($)

 

(0.75

)

 

 

(0.67

)

 

 

12

%

 

 

8

%

 

 

 

 

 

 

 

 

Fundamental loss per share ($)(1)

 

(0.49

)

 

 

(0.87

)

 

 

(44

%)

 

 

(46

%)

 

 

 

 

 

 

 

 

Fully-diluted shares outstanding (‘000’s)

 

58,364

 

 

 

56,898

 

 

 

3

%

 

 

n/a

 

 

 

 

 

 

 

 

 

 

 

Average period USD / ZAR exchange rate

 

15.20

 

 

 

15.72

 

 

 

(3

%)

 

 

n/a

 

(1) Adjusted EBITDA income (loss), fundamental loss and fundamental loss per share are non-GAAP measures and are described below under “Use of Non-GAAP Measures—Operating income before depreciation and amortization and adjusted EBITDA, and —Fundamental net loss and fundamental loss per share.” See Attachment B for a reconciliation of GAAP operating loss to EBITDA income (loss) and Adjusted EBITDA (loss), and GAAP net loss to fundamental net loss and loss per share.


Factors impacting comparability of our Q4 2022 and Q4 2021 results

  • Higher revenue: Our revenues increased 288% in ZAR, primarily due to the contribution from Connect, which contributed ZAR 1,341 million in Q4 2022 compared to nil in Q4 2021 with the Connect Group acquired on April 14, 2022. On a constant currency basis the existing Merchant business grew revenue 35% in Q4 22 to ZAR304 million. Group revenue drivers in the quarter included an increase in hardware sales, an increase in merchant transaction processing fees, and a moderate increase in lending and insurance revenues;

  • Lower operating losses: Operating losses decreased, delivering an improvement of 18% in ZAR compared with the prior period primarily due to contribution from Connect, the closure of the loss-making IPG operations and the implementation of various cost reduction initiatives in our Consumer business, which was partially offset by an increase in acquisition related intangible asset amortization;

  • Significant transaction costs: We expensed $4.2 million of transaction costs related to the Connect acquisition; and

  • Foreign exchange movements: The U.S. dollar was 10% stronger against the ZAR during the fourth quarter of fiscal 2022, which impacted our reported results.

Results of Operations by Segment and Liquidity

Consumer

Segment revenue was $15.7 million in Q4 2022, down 6% compared with Q4 2021, and down 5% compared with Q3 2022, on a constant currency basis. Segment revenue decreased primarily due to lower processing fees, partially offset by higher lending and insurance revenues and higher account holder fees. Our EBITDA loss reduced during Q4 2022 compared with the comparable periods as a result of the cost reduction initiatives, including the Q3 2022 reorganization process, embarked on during fiscal 2022 and a recalibration, in June 2022, of our allowance for doubtful microlending finance loans receivable from 10% of the lending book outstanding to 6.5% of the lending book, which resulted in a release from the allowance in fiscal 2022, which decreases were partially offset by an increase in insurance-related claims experience. Our EBITDA loss margin (calculated as EBITDA loss divided by revenue) for Q4 2022 and 2021 was (9%) and (38%), respectively.

Merchant

Segment revenue was $105.7 million in Q4 2022, up 632% compared with Q4 2021 and up 470% compared to Q3 2022 on a constant currency basis. Segment revenue increased due to the inclusion of Connect for two and a half months and an increase in hardware sales and processing fees. The increase in segment EBITDA is primarily due to the inclusion of Connect, which was partially offset by higher costs related to processing fees and higher employee-related expenses. Connect records a significant proportion of its airtime sales in revenue and cost of sales, while only earning a relatively small margin. This depresses the EBITDA margins shown by the business. Our EBITDA margin for Q4 2022 and 2021 was 7% and 2%, respectively.

Other

Other includes the activities of IPG in fiscal 2021 and our other legacy businesses outside South Africa, principally Botswana.

Segment revenue decreased due to lower revenue following the closure of IPG in fiscal 2021. We recorded an EBITDA contribution during the fourth quarter of fiscal 2022 following the closure of our loss-making activities performed through IPG.

Corporate/Eliminations

Our corporate expenses generally include acquisition-related intangible asset amortization; expenses incurred related to corporate actions; expenditures related to compliance with the Sarbanes-Oxley Act of 2002; non-employee directors’ fees; certain employee and executive bonuses; stock-based compensation; legal fees; audit fees; directors and officer’s insurance premiums; elimination entries; and from fiscal 2022 our group CEO’s compensation.

