Net 1 UEPS Technologies, Inc. (Nasdaq: UEPS; JSE: NT1) today
released results for the second fiscal quarter ended December 31,
2018.
Q2 2019 Highlights:
- Revenue of $97.2 million and Fundamental EPS of $(0.88)
- Fundamental EPS of ($0.88) includes $0.74 per share of non-cash
adjustments, including a $0.41 allowance for doubtful loans
receivable, $0.28 Cell C fair value loss adjustment, and $0.05
Cedar Cell note impairment loss;
- Operating loss was attributable primarily to our rural South
African businesses;
- Adjusted negative EBITDA of approximately $25 million including
approximately $23 million for allowance for doubtful loans
receivable;
- Korea EBITDA margin improved to 22% from 20% in Q2 2018;
- Net cash of approximately $35 million at December 31,
2018;
- Active EPE accounts declined to 1.1 million as of December 31,
2018.
“This was a very difficult quarter for our company.
Our loss for the quarter is primarily attributable to our rural
South African businesses,” said Herman Kotzé, CEO. “Our other
transaction-driven businesses continue to operate profitably and
provide a meaningful source of EBITDA and free cash flow. We are
pleased with the performance of KSNET, DNI, and our EasyPay
financial switch and transaction processing business in South
Africa. Our equity investments continued to perform in line with
expectations.”
“Currently, our primary focus is to immediately
stem the losses in our South African financial inclusion
operations, right size the businesses and get them to a breakeven
level by the end of this fiscal year. The Board and management are
squarely focused on reviewing all options available for the
business in South Africa, and will provide updates when there are
tangible actions to report. At this time, we believe that all
of the challenges we are facing are contained and can be resolved
in the near future, and remain comfortable with the Company’s
liquidity position over the next 12 months,” concluded
Kotzé.
Subsequent EventOn January 29,
2019 the High Court of the Republic of South Africa (Gauteng
Division, Pretoria) handed down its final judgment in our
application to direct SASSA to pay social grants into the EPE
accounts of recipients who had previously made biometric elections
to receive their grants into their EPE accounts, but had not
submitted a SASSA-prescribed form called an “Annexure C form”. The
High Court reversed a portion of its November 28, 2018 interim
order that directed SASSA to pay grants into the EPE accounts of
recipients who made those biometric elections without submitting a
physical Annexure C form. The effect of the final judgment is that,
while SASSA is required to promptly pay social grants into EPE
accounts of those recipients who have submitted the Annexure C form
electing to have their grants paid that way, SASSA is not required
to pay grants into the EPE accounts of those recipients who have
not submitted the Annexure C form, despite having provided their
previous biometric consent. We are currently evaluating the options
available to it, including an appeal against the judgment.
Summary Financial Metrics
|
Three months ended December 31, |
(All figures in USD
‘000s except per share data) |
2018 |
|
2017 |
|
% change in
USD |
|
% change in ZAR |
Revenue |
97,150 |
|
148,416 |
|
(35 |
%) |
|
(31 |
%) |
GAAP operating (loss)
income |
(43,075 |
) |
16,307 |
|
(364 |
%) |
|
(377 |
%) |
Adjusted (negative)
EBITDA (1) |
(24,731 |
) |
32,981 |
|
(175 |
%) |
|
(179 |
%) |
GAAP net (loss)
income |
(63,941 |
) |
9,622 |
|
(765 |
%) |
|
(796 |
%) |
Fundamental net (loss)
income (1) |
(49,966 |
) |
22,405 |
|
(323 |
%) |
|
(335 |
%) |
GAAP (loss) earnings
per share ($) |
(1.13 |
) |
0.17 |
|
(764 |
%) |
|
(795 |
%) |
Fundamental
(loss)(loss) earnings per share ($) (1) |
(0.88 |
) |
0.39 |
|
(326 |
%) |
|
(336 |
%) |
Fully-diluted shares
outstanding (‘000’s) |
56,855 |
|
56,807 |
|
1 |
% |
|
|
|
Average period USD/ ZAR
exchange rate |
14.32 |
|
13.67 |
|
5 |
% |
|
|
|
Non-cash adjustments
included (before tax impact): |
50,150 |
|
- |
|
nm |
|
|
|
|
Allowance for doubtful finance loans receivables |
23,391 |
|
- |
|
nm |
|
|
|
|
Change in fair value of equity securities |
15,836 |
|
- |
|
nm |
|
|
|
|
Goodwill impairment loss |
8,191 |
|
- |
|
nm |
|
|
|
|
Impairment of Cedar Cellular note |
2,732 |
|
- |
|
nm |
|
|
|
|
|
Six months ended December
31, |
(All figures in USD
‘000s except per share data) |
2018 |
|
2017 |
|
% change in USD |
|
% change in ZAR |
Revenue |
223,034 |
|
300,974 |
|
(26 |
%) |
|
(21 |
%) |
GAAP operating (loss)
income |
(42,179 |
) |
41,313 |
|
(202 |
%) |
|
(209 |
%) |
Adjusted (negative)
EBITDA (1) |
(11,491 |
) |
68,439 |
|
(117 |
%) |
|
(118 |
%) |
GAAP net (loss)
income |
(69,140 |
) |
29,105 |
|
(338 |
%) |
|
(354 |
%) |
Fundamental net (loss)
income (1) |
(48,709 |
) |
46,875 |
|
(204 |
%) |
|
(211 |
%) |
GAAP (loss) earnings
per share ($) |
(1.22 |
) |
0.51 |
|
(100 |
%) |
|
(100 |
%) |
Fundamental
(loss)(loss) earnings per share ($) (1) |
(0.86 |
) |
0.83 |
|
(204 |
%) |
|
(211 |
%) |
Fully-diluted shares
outstanding (‘000’s) |
56,814 |
|
56,812 |
|
- |
|
|
|
|
Average period USD/ ZAR
exchange rate |
14.34 |
|
13.41 |
|
7 |
% |
|
|
|
Non-cash adjustments
included (before tax impact): |
54,553 |
|
- |
|
nm |
|
|
|
|
Allowance for doubtful finance loans receivables |
27,794 |
|
- |
|
nm |
|
|
|
|
Change in fair value of equity securities |
15,836 |
|
- |
|
nm |
|
|
|
|
Goodwill impairment loss |
8,191 |
|
- |
|
nm |
|
|
|
|
Impairment of Cedar Cellular note |
2,732 |
|
- |
|
nm |
|
|
|
|
(1) Adjusted negative EBITDA, fundamental net
(loss) income and (loss)(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)(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)(loss) earnings per share.
