Net 1 UEPS Technologies, Inc. (Nasdaq: UEPS; JSE: NT1) today
released results for the first fiscal quarter ended September 30,
2021.
Financial Metrics:
- Continued momentum in EPE account
openings;
- At September 30, 2021, unrestricted
cash of $188 million and no debt;
- Revenue of $34.5 million, a
decrease of 2% from Q1 2021;
- Operating loss of $(11.2) million
in Q1 2022;
- GAAP EPS of $(0.23) and Fundamental
EPS of $(0.22); and
- Adjusted EBITDA loss of $(10.1)
million.
“While the South African economy continued to be
challenging in the first quarter, I am pleased that the Net1 team
continued to stay focused on executing our transformational plans
and the long-term commitment to unlock value for all of our
stakeholders. Our strategic imperative is to return the Financial
Services business to break-even and into profitability as soon as
possible,” said Chris Meyer, Group CEO of Net1. “We also continued
to deliver on our strategic priorities with the announcement
earlier this month to acquire Connect Group, one of the fastest
growing fintech companies in South Africa. This compelling
acquisition is an important milestone at the beginning of our
transformative journey as it significantly enhances our scale,
propels our growth trajectory and positions us well to become the
leading South African fintech platform.”
Summary Financial Metrics
|
Q1 2022 |
|
Q1 2021 |
|
Q4 2021 |
|
Q1 ’22 vsQ1 ’21 |
|
Q1 ’22 vsQ4 ’21 |
|
Q1 ’22 vsQ1 ’21 |
|
Q1 ’22 vsQ4 ’21 |
|
|
|
(asrestated)(1) |
|
|
|
|
|
|
(All figures in USD ‘000s
except per share data) |
USD ‘000’s (except per share
data) |
|
% change in USD |
|
% change in ZAR |
Revenue |
34,504 |
|
|
35,136 |
|
|
34,517 |
|
|
(2 |
%) |
|
(0 |
%) |
|
(14 |
%) |
|
3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
loss |
(11,225 |
) |
|
(10,775 |
) |
|
(13,600 |
) |
|
4 |
% |
|
(17 |
%) |
|
(9 |
%) |
|
(15 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
(loss)(2) |
(10,087 |
) |
|
(9,744 |
) |
|
(8,208 |
) |
|
4 |
% |
|
23 |
% |
|
(10 |
%) |
|
27 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP (loss)
earnings per share ($) |
(0.23 |
) |
|
(0.51 |
) |
|
0.03 |
|
|
(55 |
%) |
|
nm |
|
|
(61 |
%) |
|
nm |
|
Continuing |
(0.23 |
) |
|
(0.51 |
) |
|
0.03 |
|
|
(55 |
%) |
|
nm |
|
|
(61 |
%) |
|
nm |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fundamental loss
per share ($)(2) |
(0.22 |
) |
|
(0.23 |
) |
|
- |
|
|
(4 |
%) |
|
nm |
|
|
(17 |
%) |
|
nm |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fully-diluted
shares outstanding (‘000’s) |
56,809 |
|
|
57,119 |
|
|
56,937 |
|
|
(1 |
%) |
|
(0 |
%) |
|
nm |
|
|
nm |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average period
USD/ ZAR exchange rate |
14.61 |
|
|
16.77 |
|
|
14.17 |
|
|
(13 |
%) |
|
3 |
% |
|
nm |
|
|
nm |
|
(1) Q1 2021 has been restated to correct an
error with respect to the recognition of certain revenue and
related cost of goods sold, IT processing, servicing and support.
The financial information for the three months ended September 30,
2020, has been restated with the effect of decreasing revenue by
$2.0 million. Refer to Note 1 to our unaudited condensed
consolidated financial statements.
(2) Adjusted EBITDA (loss), fundamental loss and
fundamental loss per share are non-GAAP measures and are described
below under “Use of Non-GAAP Measures—EBITDA and Adjusted EBITDA,
and —Fundamental net (loss) income and fundamental (loss) earnings
per share.” See Attachment B for a reconciliation of GAAP operating
loss to EBITDA (loss) and Adjusted EBITDA (loss), and GAAP net loss
to fundamental net loss and loss per share.
