Financial Performance - Net revenue for Q1 FY2026 was ZAR 1.53 billion, a 45% increase year-on-year [4][5] - Group adjusted EBITDA reached ZAR 271 million, representing a 61% year-on-year growth [4][6] - Adjusted earnings grew by 150% to ZAR 87 million, with adjusted earnings per share doubling from ZAR 0.54 to ZAR 1.07 [4][8] - Net debt to adjusted EBITDA improved from 2.9 times to 2.5 times [10] Business Line Performance - The Enterprise division reported net revenue of ZAR 222 million, a 19% year-on-year increase [5][6] - Consumer division net revenue increased by 43% year-on-year [6][19] - Merchant division net revenue also rose by 43%, driven by the acquisition of Adumo [6][19] - Segment adjusted EBITDA for the Merchant division was ZAR 162 million, a 20% increase year-on-year [6][8] Market Performance - The number of devices in the Merchant division grew from 53,500 to almost 88,000 [11] - Total Payment Volume (TPV) for card acquiring more than doubled to ZAR 9.2 billion [11] - Cash TPV in the micro merchant segment grew 75% year-on-year, now accounting for 18% of all cash volumes [13] Company Strategy and Industry Competition - The company is focusing on unifying its merchant brand and product offerings to enhance efficiency [7][28] - The integration of various products and businesses is aimed at creating a comprehensive go-to-market strategy [7][28] - The Bank Zero acquisition is expected to enhance customer offerings and expand the consumer base [29][32] Management Commentary on Operating Environment and Future Outlook - Management expressed confidence in achieving guidance for the 13th consecutive quarter [3] - The company anticipates continued improvement in net debt to adjusted EBITDA ratio as adjusted EBITDA increases [10] - Future growth is expected to be driven by innovations in product offerings and distribution channels [20][21] Other Important Information - Cash flows from operations totaled ZAR 341 million for the quarter [9] - Capital expenditure for the quarter was ZAR 90 million, with expectations to remain below ZAR 400 million annually [9][10] - The company is simplifying its corporate structure by exiting non-core business lines [30] Q&A Session Summary Question: What caused the sequential performance decline in the merchant segment revenue? - Management indicated that seasonality and the closure of non-core business lines contributed to the decline [37] Question: What about the change in margin for the merchant segment? - Management noted non-recurring costs impacted margins, and guidance for the next quarter provides a clearer picture of underlying growth [38] Question: What is the impact of infrastructure rationalization on the cost base? - Management expects significant cost savings from the rationalization of operations and reduction of office locations [44] Question: Can you elaborate on the potential IPO of Cell C? - Management supports the planned IPO and aims to simplify operations by monetizing their equity position [47][48] Question: How long is the runway for growth in the consumer segment? - Management believes there is still significant growth potential, particularly with the upcoming Bank Zero acquisition [55][56]

Financial Performance - Net revenue for Q1 FY2026 was ZAR 1.53 billion, a 45% increase year-on-year [4] - Group adjusted EBITDA reached ZAR 271 million, reflecting a 61% year-on-year growth [4] - Adjusted earnings grew by 150% to ZAR 87 million, with adjusted earnings per share doubling from ZAR 0.54 to ZAR 1.07 [4][9] - Net debt to adjusted EBITDA improved from 2.9 times in the previous quarter to 2.5 times [11] Business Line Performance - The Enterprise division generated ZAR 222 million in net revenue, a 19% year-on-year increase [5] - Consumer division net revenue increased by 43% year-on-year [6] - Merchant division net revenue also rose by 43%, primarily due to the acquisition of Adumo [6] - Merchant segment adjusted EBITDA was ZAR 162 million, a 20% increase year-on-year [6] Market Performance - Total Payment Volume (TPV) for card acquiring more than doubled to ZAR 9.2 billion from ZAR 4.2 billion year-on-year [12] - Cash TPV in the micro merchant segment grew 75% year-on-year, now accounting for 18% of all cash volumes [14] - ADP TPV increased by 13% year-on-year to ZAR 11.9 billion [27] Company Strategy and Industry Competition - The company is focused on unifying its merchant brand and product offerings to enhance efficiency and capture growth [7] - The integration of various products aims to build deeper relationships with clients and transition from single product to multi-product solutions [13] - The Bank Zero acquisition is expected to enhance customer offerings and expand the consumer base [31][34] Management Commentary on Operating Environment and Future Outlook - Management expressed confidence in achieving continued growth and reaffirmed FY2026 guidance for net revenue and adjusted EBITDA [35] - The company anticipates a transformative year for the merchant segment, with significant growth expected from the integration of Adumo [6][8] - Management highlighted the importance of maintaining discipline and focus in execution for future growth [35] Other Important Information - Cash flows from operations totaled ZAR 341 million for the quarter, with ZAR 122 million reinvested into growing lending books [10] - Capital expenditure for the quarter was ZAR 90 million, with expectations to remain below ZAR 400 million annually [10] Q&A Session Summary Question: What caused the sequential performance decline in the merchant revenue line? - Management noted seasonality and the