Our corporate expenses for fiscal 2022 increased compared with fiscal 2021 primarily due to transaction related expenses of $4.2 million (ZAR 65.9 million) related to the Connect acquisition, legacy adjustments of clearing and settlement accounts of $1.6 million (ZAR 25.7 million) and significantly higher stock-based compensation charges due to the expansion of our senior management team. The legacy processing adjustments represents amounts we identified during the current fiscal quarter related to prior periods.

Cash flow and liquidity

At June 30, 2022, our cash and cash equivalents were $43.9 million and comprised of ZAR-denominated balances of ZAR 0.5 billion ($32.8 million), U.S. dollar-denominated balances of $9.6 million, and other currency deposits, primarily Botswana pula, of $1.5 million, all amounts translated at exchange rates applicable as of June 30, 2022. The decrease in our unrestricted cash balances from June 30, 2021 was primarily due to utilization of cash reserves to fund a portion of the Connect purchase consideration that was payable in cash, and to fund our operations and payment of reorganization costs, which was partially offset by the receipt of $11.4 million related to the sale of Bank Frick in fiscal 2021 and a $3.7 million gain on foreign currency options.

Q1 2023 Outlook

The Company expects the following for the three months ended September 2022:

  • Revenue between $130 million and $133 million; and

  • Total Segment Adjusted EBITDA of between $6.1 million and $6.5 million.

Webcast and Conference Call

Lesaka will host a webcast and conference call to review results on September 12, 2022, at 8:00 a.m. Eastern Time.

The results webcast can be accessed by using the following link: https://tinyurl.com/2hbdpuew

Webcast ID: 890 1764 5390
Participants using the webcast will be able to ask questions by raising their hand and then asking the question “live.”

Conference Call dial-in:

  • US Toll-Free: + 309 205 3325

  • South Africa Toll-Free + 27 87 550 3946

Participants using the conference call dial-in will be unable to ask questions.

A replay of the results presentation webcast will be available on the Lesaka investor relations website following the conclusion of the live event.

Use of Non-GAAP Measures

U.S. securities laws require that when we publish any non-GAAP measures, we disclose the reason for using these non-GAAP measures and provide reconciliations to the most directly comparable GAAP measures. The presentation of EBITDA, adjusted EBITDA, fundamental net (loss) income and fundamental (loss) earnings per share and headline (loss) earnings per share are non-GAAP measures.

Operating income before depreciation and amortization and adjusted EBITDA

Operating income before depreciation and amortization is GAAP operating (loss) income adjusted for depreciation and amortization. Adjusted EBITDA is earnings before interest, tax, depreciation and amortization (“EBITDA”), adjusted for unusual non-recurring items, costs related to acquisitions and transactions consummated or ultimately not pursued.

Fundamental net loss and fundamental loss per share

Fundamental net loss and loss per share is GAAP net loss and loss per share adjusted for the amortization of acquisition-related intangible assets (net of deferred taxes), stock-based compensation charges, and unusual non-recurring items, including costs related to acquisitions and transactions consummated or ultimately not pursued.

Fundamental net loss and loss per share for fiscal 2022 also includes adjustments for a gain related to fair value adjustments in respect of currency options, reorganization costs incurred, legacy processing adjustments, a gain on disposal of equity securities and a loss on disposal of equity-accounted investments.

Fundamental net loss and loss per share for fiscal 2021 also includes adjustments related to changes in the fair value of equity securities, loss on disposal of equity-accounted investments, impairment losses related to an equity-accounted investment and the deferred tax liability reversal related to the impairment of the equity-accounted investment.

Management believes that the EBITDA, adjusted EBITDA, fundamental net (loss) income and (loss) earnings per share metrics enhance its own evaluation, as well as an investor’s understanding, of our financial performance. Attachment B presents the reconciliation between GAAP operating income and EBITDA and adjusted EBITDA; and GAAP net (loss) income and (loss) earnings per share and fundamental net (loss) income and (loss) earnings per share.

Headline (loss) earnings per share (“H(L)EPS”)

The inclusion of H(L)EPS in this press release is a requirement of our listing on the JSE. H(L)EPS basic and diluted is calculated using net (loss) income which has been determined based on GAAP. Accordingly, this may differ to the headline (loss) earnings per share calculation of other companies listed on the JSE as these companies may report their financial results under a different financial reporting framework, including but not limited to, International Financial Reporting Standards.

