Lesaka Technologies, Inc. · NASDAQ:LSAK

Lesaka Technologies — Net1 UEPS Technologies — Q2 2019 Earnings Presentation

26 slides from Lesaka Technologies's earnings presentation, February 2019

  1. Slide 1: Q2 2019 Investor Presentation

    Q2 2019 Investor Presentation www.net1.com

  2. Slide 2: Safe Harbor Statement

    Safe Harbor Statement The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for certain forward- looking statements so long as such information is identified as forward-looking and is accompanied by meaningful cautionary statements identifying important factors that could cau

  3. Slide 3: Defined Terms

    Defined Terms Unless specifically noted otherwise within this presentation, the following terms are hereby defined as follows: Constant Currency: We analyze our results of operations both in U.S. dollars, as presented in the consolidated financial statements, and supplementally in ZAR, because ZAR i

  4. Slide 4: Performance Summary

    Performance Summary Company highlights include: • Progress on turning Korea around and restructuring of the International Payments Group First Half Fiscal 2019 financial summary: • Revenue of $223 million and Fundamental loss per share of $0.86 • Fundamental loss per share includes a $0.82 of non-ca

  5. Slide 5: Financial Highlights Second Quarter 2019

    FINANCIAL HIGHLIGHTS Second Quarter 2019

  6. Slide 6: First Half F2019 Financial Highlights

    Q2 2019 Financial Report First Half F2019 Financial Highlights • Revenue - $223 million • 26% decrease from $301 million in YTD 2018 • 21% decrease on a constant currency basis • Adjusted Negative EBITDA - ($11) million • H1 2018 EBITDA $68 million • Fundamental Net Loss – ($49) million • H1 2018 Fu

  7. Slide 7: Q2 2019 Financial Highlights

    Q2 2019 Financial Report Q2 2019 Financial Highlights • Revenue - $97 million • 35% decrease from $148 million in Q2 2018 • 31% decrease on a constant currency basis • Adjusted Negative EBITDA - ($25) million • Q2 2018 EBITDA $33 million • Fundamental Net loss – ($49) million • Q2 2018 Fundamental n

  8. Slide 8: Business Segment Results – Second quarter

    Q2 2019 Financial Report Business Segment Results – Second quarter Q2 constant currency SATP Revenue Q2 USD ITP Revenue R 877 60 1 000 R 835 $ 44 $ 44 50 800 $ 38 USD Millions 40 ZAR Millions 600 30 5% R 315 400 20 0% (14%) 200 (64%) 10 - - 2017 2018 2019 2017 2018 2019 • SATP constant currency reve

  9. Slide 9: Business Segment Results – First half

    Q2 2019 Financial Report Business Segment Results – First half USD Revenue Operating Operating Margin (Millions) (Loss) Income F2019 F2018 F2019 F2018 F2019 F2018 SATP $ 60 $ 131 ($ 15) $ 26 (26%) 20% % Change* (54%) nm ITP 78 90 (1) 0 (2%) 0% % Change* (14%) nm FIAT 92 108 (7) 27 (8%) 25% % Change*

  10. Slide 10: Business Segment Results – Second quarter

    Q2 2019 Financial Report Business Segment Results – Second quarter USD Revenue Operating Operating Margin (Millions) (Loss) Income Q2 2019 Q2 2018 Q2 2019 Q2 2018 Q2 2019 Q2 2018 SATP $ 22 $ 64 ($ 12) $ 13 (52%) 21% % Change* (64%) nm ITP 38 44 (4) (5) (11%) (11%) % Change* (10%) (281%) FIAT 39 54 (

  11. Slide 11: Balance Sheet Overview

    Q2 2019 Financial Report Balance Sheet Overview USD (Millions) Dec 31, 2018 Jun 30, 2018 Cash $ 70 $ 90 Investments and Equity Accounted Investments $ 279 $ 299 Total Assets $ 1,080 $ 1,219 Total Equity $ 652 $ 738 Total Debt $ 35 $ 50 Book Value / Share $ 11.48 $ 13.03 Net Cash / Share $ 0.61 $ 0.7

  12. Slide 12: Key Investments

    Q2 2019 Financial Report Key Investments % held Balance Sheet Value (Dec 2018) Equity Accounted: Bank Frick 35% $46 million >$46 million (1) Finbond (JSE listed) 29% $37 million $100 million (2) OneFi 25% $8 million $25 - $35 million (3) Investments: Cell C 15% $149 million $149 million MobiKwik 12%

