Wrap Text
Lesaka achieves profitability guidance for FY2024 & provides significantly higher profitability guidance for FY2025
Lesaka Technologies, Inc.
Registered in the state of Florida, USA
(IRS Employer Identification No. 98-0171860)
Nasdaq share code: LSAK
JSE share code: LSK
LEI: 529900J4IZMWV4RDEB07
ISIN: US64107N2062
("Lesaka," or the "Company")
Lesaka achieves its profitability guidance for FY 2024 and provides significantly higher profitability guidance for FY 2025
JOHANNESBURG, September 12, 2024 – Lesaka (Nasdaq: LSAK; JSE: LSK) today released results for the fourth quarter ("Q4 2024")
and year ended June 30, 2024 ("FY 2024").
FY 2024 performance:
- Revenue increased 11% in South African Rand ("ZAR")1 to $564.2 million (ZAR 10.6 billion).
- Operating income increased to $3.6 million (ZAR 67.3 million), compared to an operating loss of $15.3 million (ZAR 275.3
million) in FY 2023.
- Net loss improved 48% in ZAR to $17.4 million (ZAR 326.1 million), compared to a net loss of $35.1 million (ZAR 629.2
million) in FY 2023.
- GAAP loss per share improved 49% in ZAR, to $0.27 (ZAR R5.07).
- Guidance for Group Adjusted EBITDA (a non-GAAP measure) achieved, increasing 55% in ZAR to $36.9 million (ZAR
690.9 million).
- Fundamental earnings per share (a non-GAAP measure) of $0.06 (ZAR 1.06), improved ZAR 3.72, compared to a fundamental
loss per share of $0.15 (ZAR 2.66) in FY 2023.
- Merchant Division revenue increased 12% in ZAR to $498.3 million (ZAR 9.3 billion) and Segment Adjusted EBITDA
increased 4% in ZAR to $33.4 million (ZAR 624.1 million).
- Consumer Division revenue increased 15% in ZAR to $69.2 million (ZAR 1.3 billion) and Segment Adjusted EBITDA
increased 361% to $14.7 million (ZAR 274.2 million).
- Net debt to Group Adjusted EBITDA2 ratio improved to 2.5 times compared to 4.5 times in FY 2023.
Q4 2024 performance:
- Revenue increased 9% in ZAR to $146.0 million (ZAR 2.7 billion) compared to Q4 2023.
- Operating income increased to $0.3 million (ZAR 5.6 million) compared to an operating loss of $6.6 million (ZAR 124.3
million) in Q4 2023.
- Net loss improved 58% in ZAR to $5.0 million (ZAR 93.2 million).
- GAAP loss per share improved 59% in ZAR to $0.08 (ZAR R1.44).
- Fundamental earnings per share (a non-GAAP measure), positive for a third successive quarter, improved ZAR 1.18 to $0.02
(ZAR 0.42) compared to a fundamental loss per share of $0.04 (ZAR 0.76) in Q4 2023.
(1) Average exchange rates applicable for the year: ZAR 18.68 to $1 for FY 2024, ZAR 17.94 to $1 for FY 2023. The ZAR weakened
4.1% against the U.S. dollar during FY 2024 when compared to FY 2023.
Average exchange rates applicable for the quarter: ZAR 18.47 to $1 for Q4 2024, ZAR 18.88 to $1 for Q3 2024, ZAR 18.74 to
$1 for Q4 2023. The ZAR strengthened 1.4% against the U.S. dollar during Q4 2024 when compared to Q4 2023 and 2.2%
when compared to the prior sequential quarter (Q3 2024).
(2) Non-GAAP measure. Net Debt to EBITDA ratio is calculated as net debt at specific date divided by Annualized Group Adjusted
EBITDA.
Lesaka Chairman Ali Mazanderani said: "We continue to materially improve the profitability of Lesaka achieving Group Adjusted
EBITDA of ZAR 691 million in FY 2024, up from ZAR 445 million in FY 2023 and a significant positive transformation compared to
a Group Adjusted EBITDA loss of ZAR 328 million in FY 2022. We have carried this momentum into FY 2025 and are providing a
guidance range of ZAR 900 million to ZAR 1 billion.