Factors impacting comparability of our Q2
2019 and Q2 2018 results
- Losses incurred resulting from SASSA’s auto-migration
of EPE accounts: We experienced a significant decline in
EPE account numbers driven largely by SASSA’s auto-migration of
accounts to SAPO, often unilaterally and without the recipient’s
consent. The resultant losses were caused by the loss of monthly
income on the relevant EPE accounts, a $23.4 million allowance for
doubtful finance loans receivable as well as losses incurred from
maintaining our mobile payment infrastructure;
- Loss of CPS revenue and operating income due to the
expiration of our SASSA contract: The expiration of our
SASSA contract on September 30, 2018, resulted in the loss of all
revenue from the contract and, as a result, CPS recorded no revenue
from the SASSA during Q2 2019 compared with the prior year;
- Non-cash impairment loss related to impairment of
goodwill: We recorded an impairment loss of $8.2 million
primarily related to goodwill allocated to the international
transaction processing operating segment;
- Consolidation of DNI results: DNI contributed
to an increase in revenue and operating income during the Q2 2019,
performing in line with expectations;
- Improved contribution from South Korea: Our
South Korean operations experienced modest revenue pressures due to
ongoing regulatory changes and macroeconomic factors, though
operating income and margin continued to show improvement compared
to Q2 2018;
- High income tax expense due to deferred tax valuation
allowance on losses by certain South African businesses:
Our income tax expense included a valuation allowance recorded
against the net operating loss deferred tax asset generated by
certain of our South African businesses, including CPS and our
microlending business as a result of the losses incurred during Q2
2019;
- Unfavorable impact from the strengthening of the U.S.
dollar against the South African Rand: The U.S. dollar
appreciated 5% against the ZAR during Q2 2019 compared to Q2 2018,
which adversely impacted our reported results;
- Higher revenue from Masterpayment and allowance for
credit losses in fiscal 2018: During fiscal 2018,
Masterpayment contributed higher revenues as a result of an
increase in processing activities, particularly related to its
cryptocurrency processing launched in December 2017, as well as
from its working capital financing and supply chain solutions;
- Higher depreciation and amortization charges resulting
from DNI acquisition: Our depreciation and amortization
charge increased during the Q2 2019, as a result of our acquisition
of DNI;
- Loss resulting from Cell C fair value
adjustment: We recorded a non-cash pre-tax fair value
adjustment loss related to Cell C of approximately $15.8 million
due to lower industry comparable valuations, which adversely
impacted our reported results in fiscal 2019;
- Reduced income from equity-accounted
investments: Earnings from equity accounted investments
decreased as a result of the consolidation of DNI from June 30,
2018; and
- Lower interest income and higher interest
expense: The movement in net interest expense (before the
Cedar Cellular impairment) was $2.8 million primarily due to lower
interest income resulting from the utilization of cash to fund
strategic investments and higher interest expense as a result of
the South African lending facilities we obtained, including a
facility to fund our ATMs.
Results of Operations by Segment and
Liquidity
South African transaction
processing
Segment revenue was $21.9 million in Q2 2019, down
66% compared with Q2 2018 in USD, and 64% lower on a constant
currency basis. The 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 fiscal 2019. Our revenue and
operating income was 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. These decreases in revenue
and operating income were partially offset by higher transaction
revenue as a result of increased usage of our ATMs. Our operating
(loss) income margin for Q2 2019 and 2018 was (53.8%) and 21.0%,
respectively.
International transaction
processing
Segment revenue was $38.1 million in Q2 2019, down
14% compared with Q2 2018 in USD. The decrease in segment revenue
and operating income was 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.
Excluding the $7.0 million impairment loss, operating income during
Q2 2019 was higher compared to Q2 2018 due to an improved
contribution from KSNET primarily as a result of lower depreciation
expense and the Mastertrading allowance for doubtful working
capital finance receivable of $7.8 million recorded during Q2 2018.
These increases were partially offset by a decrease in IPG revenues
and ongoing losses at Masterpayment during Q2 2019. Operating
loss margin for Q2 2019 and 2018 was 10.6% and 11.3%, respectively.
Excluding the goodwill impairment, segment operating income and
margin for Q2 2019 were $3.0 million and 7.8%, respectively.
Excluding the Mastertrading allowance for doubtful working capital
finance receivables, segment operating income and margin for Q2
2018 were $2.8 million and 6.4% respectively.
Financial inclusion and applied
technologies
Segment revenue was $38.8 million in Q2 2019, down
28% compared with Q2 2018 in USD. 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, partially offset by the inclusion of DNI.
Operating income was significantly lower than Q2 2018, primarily
due to the allowance for doubtful finance loans receivable of $23.4
million recognized and expenses incurred to maintain and expand our
financial service infrastructure, partially offset by the
contribution from DNI. Operating (loss) income margin for the
Financial inclusion and applied technologies segment was (47.8%)
and 23.5% during Q2 2019 and 2018, respectively. Excluding the
allowance for doubtful finance loans receivable, segment operating
income and margin for fiscal 2019 were $4.9 million and 12.5%
respectively.
Corporate/eliminations
Our corporate expenses increased primarily due to
higher acquired intangible asset amortization, non-employee
director expenses and external service provider fees, partially
offset by lower transaction-related expenditures.