  13. Slide 13: Business Overview: South African Transaction Processing

    BUSINESS OVERVIEW SOUTH AFRICAN TRANSACTION PROCESSING Second Quarter 2019

  14. Slide 14: SATP Segment Highlights

    SATP Segment Highlights Q2 2019 Financial Highlights • Revenue - $22 million • 66% decrease from $64 million in Q2 2018 • 64% decrease on a constant currency basis • Lower transaction revenue from fewer EPE accounts and SASSA Grindrod accounts • Expiration of contract in CPS at end of Q1 2019, no re

  15. Slide 15: SATP Segment Highlights: Key Trends

    SATP Segment Highlights Q2 2019 Key Trends EasyPay Number of EasyPay Transactions 150 145 140 135 Millions 130 125 120 115 Q2FY17 Q3FY17 Q4FY17 Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Total 15

  16. Slide 16: Business Overview: International Transaction Processing

    BUSINESS OVERVIEW INTERNATIONAL TRANSACTION PROCESSING Second Quarter 2019

  17. Slide 17: ITP Segment Highlights

    ITP Segment Highlights Q2 2019 Financial Highlights • Revenue - $38 million • 10% decrease compared to $44 million in Q1 2018 • Contraction in IPG processing activities compared to Q2 2018 • Q2 2018 included significant surge in crypto-currency processing volumes • Operating loss – ($4) million • In

  18. Slide 18: ITP Segment Highlights: Key Trends

    ITP Segment Highlights Q2 2019 Key Trends • South Korea and Rest of the World (ROW) Growth • South Korea revenue down 3% in KRW compared to Q2 2018 • ROW revenue impacted by contraction in IPG processing activities, specifically the surge in crypto-currency processing activities in Q2 2018 Revenue K

  19. Slide 19: IPG Consolidation and Expansion

    IPG Consolidation and Expansion IPG PLAYS AN INTEGRAL ROLE IN PROVIDING END-TO-END SOLUTIONS FOR ISSUING, ACQUIRING AND PROCESSING GLOBALLY. Card Processing Volume ($Mil) Q2 2019 PROGRESS UPDATES: 120 100 • Consolidation of various business units largely complete with appropriate management structur

  20. Slide 20: Business Overview: Financial Inclusion & Applied Technologies

    BUSINESS OVERVIEW FINANCIAL INCLUSION & APPLIED TECHNOLOGIES Second Quarter 2019

  21. Slide 21: FIAT Segment Highlights

    FIAT Segment Highlights Q2 2019 Financial Highlights • Revenue - $39 million • 28% decrease from $54 million in Q2 2018 • 25% decrease on a constant currency basis • Operating Loss - $19 million • Operating income $13 million in Q2 2018 • Includes $23 million allowance for doubtful finance loans rec

  22. Slide 22: FIAT Segment Highlights: Key Trends

    FIAT Segment Highlights Q2 2019 Key Trends # of EPE Accounts Receiving Grants Value of Loans Outstanding 1 400 Millions 1 200 2.0 1 000 Millions 1.5 800 600 1.0 400 0.5 200 0 0.0 Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 As of quarter ended Outstanding Capital Deferred Service Fees Number of Billed

  23. Slide 23: Appendix A

    Appendix A

  24. Slide 24: Reconciliation of non-GAAP measures

    Reconciliation of non-GAAP measures Second quarter – Fundamental Net (Loss) Income and Negative EBITDA Three months ended Dec-18 Dec-17 $ '000 EPS, basic $ '000 EPS, basic Fundamental net (loss) income (Non-GAAP) (49,966) (0.88) 22,405 0.39 Impairment loss (8,191) - Amortisation of intangible assets

  25. Slide 25: Reconciliation of non-GAAP measures

    Reconciliation of non-GAAP measures First half – Fundamental Net (Loss) Income and Negative EBITDA Six months ended Dec-18 Dec-17 $ '000 EPS, basic $ '000 EPS, basic Fundamental net (loss) income (Non-GAAP) (48,709) (0.86) 46,875 0.83 Impairment loss (9,060) (4,354) Amortisation of intangible assets

  26. Slide 26: Thank you!

    Thank you! www.net1.com

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