FY25 Q2 Results Presentation February 06. 2025 1 As a domestic filer in the US, we report results in US dollars under US GAAP as evident in our 10-K and 10-Q filings. It is important to note that our operational currency is South African Rand and as such we analyze our performance in South African Rand. The company's results reported in US dollars can be significantly affected by the currency fluctuation s between the US dollar and the South African Rand and thus we refer investors to results reported in ZA ...

Lesaka Technologies, Inc. (NASDAQ:LSAK) Q2 2025 Earnings Conference Call February 6, 2025 8:00 AM ET Company Participants Ali Zaynalabidin Mazanderani - Executive Chairman Daniel Smith - Group CFO Steven Heilbron - CEO, Connect Group & Director Lincoln Mali - CEO, Southern Africa & Director Naeem Kola - Group COO, Treasurer, Secretary & Director Bronwyn Nielsen - The Nielsen Network Conference Call Participants Bronwyn Nielsen Hello, everyone, and welcome to the Lesaka Technologies Webcast and Conference C ...

Core Viewpoint - Lesaka Technologies reported quarterly earnings of $0.01 per share, matching the Zacks Consensus Estimate, and showing an improvement from a loss of $0.04 per share a year ago [1] - The company generated revenues of $146.82 million for the quarter ended December 2024, exceeding the Zacks Consensus Estimate by 14.70% and up from $143.89 million year-over-year [2] Financial Performance - The earnings surprise for the previous quarter was -16.67%, with an actual loss of $0.07 per share against an expected loss of $0.06 [1] - Over the last four quarters, Lesaka Technologies has not surpassed consensus EPS estimates [1] - The current consensus EPS estimate for the upcoming quarter is $0.05 on revenues of $134 million, and for the current fiscal year, it is $0.16 on revenues of $546.55 million [7] Market Performance - Lesaka Technologies shares have declined approximately 11.6% since the beginning of the year, contrasting with the S&P 500's gain of 2.7% [3] - The company's Zacks Rank is currently 4 (Sell), indicating expectations of underperformance in the near future [6] Industry Outlook - The Technology Services industry, to which Lesaka Technologies belongs, is currently ranked in the top 35% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8]

