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Net 1 UEPS Technologies, Inc. Reports Preliminary Fourth Quarter and Full Year 2019 Results

JOHANNESBURG, South Africa, Sept. 26, 2019 (GLOBE NEWSWIRE) -- Net 1 UEPS Technologies, Inc. (Nasdaq: UEPS; JSE: NT1) today released preliminary unaudited results for the fourth quarter and full year fiscal 2019.

Preliminary Q4 2019 Highlights:

  • Revenue of $71.2 million, GAAP EPS of $(2.63) and Fundamental EPS of $(2.45);
  • Fundamental EPS of $(2.45) includes $125.4 million, or $2.21 per share of non-cash fair value loss adjustments for Cell C, net of tax, and $13.7 million, or $0.24 per share for impairments of the Cedar Cellular note and goodwill;
  • Total revenue from continuing operations in constant currency grew 3.5% compared to Q3 2019, while adjusted EBITDA loss improved from ($9.4) million in Q3 2019 to a loss of $(0.7) million in Q4 2019;
  • South African operations achieved EBITDA breakeven in July 2019; active EPE accounts remained stable at 1.1 million; and
  • KSNET revenue grew 11% compared to Q3 2019 in constant currency, while EBITDA margin improved 200 basis points;

“We are pleased to report that we have stabilized our business in South Africa, and we are focused on returning to growth and profitability in fiscal 2020. Going forward, we are returning to our roots of providing innovative and affordable financial technology and services offerings to the unbanked and underbanked, as well as leveraging our deep expertise in cryptography and secure transactions to introduce new and relevant products,” said Herman Kotzé, CEO. “We also continue to review our portfolio of investments for those that do not fit our strategic focus or give us a path to control, and will accordingly be evaluated for monetization. Building on our disposal of DNI which started in Q3 2019, the Company has now received multiple indicative offers for KSNET in Korea, and we have engaged FT Partners to assist the Board to determine the appropriate course of action. With the challenges of the last year and the required repositioning behind us, we are well positioned to unlock shareholder value and improve capital allocation going forward.”

“As we look to fiscal 2020, our progress should be benchmarked to our Q4 2019 results rather than year-over-year comparisons given the contract termination and business disposals over the course of fiscal 2019. In fiscal 2020, we expect to generate adjusted EBITDA of at least $16 million using a constant currency base of ZAR 14.27/$1, driven by growth in South Korea and South Africa, and reduced losses in our IPG business,” said Alex Smith, CFO. “We are working closely with Cell C and its stakeholders to improve its short-term liquidity challenges, conclude its recapitalization and as a result, create a long-term sustainable business. Our other equity investments continued to perform in line, or ahead of expectations during the quarter.”

Preliminary Summary Financial Metrics

  Three months ended June 30,
  2019   2018
As
restated
(1)
  % change
in USD
  % change
in ZAR
(All figures in USD ‘000s except per share data)              
Revenue 71,181   149,194   (52%)   (40%)
GAAP operating (loss) income (15,607)   10,072   nm   nm
Adjusted (negative) EBITDA(2) (749)   24,301   nm   nm
GAAP (loss) earnings per share ($) (2.63)   0.05   nm   nm
Continuing (2.63)   0.10   nm   nm
Discontinued -   (0.05)   nm   nm
Fundamental (loss) earnings per share ($)(2) (2.45)   0.22   nm   nm
Fully-diluted shares outstanding (‘000’s) 56,804   56,816   (0%)    
Average period USD/ ZAR exchange rate 14.29   11.45   25%    
Non-cash adjustments included (before tax impact): 140,827   12,834   997%    
Allowance for doubtful finance loans receivables 1,148   1,798   (36%)    
Change in fair value of equity securities 125,360   5,370   2,234%    
Loss on disposal of DNI 631   -   nm    
Loss on acquisition of DNI -   4,614   nm    
Impairment loss 6,249   1,052   494%    
Impairment of Cedar Cell note 7,439   -   nm    