Factors impacting comparability of our
Q1 2022 and Q1 2021 results
- Lower revenue: Our
revenues decreased 14% in ZAR primarily due to fewer prepaid
airtime and hardware sales and lower transaction fee revenue;
- Lower operating
losses: Operating losses have reduced by 9% in ZAR
compared with the prior period primarily due to the closure of IPG
and lower legal and consulting fees (excluding those related to the
Connect Group transaction). We continue to experience operating
losses because of depressed revenues and have embarked on a plan to
reduce operating expenses, including closing our mobile payment
infrastructure;
- Foreign exchange
movements: The U.S. dollar was 13% weaker against the ZAR
during Q1, 2021, which impacted our reported results.
Results of Operations by Segment and
Liquidity
Processing
Segment revenue, excluding IPG, was $21.4
million in Q1 2022, down 13% compared with Q1 2021, but up 4%
compared with Q4 2021 on a constant currency basis. Excluding IPG,
segment revenue decreased primarily due to fewer prepaid airtime
sales and a reduction in volume-driven transaction fees, including
as a result of the South African banking industry’s decision to
waive fees charged to customers for utilizing other banks’ ATMs in
August and September 2021. Excluding IPG, Processing’s operating
loss has been impacted by the lower revenue. Our operating loss
margin (calculated as operating (loss) income divided by revenue)
for Q1 2022 and 2021 was (33.4%) and (32.4%), respectively.
Excluding IPG, our operating loss margin for the Processing segment
was (21.3%) during the Q1 2021.
Financial services
Segment revenue was $10.6 million in Q1 2022, up
12% compared with Q1 2021 and marginally higher compared to Q4 2021
on a constant currency basis. Segment revenue increased due to
higher account fee revenue following an increase in the number of
EPE accounts, an increase in lending revenue as a result of
improved lending activity, and an increase in insurance revenues
from an increase in business written. The increase in operating
loss is primarily due to the increase in insurance-related claims
experienced this quarter attributed to the COVID-19 pandemic as
well as higher employee costs compared with the prior period. Our
operating loss margin for Q1 2022 and 2021 was (28.2%) and (28.7%),
respectively.
Technology
Segment revenue was $4.8 million in Q1 2022,
down 32%, compared with Q1 2021, but up 1% compared with Q4 2021 on
a constant currency basis. Segment revenue decreased due to fewer
hardware sales compared to the prior period. Operating income for
Q1, 2021 was directly impacted by the lower revenue compared with
fiscal 2021. Our operating income margin for the Technology segment
was 12.5% and 28.6% during Q1 2022 and 2021, respectively.
Corporate/eliminations
Our corporate expenses for fiscal 2022 decreased
compared with fiscal 2021 due to lower legal and consulting fees
incurred. We expect to incur additional expenses related to the
Connect Group transaction in the second quarter of fiscal 2022.
Cash flow and liquidity
At September 30, 2021, our cash and cash
equivalents were $188.5 million and comprised of U.S.
dollar-denominated balances of $162.5 million, ZAR-denominated
balances of ZAR 0.4 billion ($23.7 million), and other currency
deposits, primarily Botswana pula, of $2.3 million, all amounts
translated at exchange rates applicable as of September 30, 2021.
The decrease in our unrestricted cash balances from June 30, 2021,
was primarily due to weak trading activities and utilization of
cash reserves to fund our operations. We believe we have sufficient
cash reserves to support us through the next twelve months.
Together with our existing cash reserves, we also believe that our
credit facilities are sufficient to fund our ATM network.
Excluding the impact of income taxes, cash used
in operating activities during Q1 2022 was impacted by the cash
losses incurred by the majority of our continuing operations.
Capital expenditures for Q1 2022 and 2021 were $0.7 million and
$0.3 million, respectively.
Conference Call
We will host a conference call to review these
results on November 9, 2021, 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 010-201-6800 (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.
Participants can
pre-register for the November 9, 2021, conference call by
navigating to
https://services.choruscall.za.com/DiamondPassRegistration/register?confirmationNumber=2110832&linkSecurityString=3a7b066b0.