H(L)EPS basic and diluted is calculated as GAAP net (loss) income adjusted for the impairment losses related to our equity-accounted investments and (profit) loss on sale of property, plant and equipment. Attachment C presents the reconciliation between our net (loss) income used to calculate (loss) earnings per share basic and diluted and H(L)EPS basic and diluted and the calculation of the denominator for headline diluted (loss) earnings per share.

About Lesaka (www.lesakatech.com)

Lesaka Technologies, (Lesaka™) is a South African Fintech company that utilizes its proprietary banking and payment technologies to deliver superior financial services solutions to merchants (B2B) and consumers (B2C) in Southern Africa. Lesaka’s mission is to drive true financial inclusion for both merchant and consumer markets through offering affordable financial services to previously underserved sectors of the economy. Lesaka offers cash management solutions, growth capital, card acquiring, bill payment technologies and value-added services to formal and informal retail merchants as well as banking, lending, and insurance solutions to consumers across Southern Africa. The Lesaka journey originally began as “Net1” in 1997 and later rebranded to Lesaka (2022), with the acquisition of the Connect. As Lesaka, the business continues to grow its systems and capabilities to deliver meaningful fintech-enabled, innovative solutions for South Africa’s merchant and consumer markets.

Lesaka has a primary listing on NASDAQ (NasdaqGS: LSAK) and a secondary listing on the Johannesburg Stock Exchange (JSE: LSK). Visit www.lesakatech.com for additional information about Lesaka Technologies (Lesaka ™).

Forward-Looking Statements

This announcement contains forward-looking statements that involve known and unknown risks and uncertainties. A discussion of various factors that may cause our actual results, levels of activity, performance or achievements to differ materially from those expressed in such forward-looking statements are included in our filings with the Securities and Exchange Commission. We undertake no obligation to revise any of these statements to reflect future events.

Investor Relations Contact:
Partner – ICR
Email: LesakaIR@icrinc.com

Media Relations Contact:
Janine Bester Gertzen
Email: Janine@thenielsennetwork.com


LESAKA TECHNOLOGIES, INC.

Unaudited Condensed Consolidated Statements of Operations

 

Unaudited

 

(A)

 

Three months ended

 

Year ended

 

June 30,

 

June 30,

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

 

(In thousands)

 

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

REVENUE

$

121,789

 

 

$

34,517

 

 

$

222,609

 

 

$

130,786

 

 

 

 

 

 

 

 

 

 

 

 

 

EXPENSE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of goods sold, IT processing, servicing and support

 

100,522

 

 

 

22,353

 

 

 

168,317

 

 

 

96,248

 

Selling, general and administration

 

21,663

 

 

 

24,546

 

 

 

74,993

 

 

 

84,063

 

Depreciation and amortization

 

5,491

 

 

 

1,218

 

 

 

7,575

 

 

 

4,347

 

Reorganization costs

 

-

 

 

 

-

 

 

 

5,894

 

 

 

-

 

Transaction costs related to Connect Group acquisition

 

4,235

 

 

 

-

 

 

 

6,025

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING LOSS

 

(10,122

)

 

 

(13,600

)

 

 

(40,195

)

 

 

(53,872

)

 

 

 

 

 

 

 

 

 

 

 

 

CHANGE IN FAIR VALUE OF EQUITY SECURITIES

 

-

 

 

 

23,362

 

 

 

-

 

 

 

49,304

 

 

 

 

 

 

 

 

 

 

 

 

 

GAIN RELATED TO FAIR VALUE ADJUSTMENT TO CURRENCY OPTIONS

 

-

 

 

 

-

 

 

 

3,691

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

LOSS ON DISPOSAL OF EQUITY-ACCOUNTED INVESTMENT

 

30

 

 

 

-

 

 

 

376

 

 

 

13

 

 

 

 

 

 

 

 

 

 

 

 

 

GAIN ON DISPOSAL OF EQUITY SECURITIES

 

-

 

 

 

-

 

 

 

720

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

LOSS ON DISPOSAL OF EQUITY-ACCOUNTED INVESTMENT - BANK FRICK

 

-

 

 

 

-

 

 

 

-

 

 

 

472

 

 

 

 

 

 

 