  Fiscal year ended June 30,
  2019   2018
As
restated
(1)
  % change
in USD
  % change
in ZAR
(All figures in USD ‘000s except per share data)              
Revenue 380,699   612,889   (38%)   (30%)
GAAP operating (loss) income (79,469)   58,949   nm   nm
Adjusted (negative) EBITDA(2) (12,621)   127,155   nm   nm
GAAP (loss) earnings per share ($) (4.82)   1.13   nm   nm
Continuing (4.80)   1.09   nm   nm
Discontinued (0.02)   0.04   nm   nm
Fundamental (loss) earnings per share ($)(2) (3.93)   2.00   nm   nm
Fully-diluted shares outstanding (‘000’s) 56,778   56,858   (0%)    
Average period USD/ ZAR exchange rate 14.27   12.70   12%    
Non-cash adjustments included (before tax impact): 238,554   6,416   3,618%    
Allowance for doubtful finance loans receivables 32,786   13,358   145%    
Change in fair value of equity securities 167,459   (32,473)   nm    
Loss on disposal of DNI 5,771   -   nm    
Loss on acquisition of DNI -   4,614   nm    
Impairment loss 19,745   20,917   (6%)    
Impairment of Cedar Cell note 12,793   -   nm    

(1) 2018 restated to correct an error identified by its equity method investment – Finbond Group Limited. The financial information for the three months and year ended June 30, 2018, have been restated with the effect of decreasing GAAP net (loss) income by $0.1 million, respectively. GAAP (loss) earnings per share were unaffected.

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

Factors impacting comparability of our preliminary Q4 2019 and Q4 2018 results

  • Decline in revenue: Our revenues declined 41% in ZAR primarily due to the expiration of our SASSA contract, the significant decline in EPE account numbers driven by SASSA’s auto-migration of accounts to SAPO, and a reduction in EPE-related financial and value-added services and transaction fees due to a smaller customer base;
  • Increase in operating losses: Lower revenue, coupled with a high-fixed cost infrastructure, ongoing IPG operating losses, and a goodwill impairment resulted in an operating loss. We also incurred $1.0 million in retrenchment costs during Q4 2019;
  • Non-cash losses, impairments and fair-value adjustments: We incurred a $0.6 million non-cash loss on disposal of an 8% interest in DNI, a goodwill impairment loss of $6.2 million, a fair value adjustment loss of $125.4 million for Cell C and a $7.4 million impairment of our Cedar Cell note; and
  • Adverse foreign exchange movements: The U.S. dollar appreciated 24% against the ZAR and 10% against the KRW during Q4 2019, which adversely impacted our reported results.

Preliminary Results of Operations by Segment and Liquidity

    South African transaction processing

Segment revenue was $18.9 million in Q4 2019, down 63% on a constant currency basis compared with Q4 2018 but up from $17.4 million in Q3 2019. The year-over-year decrease in segment revenue and operating income was primarily due to the substantial decrease in the number of SASSA grant recipients paid under our SASSA contract as the contract ended at the end of Q1 2019. Our revenue and operating income were also adversely impacted by the significant reduction in the number of SASSA grant recipients with SASSA-branded Grindrod cards linked to Grindrod bank accounts as well as a lower number of EPE accounts in Q2 2019. These decreases in revenue and operating income were partially offset by higher transaction revenue as a result of increased usage of our ATMs. Operating income for this operating segment for Q4 2019 included retrenchment costs of $1.0 million (ZAR 14.3 million). Our operating (loss) income margin for Q4 2019 and 2018 was (13.1%) and 6.7%, respectively. Excluding restructuring costs, the operating loss margin for Q4 2019 and Q3 2019 was (7.5%) and (57.5%) respectively.

