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JOHANNESBURG--(BUSINESS WIRE)-- Lesaka Technologies, Inc. (Nasdaq: LSAK; JSE: LSK) today released its results for the first quarter (“Q1 2024”) ended September 30, 2023.
Performance highlights for Q1 2024:
(1) Average exchange rates applicable for the quarter: ZAR 18.71 to $1 for Q1 2024, ZAR 17.13 to $1 for Q1 2023 and ZAR 18.74 to $1 for Q4 2023. The ZAR weakened 9.2% against the U.S. dollar during Q1 2024 when compared to Q1 2023 and (0.2%) when compared to the prior sequential quarter (Q4 2023).
Lesaka Group CEO Chris Meyer said: “It has been yet another encouraging quarter for us. We achieved a major milestone by returning to profitability at an operating level for the quarter.”
Mr. Meyer added, “In a tough economic environment the continued growth in all our key revenue drivers demonstrates the resilience of our business model and the relevance of our services to our customers. We will continue to innovate and extend the positive impact we are having on the lives of South Africa’s small merchants and grant beneficiaries as the digitalization trend in the informal economy continues.”
Full release and webcast details at https://ir.lesakatech.com/.
The discussion of our consolidated overall results of operations is based on amounts as reflected in our unaudited condensed consolidated financial statements which are prepared in accordance with U.S. GAAP. We analyze our results of operations both in U.S. dollars, as presented in the unaudited condensed consolidated financial statements, and supplementally in ZAR, because ZAR is the functional currency of the entities which contribute the majority of our revenue and is the currency in which the majority of our transactions are initially incurred and measured. Due to the significant impact of currency fluctuations between the U.S. dollar and the ZAR on our reported results and because we use the U.S. dollar as our reporting currency, we believe that the supplemental presentation of our results of operations in ZAR is useful to investors to understand the changes in the underlying trends of our business.
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 and Group Adjusted EBITDA are non-GAAP measures.
Below is the reconciliation between our GAAP measure and our non-GAAP measures.
|
FY24 Q1 |
FY23 Q4 |
FY23 Q1 |
FY24 Q1 |
FY23 Q4 |
FY23 Q1 |
||||||||||||
For the quarter |
$’000 |
$’000 |
$’000 |
ZAR’000 |
ZAR’000 |
ZAR’000 |
||||||||||||
Average exchange rate for conversion from ZAR to $ |
18.71 |
|
18.74 |
|
17.13 |
|
18.71 |
|
18.74 |
|
17.13 |
|
||||||
Loss attributable to Lesaka – GAAP |
(5,651 |
) |
(11,909 |
) |
(10,696 |
) |
(105,635 |
) |
(223,192 |
) |
(183,231 |
) |
||||||
Loss from equity accounted investments |
1,405 |
|
2,535 |
|
2,617 |
|
26,657 |
|
47,509 |
|
44,831 |
|
||||||
Net loss before loss from equity-accounted investments |
(4,246 |
) |
(9,374 |
) |
(8,079 |
) |
(78,978 |
) |
(175,683 |
) |
(138,400 |
) |
||||||
Income tax (benefit) expense |
264 |
|
(1,844 |
) |
31 |
|
4,825 |
|
(34,560 |
) |
532 |
|
||||||
Loss before income tax expense |
(3,982 |
) |
(11,218 |
) |
(8,048 |
) |
(74,153 |
) |
(210,243 |
) |
(137,868 |
) |
||||||
Reversal of allowance for doubtful EMI loans receivable |
(250 |
) |
- |
|
- |
|
(4,741 |
) |
- |
|
- |
|
||||||
Net loss (gain) on disposal of equity-accounted investment |
- |
|
12 |
|
(248 |
) |
- |
|
225 |
|
(4,248 |
) |
||||||
Impairment loss |
- |
|
7,039 |
|
- |
|
- |
|
131,921 |
|
- |
|
||||||
Unrealized loss FV for currency adjustments |
102 |
|
179 |
|
- |
|
1,947 |
|
3,355 |
|
- |
|
||||||
Operating income/(loss) after PPA amortization and net interest (non-GAAP) |
(4,130 |
) |
(3,988 |
) |
(8,296 |
) |
(76,947 |
) |
(74,742 |
) |
(142,116 |
) |
||||||
PPA amortization (amortization of acquired intangible assets) |
3,608 |
|
3,590 |
|
3,928 |
|
67,266 |
|
67,266 |
|
67,267 |
|
||||||
Operating income/(loss) before PPA amortization after net interest (non-GAAP) |
(522 |
) |
(398 |
) |
(4,368 |
) |
(9,681 |
) |
(7,476 |
) |
(74,849 |
) |
||||||
Interest expense |
4,909 |
|
5,159 |
|
4,036 |
|
91,429 |
|
96,687 |
|
69,140 |
|
||||||
Interest income |
(449 |
) |
(584 |
) |
(411 |
) |
(8,368 |
) |
(10,945 |
) |
(7,041 |
) |
||||||
Operating income/(loss) before PPA amortization and net interest (non-GAAP) |
3,938 |
|
4,177 |
|
(743 |
) |
73,380 |
|
78,266 |
|
(12,750 |
) |
||||||
Depreciation (excluding amortization of intangibles) |
2,248 |
|
2,203 |
|
2,070 |
|
41,900 |
|
41,303 |
|
35,482 |
|
||||||
Stock-based compensation charges |
1,759 |
|
1,354 |
|
1,462 |
|
32,797 |
|
25,376 |
|
25,045 |
|
||||||
Lease adjustments |
696 |
|
651 |
|
812 |
|
12,961 |
|
12,201 |
|
13,910 |
|
||||||
Once-off items |
78 |
|
64 |
|
598 |
|
1,465 |
|
1,199 |
|
10,245 |
|
||||||
Group Adjusted EBITDA (non-GAAP) |
8,719 |
|
8,449 |
|
4,199 |
|
162,503 |
|
158,345 |
|
71,932 |
|
||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20231107247751/en/
Investor Relations Contacts: Phillipe Welthagen Email: phillipe.welthagen@lesakatech.com Mobile: +27 84 512 5393
FNK IR: Rob Fink / Matt Chesler, CFA Email: lsak@fnkir.com
Media Relations Contact: Janine Bester Gertzen Email: janine@thenielsennetwork.com
Source: Lesaka Technologies, Inc.