Cash flow and liquidity
At December 31, 2018, our cash and cash equivalents
were $69.9 million and comprised mainly KRW-denominated balances of
KRW 31.9 billion ($28.7 million), ZAR-denominated balances of ZAR
376.7 million ($26.2 million), U.S. dollar-denominated balances of
$11.7 million, and other currency deposits, primarily Botswana
pula, of $3.4 million, all amounts translated at exchange rates
applicable as of December 31, 2018. The decrease in our 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 the utilization of our
debt facilities to fund our ATMs and to finance our lending to Cell
C to fund the construction of mobile telephony network
infrastructure, the contribution from the inclusion of 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 Q2
2019 and 2018 were $2.5 million and $2.1 million, respectively, and
have increased primarily due to the acquisition of ATMs in South
Africa, computer equipment to maintain our processing activities
and the expansion of our branch network. We made a scheduled South
African debt facility payment of $10.6 million (ZAR 151
million).
Operating metrics and supplemental
presentation for Q2 2019 Results
Our updated operating metrics have been posted on
our website (www.net1.com). A supplemental presentation for Q2 2019
will be posted to the Investor Relations page of our website –
ir.net1.com one hour prior to our earnings call on Friday, February
8, 2019.
Conference Call
We will host a conference call to review these
results on February 8, 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 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 through February 28,
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, an allowance for doubtful Mastertrading working
capital finance loans receivable and profits realized on 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 the impairment loss,
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
non-controlling interest portion of the amortization of intangible
assets (net of deferred taxes).
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. 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 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 (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 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: Dhruv
ChopraHead of Investor RelationsPhone: +1 917-767-6722Email:
dchopra@net1.com
Media Relations Contact:Bridget
von HoldtBusiness Director – BCWPhone: +27-82-610-0650Email:
bridget.vonholdt@bm-africa.com
NET 1 UEPS TECHNOLOGIES, INC. |
Unaudited Condensed Consolidated Statements of
Operations |
|
Three months ended |
|
Six months ended |
|
December 31, |
|
December 31, |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
|
|
|
|
|
|
|
|
|
(In thousands, except per share data) |
|
(In thousands, except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
REVENUE |
$ |
97,150 |
|
|
$ |
148,416 |
|
$ |
223,034 |
|
|
$ |
300,974 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
goods sold, IT processing, servicing and support |
|
51,185 |
|
|
|
73,994 |
|
|
123,501 |
|
|
|
148,646 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling,
general and administration |
|
70,996 |
|
|
|
49,392 |
|
|
112,874 |
|
|
|
93,326 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
9,853 |
|
|
|
8,723 |
|
|
20,647 |
|
|
|
17,689 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment loss |
|
8,191 |
|
|
|
- |
|
|
8,191 |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING (LOSS)
INCOME |
|
(43,075 |
) |
|
|
16,307 |
|
|
(42,179 |
) |
|
|
41,313 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CHANGE IN VALUE OF
EQUITY SECURITIES |
|
(15,836 |
) |
|
|
- |
|
|
(15,836 |
) |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST INCOME, net of
impairment |
|
(331 |
) |
|
|
4,705 |
|
|
1,545 |
|
|
|
9,749 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST EXPENSE |
|
2,778 |
|
|
|
2,325 |
|
|
5,537 |
|
|
|
4,446 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(LOSS) INCOME BEFORE
INCOME TAX EXPENSE |
|
(62,020 |
) |
|
|
18,687 |
|
|
(62,007 |
) |
|
|
46,616 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME TAX (BENEFIT)
EXPENSE |
|
(2,298 |
) |
|
|
10,062 |
|
|
4,192 |
|
|
|
20,339 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET (LOSS) INCOME
BEFORE EARNINGS FROM EQUITY-ACCOUNTED INVESTMENTS |
|
(59,722 |
) |
|
|
8,625 |
|
|
(66,199 |
) |
|
|
26,277 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(LOSS) EARNINGS FROM
EQUITY-ACCOUNTED INVESTMENTS |
|
(1,247 |
) |
|
|
1,354 |
|
|
126 |
|
|
|
3,429 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET (LOSS) INCOME |
|
(60,969 |
) |
|
|
9,979 |
|
|
(66,073 |
