Net 1 UEPS Technologies, Inc. (UEPS) Q2 2022 Earnings Conference Call February 10, 2022 8:00 AM ET Company Participants Dara Dierks - IR Chris Meyer - Group CEO Lincoln Mali - South African CEO Alex Smith - CFO Conference Call Participants Raj Sharma - B. Riley Operator Good day, ladies and gentlemen, and welcome to the Net 1 Q2 2022 Earnings Call. All participants will be in listen-only mode. There will be an opportunity to ask questions later during the conference. [Operator Instructions] I would now like ...

| --- | --- | --- | |-----------------------|-------|-------| | Q2 2022 | | | | INVESTOR PRESENTATION | | | | | | | | February 10, 2022 | | | 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 cause actual results to differ materially from those projected in the info ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 For the transition period from To Commission file number: 000-31203 NET 1 UEPS TECHNOLOGIES, INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction ...

Net 1 UEPS Technologies, Inc. (UEPS) Q1 2022 Earnings Conference Call November 9, 2021 8:00 AM ET Company Participants Dara Dierks - Investor Relations Chris Meyer - Group Chief Executive Officer Lincoln Mali - South Africa Chief Executive Officer Alex Smith - Chief Financial Officer Conference Call Participants Raj Sharma - B. Riley Operator Good day, ladies and gentlemen, and welcome to the Net 1 UEPS Technologies Inc. First Quarter 2022 Earnings Call. All participants, will be in listen-only mode and the ...

| --- | --- | --- | |-----------------------|-------|-------| | | | | | | | | | Q1 2022 | | | | INVESTOR PRESENTATION | | | | | | | | November 9, 2021 | | | 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 cause actual results to differ materially from those projec ...

Acquisition and Investments - The company entered into an agreement to acquire a controlling stake in the Connect Group for ZAR 3,683,559,419, which includes 3,065,883 shares of common stock to be issued over three years [164]. - The company has signed non-binding term sheets for a ZAR 2.35 billion ($154.4 million) debt package to support the acquisition of the Connect Group [165]. - The company expects to incur additional expenses related to the Connect Group transaction in the second quarter of fiscal 2022 [213]. Financial Performance - Revenue for the first quarter of fiscal 2022 decreased by 2% to $34.5 million compared to $35.1 million in the same period of fiscal 2021 [191]. - Operating loss increased by 4% to $11.2 million from $10.8 million year-over-year [191]. - Net loss attributable to the company decreased by 55% to $13.0 million from $29.0 million in the prior year [191]. - Revenue in South African Rand (ZAR) decreased by 14% to ZAR 504.2 million from ZAR 589.4 million year-over-year [193]. - Operating loss margin for the first quarter of fiscal 2022 was (32.5%), compared to (30.7%) in the same quarter of fiscal 2021 [196]. - Interest income decreased by 36% to $0.4 million from $0.6 million year-over-year [191]. - Financial services segment revenue increased by 29% to $10.6 million, driven by higher account fee and lending revenues [202]. - Technology segment revenue decreased by 22% to $4.8 million due to fewer hardware sales compared to the prior period [202]. Cash Flow and Liquidity - Cash and cash equivalents as of September 30, 2021, totaled $188.5 million, with a decrease attributed to weak trading activities [214]. - Net cash used in operating activities during Q1 fiscal 2022 was $7.9 million (ZAR 116.1 million), a decrease from $29.9 million (ZAR 501.2 million) in Q1 fiscal 2021 [222]. - Cash used in investing activities for Q1 fiscal 2022 included capital expenditures of $0.7 million (ZAR 10.2 million), primarily for new express branches [225]. - Approximately $138.9 million was utilized from South African overdraft facilities to fund ATMs in Q1 fiscal 2022, compared to $69.1 million in Q1 fiscal 2021 [227]. - Restricted cash as of September 30, 2021, included approximately $51.6 million related to cash withdrawn from debt facilities to fund ATMs [219]. - Total short-term facilities available as of September 30, 2021, amounted to $92.6 million (ZAR 1,399.995 million) with $51.6 million (ZAR 779.451 million) utilized [217]. - Capital commitments outstanding as of September 30, 2021, were $1.0 million, expected to be funded through internally generated funds [229]. - Cash flows from financing activities showed a repayment of $98.9 million of overdraft facilities in Q1 fiscal 2022 [227]. - No significant tax payments were made during Q1 fiscal 2022, while foreign taxes paid amounted to $36,000 [224]. - The company has no off-balance sheet arrangements [228]. Customer Metrics - Gross customer additions for the quarter were approximately 124,000, a significant increase from 43,000 in the previous quarter, while net additions amounted to 102,000 compared to 33,000 previously [175]. Operational Insights - Transaction volumes in the ATM business were down by 12% compared to the previous quarter, largely due to social unrest, but volumes had largely recovered by September 2021 [177]. - The company believes it has sufficient cash reserves to support operations through the next twelve months, with no significant adverse effects on liquidity expected from the pandemic [171]. - The South African insurance business is experiencing higher claim levels, but the company believes it is adequately capitalized to address these claims [171]. - The average exchange rate for ZAR to USD was 14.6246 for the three months ended September 30, 2021, compared to 16.9080 for the same period in 2020 [185]. - The company aims to grow its B2B operations, with throughput growing by 4% compared to the previous quarter and transaction volumes increasing by 11% [178]. - The company continues to focus on enhancing the presence of its EPE bank account, known as 'the green card', through localized marketing efforts [173]. - The company continues to evaluate the impact of COVID-19 on its operations, with uncertainties regarding future financial position and cash flows [172]. Interest Rates - Interest rates on short-term borrowings are based on the South African prime rate, with a hypothetical 1% increase resulting in an estimated annual expected interest charge increase from $4.631 million to $5.293 million [233].