    International transaction processing

Segment revenue was $36.4 million in Q4 2019, down 16% compared with Q4 2018 but up from $34.4 million in Q3 2019. Segment revenue was lower during Q4 2019, primarily due to a contraction in IPG transactions processed, specifically meaningfully lower crypto-exchange and China processing activity, and modestly lower KSNET revenue as a result of lower transaction values processed. Operating income during Q4 2019 was higher compared to fiscal 2018 due to an improved contribution from KSNET, primarily as a result of a lower depreciation expense, and partially offset by the decrease in IPG revenues. Operating income margin for Q4 2019 and 2018, and Q3 2019 was 6.1%, 4.8%, and 5.6% respectively.

    Financial inclusion and applied technologies

Segment revenue was $17.4 million in Q4 2019, down 59% compared with Q4 2018 in constant currency and Q3 2019 revenue (excluding DNI) of $18.8 million. Segment revenue decreased primarily due to fewer prepaid airtime and value-added services sales, lower lending and insurance revenue, and a decrease in inter-segment revenues. Operating income was significantly lower than Q4 2018, primarily due to lower revenue generation and higher expenses incurred to maintain and expand our financial service infrastructure. Operating (loss) income for this operating segment for Q4 2019 includes a goodwill impairment of $6.2 million. Operating (loss) income margin for Q4 2019 and 2018 was (61.2%) and 25.5%, respectively. Excluding the goodwill impairment, segment operating loss and margin for Q4 2019 were ($4.5) million and (26.0%), respectively, and excluding DNI and retrenchment costs, segment operating loss and margin for Q3, 2019 were ($3.3) million and (17.8%), respectively.

    Corporate/eliminations

Our corporate expenses decreased primarily due to a reversal of stock compensation charge of $1.8 million related to stock options and restricted stock forfeited, partially offset by higher non-employee director expenses, transaction-related expenditures and external service provider fees.

    Cash flow and liquidity

At June 30, 2019, our cash and cash equivalents were $46.5 million and comprised of KRW-denominated balances of KRW 30.1 billion ($26.1 million), ZAR-denominated balances of ZAR 189.9 million ($13.5 million), U.S. dollar-denominated balances of $2.4 million, and other currency deposits, primarily Botswana pula, of $4.5 million, all amounts translated at exchange rates applicable as of June 30, 2019. The decrease in our unrestricted cash balances from June 30, 2018, was primarily due to significantly weaker trading activities, scheduled debt repayments, dividend payments to non-controlling interests and capital expenditures, which was partially offset by cash dividends received from DNI and a decrease in our South African lending book.

Excluding the impact of interest received, interest paid under our South Africa debt and taxes, the decrease in cash provided is primarily due to significantly weaker trading activity during fiscal 2019 compared to 2018. Capital expenditures for Q4 2019 and 2018 were $2.1 million and $1.9 million, respectively, and primarily relate to the acquisition of additional ATMs in South Africa. We made an unscheduled South African debt facility payment of $1.0 million (ZAR 15 million) and settled our outstanding South African long-term borrowings in full.

Operating metrics and supplemental presentation for Q4 2019 Results

A supplemental presentation and operating metrics for preliminary Q4 2019 will be posted to the Investor Relations page of our website, ir.net1.com, prior to our earnings call on Friday, September 27, 2019.

Conference Call

We will host a conference call to review these results on September 27, 2019, at 8:00 a.m. Eastern Time. To participate in the call, dial 1-508-924-4326 (US and Canada), 0333-300-1418 (U.K. only) or 080-020-0648 (South Africa only) ten minutes prior to the start of the call. Callers should request “Net1 call” upon dial-in. The call will also be webcast on the Net1 homepage, www.net1.com. Please click on the webcast link at least ten minutes prior to the call. A webcast of the call will be available for replay on the Net1 website through October 20, 2019.

Use of Non-GAAP Measures

US 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 directly comparable GAAP measures. The presentation of negative EBITDA, adjusted negative EBITDA, fundamental net (loss) income and fundamental (loss) earnings per share and headline (loss) earnings per share are non-GAAP measures.