) |
|
|
29,706 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LESS NET INCOME
ATTRIBUTABLE TO NON-CONTROLLING INTEREST |
|
2,972 |
|
|
|
357 |
|
|
3,067 |
|
|
|
601 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET (LOSS) INCOME
ATTRIBUTABLE TO NET1 |
$ |
(63,941 |
) |
|
$ |
9,622 |
|
$ |
(69,140 |
) |
|
$ |
29,105 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss)
income per share, in U.S. dollars |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
(loss) earnings attributable to Net1 shareholders |
$ |
(1.13 |
) |
|
$ |
0.17 |
|
$ |
(1.22 |
) |
|
$ |
0.51 |
Diluted
(loss) earnings attributable to Net1 shareholders |
$ |
(1.12 |
) |
|
$ |
0.17 |
|
$ |
(1.22 |
) |
|
$ |
0.51 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See Notes to Unaudited Condensed Consolidated Financial
Statements |
|
NET 1 UEPS TECHNOLOGIES, INC. |
Unaudited Consolidated Balance
Sheets |
|
Unaudited |
|
(A) |
|
December 31, |
|
June 30, |
|
2018 |
|
2018 |
|
|
|
|
|
|
|
(In thousands, except share data) |
ASSETS |
CURRENT ASSETS |
|
|
|
|
|
Cash and cash
equivalents |
$ |
69,910 |
|
|
$ |
90,054 |
|
Restricted cash |
|
63,131 |
|
|
|
- |
|
Pre-funded social welfare grants receivable |
|
- |
|
|
|
2,965 |
|
Accounts
receivable, net of allowances of – December: $1,331; June:
$1,101 |
|
105,007 |
|
|
|
109,683 |
|
Finance
loans receivable, net of allowances of – December: $39,850; June:
$16,403 |
|
25,122 |
|
|
|
62,205 |
|
Inventory |
|
10,272 |
|
|
|
12,887 |
|
Total
current assets before settlement assets |
|
273,442 |
|
|
|
277,794 |
|
Settlement assets |
|
65,765 |
|
|
|
149,047 |
|
Total
current assets |
|
339,207 |
|
|
|
426,841 |
|
PROPERTY, PLANT AND
EQUIPMENT, net of accumulated depreciation of –December: $132,191;
June: $129,185 |
|
23,739 |
|
|
|
27,054 |
|
EQUITY-ACCOUNTED
INVESTMENTS |
|
93,561 |
|
|
|
88,331 |
|
GOODWILL |
|
267,964 |
|
|
|
283,240 |
|
INTANGIBLE ASSETS, net
of accumulated amortization of – December: $132,061 ; June:
$121,466 |
|
115,250 |
|
|
|
131,132 |
|
DEFERRED INCOME
TAXES |
|
20,826 |
|
|
|
6,312 |
|
OTHER LONG-TERM ASSETS,
including reinsurance assets |
|
219,577 |
|
|
|
256,380 |
|
TOTAL ASSETS |
|
1,080,124 |
|
|
|
1,219,290 |
|
|
|
|
|
|
90,054 |
|
LIABILITIES |
CURRENT
LIABILITIES |
|
|
|
|
|
Short-term credit facilities for ATM funding |
|
63,131 |
|
|
|
- |
|
Accounts
payable |
|
20,939 |
|
|
|
35,055 |
|
Other
payables |
|
73,464 |
|
|
|
47,994 |
|
Current
portion of long-term borrowings |
|
24,660 |
|
|
|
44,695 |
|
Income
taxes payable |
|
6,770 |
|
|
|
5,742 |
|
Total
current liabilities before settlement obligations |
|
188,964 |
|
|
|
133,486 |
|
Settlement obligations |
|
65,765 |
|
|
|
149,047 |
|
Total
current liabilities |
|
254,729 |
|
|
|
282,533 |
|
DEFERRED INCOME
TAXES |
|
52,376 |
|
|
|
46,606 |
|
LONG-TERM
BORROWINGS |
|
10,395 |
|
|
|
5,469 |
|
OTHER LONG-TERM
LIABILITIES, including insurance policy liabilities |
|
2,515 |
|
|
|
38,580 |
|
TOTAL LIABILITIES |
|
320,015 |
|
|
|
373,188 |
|
COMMITMENTS AND
CONTINGENCIES |
|
|
|
|
|
REDEEMABLE COMMON
STOCK |
|
107,672 |
|
|
|
107,672 |
|
|
|
|
|
|
|
EQUITY |
COMMON
STOCK |
|
|
|
|
|
Authorized: 200,000,000 with $0.001 par value; |
|
|
|
|
|
|
|
80 |
|
|
|
80 |
|
PREFERRED
STOCK |
|
|
|
|
|
Authorized shares: 50,000,000 with $0.001 par value; |
|
|
|
|
|
Issued
and outstanding shares, net of treasury: December: -; June: - |
|
- |
|
|
|
- |
|
ADDITIONAL PAID-IN-CAPITAL |
|
277,463 |
|
|
|
276,201 |
|
TREASURY
SHARES, AT COST: December: 24,891,292; June: 24,891,292 |
|
(286,951 |
) |
|
|
(286,951 |
) |
ACCUMULATED OTHER COMPREHENSIVE LOSS |
|
(198,272 |
) |
|
|
(184,436 |
) |
RETAINED
EARNINGS |
|
768,485 |
|
|
|
837,625 |
|
TOTAL
NET1 EQUITY |
|
560,805 |
|
|
|
642,519 |
|
NON-CONTROLLING INTEREST |
|
91,632 |
|
|
|
95,911 |
|
TOTAL EQUITY |
|
652,437 |
|
|
|
738,430 |
|
|
|
|
|
|
|
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY |
$ |
1,080,124 |
|
|
$ |
1,219,290 |
|
|
|
277,463 |
|
|
|
276,201 |
|
(A) –
Derived from restated audited financial statements filed on Form
10-K/A on December 6, 2018. |
|
NET 1 UEPS TECHNOLOGIES, INC. |
Unaudited Condensed Consolidated Statements of
Cash Flows |
|
Three months ended |
|
Six months ended |
|
December 31, |
|
December 31, |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
|
|
|
|
|
|
|
|
|
(In thousands) |
|
(In thousands) |
Cash flows from operating
activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income |
$ |
(60,969 |
) |
|
$ |
9,979 |
|
|
$ |
(66,073 |
) |
|
$ |
29,706 |
|
Depreciation and amortization |
|
9,853 |
|
|
|
8,723 |
|
|
|
20,647 |
|
|
|
17,689 |
|
Impairment
loss |
|
8,191 |
|
|
|
- |
|
|
|
8,191 |
|
|
|
- |
|