Participants utilizing this pre-registration service will receive
their dial-in number upon registration
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.
EBITDA and adjusted EBITDA
Earnings before interest, tax, depreciation and
amortization (“EBITDA”) is GAAP operating (loss) income adjusted
for depreciation and amortization. Adjusted EBITDA is EBITDA
adjusted for unusual non-recurring items, costs related to
acquisitions and transactions consummated or ultimately not
pursued.
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), stock-based compensation
charges, and unusual non-recurring items, including costs related
to acquisitions and transactions consummated or ultimately not
pursued.
Fundamental net (loss) income and (loss)
earnings per share for fiscal 2021 also includes impairment losses
related to our 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 Net1
Net1 is a leading financial technology company
that utilizes its proprietary banking and payment technology to
deliver on its mission of financial inclusion through the
distribution of low-cost financial and value-added services to
underserved consumers and small businesses in Southern Africa,
which represents a significant segment of these economies. The
Company also provides transaction processing services, including
being a payment processor and bill payment platform in South
Africa. Net1 leverages its strategic investments to further expand
its product offerings or to enter new markets.
Net1 has a primary listing on NASDAQ (NasdaqGS:
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.
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:Dara Dierks Managing
Director – ICR Email: net1IR@icrinc.com
Media Relations Contact:Bridget von
HoldtCo-Market Leader | MD – BCWPhone: +27-82-610-0650Email:
Bridget.vonholdt@bcw-global.com
|
NET 1 UEPS TECHNOLOGIES, INC. |
Unaudited Condensed Consolidated Statements of
Operations |
|
|
|
Unaudited |
|
|
|
Three months ended |
|
|
|
September 30, |
|
|
|
2021 |
|
2020 |
|
|
|
|
|
(asrestated)(A) |
|
|
|
(In thousands) |
|
|
|
|
|
|
|
|
REVENUE |
|
$ |
34,504 |
|
|
$ |
35,136 |
|
|
|
|
|
|
|
|
|
EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods sold, IT processing, servicing and support |
|
|
24,207 |
|
|
|
26,460 |
|
|
Selling, general
and administration |
|
|
20,627 |
|
|
|
18,528 |
|
|
Depreciation and
amortization |
|
|
895 |
|
|
|
923 |
|
|
|
|
|
|
|
|
|
OPERATING
LOSS |
|
|
(11,225 |
) |
|
|
(10,775 |
) |
|
|
|
|
|
|
|
|
INTEREST
INCOME |
|
|
389 |
|
|
|
611 |
|
|
|
|
|
|
|
|
|
INTEREST
EXPENSE |
|
|
816 |
|
|
|
747 |
|
|
|
|
|
|
|
|
|
LOSS BEFORE INCOME
TAX EXPENSE (BENEFIT) |
|
|
(11,652 |
) |
|
|
(10,911 |
) |
|
|
|
|
|
|
|
|
INCOME TAX EXPENSE
(BENEFIT) |
|
|
186 |
|
|
|
(1,090 |
) |
|
|
|
|
|
|
|
|
NET LOSS BEFORE
LOSS FROM EQUITY-ACCOUNTED INVESTMENTS |
|
|
(11,838 |
) |
|
|
(9,821 |
) |
|
|
|
|
|
|
|
|
LOSS FROM
EQUITY-ACCOUNTED INVESTMENTS |
|
|
(1,156 |
) |
|
|
(19,137 |
) |
|
|
|
|
|
|
|
|
NET LOSS
ATTRIBUTABLE TO NET1 |
|
|
(12,994 |
) |
|
|
(28,958 |
) |
|
|
|
|
|
|
|
|
Net loss
per share, in United States dollars: |
|
|
|
|
|
|
Basic loss
attributable to Net1 shareholders |
|
$ |
(0.23 |
) |
|
$ |
(0.51 |
) |
Diluted loss
attributable to Net1 shareholders |
|
$ |
(0.23 |
) |
|
$ |
(0.51 |
) |
(A) Three months ended September 30, 2020, has
been restated to correct an error with respect to the recognition
of certain revenue and related cost of goods sold, IT processing,
servicing and support. The financial information for the three
months ended September 30, 2020, has been restated with the effect
of decreasing revenue by $2.0 million.