    EBITDA and adjusted EBITDA

(Loss) Earnings before interest, tax, depreciation and amortization (“EBITDA”) is GAAP operating (loss) income adjusted for depreciation and amortization and, if applicable, impairment losses. Adjusted EBITDA is EBITDA adjusted for costs related to acquisitions and transactions consummated or ultimately not pursued, retrenchment costs incurred, and in fiscal 2018, the non-cash re-measurement loss related to the acquisition of DNI, an allowance for doubtful Mastertrading working capital finance loans receivable, a refund of indirect taxes in Korea, and (loss) profits realized on the sale of a business.

    Fundamental net (loss) income and fundamental (loss) earnings per share

Fundamental net (loss) income and (loss) earnings per share is GAAP net (loss) income and (loss) earnings per share adjusted for the amortization of acquisition-related intangible assets (net of deferred taxes), the amortization of intangible assets (net of deferred taxes) related to equity-accounted investments, stock-based compensation charges and reversals, the amortization of South African and South Korean debt facility fees and unusual non-recurring items, including impairment losses, costs related to acquisitions and transactions consummated or ultimately not pursued.

Fundamental net (loss) income and (loss) earnings per share for fiscal 2019 also includes an adjustment for the loss incurred on the disposal of DNI, retrenchment costs incurred, accretion of interest related to the DNI contingent consideration, and for the non-controlling interest portion of the amortization of intangible assets (net of deferred taxes). Fundamental net income and earnings per share for fiscal 2018 also includes adjustments for an allowance for doubtful working capital finance receivables, the non-cash re-measurement loss related to the acquisition of DNI, refund of indirect taxes in Korea, the impact of changes in tax laws in the U.S and a gain realized on the sale of XeoHealth.

We provide earnings guidance only on a non-GAAP basis and do not provide a reconciliation of forward-looking fundamental (loss) earnings per share guidance to the most directly comparable GAAP financial measures because of the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation, the amounts of which, based on past experience, could be material.

Management believes that the EBITDA, adjusted EBITDA, fundamental net (loss) income and (loss) earnings per share metric enhances 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 loss and (profit) loss on sale of property, plant and equipment and the re-measurement loss on the acquisition of DNI. Attachment C presents the reconciliation between our net (loss) income used to calculate (loss) earnings per share basic and diluted and HE(L)PS basic and diluted and the calculation of the denominator for headline diluted (loss) earnings per share.

About Net1

Net1 is a leading provider of transaction processing services, financial inclusion products and services and secure payment technology. Net1 operates market-leading payment processors in South Africa and the Republic of Korea. Net1 offers debit, credit and prepaid processing and issuing services for all major payment networks. In South Africa, Net1 provides innovative low-cost financial inclusion products, including banking, lending and insurance and through DNI is a leading distributor of mobile subscriber starter packs for Cell C, a South African mobile network operator. Net1 leverages its strategic equity investments in Finbond and Bank Frick (both regulated banks), and Cell C to introduce products to new customers and geographies.

Net1 has a primary listing on NASDAQ (UEPS) and a secondary listing on the Johannesburg Stock Exchange (JSE:NT1). Visit www.net1.com for additional information about Net1.

Forward-Looking Statements

This announcement contains forward-looking statements that involve known and unknown risks and uncertainties, including statements concerning our preliminary financial results for our fourth quarter and full year ended June 30, 2019. The preliminary financial results for our fourth quarter and full year 2019 included in this press release represent the most current information available to management. Our actual results, when disclosed in our Form 10-K, may differ from these preliminary results as a result of the completion of our financial closing procedures, final adjustments, completion of the review by our independent registered public accounting firm and other developments that may arise between now and the disclosure of the final results. A discussion of various factors that may cause our preliminary 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:
Dhruv Chopra
Group Vice President, Investor Relations
Phone: +1 917-767-6722
Email: dchopra@net1.com

Media Relations Contact:
Bridget von Holdt
Business Director – BCW
Phone: +27-82-610-0650
Email: bridget.vonholdt@bm-africa.com