closure of non-core business lines as contributing factors [39] Question: What is the impact on margins due to recent changes? - Management indicated that non-recurring costs affected margins, and guidance for the next quarter would provide a clearer picture [40] Question: What are the expected cost savings from infrastructure rationalization? - Management expects significant cost savings from reducing office locations and eliminating duplicated functions [46] Question: How is cross-selling progressing within the merchant segment? - Management confirmed that most merchants have multiple products, with plans to provide detailed metrics on cross-sell rates in future reports [44] Question: What is the rationale behind the Cell C potential IPO? - Management supports the IPO as part of simplifying operations and reallocating capital towards core business [49]

Financial Performance - Q1 FY26 revenue increased by 10% in ZAR (South African Rand) to R3,023,546,000 and 12% in USD to $171,448,000 compared to Q1 FY25 [10] - Q1 FY26 expense increased by 9% in ZAR to R3,016,810,000 and 11% in USD to $171,065,000 compared to Q1 FY25 [10] - Q1 FY26 net loss attributable to the company was R75,890,000, a 6% decrease compared to a net loss of R81,023,000 in Q1 FY25 [10] - Basic loss per share attributable to Lesaka shareholders decreased by 26% from (R1.26) in Q1 FY25 to (R0.93) in Q1 FY26 [10] - Adjusted earnings per share attributable to shareholders increased by 97% from R0.54 in Q1 FY25 to R1.07 in Q1 FY26 [10] - Group Adjusted EBITDA increased by 61% from R168,000,000 in Q1 FY25 to R271,000,000 in Q1 FY26 [13] Segment Performance - Consumer revenue increased by 43% from R378,063,000 in Q1 FY25 to R539,006,000 in Q1 FY26 [72] - Enterprise revenue increased by 22% from R213,997,000 in Q1 FY25 to R261,904,000 in Q1 FY26 [72] Guidance - The company projects net revenue between R1,575,000,000 and R1,725,000,000 for Q2 FY26, representing a year-over-year growth of 14% to 25% [55] - The company projects Group Adjusted EBITDA between R280,000,000 and R320,000,000 for Q2 FY26, representing a year-over-year growth of 32% to 51% [55]

Financial Performance - Q1 FY2026 revenue reached $171.5 million (ZAR 3.0 billion), representing a 10% increase in ZAR year-on-year[8] - Net revenue for Q1 FY2026 was $86.6 million (ZAR 1.5 billion), up 45% in ZAR compared to Q1 FY2025[8] - Group Adjusted EBITDA for Q1 FY2026 was $15.3 million (ZAR 270.6 million), an increase of 61% in ZAR, meeting the guidance provided[8] - Adjusted earnings for Q1 FY2026 were $5.0 million (ZAR 87.3 million), reflecting a 150% increase in ZAR year-on-year[8] - The company's revenue for the three months ended September 30, 2025, was $171,448,000, an increase of 11.9% from $153,568,000 in the same period of 2024[23] - Group Adjusted EBITDA for the three months ended September 30, 2025, was $15,341,000, up from $9,363,000 in the same period of 2024, indicating a year-over-year increase of 63.5%[22] - The net revenue (non-GAAP) for the three months ended September 30, 2025, was $86,606,000, compared to $58,809,000 in the same period of 2024, reflecting a growth of 47.3%[23] Segment Performance - Merchant Segment revenue was $127.0 million (ZAR 2.2 billion), with net revenue of $44.4 million (ZAR 782.8 million), up 43% in ZAR[8] - Consumer Segment revenue increased to $30.6 million (ZAR 539.0 million), also up 43% in ZAR[8] - Enterprise Segment net revenue was $12.6 million (ZAR 221.6 million), marking a 19% increase in ZAR[8] Future Guidance - For Q2 FY2026, net revenue is expected to be between ZAR 1.575 billion and ZAR 1.725 billion[8] - Full FY2026 guidance includes net revenue between ZAR 6.4 billion and ZAR 6.9 billion, with Group Adjusted EBITDA between ZAR 1.25 billion and ZAR 1.45 billion[8] - Adjusted earnings per share for FY2026 is projected to be at least ZAR 4.60, indicating a year-on-year growth of greater than 100%[8] Loss and Expenses - Lesaka Technologies reported a GAAP net loss of $4,297,000 for the three months ended September 30, 2025, compared to a loss of $4,542,000 in the same period of 2024, representing a decrease of 5.4%[22] - The loss attributable to Lesaka for the year ended June 30, 2025, was $87,634,000, significantly higher than the loss of $17,440,000 for the year ended June 30, 2024[23] - The company reported a basic loss per share of $0.05 for the three months ended September 30, 2025, compared to a loss of $0.07 in the same period of 2024[24] - Lesaka's interest expense for the three months ended September 30, 2025, was $4,898,000, slightly down from $5,032,000 in the same period of 2024[26] - Headline loss per share for the three months ended September 30, 2025, was $0.05, unchanged from the previous year[34] Cash Flow and Assets - Cash flows from operating activities generated $8,923 in the latest quarter, a significant turnaround from a cash outflow of $4,137 in the prior year[28] - Total current assets decreased slightly to $240,544 as of September 30, 2025, from $243,923 as of June 30, 2025[30] - Finance loans receivable increased to $80,860, up from $74,110 in the previous quarter, indicating a 9.8% growth[30] - Inventory levels decreased to $18,957, down from $23,551 in the previous quarter, reflecting a 19.5% reduction[30] - Total liabilities decreased to $386,633 as of September 30, 2025, from $392,327 as of June 30, 2025, showing a 1.0% decline[30] - Cash, cash equivalents, and restricted cash at the end of the period totaled $72,284, down from $76,639 at the beginning of the period[28] Fair Value Adjustments - The company recognized a net gain of $59,828,000 on the change in fair value of equity securities for the year ended June 30, 2025[23] - The company reported a fair value adjustment related to financial liabilities of $(1) for the latest quarter, compared to a positive adjustment of $190 in the prior year[28] Share Information - The weighted average number of shares used to calculate net loss per share increased to 81,327, compared to 64,293 in the prior year, reflecting a 26.6% increase[34]