 

 

 

 

 

 

INTEREST INCOME

 

626

 

 

 

482

 

 

 

2,089

 

 

 

2,416

 

 

 

 

 

 

 

 

 

 

 

 

 

INTEREST EXPENSE

 

3,557

 

 

 

814

 

 

 

5,829

 

 

 

2,982

 

 

 

 

 

 

 

 

 

 

 

 

 

(LOSS) INCOME BEFORE INCOME TAX EXPENSE

 

(13,083

)

 

 

9,430

 

 

 

(39,900

)

 

 

(5,619

)

 

 

 

 

 

 

 

 

 

 

 

 

INCOME TAX (BENEFIT) EXPENSE

 

(427

)

 

 

3,011

 

 

 

327

 

 

 

7,560

 

 

 

 

 

 

 

 

 

 

 

 

 

NET (LOSS) INCOME BEFORE LOSS FROM EQUITY-ACCOUNTED INVESTMENTS

 

(12,656

)

 

 

6,419

 

 

 

(40,227

)

 

 

(13,179

)

 

 

 

 

 

 

 

 

 

 

 

 

LOSS FROM EQUITY-ACCOUNTED INVESTMENTS

 

(2,493

)

 

 

(4,780

)

 

 

(3,649

)

 

 

(24,878

)

 

 

 

 

 

 

 

 

 

 

 

 

NET LOSS ATTRIBUTABLE TO LESAKA

 

(15,149

)

 

 

1,639

 

 

 

(43,876

)

 

 

(38,057

)

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share, in United States dollars:

 

 

 

 

 

 

 

 

 

 

 

Basic loss attributable to Lesaka shareholders

$

(0.25

)

 

$

0.03

 

 

$

(0.75

)

 

$

(0.67

)

Diluted loss attributable to Lesaka shareholders

$

(0.25

)

 

$

0.03

 

 

$

(0.75

)

 

$

(0.67

)

(A) Derived from audited consolidated financial statements.


LESAKA TECHNOLOGIES, INC.

Condensed Consolidated Balance Sheets

 

(A)

 

(A)

 

June 30,

 

June 30,

 

 

2022

 

 

 

2021

 

 

(In thousands, except share data)

ASSETS

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

 

Cash and cash equivalents

$

43,940

 

 

$

198,572

 

Restricted cash

 

60,860

 

 

 

25,193

 

Accounts receivable, net of allowance of - 2022: $509; 2021: $267 and other receivables

 

28,898

 

 

 

26,583

 

Finance loans receivable, net of allowance of - 2022: $1,691; 2021: $2,349

 

33,892

 

 

 

21,142

 

Inventory

 

34,226

 

 

 

22,361

 

Total current assets before settlement assets

 

201,816

 

 

 

293,851

 

Settlement assets

 

15,916

 

 

 

466

 

Total current assets

 

217,732

 

 

 

294,317

 

PROPERTY, PLANT AND EQUIPMENT, net of acc. depr. of - 2022: $35,249; 2021: $38,535

 

24,599

 

 

 

7,492

 

OPERATING LEASE RIGHT-OF-USE

 

7,146

 

 

 

4,519

 

EQUITY-ACCOUNTED INVESTMENTS

 

5,861

 

 

 

10,004

 

GOODWILL

 

162,657

 

 

 

29,153

 

INTANGIBLE ASSETS, net of acc. amort. of - 2022: $16,390; 2021: $16,403

 

156,702

 

 

 

357

 

DEFERRED INCOME TAXES

 

3,776

 

 

 

622

 

OTHER LONG-TERM ASSETS, including reinsurance assets

 

78,092

 

 

 

81,866

 

TOTAL ASSETS

 

656,565

 

 

 

428,330

 

LIABILITIES

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

Short-term credit facilities for ATM funding

 

51,338

 

 

 

14,245

 

Short-term credit facilities

 

14,880

 

 

 

-

 

Accounts payable

 

18,572

 

 

 

7,113

 

Other payables

 

34,362

 

 

 

27,588

 

Operating lease liability - current

 

2,498

 

 

 

2,822

 

Current portion of long-term borrowings

 

6,804

 

 

 

-

 

Income taxes payable

 

2,140

 

 

 

256

 

Total current liabilities before settlement obligations

 

130,594

 

 

 

52,024

 

Settlement obligations

 

15,276

 

 

 

466

 