Financial Performance - Lesaka's Merchant Division reported a total throughput of ZAR 11.3 billion for Q2 2025, a significant increase from ZAR 4.1 billion in Q2 2024, representing a year-on-year growth of 175%[242]. - Total throughput for Alternative Digital Payments (ADP) in Q2 2025 was ZAR 11.1 billion, a 32% increase from ZAR 8.4 billion in Q2 2024, driven by a 63% increase in supplier enabled payments[253]. - Total throughput for bill payments in Q2 2025 was ZAR 8.3 billion, representing a 13% increase compared to ZAR 7.3 billion in Q2 2024[264]. - Total throughput for utility payments decreased by 16% to ZAR 1.6 billion in Q2 2025 from ZAR 2.0 billion in Q2 2024[264]. - Revenue in ZAR decreased by 2% in Q2 2025, primarily due to fewer low-margin prepaid airtime sales and a lower contribution from the Enterprise division[283]. - Revenue for the three months ended December 31, 2024, was $146.8 million, a 2% increase from $143.9 million in 2023[284]. - Merchant segment revenue decreased by 1% to $115.8 million, while Consumer segment revenue increased by 37% to $22.9 million[296]. - Revenue for the first half of fiscal 2025 was flat, with a 0.2% increase in ZAR, primarily due to the inclusion of Adumo and increased value-added services, offset by fewer Pinned Airtime sales[309][311]. - Total consolidated revenue for the six months ended December 31, 2024, was ZAR 5,244,890, a slight increase of 0% compared to ZAR 5,232,165 in 2023[325]. Consumer Division Performance - The Consumer Division's total active EasyPay Everywhere (EPE) transactional account base grew to 1.6 million, an increase of 11% from 1.4 million in Q2 2024[255]. - Lending solutions in the Consumer Division saw approximately 336,000 loans originated during Q2 2025, a 21% increase compared to 278,000 loans in Q2 2024, with gross advances rising to ZAR 617 million, up 38% year-on-year[255]. - The Consumer Division's insurance policies written increased to approximately 50,000 in Q2 2025, a 19% rise from 42,000 in Q2 2024, contributing to a total of 496,488 active policies[258]. - The Consumer Division's total active insurance policies grew by 29% year-on-year, from 384,338 in Q2 2024 to 496,488 in Q2 2025[258]. - The number of active card holders reached approximately 200,000 at the end of Q2 2025, with a load value of approximately ZAR 170 million for the quarter ended December 31, 2024[262]. Merchant Division Performance - The number of devices deployed in the Merchant Division reached 80,178, up from 48,199 in Q2 2024, marking a 66% increase[242]. - The total net loan book size in the Merchant Division grew to ZAR 343 million by the end of Q2 2025, compared to ZAR 253 million at the end of Q2 2024, reflecting a 36% increase[248]. - The number of GAAP sites in the Merchant Division reached 9,705 as of December 31, 2024, with an approximate ARPU per site of ZAR 3,300[244]. Costs and Expenses - Operating income decreased due to higher costs and increased amortization of acquisition-related intangible assets from the acquisition of Adumo[283]. - Selling, general and administration expenses rose by $15.0 million (70%) to $36.5 million, driven by the inclusion of Adumo and higher employee-related costs[287]. - Group costs increased due to higher employee-related expenses, travel, audit, consulting, and legal fees, resulting in a 51% increase in group costs compared to the prior period[308][324]. - Selling, general and administration expenses increased by 44% to $63.2 million, driven by the inclusion of Adumo and higher employee-related expenses[311][314]. Profitability and Loss - Net loss attributable to the company was $32.1 million, a significant increase of 1,087% compared to a loss of $2.7 million in the previous year[284]. - Operating income margin decreased to 0.5% in Q2 2025 from 1.6% in Q2 2024[289]. - Group Adjusted EBITDA for Q2 2025 was $11.8 million, a 32% increase from $9.0 million in Q2 2024[296]. - Group Adjusted EBITDA increased by 25% to $21.2 million, with significant contributions from the Merchant and Consumer segments[324]. Tax and Interest - The effective tax expense for fiscal 2025 was $(6.4) million, compared to $0.7 million in fiscal 2024, influenced by deferred tax impacts and ongoing losses in certain operations[292]. - Interest income increased by 49% to $0.7 million, while interest expense rose by 28% to $6.2 million due to higher borrowings[290][291]. - Net interest charges increased to $5.5 million (ZAR 97.7 million) in Q2 2025 from $4.3 million (ZAR 81.2 million) in the prior period[283]. Cash Flow and Financing - Cash and cash equivalents as of December 31, 2024, totaled $60.6 million, with a decrease attributed to cash reserves utilized for repayments and investments[344]. - Net cash used in operating activities during the second quarter of fiscal 2025 was $9.2 million (ZAR 163.6 million), compared to net cash provided of $0.6 million (ZAR 10.9 million) in the same quarter of fiscal 2024[354]. - Cash flows from operating activities during the first half of fiscal 2025 showed a net usage of $13.3 million (ZAR 236.7 million) compared to a net cash provided of $4.0 million (ZAR 74.0 million) in the first half of fiscal 2024[357]. - The company has a revolving credit facility of ZAR 300 million utilized to fund a portion of merchant finance loans receivable[349]. - The company has entered into an arrangement with African Bank to fund ATMs, where cash in ATMs is considered African Bank's property[353]. Acquisitions and Investments - The acquisition of Recharger (Pty) Ltd was announced on November 20, 2024, with a purchase consideration of ZAR 507 million, to be paid in two tranches[265][266]. - A non-cash fair value loss of $33.7 million was recorded during Q2 2025 related to the investment in MobiKwik[283]. - A non-cash fair value loss of $33.7 million was recorded related to the investment in MobiKwik during the first half of fiscal 2025[309][316]. Market Conditions - The U.S. dollar was 5% weaker against the ZAR during Q2 2025, positively impacting the reported results in U.S. dollars[283]. - The U.S. dollar was 5% weaker against the ZAR during the first half of fiscal 2025, adversely impacting reported results[309]. - The estimated fair value of exchange-traded equity securities is $42,566,000, with a hypothetical 10% increase raising it to $46,823,000 and a decrease lowering it to $38,309,000[376].