Financial Performance - Total throughput for the Merchant Division reached ZAR 9.2 billion in Q1 2026, a 117% increase from ZAR 4.2 billion in Q1 2025, driven by the inclusion of Adumo[178] - Revenue increased by $17.9 million (ZAR 266.7 million) or 11.6% (in ZAR 9.7%) primarily due to the inclusion of Adumo and Recharger, higher transaction activity, and increased insurance premiums collected[212] - Consolidated revenue for the three months ended September 30, 2025, was $171.4 million, a 12% increase from $153.6 million in 2024[223] - Merchant segment revenue increased by 3% to $126.9 million, while Consumer segment revenue surged by 45% to $30.6 million, and Enterprise segment revenue rose by 25% to $14.9 million[223] - Group Adjusted EBITDA for the three months ended September 30, 2025, was $15.3 million, reflecting a 64% increase from $9.4 million in 2024[223] Lending and Consumer Growth - The lending origination volume for the period was ZAR 201 million, representing a 21% increase compared to ZAR 166 million in Q1 2025[183] - The net loan book outstanding increased by 72% to ZAR 470 million as of Q1 2026, up from ZAR 273 million in Q1 2025[183] - Lending originations for EasyPay Loans increased by 77% to ZAR 820 million in Q1 2026, compared to ZAR 462 million in Q1 2025[190] - The Consumer Division saw a 24% increase in active consumers, reaching 1.9 million in Q1 2026, compared to 1.6 million in Q1 2025[190] - The average revenue per consumer per month increased to ZAR 89 in Q1 2026, up from ZAR 78 in Q1 2025, reflecting a 13% growth[193] Operational Efficiency - Operating income improved to $383,000 compared to a loss of $45,000 in the prior year, driven by strong performance in the Consumer segment and contributions from Adumo and Recharger[211] - The operating income margin improved to 0.2% in the first quarter of fiscal 2026 from (0.0)% in the prior year[218] - The Segment Adjusted EBITDA margin for the Merchant segment improved to 7.2% in fiscal 2026 from 6.1% in fiscal 2025[229] - Consumer segment revenue growth was driven by higher transaction fees and an increase in loan originations, resulting in a Segment Adjusted EBITDA margin of 27.8% for fiscal 2026[231] - Enterprise segment revenue and Adjusted EBITDA increased primarily due to the inclusion of Recharger, with a Segment Adjusted EBITDA margin of 8.54% for fiscal 2026[233] Expenses and Costs - Selling, general and administration expenses rose by $12.9 million (ZAR 219.5 million), or 48.5% (in ZAR 45.8%), mainly due to higher employee-related expenses and the inclusion of Adumo and Recharger[215] - Depreciation and amortization expense increased by $6.6 million (ZAR 114.7 million), or 105.4% (101.8%), attributed to acquisition-related intangible asset amortization from Adumo and Recharger[216] - Cost of goods sold decreased by $0.5 million (ZAR 45.8 million) or 0.4% (in ZAR 2.1%), primarily due to reduced prepaid airtime costs[213] - Group costs increased due to higher employee costs and consulting fees, partially offset by lower bonus expenses[235] Cash Flow and Financing - Cash and cash equivalents as of September 30, 2025, totaled $72.2 million, including ZAR 1.2 billion ($69.2 million) in South African Rand[241] - Net cash provided by operating activities in Q1 fiscal 2026 was $8.9 million (ZAR 157.6 million), compared to a net cash utilized of $4.1 million (ZAR 73.3 million) in Q1 fiscal 2025[252] - Capital expenditures for Q1 fiscal 2026 were $4.0 million (ZAR 70.3 million), primarily for the acquisition of vaults and POS devices[255] - The company has a revolving credit facility of ZAR 400.0 million utilized for merchant finance loans[248] - Long-term borrowings outstanding amount to ZAR 3.6 billion ($208.1 million) as of September 30, 2025, including ZAR 3.1 billion from Lesaka SA for refinancing[248] Acquisitions and Integration - The company closed acquisitions of Adumo and Recharger in fiscal 2025, integrating their businesses into its operations[209] - The company plans to make a cash payment of ZAR 175 million ($10.1 million) in March 2026 related to the acquisition of Recharger[245] Tax and Interest - The effective tax rate for fiscal 2025 was impacted by tax expenses from profitable South African operations and non-deductible expenses, with an income tax benefit of $0.1 million (ZAR 2.6 million) recorded in the first quarter of fiscal 2026[221] - Net interest charge decreased to $4.36 million (ZAR 76.9 million) from $4.45 million (ZAR 79.8 million) due to lower interest rates and changes in borrowing arrangements[211] - Interest expense decreased to $4.9 million (ZAR 86.4 million) from $5.0 million (ZAR 90.3 million), reflecting lower interest rates[220] - Estimated annual expected interest charge on South African borrowings is $22.9 million, with a hypothetical 1% increase raising it to $25.1 million[265] Risks and Challenges - The company is exposed to cash loss risks in ATMs and must repay African Bank for any shortages[251] - Restricted cash of $0.1 million is included in the consolidated statement of cash flows as of September 30, 2025[250]