We have established ourselves as the leading independent fintech in Southern Africa with significant room for increased growth and
profitability over the coming years."
Chief Executive Officer Southern Africa Lincoln Mali added, "I am particularly pleased with the Consumer Division's performance.
Our teams have worked hard to turn it into an important profit and cash flow contributor for the Group, demonstrated by the 94% growth
in Segment Adjusted EBITDA this quarter. We are entering an exciting period of growth for Lesaka, integrating the Adumo and
Touchsides acquisitions with our existing fintech solutions as we strive to empower Southern African consumers and merchants to fulfil
their potential."
Outlook: First Quarter 2025 ("Q1 2025") and Full Fiscal Year 2025 ("FY 2025")
While we report our financial results in USD, we measure our operating performance in ZAR, and as such we provide our guidance
accordingly.
For Q1 2025, the quarter ending September 30, 2024 we expect:
- Revenue between ZAR 2.5 billion and ZAR 2.7 billion.
- Group Adjusted EBITDA between ZAR 160 million and ZAR 180 million
For FY 2025, the year ending June 30, 2025, we expect:
- Revenue between ZAR 10.0 billion and ZAR 11.0 billion.
- Group Adjusted EBITDA between ZAR 900 million and ZAR 1 billion
Our outlook provided:
- Includes the impact of a portion of revenue recognized on a gross basis1 in FY 2024, that has converted to an agency
relationship and will be recognized on a net basis in FY 2025. This has no material impact on profitability.
- Includes the impact of the previously announced acquisition of Adumo, expected to close in October 2024 (quarter two
of fiscal 2025).
- Includes the impact of an interest expense charge2 on the consumer loan book that was not included in Group Adjusted
EBITDA in FY 2024.
- Excludes the impact of unannounced mergers and acquisitions that we may conclude.
The mid-point of the FY 2025 Group Adjusted EBITDA implies a growth rate of more than 30% on a like-for-like basis (excluding
Adumo and the interest expense charge on the consumer book).
(1) FY 2024 revenue includes approximately ZAR 1.8 billion of revenue recognized on a gross basis for Easyload prepaid
airtime vouchers sold. If we recognized this revenue on a gross basis in FY 2025 it would be ZAR 2.4 billion.
(2) We are currently engaging our funders to provide the Consumer Division with a specific debt facility to be utilized to fund our
Consumer lending book. This will result in the inclusion of the related interest expense charges in Group Adjusted EBITDA.
Our FY 2025 Q1 and FY2025 Group Adjusted EBITDA guidance provided has been prepared on the basis that the facility is
in place with effect from the commencement of Q1 FY 2025. It accordingly includes an interest expense charge related to the
Consumer Division of approximately ZAR 15 million (FY 2025 Q1) and ZAR 105 million (FY 2025), compared to zero in FY
2024 Q1 and FY 2024, when the interest expense related to funding the Consumer Lending book was included in the Group's
interest expense charge, which is not included in Group Adjusted EBITDA.
Management has provided its outlook regarding Group Adjusted EBITDA, which is a non-GAAP financial measure and excludes certain
charges. Management has not reconciled this non-GAAP financial measure to the corresponding GAAP financial measure because
guidance for the various reconciling items is not provided. Management is unable to provide guidance for these reconciling items because
they cannot determine their probable significance, as certain items are outside of the company's control and cannot be reasonably
predicted since these items could vary significantly from period to period. Accordingly, reconciliations to the corresponding GAAP
financial measure is not available without unreasonable effort.
Earnings Presentation for FY 2024 and Q4 2024 Results
Our earnings presentation will be posted to the Investor Relations page of our website prior to our earnings call.
Webcast and Conference Call
Lesaka will host a webcast and conference call to review results on September 12, 2024, at 8:00 a.m. Eastern Time which is 2:00 p.m.
South Africa Standard Time ("SAST"). A replay of the results presentation webcast will be available on the Lesaka investor relations
website following the conclusion of the live event.
Presentation webcast via Zoom:
Link to access the results webcast: https://bit.ly/3zGC4fy
Participants using the webcast will be able to ask questions by raising their hand and then asking the question "live."