|
NET 1 UEPS TECHNOLOGIES, INC. |
Unaudited Consolidated Balance Sheets |
|
|
|
|
|
Unaudited |
|
(A) |
|
|
|
|
|
September 30, |
|
June 30, |
|
|
|
|
|
2021 |
|
2021 |
|
|
|
|
|
(In thousands, except share data) |
ASSETS |
|
|
|
|
|
CURRENT
ASSETS |
|
|
|
|
|
|
Cash and cash
equivalents |
$ |
188,495 |
|
|
$ |
198,572 |
|
|
Restricted
cash |
|
61,926 |
|
|
|
25,193 |
|
|
Accounts
receivable, net of allowance of - September: $365; June: $267 and
other receivables |
|
27,643 |
|
|
|
26,583 |
|
|
Finance loans
receivable, net of allowance of - September: $2,290; June:
$2,349 |
|
20,607 |
|
|
|
21,142 |
|
|
Inventory |
|
19,613 |
|
|
|
22,361 |
|
|
|
Total current
assets before settlement assets |
|
318,284 |
|
|
|
293,851 |
|
|
|
|
Settlement
assets |
|
466 |
|
|
|
466 |
|
|
|
|
|
Total current assets |
|
318,750 |
|
|
|
294,317 |
|
PROPERTY, PLANT
AND EQUIPMENT, net of accumulated depreciation of - September:
$36,163; June: $38,535 |
|
6,718 |
|
|
|
7,492 |
|
OPERATING LEASE
RIGHT-OF-USE |
|
3,890 |
|
|
|
4,519 |
|
EQUITY-ACCOUNTED
INVESTMENTS |
|
7,607 |
|
|
|
10,004 |
|
GOODWILL |
|
27,619 |
|
|
|
29,153 |
|
INTANGIBLE ASSETS,
net of accumulated amortization of - September: $15,536; June:
$16,403 |
|
321 |
|
|
|
357 |
|
DEFERRED INCOME
TAXES |
|
934 |
|
|
|
622 |
|
OTHER LONG-TERM
ASSETS, including reinsurance assets |
|
77,916 |
|
|
|
81,866 |
|
TOTAL
ASSETS |
|
443,755 |
|
|
|
428,330 |
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
|
CURRENT
LIABILITIES |
|
|
|
|
|
|
Short-term credit
facilities for ATM funding |
|
51,568 |
|
|
|
14,245 |
|
|
Accounts
payable |
|
4,308 |
|
|
|
7,113 |
|
|
Other
payables |
|
28,180 |
|
|
|
27,588 |
|
|
Operating lease
liability - current |
|
2,674 |
|
|
|
2,822 |
|
|
Income taxes
payable |
|
539 |
|
|
|
256 |
|
|
|
Total current
liabilities before settlement obligations |
|
87,269 |
|
|
|
52,024 |
|
|
|
|
Settlement
obligations |
|
466 |
|
|
|
466 |
|
|
|
|
|
Total current
liabilities |
|
87,735 |
|
|
|
52,490 |
|
DEFERRED INCOME
TAXES |
|
10,404 |
|
|
|
10,415 |
|
OPERATING LEASE
LIABILITY - LONG TERM |
|
1,413 |
|
|
|
1,890 |
|
OTHER LONG-TERM
LIABILITIES, including insurance policy liabilities |
|
2,477 |
|
|
|
2,576 |
|
TOTAL
LIABILITIES |
|
102,029 |
|
|
|
67,371 |
|
COMMITMENTS AND
CONTINGENCIES |
|
- |
|
|
|
- |
|
REDEEMABLE COMMON
STOCK |
|
84,979 |
|
|
|
84,979 |
|
|
|
|
|
|
|
|
|
|
|
EQUITY |
|
|
|
|
|
NET1 EQUITY: |
|
|
|
|
|
COMMON STOCK |
|
|
|
|
|
|
Authorized:
200,000,000 with $0.001 par value; |
|
|
|
|
|
|
Issued and
outstanding shares, net of treasury: September: $56,996,214; June:
$56,716,620 |
|
80 |
|
|
|
80 |
|
PREFERRED
STOCK |
|
|
|
|
|
|
Authorized shares:
50,000,000 with $0.001 par value; |
|
|
|
|
|
|
Issued and
outstanding shares, net of treasury: September: -; June: - |
|
- |
|
|
|
- |
|
ADDITIONAL
PAID-IN-CAPITAL |
|
302,277 |
|
|
|
301,959 |
|
TREASURY SHARES,
AT COST: September: $24,891,292; June: $24,891,292 |
|
(286,951 |
) |
|
|
(286,951 |
) |
ACCUMULATED OTHER
COMPREHENSIVE LOSS |
|
(152,278 |
) |
|
|
(145,721 |
) |
RETAINED
EARNINGS |
|
393,619 |
|
|
|
406,613 |
|
TOTAL NET1
EQUITY |
|
256,747 |
|
|
|
275,980 |
|
NON-CONTROLLING
INTEREST |
|
- |
|
|
|
- |
|
TOTAL
EQUITY |
|
256,747 |
|
|
|
275,980 |
|
|
|
|
|
|
|
|
|
|
|
TOTAL
LIABILITIES, REDEEMABLE COMMON STOCK AND SHAREHOLDERS’
EQUITY |
$ |
443,755 |
|
|
$ |
428,330 |
|
(A) Derived from audited consolidated financial statements.
|
NET 1 UEPS TECHNOLOGIES, INC. |
Unaudited Condensed Consolidated Statements of Cash
Flows |
|
|
|
Unaudited |
|
|
|
Three months ended |
|
|
|
September 30, |
|
|
|
2021 |
|
2020 |
|
|
|
(In thousands) |
|
|
|
|
|
|
|
|
Cash flows
from operating activities |
|
|
|
|
|
|
Net loss |
$ |
(12,994 |
) |
|
$ |
(28,958 |
) |
|
Depreciation and
amortization |
|
895 |
|
|
|
923 |
|
|
Impairment
loss |
|
140 |
|
|
|
- |
|
|
Movement in
allowance for doubtful accounts receivable |
|
386 |
|
|
|
514 |
|
|
Loss from
equity-accounted investments |
|
1,156 |
|
|
|
19,137 |
|
|
Movement in
allowance for doubtful loans |
|
- |
|
|
|
78 |
|
|
Fair value
adjustment related to financial liabilities |
|
(90 |
) |
|
|
886 |
|
|
Interest
payable |
|
11 |
|
|
|
(63 |
) |
|
Profit on disposal
of property, plant and equipment |
|
(165 |
) |
|
|
(10 |
) |
|
Stock-based
compensation charge |
|
309 |
|
|
|
399 |
|
|
Dividends received
from equity-accounted investments |
|
137 |
|
|
|
57 |
|
|
Decrease
(Increase) in accounts receivable and finance loans receivable |
|
1,188 |
|
|
|
(8,115 |
) |
|
Decrease in
inventory |
|
1,583 |
|
|
|
2,359 |
|
|
Decrease in
accounts payable and other payables |
|
(431 |
) |
|
|
(415 |
) |
|
Increase
(Decrease) in taxes payable |
|
294 |
|
|
|
(14,917 |
) |
|
Decrease in
deferred taxes |
|
(367 |
) |
|
|
(1,755 |
) |
|
|
Net cash used in operating activities |
|
(7,948 |
) |
|
|
(29,880 |
) |
|
|
|
|
|
|
|
|
Cash flows
from investing activities |
|
|
|
|
|
Capital
expenditures |
|
(698 |
) |
|
|
(275 |
) |
Proceeds from
disposal of property, plant and equipment |
|
231 |
|
|
|
16 |
|
Proceeds from
disposal of Net1 Korea, net of cash disposed |
|
- |
|
|
|