Movement in
allowance for doubtful accounts receivable |
|
21,368 |
|
|
|
9,402 |
|
|
|
23,958 |
|
|
|
9,465 |
|
Loss
(Earnings) from equity-accounted investments |
|
1,247 |
|
|
|
(1,354 |
) |
|
|
(126 |
) |
|
|
(3,429 |
) |
Interest on
Cedar Cell note, net of impairment |
|
1,516 |
|
|
|
(182 |
) |
|
|
1,360 |
|
|
|
(182 |
) |
Change in
fair value of equity securities |
|
15,836 |
|
|
|
- |
|
|
|
15,836 |
|
|
|
- |
|
Fair value
adjustments and re-measurements |
|
83 |
|
|
|
(190 |
) |
|
|
1 |
|
|
|
(99 |
) |
Interest
payable |
|
131 |
|
|
|
(159 |
) |
|
|
241 |
|
|
|
(247 |
) |
Facility
fee amortized |
|
68 |
|
|
|
214 |
|
|
|
155 |
|
|
|
347 |
|
(Profit)
Loss on disposal of property, plant and equipment |
|
(139 |
) |
|
|
16 |
|
|
|
(266 |
) |
|
|
121 |
|
Profit on
disposal of business |
|
- |
|
|
|
(463 |
) |
|
|
- |
|
|
|
(463 |
) |
Stock-based
compensation charge, net |
|
598 |
|
|
|
608 |
|
|
|
1,185 |
|
|
|
1,435 |
|
Dividends
received from equity accounted investments |
|
454 |
|
|
|
1,253 |
|
|
|
454 |
|
|
|
2,165 |
|
Decrease
(Increase) in accounts receivable, pre-funded social welfare grants
receivable and finance loans receivable |
|
18,753 |
|
|
|
(3,397 |
) |
|
|
28,755 |
|
|
|
(42,601 |
) |
(Increase)
Decrease in inventory |
|
(24 |
) |
|
|
(2,322 |
) |
|
|
2,161 |
|
|
|
(3,848 |
) |
(Decrease)
Increase in accounts payable and other payables |
|
(11,759 |
) |
|
|
(481 |
) |
|
|
(19,535 |
) |
|
|
2,948 |
|
(Decrease)
Increase in taxes payable |
|
(7,007 |
) |
|
|
(9,754 |
) |
|
|
1,347 |
|
|
|
(916 |
) |
(Increase)
Decrease in deferred taxes |
|
(3,436 |
) |
|
|
1,419 |
|
|
|
(7,070 |
) |
|
|
428 |
|
Net cash (used in) provided by operating
activities |
|
(5,236 |
) |
|
|
13,312 |
|
|
|
11,221 |
|
|
|
12,519 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital
expenditures |
|
(2,547 |
) |
|
|
(2,103 |
) |
|
|
(5,665 |
) |
|
|
(3,576 |
) |
Proceeds
from disposal of property, plant and equipment |
|
212 |
|
|
|
99 |
|
|
|
486 |
|
|
|
415 |
|
Acquisition
of intangible assets |
|
(1,384 |
) |
|
|
- |
|
|
|
(1,384 |
) |
|
|
- |
|
Investment
in equity of equity-accounted investments |
|
(2,500 |
) |
|
|
(40,892 |
) |
|
|
(2,500 |
) |
|
|
(113,738 |
) |
Investment
in MobiKwik |
|
(1,056 |
) |
|
|
- |
|
|
|
(1,056 |
) |
|
|
- |
|
Proceeds on
return of investment |
|
- |
|
|
|
- |
|
|
|
284 |
|
|
|
- |
|
Investment
in Cell C |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(151,003 |
) |
Acquisition
of held to maturity investment |
|
- |
|
|
|
(9,000 |
) |
|
|
- |
|
|
|
(9,000 |
) |
Other
investing activities |
|
- |
|
|
|
(154 |
) |
|
|
- |
|
|
|
(154 |
) |
Net change
in settlement assets |
|
2,031 |
|
|
|
24,519 |
|
|
|
77,962 |
|
|
|
237,168 |
|
Net cash (used in) provided by investing
activities |
|
(5,244 |
) |
|
|
(27,531 |
) |
|
|
68,127 |
|
|
|
(39,888 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds
from bank overdraft |
|
221,582 |
|
|
|
690 |
|
|
|
306,237 |
|
|
|
32,570 |
|
Repayment
of bank overdraft |
|
(245,726 |
) |
|
|
(11,391 |
) |
|
|
(245,726 |
) |
|
|
(14,343 |
) |
Repayment
of long-term borrowings |
|
(13,551 |
) |
|
|
(30,881 |
) |
|
|
(23,811 |
) |
|
|
(45,141 |
) |
Long-term
borrowings utilized |
|
3,203 |
|
|
|
- |
|
|
|
11,004 |
|
|
|
95,431 |
|
Dividends
paid to non-controlling interest |
|
(1,208 |
) |
|
|
- |
|
|
|
(2,937 |
) |
|
|
- |
|
Payment of
guarantee fee |
|
(258 |
) |
|
|
- |
|
|
|
(394 |
) |
|
|
(552 |
) |
Net change
in settlement obligations |
|
(2,031 |
) |
|
|
(24,519 |
) |
|
|
(77,962 |
) |
|
|
(237,168 |
) |
Net cash used in financing activities |
|
(37,989 |
) |
|
|
(66,101 |
) |
|
|
(33,589 |
) |
|
|
(169,203 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of
exchange rate changes on cash |
|
(1,823 |
) |
|
|
6,857 |
|
|
|
(2,772 |
) |
|
|
3,011 |
|
Net
(decrease) increase in cash, cash equivalents and restricted
cash |
|
(50,292 |
) |
|
|
(73,463 |
) |
|
|
42,987 |
|
|
|
(193,561 |
) |
Cash, cash equivalents and restricted cash – beginning of
period |
|
183,333 |
|
|
|
138,359 |
|
|
|
90,054 |
|
|
|
258,457 |
|
Cash, cash equivalents and restricted cash – end of period
(1) |
$ |
133,041 |
|
|
$ |
64,896 |
|
|
$ |
133,041 |
|
|
$ |
64,896 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See Notes to Unaudited Condensed Consolidated Financial
Statements |
|
|
|
|
|
|
|
|
(1) Cash, cash equivalents and restricted cash
as of December 31, 2018, includes restricted cash of approximately
$63.1 million related to cash withdrawn from our various debt
facilities to fund ATMs. This cash may only be used to fund ATMs
and is considered restricted as to use and therefore is classified
as restricted cash.
Net 1 UEPS Technologies, Inc.