Total current liabilities

 

145,870

 

 

 

52,490

 

DEFERRED INCOME TAXES

 

54,211

 

 

 

10,415

 

OPERATING LEASE LIABILITY - LONG TERM

 

4,827

 

 

 

1,890

 

LONG-TERM BORROWINGS

 

134,842

 

 

 

-

 

OTHER LONG-TERM LIABILITIES, including insurance policy liabilities

 

2,466

 

 

 

2,576

 

TOTAL LIABILITIES

 

342,216

 

 

 

67,371

 

REDEEMABLE COMMON STOCK

 

79,429

 

 

 

84,979

 

EQUITY

 

 

 

 

 

LESAKA EQUITY:

 

 

 

 

 

COMMON STOCK

 

 

 

 

 

Authorized: 200,000,000 with $0.001 par value;

 

 

 

 

 

Issued and outstanding shares, net of treasury: 2022: 62,324,321; 2021: 56,716,620

 

83

 

 

 

80

 

PREFERRED STOCK

 

 

 

 

 

Authorized shares: 50,000,000 with $0.001 par value;

 

 

 

 

 

Issued and outstanding shares, net of treasury: 2022: -; 2021: -

 

-

 

 

 

-

 

ADDITIONAL PAID-IN-CAPITAL

 

327,891

 

 

 

301,959

 

TREASURY SHARES, AT COST: 2022: 24,891,292; 2021: 24,891,292

 

(286,951

)

 

 

(286,951

)

ACCUMULATED OTHER COMPREHENSIVE LOSS

 

(168,840

)

 

 

(145,721

)

RETAINED EARNINGS

 

362,737

 

 

 

406,613

 

TOTAL LESAKA EQUITY

 

234,920

 

 

 

275,980

 

NON-CONTROLLING INTEREST

 

-

 

 

 

-

 

TOTAL EQUITY

 

234,920

 

 

 

275,980

 

TOTAL LIABILITIES, REDEEMABLE COMMON STOCK AND SHAREHOLDERS’ EQUITY

$

656,565

 

 

$

428,330

 

(A) Derived from audited consolidated financial statements.


LESAKA TECHNOLOGIES, INC.

Unaudited Condensed Consolidated Statements of Cash Flows

 

Unaudited

 

(A)

 

Three months ended

 

Year ended

 

June 30,

 

June 30,

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

 

(In thousands)

 

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

 

 

 

Net loss

$

(15,149

)

 

$

1,639

 

 

$

(43,876

)

 

$

(38,057

)

Depreciation and amortization

 

5,491

 

 

 

1,218

 

 

 

7,575

 

 

 

4,347

 

Movement in allowance for doubtful accounts receivable

 

334

 

 

 

(803

)

 

 

1,551

 

 

 

110

 

Interest payable

 

208

 

 

 

45

 

 

 

9

 

 

 

(1

)

Fair value adjustment related to financial liabilities

 

10

 

 

 

(361

)

 

 

(466

)

 

 

840

 

Gain on disposal of equity securities

 

-

 

 

 

-

 

 

 

(720

)

 

 

-

 

Loss on disposal of equity-accounted investment

 

30

 

 

 

-

 

 

 

376

 

 

 

13

 

Loss on disposal of equity-accounted investment - Bank Frick

 

-

 

 

 

-

 

 

 

-

 

 

 

472

 

Loss from equity-accounted investments

 

2,493

 

 

 

4,780

 

 

 

3,649

 

 

 

24,878

 

Movement in allowance for doubtful loans

 

-

 

 

 

4,000

 

 

 

38

 

 

 

4,739

 

Change in fair value of equity securities

 

-

 

 

 

(23,362

)

 

 

-

 

 

 

(49,304

)

(Profit) Loss on disposal of property, plant and equipment

 

(449

)

 

 

(120

)

 

 

(2,849

)

 

 

480

 

Stock-based compensation charge

 

1,251

 

 

 

(532

)

 

 

2,962

 

 

 

344

 

Dividends received from equity accounted investments

 

18

 

 

 

69

 

 

 

155

 

 

 

194

 

Decrease (Increase) in accounts receivable and finance loans receivable

 

12,021

 

 

 

(479

)

 

 

9,055

 

 

 

3,751

 

(Increase) Decrease in inventory

 

(4,793

)

 

 

(1,363

)

 

 

(4,820

)

 

 