20,114 |
|
Proceeds from
disposal of DNI as equity-accounted investment |
|
- |
|
|
|
329 |
|
Loan to
equity-accounted investment |
|
- |
|
|
|
(78 |
) |
Net change in
settlement assets |
|
- |
|
|
|
4,068 |
|
|
Net cash
(used in) provided by investing activities |
|
(467 |
) |
|
|
24,174 |
|
|
|
|
|
|
|
|
|
Cash flows
from financing activities |
|
|
|
|
|
Proceeds from bank
overdraft |
|
138,905 |
|
|
|
69,146 |
|
Repayment of bank
overdraft |
|
(98,908 |
) |
|
|
(76,850 |
) |
Proceeds from
disgorgement of shareholders' short-swing profits |
|
- |
|
|
|
98 |
|
Net change in
settlement obligations |
|
- |
|
|
|
(4,068 |
) |
|
Net cash
provided by (used in) financing activities |
|
39,997 |
|
|
|
(11,674 |
) |
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash |
|
(4,925 |
) |
|
|
806 |
|
Net
increase (decrease) in cash, cash equivalents and restricted
cash |
|
26,657 |
|
|
|
(16,574 |
) |
Cash, cash
equivalents and restricted cash – beginning of period |
|
223,765 |
|
|
|
232,485 |
|
Cash, cash
equivalents and restricted cash – end of period |
$ |
250,422 |
|
|
$ |
215,911 |
|
|
|
|
|
|
|
|
|
Net 1 UEPS Technologies, Inc.
Attachment A
Operating segment revenue, operating
(loss) income and operating (loss) margin:
Three months ended September 30, 2021
and 2020 and June 30, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change - actual |
Change – constant exchange
rate(1) |
|
|
|
|
|
|
|
|
Q1 '22 |
|
Q1 '21 |
|
Q4 '21 |
Q1 '22 vs Q1
'21 |
Q1 '22 vs Q4
'21 |
Q1 '22 vs Q1
'21 |
Q1 '22 vs Q4
'21 |
Key segmental data, in ’000, except margins |
|
|
|
(asrestated)(A) |
|
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Processing |
|
$ |
21,356 |
|
|
$ |
22,506 |
|
|
$ |
21,192 |
|
(5 |
%) |
1 |
% |
(17 |
%) |
4 |
% |
|
|
All Other |
|
|
21,356 |
|
|
|
21,297 |
|
|
|
21,192 |
|
0 |
% |
1 |
% |
(13 |
%) |
4 |
% |
|
|
IPG |
|
|
- |
|
|
|
1,209 |
|
|
|
- |
|
nm |
|
nm |
|
nm |
|
nm |
|
|
Financial
services |
|
|
10,626 |
|
|
|
8,265 |
|
|
|
10,830 |
|
29 |
% |
(2 |
%) |
12 |
% |
1 |
% |
|
Technology |
|
|
4,824 |
|
|
|
6,211 |
|
|
|
4,905 |
|
(22 |
%) |
(2 |
%) |
(32 |
%) |
1 |
% |
|
|
|
Subtotal:
Operating segments |
|
|
36,806 |
|
|
|
36,982 |
|
|
|
36,927 |
|
(0 |
%) |
(0 |
%) |
(13 |
%) |
3 |
% |
|
|
|
Intersegment
eliminations |
|
|
(2,302 |
) |
|
|
(1,846 |
) |
|
|
(2,410 |
) |
25 |
% |
(4 |
%) |
9 |
% |
(1 |
%) |
|
|
|
|
Consolidated revenue |
|
$ |
34,504 |
|
|
$ |
35,136 |
|
|
$ |
34,517 |
|
(2 |
%) |
(0 |
%) |
(14 |
%) |
3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