Attachment A
Operating segment revenue, operating
income and operating margin:
Three months ended December 31, 2018 and
2017 and September 30, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Key segmental data, in ’000, except margins |
|
|
|
|
|
|
|
|
|
|
|
|
Change - actual |
|
Change – constant exchange
rate(1) |
Revenue: |
Q2 ‘19 |
|
Q2 ‘18 |
|
Q1 '19 |
|
Q2
‘19vsQ2‘18 |
|
Q2 ‘19vsQ1
‘19 |
|
Q2
‘19vsQ2‘18 |
|
Q2 ‘19vsQ1
‘19 |
South African
transaction processing |
$ |
21,970 |
|
|
$ |
64,148 |
|
|
$ |
37,749 |
|
|
(66 |
%) |
|
(42 |
%) |
|
(64 |
%) |
|
(44 |
%) |
International
transaction processing |
|
38,124 |
|
|
|
44,185 |
|
|
|
39,387 |
|
|
(14 |
%) |
|
(3 |
%) |
|
(10 |
%) |
|
(7 |
%) |
Financial inclusion and
applied technologies |
|
38,755 |
|
|
|
54,131 |
|
|
|
53,206 |
|
|
(28 |
%) |
|
(27 |
%) |
|
(25 |
%) |
|
(30 |
%) |
Subtotal:
Operating segments |
|
98,849 |
|
|
|
162,464 |
|
|
|
130,342 |
|
|
(39 |
%) |
|
(24 |
%) |
|
(36 |
%) |
|
(27 |
%) |
Intersegment eliminations |
|
(1,699 |
) |
|
|
(14,048 |
) |
|
|
(4,458 |
) |
|
(88 |
%) |
|
(62 |
%) |
|
(87 |
%) |
|
(63 |
%) |
Consolidated revenue |
$ |
97,150 |
|
|
$ |
148,416 |
|
|
$ |
125,884 |
|
|
(35 |
%) |
|
(23 |
%) |
|
(31 |
%) |
|
(26 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
(loss) income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
South African
transaction processing |
$ |
(11,830 |
) |
|
$ |
13,470 |
|
|
$ |
(3,513 |
) |
|
nm |
|
|
237 |
% |
|
nm |
|
|
225 |
% |
International
transaction processing |
|
(4,043 |
) |
|
|
(4,991 |
) |
|
|
2,762 |
|
|
(19 |
%) |
|
nm |
|
|
(281 |
%) |
|
nm |
|
Financial inclusion and
applied technologies |
|
(18,538 |
) |
|
|
12,737 |
|
|
|
11,302 |
|
|
nm |
|
|
nm |
|
|
nm |
|
|
nm |
|
Subtotal:
Operating segments |
|
(34,411 |
) |
|
|
21,216 |
|
|
|
10,551 |
|
|
nm |
|
|
nm |
|
|
nm |
|
|
nm |
|
Corporate/Eliminations |
|
(8,664 |
) |
|
|
(4,909 |
) |
|
|
(9,655 |
) |
|
76 |
% |
|
(10 |
%) |
|
(49 |
%) |
|
(13 |
%) |
Consolidated operating (loss) income |
$ |
(43,075 |
) |
|
$ |
16,307 |
|
|
$ |
896 |
|
|
nm |
|
|
nm |
|
|
nm |
|
|
nm |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
(loss) income margin (%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
South African
transaction processing |
|
(53.8 |
%) |
|
|
21.0 |
% |
|
|
(9.3 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
International
transaction processing |
|
(10.6 |
%) |
|
|
(11.3 |
%) |
|
|
7.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Financial inclusion and
applied technologies |
|
(47.8 |
%) |
|
|
23.5 |
% |
|
|
21.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated operating margin |
|
(44.3 |
%) |
|
|
11.0 |
% |
|
|
0.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) – This information shows what the change in
these items would have been if the USD/ ZAR exchange rate that
prevailed during the Q2 2019 also prevailed during Q2 2018 and Q1
2019. |
|
|
Six months ended December 31, 2018 and 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Key segmental data, in ’000, except margins |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change - actual |
|
Change – constant exchange
rate(1) |
Revenue: |
F2019 |
|
F2018 |
|
F2019vsF2018 |
|
F2019vsF2018 |
South African
transaction processing |
$ |
59,719 |
|
|
$ |
130,585 |
|
|
(54 |
%) |
|
(51 |
%) |
International
transaction processing . |
|
77,511 |
|
|
|
90,207 |
|
|
(14 |
%) |
|
(8 |
%) |
Financial inclusion and
applied technologies |
|
91,961 |
|
|
|
108,444 |
|
|
(15 |
%) |
|
(9 |
%) |
Subtotal:
Operating segments |
|
229,191 |
|
|
|
329,236 |
|
|
(30 |
%) |
|
(26 |
%) |
Intersegment eliminations |
|
(6,157 |
) |
|
|
(28,262 |
) |
|
(78 |
%) |
|
(77 |
%) |
Consolidated revenue |
$ |
223,034 |
|
|
$ |
300,974 |
|
|
(26 |
%) |
|
(21 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
(loss) income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
South African
transaction processing |
$ |
(15,343 |
) |
|
$ |
25,802 |
|
|
nm |
|
|
nm |
|
International
transaction processing |
|
(1,281 |
) |
|
|
325 |
|
|
nm |
|
|
nm |
|
Financial inclusion and
applied technologies . |
|
(7,236 |
) |
|
|
26,657 |
|
|
nm |
|
|
nm |
|
Subtotal:
Operating segments |
|
(23,860 |
) |
|
|
52,784 |
|
|
nm |
|
|
nm |
|
Corporate/Eliminations |
|
(18,319 |
) |
|
|
(11,471 |
) |
|
60 |
% |
|
71 |
% |
Consolidated operating (loss) income |
$ |
(42,179 |
) |
|
$ |
41,313 |
|
|
nm |
|
|
nm |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
(loss) income margin (%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
South African
transaction processing |
|
(25.7 |
%) |
|
|
19.8 |
% |
|
|
|
|
|
|
International
transaction processing . |
|