Core Insights - Lesaka Technologies, Inc. reported its Q1 2026 financial results, showing significant growth in various metrics compared to Q1 2025 [1][2]. Financial Performance - Revenue reached $171.5 million (ZAR 3.0 billion), an increase of 10% in ZAR [8]. - Net Revenue was $86.6 million (ZAR 1.5 billion), up 45% in ZAR [8]. - Operating Income improved to $0.4 million (ZAR 6.7 million) from a loss of $0.1 million (ZAR 0.3 million) [8]. - Net Loss was $4.3 million (ZAR 75.9 million), a 6% improvement in ZAR [8]. - Group Adjusted EBITDA was $15.3 million (ZAR 270.6 million), up 61% in ZAR [8]. - Basic loss per share improved to $0.05 (ZAR 0.93), a 26% improvement in ZAR [8]. - Adjusted earnings were $5.0 million (ZAR 87.3 million), up 150% in ZAR [8]. - Adjusted earnings per share increased to $0.06 (ZAR 1.07), up 97% in ZAR [8]. Segment Performance - Merchant Segment Revenue was $127.0 million (ZAR 2.2 billion), with Net Revenue of $44.4 million (ZAR 782.8 million), up 43% in ZAR [8]. - Consumer Segment Revenue reached $30.6 million (ZAR 539.0 million), also up 43% in ZAR [8]. - Enterprise Segment Revenue was $14.9 million (ZAR 261.9 million), with Net Revenue of $12.6 million (ZAR 221.6 million), up 19% in ZAR [8]. Guidance and Outlook - For Q2 FY2026, the company expects Net Revenue between ZAR 1.575 billion and ZAR 1.725 billion [9]. - Full Fiscal Year 2026 guidance includes Net Revenue between ZAR 6.4 billion and ZAR 6.9 billion, with Group Adjusted EBITDA between ZAR 1.25 billion and ZAR 1.45 billion [9]. - The company anticipates positive Net Income Attributable to Lesaka and Adjusted earnings per share of at least ZAR 4.60, implying a year-on-year growth of greater than 100% [9]. Company Overview - Lesaka Technologies operates as a South African fintech company, providing financial services and software to underserved consumers and merchants in Southern Africa [22][23]. - The company offers a multiproduct platform that includes transactional accounts, lending, insurance, and merchant acquiring services [22].

Core Viewpoint - Bragar Eagel & Squire, P.C. is investigating potential claims against Lesaka Technologies, Inc. for possible violations of federal securities laws and unlawful business practices following a significant restatement of financial statements [1][2]. Investigation Details - On September 10, 2025, Lesaka announced that its Audit Committee concluded that the unaudited condensed consolidated financial statements for the quarters ended September 30, 2024, December 31, 2024, and March 31, 2025, should be restated due to a re-evaluation of revenue classification [2]. - The restatement indicates that certain revenue was reported as an agent rather than as a principal, affecting the related cost of goods sold, which led to a drop in Lesaka's stock price [2]. Next Steps - Investors who purchased or acquired Lesaka shares and suffered losses are encouraged to contact Bragar Eagel & Squire for more information regarding their rights and potential claims [3].

Core Points - Lesaka Technologies, Inc. will release its first quarter 2026 results after the U.S. market close on November 5, 2025 [1] - A presentation webcast and conference call will be held on November 6, 2025, at 8:00am EDT, followed by a live Q&A session for analysts and investors [1] Company Overview - Lesaka operates as a South African fintech company focused on providing financial services, software, and business services to underserved consumers and merchants in Southern Africa [4] - The company offers an integrated multiproduct platform that includes transactional accounts, lending, insurance, merchant acquiring, cash management, software, and Alternative Digital Products (ADP) [4] - Lesaka aims to facilitate payments between consumers, merchants, and enterprises, contributing to the digitization of commerce in its markets [4] Investor Relations - Lesaka has a primary listing on NASDAQ (NASDAQ:LSAK) and a secondary listing on the Johannesburg Stock Exchange (JSE: LSK) [5] - Contact information for investor relations includes emails and mobile numbers for key personnel [5]

Currency and Economic Impact - Fluctuations in the South African rand (ZAR) significantly impact reported revenue and net income, complicating performance evaluations across reporting periods[118] - The company faces risks related to fluctuations in currency exchange rates, particularly the U.S. dollar/ZAR exchange rate[153] - The U.S. dollar to the ZAR exchange rate has fluctuated significantly over the past three years, impacting the company's results of operations[355] - The company uses forward contracts to limit exposure to currency exchange risk primarily with the euro, renminbi, and U.S. dollar[353] - The company had no outstanding foreign exchange contracts as of June 30, 2025 and 2024[354] Regulatory Compliance and Risks - Compliance with various regulatory regimes may incur significant additional costs, and failure to comply could result in shutdowns, fines, or civil liability[127] - Proposed regulatory changes to the national payments system may lead to increased operating costs and affect business conduct[140] - The South African Financial Advisory and Intermediary Services Act requires registration as a financial service provider, and loss of licenses could halt financial services operations[134] - The company is subject to extensive regulations regarding anti-corruption laws, which could impose substantial penalties for non-compliance[130] - Proposed regulations by the South African Reserve Bank aim to establish a robust regulatory framework for the national payment system, potentially increasing operational costs[142] - Compliance