 
NET 1 UEPS TECHNOLOGIES, INC.
Preliminary Unaudited Consolidated Statements of Operations
       
    Unaudited       Unaudited  
    Three months ended       Year ended  
    June 30,
      June 30,
 
    2019     2018
(As
restated)
(R)
      2019     2018
(As
restated)
(R)
 
  (In thousands, except per share data)   (In thousands, except per share data)
                   
REVENUE $ 71,181   $ 149,194     $ 380,699   $ 612,889  
                   
EXPENSE                  
                   
Cost of goods sold, IT processing, servicing and support   41,668     78,030       215,348     304,536  
                   
Selling, general and administration   32,050     51,586       187,726     193,003  
                   
Depreciation and amortization   6,821     8,454       37,349     35,484  
                   
Impairment loss   6,249     1,052       19,745     20,917  
                   
OPERATING (LOSS) INCOME   (15,607 )   10,072       (79,469 )   58,949  
                   
CHANGE IN FAIR VALUE OF EQUITY SECURITIES   (125,360 )   (5,370 )     (167,459 )   32,473  
                   
LOSS ON DISPOSAL OF DNI   631     -       5,771     -  
                   
INTEREST INCOME, net of impairment   (6,150 )   2,982       (5,564 )   17,885  
Interest income   1,289     2,982       7,229     17,885  
Impairment of Cedar Cellular note   (7,439 )   -       (12,793 )   -  
                   
INTEREST EXPENSE   1,694     2,069       10,724     8,941  
                   
(LOSS) INCOME BEFORE INCOME TAX (BENEFIT) EXPENSE   (149,442 )   5,615       (268,987 )   100,366  
                   
INCOME TAX (BENEFIT) EXPENSE   2,023     8,840       3,725     48,597  
                   
NET (LOSS) INCOME BEFORE EARNINGS FROM EQUITY-ACCOUNTED INVESTMENTS   (151,465 )   (3,225 )     (272,712 )   51,769  
                   
EARNINGS FROM EQUITY-ACCOUNTED INVESTMENTS   1,820     4,208       1,482     11,597  
                   
NET (LOSS) INCOME   (149,645 )   983       (271,230 )   63,366  
Continuing   (149,645 )   3,794       (273,920 )   60,975  
Discontinued   -     (2,811 )     2,690     2,391  
                   
LESS (ADD) NET INCOME (LOSS) ATTRIBUTABLE TO NON-CONTROLLING INTEREST   10     (1,783 )     2,349     (880 )
Continuing   10     (1,783 )     (1,352 )   (880 )
Discontinued   -     -       3,701     -  
                   
NET (LOSS) INCOME ATTRIBUTABLE TO NET1 $ (149,655 )   2,766       (273,579 )   64,246  
Continuing   (149,655 )   5,577       (272,568 )   61,855  
Discontinued   -   $ (2,811 )   $ (1,011 ) $ 2,391  
                   
Net (loss) income per share, in U.S. dollars                  
Basic (loss) earnings attributable to Net1 shareholders   (2.63 )   0.05       (4.82 )   1.13  
Continuing   (2.63 )   0.10       (4.80 )   1.09  
Discontinued   -     (0.05 )     (0.02 )   0.04  
Diluted (loss) earnings attributable to Net1 shareholders   (2.63 )   0.05       (4.82 )   1.13  
Continuing   (2.63 )   0.10       (4.80 )   1.09  
Discontinued   -     (0.05 )     (0.02 )   0.04  
                   
(R) Certain amounts have been restated to correct an insignificant misstatement.