(loss) income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Processing |
|
$ |
(7,131 |
) |
|
$ |
(7,301 |
) |
|
$ |
(5,785 |
) |
(2 |
%) |
23 |
% |
(15 |
%) |
27 |
% |
|
|
All Other |
|
|
(7,131 |
) |
|
|
(4,529 |
) |
|
|
(5,809 |
) |
57 |
% |
23 |
% |
37 |
% |
27 |
% |
|
|
IPG |
|
|
- |
|
|
|
(2,772 |
) |
|
|
24 |
|
nm |
|
nm |
|
nm |
|
nm |
|
|
Financial
services |
|
|
(2,998 |
) |
|
|
(2,372 |
) |
|
|
(2,875 |
) |
26 |
% |
4 |
% |
10 |
% |
8 |
% |
|
Technology |
|
|
603 |
|
|
|
1,775 |
|
|
|
(357 |
) |
(66 |
%) |
nm |
|
(70 |
%) |
nm |
|
|
|
|
Subtotal:
Operating segments |
|
|
(9,526 |
) |
|
|
(7,898 |
) |
|
|
(9,017 |
) |
21 |
% |
6 |
% |
5 |
% |
9 |
% |
|
|
|
Corporate/Eliminations |
|
|
(1,699 |
) |
|
|
(2,877 |
) |
|
|
(4,583 |
) |
(41 |
%) |
(63 |
%) |
(49 |
%) |
(62 |
%) |
|
|
|
|
|
Consolidated operating loss |
|
$ |
(11,225 |
) |
|
$ |
(10,775 |
) |
|
$ |
(13,600 |
) |
4 |
% |
(17 |
%) |
(9 |
%) |
(15 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
(loss) income margin (%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Processing |
|
|
(33.4 |
%) |
|
|
(32.4 |
%) |
|
|
(27.3 |
%) |
|
|
|
|
|
|
All Other |
|
|
(33.4 |
%) |
|
|
(21.3 |
%) |
|
|
(27.4 |
%) |
|
|
|
|
|
|
IPG |
|
|
nm |
|
|
|
(229.3 |
%) |
|
|
nm |
|
|
|
|
|
|
Financial
services |
|
|
(28.2 |
%) |
|
|
(28.7 |
%) |
|
|
(26.5 |
%) |
|
|
|
|
|
Technology |
|
|
12.5 |
% |
|
|
28.6 |
% |
|
|
(7.3 |
%) |
|
|
|
|
|
|
|
Consolidated operating margin |
|
|
(32.5 |
%) |
|
|
(30.7 |
%) |
|
|
(39.4 |
%) |
|
|
|
|
(A) – 2021 has been restated to
correct an error with respect to the recognition of certain revenue
and related cost of goods sold, IT processing, servicing and
support.
(1) – This information shows
what the change in these items would have been if the USD/ ZAR
exchange rate that prevailed during Q1 2022 also prevailed during
Q1 2021 and Q4 2021.
(Loss) Earnings from equity-accounted
investments:
The table below presents the relative loss
(earnings) from our equity-accounted investments:
|
|
|
Q1 2022 |
|
|
Q1 2021 |
|
% change |
Bank Frick |
|
- |
|
|
|
481 |
|
|
nm |
|
|
Share of net income |
|
- |
|
|
|
481 |
|
|
nm |
|
Finbond |
|
(1,156 |
) |
|
|
(19,461 |
) |
|
(94 |
%) |
|
Share of net loss |
|
(1,156 |
) |
|
|
(2,617 |
) |
|
(56 |
%) |
|
Impairment |
|
- |
|
|
|
(16,844 |
) |
|
nm |
|
Other |
|
- |
|
|
|
(157 |
) |
|
nm |
|
|
Share of net loss |
|
- |
|
|
|
(157 |
) |
|
nm |
|
|
Loss from equity-accounted investments |
$ |
(1,156 |
) |
|
$ |
(19,137 |
) |
|
(94 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
Net 1 UEPS Technologies,
Inc.