Financial Performance - Lesaka reported Q2 2025 revenue of $146.8 million (ZAR 2.6 billion), which is at the upper end of their revenue guidance and represents an increase from $143.9 million (ZAR 2.7 billion) in Q2 2024[5]. - Net Revenue for Q2 2025 was $77.1 million (ZAR 1.4 billion), a 42% increase in ZAR from $51.7 million (ZAR 968.7 million) in Q2 2024[5]. - Group Adjusted EBITDA for Q2 2025 was $11.8 million (ZAR 211.8 million), exceeding guidance and improving 26% in ZAR from $9.0 million (ZAR 167.8 million) in Q2 2024[5]. - The company expects FY2025 revenue guidance between ZAR 10.0 billion and ZAR 11.0 billion, with Net Revenue between ZAR 5.2 billion and ZAR 5.6 billion[6]. - For FY2026, Group Adjusted EBITDA is expected to be between ZAR 1.25 billion and ZAR 1.45 billion, including the impact of the acquisition of Recharger[7]. - Lesaka's Merchant Division Revenue decreased by 5% in ZAR to $115.8 million (ZAR 2.1 billion), while Consumer Division Revenue increased by 31% in ZAR to $22.9 million (ZAR 410.7 million)[5]. - Lesaka's net loss for Q2 2025 increased to $32.1 million (ZAR 583.7 million) compared to a net loss of $2.7 million (ZAR 50.8 million) in Q2 2024[5]. - The company reported a GAAP loss of $32,134,000 for the three months ended December 31, 2024, compared to a loss of $2,707,000 in the same period of 2023, indicating a significant increase in losses[26]. - The company's net revenue for the three months ended December 31, 2024, was $77,060,000, representing a 49% increase from $51,730,000 in the same period of 2023[30]. - Group Adjusted EBITDA for the six months ended December 31, 2024, was $21,173,000, up from $16,975,000 in the same period of 2023, reflecting a growth of approximately 25%[26]. - Merchant net revenue for the three months ended December 31, 2024, was $47,714,000, a 75% increase from $27,214,000 in the same period of 2023[30]. - For the six months ended December 31, 2024, Lesaka Technologies reported a net loss of $36,676,000 compared to a net loss of $8,358,000 for the same period in 2023, representing a significant increase in losses[32]. - Revenue for the six months ended December 31, 2024, was $292,364,000, up from $279,982,000 in 2023, indicating a growth of approximately 4.6% year-over-year[34]. - The company reported a net loss of $36,676,000 for the six months ended December 31, 2024, compared to a net loss of $8,358,000 for the same period in 2023[39]. Strategic Acquisitions - The acquisition of Adumo, which closed in October 2024, and the expected acquisition of Recharger in Q3 2025 are significant strategic moves for the company[6]. - The company incurred transaction costs of $684,000 related to acquisitions in the three months ended December 31, 2024[31]. - The company incurred transaction costs related to the Adumo acquisition amounting to $1,702,000 for the six months ended December 31, 2024[34]. Cash Flow and Investments - Cash flows from operating activities showed a net cash used of $13,302,000 for the six months ended December 31, 2024, compared to a net cash provided of $3,957,000 in 2023[36]. - The company reported capital expenditures of $10,283,000 for the six months ended December 31, 2024, compared to $5,007,000 in 2023, reflecting an increase in investment activities[36]. Balance Sheet and Equity - Total current assets increased to $211,365,000 in December 2024 from $187,696,000 in June 2024, representing a growth of 12.6%[38]. - Total assets reached $640,574,000 in December 2024, up from $558,450,000 in June 2024, indicating a 14.7% increase[38]. - Total liabilities increased to $351,580,000 in December 2024 from $303,164,000 in June 2024, reflecting a rise of 15.9%[38]. - Goodwill increased significantly to $200,760,000 in December 2024 from $138,551,000 in June 2024, a growth of 44.9%[38]. - Total equity rose to $200,037,000 in December 2024, compared to $175,857,000 in June 2024, marking a 13.8% increase[38]. - Additional paid-in capital increased to $421,950,000 in December 2024 from $343,639,000 in June 2024, a rise of 22.8%[38]. Operational Performance - Operating loss for the six months ended December 31, 2024, was $732,000, compared to an operating income of $2,501,000 in 2023, marking a decline in operational performance[34]. - The cost of goods sold and related expenses decreased from $221,756,000 in 2023 to $212,185,000 in 2024, reflecting a reduction of about 4.3%[34]. - The company experienced a change in fair value of equity securities resulting in a loss of $33,731,000 for the six months ended December 31, 2024, compared to no such loss in 2023[34]. - Stock-based compensation charges for the three months ended December 31, 2024, amounted to $2,644,000, compared to $1,804,000 in the same period of 2023[31]. - The indirect tax provision release contributed to a benefit of $196,000 in the three months ended December 31, 2024[31]. Shareholder Impact - Basic loss per share attributable to Lesaka shareholders was $0.51 for the six months ended December 31, 2024, compared to $0.13 in 2023, indicating a worsening loss per share[34]. - Headline loss per share for the three months ended December 31, 2024, was $(0.40), compared to $(0.09) in the prior year[39]. - The weighted average number of shares used to calculate basic loss per share increased to 79,753,000 in December 2024 from 63,805,000 in December 2023[40].