 
NET 1 UEPS TECHNOLOGIES, INC.
Preliminary Unaudited Consolidated Balance Sheets
    Unaudited       Unaudited (R)  
    June 30,       June 30,  
    2019       2018  
       
    (In thousands, except share data)  
ASSETS              
CURRENT ASSETS          
Cash and cash equivalents $ 46,065     $ 87,075  
Restricted cash   75,446       -  
Pre-funded social welfare grants receivable   -       2,965  
Accounts receivable, net of allowance of – 2019: $1,241; 2018: $1,101 and other receivables   72,494       93,448  
Finance loans receivable, net of allowance of – 2019: $9,291; 2018: $16,403   30,631       61,463  
Inventory   7,535       10,361  
Current assets of discontinued operation   -       22,482  
Total current assets before settlement assets   232,171       277,794  
Settlement assets   63,479       149,047  
Total current assets   295,650       426,841  
PROPERTY, PLANT AND EQUIPMENT, net of accumulated depreciation of – 2019: $117,866; 2018: $126,026   18,554       25,737  
EQUITY-ACCOUNTED INVESTMENTS   151,116       86,016  
GOODWILL   149,387       169,079  
INTANGIBLE ASSETS, net of accumulated amortization of – 2019: $127,100; 2018: $121,466   11,889       27,129  
DEFERRED INCOME TAXES   2,151       4,776  
OTHER LONG-TERM ASSETS, including reinsurance assets   44,189       235,032  
LONG-TERM ASSETS OF DISCONTINUED OPERATION   -       242,704  
TOTAL ASSETS   672,936       1,217,314  
           
LIABILITIES              
CURRENT LIABILITIES          
Short-term credit facilities for ATM funding   75,446       -  
Short-term credit facilities   9,544       -  
Accounts payable   17,005       21,106  
Other payables   32,410       41,645  
Current portion of long-term borrowings   -       44,079  
Income taxes payable   6,223       5,742  
Current liabilities of discontinued operation   -       20,914  
Total current liabilities before settlement obligations   140,628       133,486  
Settlement obligations   63,479       149,047  
Total current liabilities   204,107       282,533  
DEFERRED INCOME TAXES   4,682       16,067  
LONG-TERM BORROWINGS   -       5,469  
OTHER LONG-TERM LIABILITIES, including insurance policy liabilities   3,007       30,289  
LONG-TERM LIABILITIES OF DISCONTINUED OPERATION   -       38,387  
TOTAL LIABILITIES   211,796       372,745  
COMMITMENTS AND CONTINGENCIES          
           
REDEEMABLE COMMON STOCK   107,672       107,672  
           
EQUITY              
COMMON STOCK          
Authorized: 200,000,000 with $0.001 par value;          
Issued and outstanding shares, net of treasury - 2019: 56,568,425; 2018: 56,685,925   80       80  
PREFERRED STOCK          
Authorized shares: 50,000,000 with $0.001 par value;          
Issued and outstanding shares, net of treasury: June: -; June: -   -       -  
ADDITIONAL PAID-IN-CAPITAL   276,997       276,201  
TREASURY SHARES, AT COST: 2019: 24,891,292; 2018: 24,891,292   (286,951 )     (286,951 )
ACCUMULATED OTHER COMPREHENSIVE LOSS   (199,273 )     (184,538 )
RETAINED EARNINGS   562,615       836,194  
TOTAL NET1 EQUITY   353,468       640,986  
NON-CONTROLLING INTEREST   -       95,911  
TOTAL EQUITY   353,468       736,897  
           
TOTAL LIABILITIES, REDEEMABLE COMMON STOCK AND SHAREHOLDERS’ EQUITY $ 672,936     $ 1,217,314  
           
(R) Certain amounts have been restated to correct an insignificant misstatement.


...
NET 1 UEPS TECHNOLOGIES, INC.
Preliminary Unaudited Condensed Consolidated Statements of Cash Flows
                           
    Three months ended       Year ended  
    June 30,        June 30,   
    2019       2018(R)
(as restated)
      2019       2018(R)
(as restated)
 
               
    (In thousands)       (In thousands)  
                           