(1.7 |
%) |
|
|
0.4 |
% |
|
|
|
|
|
|
Financial inclusion and
applied technologies |
|
(7.9 |
%) |
|
|
24.6 |
% |
|
|
|
|
|
|
Overall
operating margin |
|
(18.9 |
%) |
|
|
13.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) – This information shows what the change in
these items would have been if the USD/ ZAR exchange rate that
prevailed during the first half of fiscal 2019 also prevailed
during the first half of fiscal 2018. |
|
|
(Loss) Earnings from equity-accounted
investments:
The table below presents the relative (loss)
earnings from our equity-accounted investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Q2 2019 |
|
Q2 2018 |
|
% change |
|
F2019 |
|
F2018 |
|
% change |
Bank Frick |
$ |
(1,217 |
) |
|
$ |
322 |
|
|
nm |
|
|
$ |
(1,805 |
) |
|
$ |
322 |
|
|
nm |
|
Share of
net income |
|
402 |
|
|
|
487 |
|
|
(17 |
%) |
|
|
564 |
|
|
|
487 |
|
|
16 |
% |
Amortization of intangible assets, net of deferred tax |
|
(141 |
) |
|
|
(165 |
) |
|
(15 |
%) |
|
|
(285 |
) |
|
|
(165 |
) |
|
73 |
% |
Other |
|
(1,478 |
) |
|
|
- |
|
|
nm |
|
|
|
(2,084 |
) |
|
|
- |
|
|
nm |
|
DNI(1) |
|
- |
|
|
|
1,046 |
|
|
nm |
|
|
|
- |
|
|
|
1,911 |
|
|
nm |
|
Share of
net income |
|
- |
|
|
|
1,832 |
|
|
nm |
|
|
|
- |
|
|
|
3,240 |
|
|
nm |
|
Amortization of intangible assets, net of deferred tax |
|
- |
|
|
|
(786 |
) |
|
nm |
|
|
|
- |
|
|
|
(1,329 |
) |
|
nm |
|
Finbond(2) |
|
- |
|
|
|
- |
|
|
nm |
|
|
|
1,875 |
|
|
|
1,101 |
|
|
70 |
% |
Other |
|
(30 |
) |
|
|
(14 |
) |
|
114 |
% |
|
|
56 |
|
|
|
95 |
|
|
(41 |
%) |
(Loss)
earnings from equity-accounted investments |
$ |
(1,247 |
) |
|
$ |
1,354 |
|
|
(192 |
%) |
|
$ |
126 |
|
|
$ |
3,429 |
|
|
(96 |
%) |
(1) DNI was accounted for using the equity method in fiscal 2018
and has been consolidated from June 30, 2018, following the
acquisition of a controlling interest in the company. DNI is
included in our Financial inclusion and applied technologies
operating segment from the acquisition date. (2) Finbond is listed
on the Johannesburg Stock Exchange and reports its six-month
results during our first quarter and its annual results during our
fourth quarter and we record those results in our results during
those quarters
Net 1 UEPS Technologies,
Inc.
Attachment B
Reconciliation of GAAP operating (loss)
income to negative EBITDA and adjusted negative
EBITDA:
Three and six months and year ended
December 31, 2018 and 2017
|
|
|
|
|
Three months ended December 31, |
|
Six months ended December 31, |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
Operating (loss) income
- GAAP |
(43,075 |
) |
|
16,307 |
|
|
(42,179 |
) |
|
41,313 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
9,853 |
|
|
8,723 |
|
|
20,647 |
|
|
17,689 |
|
Impairment loss |
8,191 |
|
|
- |
|
|
8,191 |
|
|
- |
|
(Negative) EBITDA |
(25,031 |
) |
|
25,030 |
|
|
(13,341 |
) |
|
59,002 |
|
Transaction costs |
300 |
|
|
611 |
|
|
1,850 |
|
|
2,097 |
|
Non-recurring Mastertrading allowance for doubtful accounts. |
- |
|
|
7,803 |
|
|
- |
|
|
7,803 |
|
Profit on
sale of Xeo |
- |
|
|
(463 |
) |
|
- |
|
|
(463 |
) |
Adjusted (negative) EBITDA |
(24,731 |
) |
|
32,981 |
|
|
(11,491 |
) |
|
68,439 |
|
Reconciliation of GAAP net (loss) income
and (loss) earnings per share, basic, to fundamental net (loss)
income and (loss) earnings per share, basic:
Three months ended December 31, 2018 and
2017
|
|
|
|
|
|
|
|
|
Net (loss) income(USD’000) |
|
(L)EPS, basic(USD) |
|
Net (loss) income (ZAR’000) |
|
(L)EPS, basic (ZAR) |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
GAAP |
(63,941 |
) |
|
9,622 |
|
|
(1.13 |
) |
|
0.17 |
|
(915,866 |
) |
|
131,510 |
|
|
(16.11 |
) |
|
2.31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment loss |
8,191 |
|
|
- |
|
|
|
|
|
|
|
117,325 |
|
|
- |
|
|
|
|
|
|
Intangible asset amortization, net |
4,510 |
|
|
2,199 |
|
|
|
|
|
|
|
64,609 |
|
|
30,055 |
|
|
|
|
|
|
Intangible asset amortization, net related to non-controlling
interest |
(909 |
) |
|
- |
|
|
|
|
|
|
|
(13,020 |
) |
|
- |
|
|
|
|
|
|
Stock-based compensation charge |
598 |
|
|
608 |
|
|
|
|
|
|
|
8,566 |
|
|
8,310 |
|
|
|
|
|
|
Transaction costs |
300 |
|
|
611 |
|
|
|
|
|
|
|
4,297 |
|
|
8,351 |
|
|
|
|
|
|
Intangible asset amortization, net related to equity accounted
investments ... |
1,217 |
|
|
951 |
|
|
|
|
|
|
|
17,432 |
|
|
10,701 |
|
|
|
|
|
|
Facility
fees for debt |
68 |
|
|
214 |
|
|
|
|
|
|
|
974 |
|
|
2,925 |
|
|
|
|
|
|
Non-recurring Mastertrading allowance for doubtful accounts |
- |
|
|
7,803 |
|
|
|
|
|
|
|
- |
|
|
106,647 |
|
|
|
|
|
|
Change in
US tax rate |
- |
|
|
860 |
|
|
|
|
|
|
|
- |
|
|
11,754 |
|
|
|
|
|
|
Profit on
sale of Xeo |
- |
|
|
(463 |
) |
|
|
|
|
|