Attachment B
Reconciliation of GAAP operating loss to
EBITDA loss and adjusted EBITDA loss:
Three months ended September 30, 2021
and 2020
|
|
|
|
|
Three months endedSeptember 30, |
|
|
|
|
|
2021 |
|
2020 |
Operating
loss - GAAP |
(11,225 |
) |
|
(10,775 |
) |
|
|
|
|
|
|
|
|
|
Depreciation and
amortization |
895 |
|
|
923 |
|
|
|
Negative
EBITDA |
(10,330 |
) |
|
(9,852 |
) |
|
|
|
Transaction
costs |
243 |
|
|
30 |
|
|
|
|
|
Adjusted EBITDA loss |
(10,087 |
) |
|
(9,744 |
) |
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP net loss and loss
per share, basic, to fundamental net loss and loss per share,
basic:
Three months ended September 30, 2021
and 2020
|
Net (loss) income(USD '000) |
|
(L)PS, basic (USD) |
|
Net (loss) income(ZAR '000) |
|
(L)PS, basic (ZAR) |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
GAAP |
(12,994 |
) |
|
(28,958 |
) |
|
(0.23 |
) |
|
(0.51 |
) |
|
(189,880 |
) |
|
(485,735 |
) |
|
(3.33 |
) |
|
(8.50 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation
charge |
309 |
|
|
399 |
|
|
|
|
|
|
4,515 |
|
|
6,693 |
|
|
|
|
|
Intangible asset amortization,
net |
68 |
|
|
59 |
|
|
|
|
|
|
990 |
|
|
990 |
|
|
|
|
|
Impairment of equity method
investment |
- |
|
|
16,844 |
|
|
|
|
|
|
- |
|
|
281,729 |
|
|
|
|
|
Transaction costs |
243 |
|
|
30 |
|
|
|
|
|
|
3,551 |
|
|
503 |
|
|
|
|
|
Reversal of deferred taxes
related to impairment of equity method investment |
- |
|
|
(1,353 |
) |
|
|
|
|
|
- |
|
|
(22,633 |
) |
|
|
|
|
Fundamental |
(12,374 |
) |
|
(12,901 |
) |
|
(0.22 |
) |
|
(0.23 |
) |
|
(180,824 |
) |
|
(217,145 |
) |
|
(3.17 |
) |
|
(3.80 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net 1 UEPS Technologies, Inc.
Attachment C
Reconciliation of net loss used to
calculate loss per share basic and diluted and headline loss per
share basic and diluted:
Three months ended September 30, 2021
and 2020
|
|
2021 |
|
2020 |
|
|
|
|
|
Net loss
(USD’000) |
(12,994 |
) |
|
(28,958 |
) |
Adjustments: |
|
|
|
|
Impairment of equity method investments |
- |
|
|
16,844 |
|
|
Impairment loss |
140 |
|
|
- |
|
|
Profit on sale of property,
plant and equipment |
(165 |
) |
|
(10 |
) |
|
Tax effects on above |
7 |
|
|
(1,350 |
) |
|
|
|
|
|
Net loss used to
calculate headline loss (USD’000) |
(13,012 |
) |
|
(13,474 |
) |
|
|
|
|
|
Weighted average
number of shares used to calculate net loss per share basic loss
and headline loss per share basic loss (‘000) |
56,678 |
|
|
57,119 |
|
|
|
|
|
|
Weighted average
number of shares used to calculate net loss per share diluted loss
and headline loss per share diluted loss (‘000) |
56,809 |
|
|
57,119 |
|
|
|
|
|
|
Headline loss per
share: |
|
|
|
|
Basic, in USD |
(0.23 |
) |
|
(0.24 |
) |
|
Diluted, in USD |
(0.23 |
) |
|
(0.24 |
) |
Calculation of the denominator for headline diluted loss
per share
|
|
|
Q1 2022 |
|
|
Q1 2021 |
|
|
|
|
|
|
|
|
|
Basic
weighted-average common shares outstanding and unvested restricted
shares expected to vest under GAAP |
56,678 |
|
|
57,119 |
|
|
Effect of dilutive
securities under GAAP |
131 |
|
|
- |
|
|
|
Denominator for headline
diluted loss per share |
56,809 |
|
|
57,119 |
|
Weighted average number of shares used to
calculate headline diluted loss per share represents the
denominator for basic weighted-average common shares outstanding
and unvested restricted shares expected to vest plus the effect of
dilutive securities under GAAP. We use this number of fully-diluted
shares outstanding to calculate headline diluted loss per share
because we do not use the two-class method to calculate headline
diluted loss per share.
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