Cash flows from operating activities                          
Net (loss) income $ (149,645 ) $ 983     $ (271,230 ) $ 63,366  
Depreciation and amortization   6,821     8,454       37,349     35,484  
Impairment loss   6,249     1,052       19,745     20,917  
Allowance for doubtful accounts receivable charged   1,148     1,798       32,786     13,358  
Earnings from equity-accounted investments   (1,820 )   (4,208 )     (1,482 )   (11,597 )
Interest on Cedar Cellular note   (447 )   (626 )     (2,397 )   (1,395 )
Impairment of Cedar Cellular note   7,439     -       12,793     -  
Change in fair value of equity securities   125,360     5,370       167,459     (32,473 )
Fair value adjustments and foreign currency re-measurements   (18 )   623       73     414  
Interest payable   (57 )   118       237     (146 )
Facility fee amortized   115     122       321     589  
Loss (Profit) on disposal of business   631     -       5,771     (463 )
Loss on fair value of DNI   -     4,614       -     4,614  
(Profit) Loss on disposal of property, plant and equipment   (73 )   (31 )     (486 )   40  
Stock compensation charge, net of forfeitures   (1,279 )   597       393     2,607  
Dividends received from equity accounted investments   864     -       1,318     4,111  
Decrease (Increase) in accounts and finance loans receivable, and pre-funded grants receivable   5,130     20,170       11,663     17,732  
Decrease (Increase) in inventory   430     255       4,042     (2,521 )
(Decrease) Increase in accounts payable and other payables   (3,199 )   4,820       (14,538 )   10,595  
Increase (Decrease) in taxes payable   1,286     (6,954 )     3,428     1,137  
(Decrease) Increase in deferred taxes   (482 )   (2,316 )     (11,705 )   5,936  
Net cash (used in) provided by operating activities   (1,547 )   34,841       (4,460 )   132,305  
                   
Cash flows from investing activities                  
Capital expenditures   (2,136 )   (1,848 )     (9,416 )   (9,649 )
Proceeds from disposal of property, plant and equipment   264     83       1,045     658  
Acquisition of intangible assets   -     -       (1,384 )   -  
Investment in equity of equity-accounted investments   -     (1,000 )     (2,989 )   (133,335 )
Disposal of DNI   -     -       (2,114 )   -  
Investment in MobiKwik   -     -       (1,056 )   -  
Repayment of loans by equity-accounted investments   1,029     9,180       1,029     9,180  
Proceeds on return of investment   -     -       284     -  
Investment in Cell C   -     -       -     (151,003 )
Loans to equity-accounted investments   -     -       -     (10,635 )
Acquisition of held to maturity investment   -     -       -     (9,000 )
Acquisitions, net of cash acquired       (6,202 )     -     (6,202 )
Other investing activities, net   -     (207 )     -     (61 )
Net change in settlement assets   2,198     210,405       79,077     490,795  
Net cash provided by investing activities   1,355     210,411       64,476     180,748  
                   
Cash flows from financing activities                  
Proceeds from bank overdraft   238,229     2,528       822,754     44,900  
Repayment of bank overdraft   (238,146 )   (5,932 )     (740,969 )   (62,925 )
Repayment of long-term borrowings   (1,047 )   (16,095 )     (37,357 )   (77,062 )
Long-term borrowings utilized   -     -       14,613     113,157  
Dividends paid to non-controlling interest   (19 )   -       (4,104 )   -  
Payment of guarantee fee   -     -       (394 )   (754 )
Acquisition of non-controlling interests   (180 )   -       (180 )   -  
Net change in settlement obligations   (2,198 )   (210,405 )     (79,077 )   (490,795 )
Net cash used in financing activities   (3,361 )   (229,904 )     (24,714 )   (473,479 )
                   
Effect of exchange rate changes on cash   2,126     (12,466 )     (3,845 )   (7,977 )
Net (decrease) increase in cash, cash equivalents and restricted cash   (1,427 )   2,882       31,457     (168,403 )
Cash, cash equivalents and restricted cash – beginning   122,938     87,172       90,054     258,457  
Cash, cash equivalents and restricted cash – end of period (1) $ 121,511   $ 90,054     $ 121,511   $ 90,054