Conference call dial-in:
- US Toll-Free: +1 669 444 9171 or +1 669 900 6833 or +1 689 278 1000
- South Africa Toll-Free: +27 21 426 8191 or +27 87 550 3946
Participants using the conference call dial-in will be unable to ask questions.
A replay of the results presentation webcast will be available on the Lesaka investor relations website following the conclusion of the
live event.
Our Form 10-K for the fiscal year ended June 30, 2024, as filed with the SEC, is available on our company website at
www.lesakatech.com
Headline earnings (loss) per share ("HEPS")
The inclusion of H(L)EPS in this results announcement 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.
The table below presents our HEPS for Q4 2024 and 2023:
Q4 Q4
2024 2023
Net loss used to calculate headline earnings (USD'000).......................................................................................... (5,047) (4,859)
Headline (loss) earnings per share: ............................................................................................................
Basic, in USD ................................................................................................................................ (0.08) (0.08)
Diluted, in USD............................................................................................................................... (0.08) (0.08)
The table below presents our HEPS for fiscal 2024 and 2023:
2024 2023
Net loss used to calculate headline earnings (USD'000).......................................................................................... (16,496) (27,062)
Headline (loss) earnings per share: ............................................................................................................
Basic, in USD ................................................................................................................................ (0.26) (0.43)
Diluted, in USD............................................................................................................................... (0.26) (0.43)
Results announcement released in the US and unaudited condensed consolidated financial statements
The full results announcement released in the U.S. and our audited consolidated financial statements are available at
https://senspdf.jse.co.za/documents/2024/JSE/ISSE/LSKE/Q4Res2024.pdf and have been published on Lesaka's website at
www.lesakatech.com. Any investment decision by investors and/or shareholders should be based on consideration of the U.S. results
announcement and its recently published consolidated financial statements. The U.S. results announcement and our consolidated
financial statements are available upon request through enquiries directed to either Lesaka's investor relations contact at
phillipe.welthagen@lesakatech.com or Lesaka's media relations contact at Janine@thenielsennetwork.com.
About Lesaka (www.lesakatech.com)
Lesaka Technologies, (Lesaka™) is a South African Fintech company driven by a purpose to provide financial services and software to
Southern Africa's underserviced consumers (B2C) and merchants (B2B), improving people's lives and increasing financial inclusion in
the markets in which we operate. We offer a wide range of solutions including transactional accounts (banking), lending, insurance,
cash management solutions, card acceptance, supplier payments, software services and bill payments. By providing a full-service fintech
platform in our connected ecosystem, we facilitate the digitization of commerce in our markets.
Lesaka has a primary listing on NASDAQ (NasdaqGS: LSAK) and a secondary listing on the Johannesburg Stock Exchange (JSE:
LSK). Visit www.lesakatech.com for additional information about Lesaka Technologies (Lesaka™).
Audit opinion
KPMG, Inc. in South Africa, have audited our consolidated financial statements for the year ended June 30, 2024, and have issued an
unmodified opinion.
Forward-Looking Statements
This press release contains certain statements that may be considered forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are
subject to the safe harbor created by those sections and the Private Securities Litigation Reform Act of 1995, as amended. Such
statements may be identified by their use of terms or phrases such as "expects," "estimates," "projects," "believes," "anticipates,"
"plans," "could," "would," "may," "will," "intends," "outlook," "focus," "seek," "potential," "mission," "continue," "goal," "target,"
"objective," derivations thereof, and similar terms and phrases. Forward-looking statements are based upon the current beliefs and
expectations of our management and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified,
which could cause future events and actual results to differ materially from those set forth in, contemplated by, or underlying the forward-
looking statements. In this press release, statements relating to future financial results and future financing and business opportunities
are forward-looking statements. Additional information concerning factors that could cause actual events or results to differ materially
from those in any forward-looking statement is contained in our Form 10-K for the fiscal year ended June 30, 2024, as filed with the
SEC, as well as other documents we have filed or will file with the SEC. We assume no obligation to update the information in this
press release, to revise any forward-looking statements or to update the reasons actual results could differ materially from those
anticipated in forward-looking statements.
Investor Relations Contact:
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
Johannesburg
September 12, 2024
Sponsor:
Rand Merchant Bank, a division of FirstRand Bank Limited
Date: 12-09-2024 07:05:00
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