1,279

 

(Decrease) Increase in accounts payable and other payables

 

(7,183

)

 

 

4,058

 

 

 

(8,851

)

 

 

(335

)

Increase (Decrease) in taxes payable

 

643

 

 

 

(1,712

)

 

 

1,087

 

 

 

(17,210

)

(Decrease) Increase in deferred taxes

 

(1,866

)

 

 

4,665

 

 

 

(2,324

)

 

 

5,089

 

Net cash used in operating activities

 

(6,690

)

 

 

(8,258

)

 

 

(37,198

)

 

 

(58,371

)

Cash flows from investing activities

 

 

 

 

 

 

 

 

 

 

 

Capital expenditures

 

(2,837

)

 

 

(338

)

 

 

(4,558

)

 

 

(4,285

)

Proceeds from disposal of property, plant and equipment

 

688

 

 

 

226

 

 

 

4,217

 

 

 

571

 

Acquisition of Connect, net of cash acquired

 

(202,159

)

 

 

-

 

 

 

(202,159

)

 

 

-

 

Proceeds from disposal of equity securities

 

-

 

 

 

-

 

 

 

720

 

 

 

-

 

Proceeds from disposal of equity-accounted investment

 

46

 

 

 

-

 

 

 

865

 

 

 

-

 

Proceeds from disposal of equity-accounted investment - Bank Frick

 

3,890

 

 

 

-

 

 

 

11,390

 

 

 

18,568

 

Proceeds from disposal of Net1 Korea, net of cash disposed

 

-

 

 

 

-

 

 

 

-

 

 

 

20,114

 

Proceeds from disposal of DNI as equity-accounted investment

 

-

 

 

 

-

 

 

 

-

 

 

 

6,010

 

Loan to equity-accounted investment

 

-

 

 

 

-

 

 

 

-

 

 

 

(1,238

)

Repayment of loans by equity-accounted investments

 

-

 

 

 

-

 

 

 

-

 

 

 

134

 

Net change in settlement assets

 

(4,265

)

 

 

1,711

 

 

 

(4,163

)

 

 

7,901

 

Net cash (used in) cash provided by investing activities

 

(204,637

)

 

 

1,599

 

 

 

(193,688

)

 

 

47,775

 

Cash flows from financing activities

 

 

 

 

 

 

 

 

 

 

 

Proceeds from bank overdraft

 

164,464

 

 

 

98,324

 

 

 

570,862

 

 

 

360,083

 

Repayment of bank overdraft

 

(152,951

)

 

 

(97,137

)

 

 

(525,459

)

 

 

(365,440

)

Long-term borrowings utilized

 

78,851

 

 

 

-

 

 

 

78,851

 

 

 

-

 

Repayment of long-term borrowings

 

(5,581

)

 

 

-

 

 

 

(5,581

)

 

 

-

 

Guarantee fee

 

(1,307

)

 

 

-

 

 

 

(1,307

)

 

 

-

 

Proceeds from issue of shares

 

-

 

 

 

-

 

 

 

759

 

 

 

53

 

Proceeds from disgorgement of shareholders' short-swing profits

 

-

 

 

 

-

 

 

 

-

 

 

 

124

 

Net change in settlement obligations

 

4,236

 

 

 

(1,711

)

 

 

4,134

 

 

 

(7,901

)

Net cash provided by (used in) financing activities

 

87,712

 

 

 

(524

)

 

 

122,259

 

 

 

(13,081

)

Effect of exchange rate changes on cash

 

(11,633

)

 

 

4,118

 

 

 

(10,338

)

 

 

14,957

 

Net decrease in cash, cash equivalents and restricted cash

 

(135,248

)

 

 

(3,065

)

 

 

(118,965

)

 

 

(8,720

)

Cash, cash equivalents and restricted cash – beginning of period

 

240,048

 

 

 

226,830

 

 

 

223,765

 

 

 

232,485

 

Cash, cash equivalents and restricted cash – end of period

$

104,800

 

 

$

223,765

 

 

$

104,800

 

 

$

223,765

 

(A) Derived from audited consolidated financial statements.


Lesaka Technologies, Inc.

Attachment A

Operating segment revenue, operating (loss) income and operating (loss) margin:

Three months ended June 30, 2022 and 2021 and March 31, 2022

 

 

Three months ended

Change - actual

Change –
constant
exchange rate
(1)