Core Viewpoint - Lesaka Technologies, Inc. reported its Q2 2025 financial results, highlighting a strong performance in revenue and adjusted EBITDA, while also reaffirming guidance for FY2025 and FY2026 [1][2]. Financial Performance - Revenue for Q2 2025 was $146.8 million (ZAR 2.6 billion), slightly up from $143.9 million (ZAR 2.7 billion) in Q2 2024 [4]. - Net Revenue, a non-GAAP measure, increased by 42% in ZAR to $77.1 million (ZAR 1.4 billion) compared to $51.7 million (ZAR 968.7 million) in Q2 2024 [4]. - Group Adjusted EBITDA for Q2 2025 was $11.8 million (ZAR 211.8 million), representing a 26% increase in ZAR from $9.0 million (ZAR 167.8 million) in Q2 2024 [4]. - The company reported a net loss of $32.1 million (ZAR 583.7 million) for Q2 2025, which included a non-operating, non-cash change in fair value of Mobikwik amounting to $26.6 million (ZAR 485.6 million) [4]. Guidance and Outlook - Lesaka reaffirmed its FY2025 guidance, expecting revenue between ZAR 10.0 billion and ZAR 11.0 billion, and net revenue between ZAR 5.2 billion and ZAR 5.6 billion [5]. - For FY2026, the company anticipates Group Adjusted EBITDA between ZAR 1.25 billion and ZAR 1.45 billion, which includes the impact of the Recharger acquisition expected to close in Q3 2025 [6]. Segment Performance - The Merchant Division reported a revenue decrease of 5% in ZAR to $115.8 million (ZAR 2.1 billion), while Net Revenue increased by 68% in ZAR to $47.7 million (ZAR 854.5 million) [4]. - The Consumer Division saw revenue and net revenue increase by 31% in ZAR to $22.9 million (ZAR 410.7 million), with Segment Adjusted EBITDA rising by 61% in ZAR to $4.3 million (ZAR 77.5 million) [4]. Currency Impact - The average exchange rate for Q2 2025 was ZAR 17.85 to $1, showing a 4.6% strengthening of the ZAR against the U.S. dollar compared to Q2 2024, where the rate was ZAR 18.71 to $1 [1].

JOHANNESBURG, Dec. 17, 2024 (GLOBE NEWSWIRE) -- Lesaka Technologies, Inc. ("Lesaka" or the "Company") (NASDAQ:LSAK, JSE: LSK)) today announced it will release second quarter 2025 results after the U.S. market close on February 5, 2025. Lesaka management will host a presentation webcast and conference call on February 6, 2025, at 8:00 a.m. Eastern Time ("EST"), which is 3:00 p.m. South Africa Standard Time ("SAST"), to review these results. Presentation webcast via Zoom:Link to access the results webcast: ht ...

Since last writing about Lesaka Technologies (NASDAQ: LSAK ) back in September , shares in South Africa-based fintech have continued to inch higher, even as market sentiment about investing in South Africa, which soared following the election of the "GovernmentAnalyst’s Disclosure: I/we have a beneficial long position in the shares of LSAK either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (othe ...

JOHANNESBURG, Nov. 19, 2024 (GLOBE NEWSWIRE) -- Lesaka Technologies, Inc. (Nasdaq: LSAK; JSE: LSK) (“Lesaka” or the “Company”) today announced that it has signed a definitive agreement to acquire 100% of the issued and outstanding ordinary shares of Recharger (Pty) Ltd (“Recharger”), a South African prepaid electricity submetering and payments business. The purchase consideration of ZAR 507 million ($28 million translated at the average exchange rate of $1: ZAR 18.06 as of November 18, 2024) will be paid ov ...

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