Net 1 UEPS Technologies, Inc. (UEPS) Connect Group Acquisition Conference Call November 1, 2021 8:30 AM ET Company Participants Dara Dierks - IR Chris Meyer - CEO Alexander Smith - CFO Conference Call Participants Rajiv Sharma - B. Riley FBR Bill Gordon - Gordon Capital Operator Good day, ladies and gentlemen, and welcome to the Net1 to acquire the Connect Group Conference Call. [Operator Instructions] Please note that this call is being recorded. I would now like to turn the conference over to Dara Dierks. ...

CONNECT GROUP ACQUISITION OVERVIEW November 1, 2021 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 cause actual results to differ materially from those projected in the information. The use of words such as "may", "will", "might", "should", "expect", "plan", "ant ...

Q4 2021 Investor Presentation 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 cause actual results to differ materially from those projected in the information. The use of words such as "may", "might", "will", "should", "expect", "plan", "anticipate", "believe", " ...

Financial Data and Key Metrics Changes - Total revenue for Q4 2021 was $34.5 million, representing a 41% increase year-over-year in U.S. dollar terms and a 15% increase in rand terms, primarily due to higher volume-driven transaction fees, improved lending revenue, and hardware sales [31] - Adjusted EBITDA loss was $8.2 million, which was 31% better than the $11.9 million EBITDA loss reported for Q4 2020 [32] - Fundamental loss per share for Q4 2021 was $0.18 compared to $0.21 per share a year ago [33] Business Line Data and Key Metrics Changes - In South Africa, consumer bank accounts under EasyPay Everywhere (EPE) increased by about 43,000 gross accounts and 23,000 net accounts during the quarter, totaling over 1 million active bank accounts [34] - The loan book in the financial services segment increased to ZAR336 million from ZAR307 million a year ago [34] - The insurance business saw an increase in active policies to 246,000 from 233,000 a year ago, but faced increased claims, which were 50% higher in Q4 2021 than in Q4 2020 [35] Market Data and Key Metrics Changes - The U.S. dollar was 18% weaker against the rand during Q4 2021 compared to the prior period, impacting reported results [32] - ATM network utilization showed positive trends, with total transactions up 3.5% compared to the prior quarter and 16% higher than the second quarter in fiscal 2020 [34] Company Strategy and Development Direction - The company aims to build and operate a leading South African full-service Fintech platform, focusing on financial inclusion for underserved consumers and merchants [11][12] - The target addressable market is over 150 billion rands, with a focus on both consumer financial services and merchant financial services [12] - The company is committed to a significant turnaround in its South African operations, emphasizing customer acquisition and service improvement [22][30] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges faced due to civil unrest and the need for a cultural shift towards client-focused operations [18][22] - The company is optimistic about the growth trajectory of EPE accounts and is focused on achieving break-even in its financial services business [19][66] - Management highlighted the importance of digital transformation and collaboration with SASSA to improve service delivery and customer engagement [68] Other Important Information - The company reported damages and losses from civil unrest, with 173 ATMs damaged and a total loss of ZAR 34.5 million submitted for insurance claims [29] - The company has a significant net cash position and is evaluating high-return investment opportunities [17] Q&A Session Summary Question: What is the target for account additions for the year? - Management indicated that it is too early to provide specific guidance on account additions but noted positive momentum in EPE account growth [43][46] Question: Will costs increase with the expansion of infrastructure? - Management clarified that the cost base in the financial services business is not expected to increase, focusing instead on reducing costs while investing in sales [48][50] Question: What is the breakeven point for EPE accounts? - Management stated that the previous target of 1.4 million accounts for breakeven remains relevant, but clearer guidance will be provided in the future [65] Question: How has the relationship with SASSA evolved? - Management confirmed that they opted not to participate in a recent tender due to unfavorable commercial terms but are focused on growing the customer base organically [56][58] Question: How much of the recent account growth can be attributed to marketing and digitization? - Management noted that it is early to quantify the contributions from various initiatives but acknowledged that multiple factors, including new leadership and improved relationships with SASSA, are driving growth [71][72]