with the National Credit Amendment Bill in South Africa may adversely impact the company's micro-lending operations[145] - The company is subject to varying international privacy and data protection regulations, which could result in substantial compliance costs[144] Financial Performance and Control - The company identified material weaknesses in its internal control over financial reporting, which could adversely affect the accuracy and reliability of its financial statements[155] - The company restated its quarterly financial statements for the quarters ended September 30, 2024, December 31, 2024, and March 31, 2025, due to material misstatements[163] - The company maintains credit risk policies to minimize overall credit risk, focusing on counterparties with a credit rating of "B" or better[359] - The company is exposed to credit risk in its Consumer microlending activities, which provides unsecured short-term loans[361] - The company monitors investments for impairment and makes appropriate reductions in carrying value when necessary[366] Shareholder and Stock Information - Approximately 31% of the company's outstanding common stock is owned by two shareholders, Value Capital Partners (19%) and IFC Investors (12%) as of June 30, 2025[149] - The company issued an aggregate of 1,989,162 additional shares to IFC Investors on October 1, 2024, as part of the Adumo transaction agreement[148] - The existence of a put right granted to IFC Investors could adversely impact the company's liquidity and capital resources[148] Economic Conditions and Interest Rates - High inflation and interest rates in South Africa may increase operating costs and reduce profitability, with inflation rates historically higher than those in developed economies[124] - The estimated annual expected interest charge on South African borrowings is $23,987,000, with a hypothetical 1% increase resulting in an additional $2,262,000, bringing the total to $26,249,000[358] - Interest rates in South Africa are expected to decline by a further 25 basis points in the first quarter of calendar 2026[356] - Interest rates applicable to borrowings fluctuate based on changes in the South African prime and 3-month JIBAR interest rates[357] Operational Structure - The company operates its EasyPay Everywhere (EPE) solution through a third-party bank arrangement, limiting control and economic benefits[132] - The company does not engage in extensive currency hedging, relying primarily on economic hedging through forward contracts for inventory purchases[119] Stock Price Volatility - The company's stock price experienced significant volatility during the 2025 fiscal year, ranging from a low of $3.39 to a high of $5.60[147]

[Preliminary FY2025 Results and FY2026 Outlook](index=1&type=section&id=Preliminary%20FY2025%20Results%20and%20FY2026%20Outlook) Lesaka reports strong FY2025 profitability, despite net loss from non-cash charges, and provides optimistic FY2026 guidance for Adjusted EBITDA and EPS [FY2025 Performance Summary](index=1&type=section&id=1.1.%20FY2025%20Performance%20Summary) Lesaka delivered on its FY2025 profitability guidance, with significant year-on-year growth in key adjusted metrics, despite a substantial net loss primarily due to non-operating, non-cash charges FY2025 Financial Performance (YoY Growth in ZAR) | Metric | Value (USD) | Value (ZAR) | YoY Growth (ZAR) | | :--------------------------- | :---------- | :---------- | :--------------- | | Net Revenue (non-GAAP) | $328.7 million | ZAR 5.3 billion | 38% | | Net Loss | $87.5 million | ZAR 1.6 billion | 386% | | Group Adjusted EBITDA (non-GAAP) | $50.7 million | ZAR 922.2 million | 33% | | Basic loss per share | $1.14 | ZAR 19.49 | 284% | | Adjusted earnings (non-GAAP) | $10.4 million | ZAR 186.2 million | 263% | | Adjusted earnings per share (non-GAAP) | $0.13 | ZAR 2.29 | 187% | - Net Loss was largely due to a tax-adjusted **$49.3 million (ZAR 897.6 million)** non-operating, non-cash charge from a change in fair value and sale of MobiKwik, **$18.4 million (ZAR 326.2 million)** impairment losses, and **$17.8 million (ZAR 321.9 million)** once-off transaction costs[7](index=7&type=chunk) [Q4 2025 Performance Summary](index=1&type=section&id=1.2.%20Q4%202025%20Performance%20Summary) Lesaka reported strong year-on-year growth in Q4 2025 for Net Revenue and Group Adjusted EBITDA, with adjusted earnings per share also showing significant improvement, while net loss increased due to specific non-cash charges Q4 2025 Financial Performance (YoY Growth in ZAR) | Metric | Value (USD) | Value (ZAR) | YoY Growth (ZAR) | | :--------------------------- | :---------- | :---------- | :--------------- | | Net Revenue (non-GAAP) | $82.0 million | ZAR 1.5 billion | 47% | | Net Loss | $28.8 million | ZAR 515 million | 452% | | Group Adjusted EBITDA (non-GAAP) | $16.7 million | ZAR 305.6 million | 61% | | Basic loss per share | $0.35 | ZAR 6.33 | 338% | | Adjusted earnings (non-GAAP) | $4.4 million | ZAR 80.4 million | 292% | | Adjusted earnings per share (non-GAAP) | $0.05 | ZAR 0.99 | 211% | - Net Loss was largely due to a tax-adjusted **$5.7 million (ZAR 101.4 million)** non-operating, non-cash charge relating to a change in fair value and sale of MobiKwik, **$18.4 million (ZAR 326.2 million)** impairment losses, and **$13.2 million (ZAR 237.5 million)** once-off transaction costs[7](index=7&type=chunk) [FY2026 Guidance](index=1&type=section&id=1.3.