|
- |
|
|
(6,328 |
) |
|
|
|
|
|
Fundamental |
(49,966 |
) |
|
22,405 |
|
|
(0.88 |
) |
|
0.39 |
|
(715,683 |
) |
|
303,925 |
|
|
(12.59 |
) |
|
5.34 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended December 31, 2018 and 2017
|
|
|
|
|
|
|
|
|
Net (loss) income(USD’000) |
|
(L)EPS, basic(USD) |
|
Net (loss) income (ZAR’000) |
|
(L)EPS, basic (ZAR) |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
GAAP |
(69,140 |
) |
|
29,105 |
|
|
(1.22 |
) |
|
0.51 |
|
(991,314 |
) |
|
390,375 |
|
|
(17.46 |
) |
|
6.88 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible asset amortization, net |
9,060 |
|
|
4,354 |
|
|
|
|
|
|
|
129,886 |
|
|
58,378 |
|
|
|
|
|
|
Impairment loss |
8,191 |
|
|
- |
|
|
|
|
|
|
|
117,441 |
|
|
- |
|
|
|
|
|
|
Transaction costs |
1,850 |
|
|
1,940 |
|
|
|
|
|
|
|
26,525 |
|
|
26,021 |
|
|
|
|
|
|
Intangible asset amortization, net related to non-controlling
interest |
(1,815 |
) |
|
- |
|
|
|
|
|
|
|
(26,023 |
) |
|
- |
|
|
|
|
|
|
Stock-based compensation charge |
1,185 |
|
|
1,435 |
|
|
|
|
|
|
|
16,990 |
|
|
19,247 |
|
|
|
|
|
|
Intangible asset amortization, net related to equity accounted
investments |
1,805 |
|
|
1,494 |
|
|
|
|
|
|
|
25,880 |
|
|
17,835 |
|
|
|
|
|
|
Facility
fees for debt |
155 |
|
|
347 |
|
|
|
|
|
|
|
2,222 |
|
|
4,654 |
|
|
|
|
|
|
Non-recurring Mastertrading allowance for doubtful accounts |
- |
|
|
7,803 |
|
|
|
|
|
|
|
- |
|
|
104,659 |
|
|
|
|
|
|
Change in
US tax rate |
- |
|
|
860 |
|
|
|
|
|
|
|
- |
|
|
11,535 |
|
|
|
|
|
|
Profit on
sale of Xeo |
- |
|
|
(463 |
) |
|
|
|
|
|
|
- |
|
|
(6,210 |
) |
|
|
|
|
|
Fundamental |
(48,709 |
) |
|
46,875 |
|
|
(0.86 |
) |
|
0.83 |
|
(698,393 |
) |
|
626,494 |
|
|
(12.30 |
) |
|
11.04 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net 1 UEPS Technologies, Inc.
Attachment C
Reconciliation of net (loss) income used
to calculate (loss) earnings per share basic and diluted and
headline (loss) earnings per share basic and diluted:
Three months ended December 31, 2018 and
2017
|
|
|
|
|
|
|
2018 |
|
2017 |
Net (loss) income
(USD’000) |
(63,941 |
) |
|
9,622 |
|
Adjustments: |
|
|
|
Impairment loss |
8,191 |
|
|
- |
|
Profit on
sale of business |
- |
|
|
(463 |
) |
(Profit)
loss on sale of property, plant and equipment |
(139 |
) |
|
16 |
|
Tax
effects on above |
39 |
|
|
(4 |
) |
Net (loss) income used
to calculate headline earnings (USD’000) |
(55,850 |
) |
|
9,171 |
|
Weighted average number
of shares used to calculate net income per share basic (loss)
earnings and headline (loss) earnings per share basic (loss)
earnings (‘000) |
56,834 |
|
|
56,755 |
|
Weighted average number
of shares used to calculate net income per share diluted (loss)
earnings and headline (loss) earnings per share diluted (loss)
earnings (‘000) |
56,855 |
|
|
56,807 |
|
|
|
|
|
Headline (loss)
earnings per share: |
|
|
|
Basic, in
USD |
(0.98 |
) |
|
0.16 |
|
Diluted,
in USD |
(0.98 |
) |
|
0.16 |
|
Six months ended December 31, 2018 and
2017
|
2018 |
|
2017 |
Net (loss) income
(USD’000) |
(69,140 |
) |
|
29,105 |
|
Adjustments: |
|
|
|
Impairment loss |
8,191 |
|
|
- |
|
Profit on
sale of business |
- |
|
|
(463 |
) |
(Profit)
loss on sale of property, plant and equipment |
(266 |
) |
|
16 |
|
Tax
effects on above |
74 |
|
|
(4 |
) |
Net (loss) income used
to calculate headline earnings (USD’000) |
(61,141 |
) |
|
28,654 |
|
Weighted average number
of shares used to calculate net income per share basic (loss)
earnings and headline (loss) earnings per share basic (loss)
earnings (‘000) |
56,778 |
|
|
56,762 |
|
Weighted average number
of shares used to calculate net income per share diluted (loss)
earnings and headline (loss) earnings per share diluted (loss)
earnings (‘000) |
56,814 |
|
|
56,812 |
|
|
|
|
|
Headline (loss)
earnings per share: |
|
|
|
Basic, in
USD |
(1.08 |
) |
|
0.50 |
|
Diluted,
in USD |
(1.08 |
) |
|
0.50 |
|
|
|
|
|
|
|
Calculation of the denominator for headline diluted
(loss) earnings per share
|
Q2 ‘19 |
|
Q2 ‘18 |
|
F2019 |
|
F2018 |
Basic
weighted-average common shares outstanding and unvested restricted
shares expected to vest under GAAP |
56,834 |
|
56,755 |
|
56,778 |
|
56,762 |
Effect of
dilutive securities under GAAP |
21 |
|
52 |
|
36 |
|
50 |
Denominator for headline diluted (loss) earnings per share |
56,855 |
|
56,807 |
|
56,814 |
|
56,812 |
Weighted average number of shares used to calculate
headline (loss) earnings per share diluted represent 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 (loss) earnings per share
diluted because we do not use the two-class method to calculate
headline (loss) earnings per share diluted.
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