%20FY2026%20Guidance) Lesaka reaffirms its FY2026 profitability outlook, guiding for substantial growth in Adjusted EBITDA and more than doubling Adjusted EPS, while withdrawing previous revenue guidance due to a restatement FY2026 Guidance (Year ending June 30, 2026) | Metric | Guidance Range (ZAR) | Implied Growth | | :--------------------------- | :------------------- | :-------------- | | Net Revenue | ZAR 6.4 billion - ZAR 6.9 billion | (Previous guidance withdrawn) | | Group Adjusted EBITDA | ZAR 1.25 billion - ZAR 1.45 billion | At least 35% growth | | Net Income Attributable to Lesaka | To be positive | N/A | | Adjusted earnings per share | At least ZAR 4.60 | >100% YoY growth | - The previously provided FY2026 revenue guidance has been withdrawn in light of the restatement[12](index=12&type=chunk) [Q1 2026 Guidance](index=1&type=section&id=1.4.%20Q1%202026%20Guidance) For Q1 FY2026, Lesaka expects Net Revenue between ZAR 1.50 billion and ZAR 1.65 billion and Group Adjusted EBITDA between ZAR 260 million and ZAR 300 million Q1 FY2026 Guidance (Quarter ending September 30, 2025) | Metric | Guidance Range (ZAR) | | :------------------- | :------------------- | | Net Revenue | ZAR 1.50 billion - ZAR 1.65 billion | | Group Adjusted EBITDA | ZAR 260 million - ZAR 300 million | [Chairman's Commentary](index=1&type=section&id=1.5.%20Chairman's%20Commentary) Chairman Ali Mazanderani highlighted FY2025 as a strong year, meeting profitability guidance and advancing strategic priorities. He expressed confidence in maintaining momentum into FY2026, projecting significant growth in Adjusted EBITDA and Adjusted EPS - **FY2025** was a strong year for the Group, delivering on profitability guidance and advancing key strategic priorities[4](index=4&type=chunk) - Expects to maintain momentum into **FY2026**, guiding for adjusted EBITDA growth of **at least 35%**[4](index=4&type=chunk) - Introduced an adjusted earnings per share guidance, expecting this to **more than double** in FY2026 to **at least ZAR 4.60**, from **ZAR 2.29** per share this year[4](index=4&type=chunk) [Key Financial and Operational Updates](index=2&type=section&id=Key%20Financial%20and%20Operational%20Updates) Lesaka provides crucial updates on the restatement of interim FY2025 financial results, the preliminary nature of current figures, and exclusions from its FY2026 guidance [Restatement of Interim Fiscal 2025 Financial Results](index=2&type=section&id=2.1.%20Restatement%20of%20Interim%20Fiscal%202025%20Financial%20Results) Lesaka's Audit Committee concluded that interim FY2025 financial statements need restatement due to re-evaluation of revenue classification (agent vs. principal). This restatement is expected to increase revenue and cost of goods sold but have no impact on operating income, net loss, or cash flows - Unaudited condensed consolidated financial statements for the quarters ended September 30, 2024, December 31, 2024, and March 31, 2025, should be restated[11](index=11&type=chunk) - Restatement is due to re-evaluation of the classification of certain revenue that has been reported as an agent rather than as principal, and related cost of goods sold[11](index=11&type=chunk) - The restatement is expected to have **no impact on reported operating income (loss), net loss or loss per share or net cash flows or liquidity**, but will result in an increase in revenue offset by a corresponding increase in cost of goods sold, IT processing, servicing and support[11](index=11&type=chunk) [Important Note Regarding Preliminary, Unaudited Financial Results](index=2&type=section&id=2.2.%20Important%20Note%20Regarding%20Preliminary,%20Unaudited%20Financial%20Results) The financial results presented are preliminary and unaudited, subject to finalization and audit. Actual reported results may differ based on year-end closing procedures, adjustments, and audit findings - The financial results in this press release are **preliminary estimates and unaudited**[13](index=13&type=chunk) - Actual results remain subject to completion of financial statements and their audit by the independent registered public accounting firm[13](index=13&type=chunk) - Audited results will be included in the filing on Form 10-K for the year ended June 30, 2025[14](index=14&type=chunk) [FY2026 Guidance Exclusions](index=2&type=section&id=2.3.%20FY2026%20Guidance%20Exclusions) The FY2026 guidance provided by Lesaka explicitly excludes the impact of the announced Bank Zero acquisition and any other unannounced mergers and acquisitions - **FY2026 guidance excludes** the impact of the Bank Zero acquisition (subject to regulatory approval)[9](index=9&type=chunk) - Guidance also excludes any unannounced mergers and acquisitions that may be concluded[9](index=9&type=chunk) [Non-GAAP Financial Measures](index=3&type=section&id=Non-GAAP%20Financial%20Measures) This section defines key non-GAAP financial metrics used by Lesaka, including Group Adjusted EBITDA, Net Revenue, Adjusted Earnings, and Headline (Loss) Earnings Per Share [Group Adjusted EBITDA Definition](index=3&type=section&id=3.1.%20Group%20Adjusted%20EBITDA%20Definition) Group Adjusted EBITDA is a non-GAAP measure calculated as net loss before interest, taxes, depreciation, and amortization, further adjusted for non-operational transactions, impairment loss, equity-accounted investments, stock-based compensation, and once-off items - **Group Adjusted EBITDA** is net loss before interest, taxes, depreciation and amortization[19](index=19&type=chunk) - It is adjusted for non-operational transactions (including loss on disposal of equity-accounted investments), impairment loss, loss from equity-accounted investments, stock-based compensation charges and once-off items[19](index=19&type=chunk) - Once-off items represent non-recurring expense items, including costs related to acquisitions and transactions consummated or ultimately not pursued[19](index=19&type=chunk) [Net Revenue Definition](index=3&type=section&id=3.2.%20Net%20Revenue%20Definition) Net Revenue is a non-GAAP measure derived from GAAP revenue by subtracting the cost of Pinned Airtime sold and commissions paid to third parties for agency-based prepaid solutions. This measure aims to neutralize the impact of revenue mix changes between principal and agent transactions - **Net Revenue** is a non-GAAP financial measure; GAAP revenue is the most directly comparable measure[20](index=20&type=chunk) - Calculated as GAAP revenue less (i) the cost of Pinned Airtime sold and (ii) commissions paid to third parties selling all other agency-based pre-paid solutions[21](index=21&type=chunk) - The use of Net Revenue is meaningful to users of financial information because it seeks to eliminate the impact of the change in the revenue mix from the revenue categories over the periods presented[21](index=21&type=chunk) [Adjusted Earnings and Adjusted Earnings Per Share Definition](index=3&type=section&id=3.3.%20Adjusted%20Earnings%20and%20Adjusted%20Earnings%20Per%20Share%20Definition) Adjusted earnings and Adjusted earnings per share are non-GAAP measures that modify GAAP net loss and loss per share by excluding amortization of acquisition-related intangibles, stock-based compensation, and unusual non-recurring items, with specific additional adjustments for fiscal years 2025 and 2024 - **Adjusted earnings** and **Adjusted earnings per share** are GAAP net loss and loss per share adjusted for the amortization of acquisition-related intangible assets (net of deferred taxes), stock-based compensation charges, and unusual non-recurring items[22](index=22&type=chunk) - For fiscal **2025**, adjustments also include changes in fair value of equity securities, impairment loss, deferred tax adjustments, loss on disposal of equity-accounted investments, and intangible asset amortization related to non-controlling interests[23](index=23&type=chunk) - For fiscal **2024**, adjustments also include an impairment loss related to an equity-accounted investment, unrealized currency loss related to non-core business, and a reversal of allowance for a doubtful loan receivable[24](index=24&type=chunk) [Headline (Loss) Earnings Per Share (H(L)EPS) Definition](index=4&type=section&id=3.4.%20Headline%20(Loss)%20Earnings%20Per%20Share%20(H(L)EPS)%20Definition) H(L)EPS is a JSE listing requirement, calculated using GAAP net (loss) income adjusted for impairment losses related to equity-accounted investments, impairment losses, and profit/loss on sale of property, plant, and equipment - The inclusion of **H(L)EPS** in this press release is a requirement of Lesaka's listing on the JSE[26](index=26&type=chunk) - H(L)EPS basic and diluted is calculated using net (loss) income which has been determined based on GAAP[26](index=26&type=chunk) - Adjusted for impairment losses related to equity-accounted investments, impairment losses and (profit) loss on sale of property, plant and equipment[27](index=27&type=chunk) [Company Information](index=4&type=section&id=Company%20Information) This section provides an overview of Lesaka Technologies Inc., clarifies the nature of forward-looking statements, and lists investor and media relations contacts [About Lesaka Technologies Inc.](index=4&type=section&id=4.1.%20About%20Lesaka%20Technologies%20Inc.) Lesaka Technologies Inc. is a South African fintech company providing financial services, software, and business services to underserviced consumers and merchants in Southern Africa. It offers an integrated multi-product platform and is listed on NASDAQ and JSE - **Lesaka** operates a South African fintech company driven by a purpose to provide financial services, software and other business services to Southern Africa's underserviced consumers and merchants[28](index=28&type=chunk) - Offers an integrated and holistic multiproduct platform that provides transactional accounts, lending, insurance, merchant acquiring, cash management, software and Alternative Digital Products ("ADP")[28](index=28&type=chunk) - Lesaka has a primary listing on **NASDAQ (NASDAQ:LSAK)** and a secondary listing on the **Johannesburg Stock Exchange (JSE: LSK)**[29](index=29&type=chunk) [Forward-Looking Statements](index=4&type=section&id=4.2.%20Forward-Looking%20Statements) The press release contains forward-looking statements subject to risks and uncertainties, including potential differences between preliminary and actual results, restatement impacts, and regulatory actions. Lesaka assumes no obligation to update these 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 and Section 21E of the Securities Exchange Act of 1934[30](index=30&type=chunk) - Forward-looking statements are based upon current beliefs and expectations of management and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified[30](index=30&type=chunk) - Risks include, without limitation, the risk that unaudited preliminary results may differ from actual results, the timely completion of the restatement, and potential legal or regulatory action related to the restatement[30](index=30&type=chunk) [Investor and Media Relations](index=4&type=section&id=4.3.%20Investor%20and%20Media%20Relations) Contact information for investor and media relations is provided for Phillipe Welthagen and Idris Dungarwalla - Investor Relations and Media Relations Contacts: **Phillipe Welthagen** (phillipe.welthagen@lesakatech.com, **+27 84 512 5393**) and **Idris Dungarwalla** (idris.dungarwalla@lesakatech.com, **+44 786 225 4852**)[31](index=31&type=chunk) [Attachments: Preliminary Unaudited Financials & Reconciliations](index=6&type=section&id=Attachments:%20Preliminary%20Unaudited%20Financials%20%26%20Reconciliations) This section provides detailed preliminary unaudited financial statements and reconciliations for key non-GAAP measures, including Group Adjusted EBITDA, Adjusted Earnings, and Headline Loss Per Share [Reconciliation of GAAP Loss to Group Adjusted EBITDA](index=6&type=section&id=5.1.%20Reconciliation%20of%20GAAP%20Loss%20to%20Group%20Adjusted%20EBITDA) Attachment A provides a detailed reconciliation of GAAP net loss attributable to Lesaka to Group Adjusted EBITDA for Q4 2025, Q4 2024, Q3 2025, FY2025, and FY2024, outlining specific adjustments including once-off items Group Adjusted EBITDA Reconciliation (USD '000) | Metric | Q4 2025 | Q4 2024 | FY2025 | FY2024 | | :------------------------------------------------ | :------ | :------ | :----- | :----- | | Net loss attributable to Lesaka | (28,770) | (5,035) | (87,504) | (17,440) | | Loss attributable to Lesaka - GAAP | (28,948) | (5,035) | (87,634) | (17,440) | | Income tax (benefit) expense | (8,930) | 1,482 | (18,198) | 3,363 | | Change in fair value of equity securities | 5,676 | - | 59,828 | - | | Impairment loss | 18,863 | - | 18,863 | - | | PPA amortization | 7,796 | 3,657 | 21,384 | 14,419 | | Interest expense | 4,470 | 4,620 | 21,453 | 18,932 | | Interest income | (644) | (732) | (2,596) | (2,294) | | Depreciation | 2,997 | 2,548 | 12,337 | 9,246 | | Stock-based compensation charges | 2,032 | 2,258 | 9,550 | 7,911 | | Once-off items | 13,227 | 1,684 | 17,826 | 1,853 | | **Group Adjusted EBITDA - Non-GAAP** | **16,718** | **10,258** | **50,688** | **36,936** | - Once-off items for FY2025 include **$16.16 million** in transaction costs related to Adumo, Recharger and Bank Zero acquisitions, and **$1.79 million** in other transaction costs[33](index=33&type=chunk) - Once-off items are non-recurring in nature, however, certain items may be reported in multiple quarters, such as transaction costs related to acquisitions[34](index=34&type=chunk) [Reconciliation of GAAP Net Loss to Adjusted Earnings and EPS](index=8&type=section&id=5.2.%20Reconciliation%20of%20GAAP%20Net%20Loss%20to%20Adjusted%20Earnings%20and%20EPS) Attachment B provides reconciliations of GAAP net loss and basic loss per share to Adjusted earnings and basic Adjusted EPS for Q4 2025, Q4 2024, FY2025, and FY2024, detailing various adjustments Adjusted Earnings Reconciliation (USD '000) | Metric | Q4 2025 | Q4 2024 | FY2025 | FY2024 | | :------------------------------------------ | :------ | :------ | :----- | :----- | | GAAP Net (loss) income | (28,770) | (5,035) | (87,504) | (17,440) | | Impairment loss | 18,371 | - | 18,371 | - | | Transaction costs | 13,158 | 1,684 | 17,953 | 2,805 | | Deferred tax asset valuation allowance released | (11,741) | (342) | (12,665) | (906) | | Change in fair value of equity securities, net | 5,676 | - | 49,294 | - | | Intangible asset amortization, net | 5,691 | 2,670 | 15,610 | 10,543 | | Stock-based compensation charge | 2,032 | 2,258 | 9,550 | 7,911 | | **Adjusted Earnings** | **4,369** | **1,235** | **10,361** | **2,878** | Adjusted EPS (USD) | Metric | Q4 2025 | Q4 2024 | FY2025 | FY2024 | | :---------------- | :------ | :------ | :----- | :----- | | GAAP (L) EPS, basic | (0.35) | (0.08) | (1.14) | (0.28) | | **Adjusted EPS, basic** | **0.05** | **0.02** | **0.13** | **0.04** | [Unaudited Condensed Consolidated Statements of Operations](index=9&type=section&id=5.3.%20Unaudited%20Condensed%20Consolidated%20Statements%20of%20Operations) Attachment B includes the unaudited condensed consolidated statements of operations, presenting detailed revenue, expenses, and net loss figures for Q4 2025, Q4 2024, FY2025, and FY2024 Condensed Consolidated Statements of Operations (USD '000) | Metric | Q4 2025 | Q4 2024 | FY2025 | FY2024 | | :------------------------------------------ | :------ | :------ | :----- | :----- | | Operating (loss) income | (28,401) | 295 | (27,100) | 3,590 | | Loss before income tax (benefit) expense | (37,903) | (3,593) | (105,946) | (12,798) | | Income tax (benefit) expense | (8,930) | 1,482 | (18,198) | 3,363 | | Net loss from continuing operations | (28,948) | (5,035) | (87,634) | (17,440) | | Net loss attributable to Lesaka | (28,770) | (5,035) | (87,504) | (17,440) | | Basic loss attributable to Lesaka shareholders | (0.35) | (0.08) | (1.14) | (0.27) | [Unaudited Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=5.4.%20Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Attachment B provides the unaudited condensed consolidated statements of cash flows, detailing cash flows from operating, investing, and financing activities for Q4 2025, Q4 2024, FY2025, and FY2024 Condensed Consolidated Statements of Cash Flows (USD '000) | Metric | Q4 2025 | Q4 2024 | FY2025 | FY2024 | | :------------------------------------------ | :------ | :------ | :----- | :----- | | Net cash (used in) provided by in operating activities | (6,482) | 5,652 | (9,121) | 28,789 | | Net cash provided by (used in) investing activities | 9,877 | 1,266 | (11,342) | (16,415) | | Net cash (used in) provided by financing activities | (161) | (2,972) | 29,732 | (7,113) | | Net increase in cash, cash equivalents and restricted cash | 5,516 | 6,312 | 10,721 | 7,286 | | Cash, cash equivalents and restricted cash - end of period | 76,639 | 65,918 | 76,639 | 65,918 | [Unaudited Condensed Consolidated Balance Sheets](index=11&type=section&id=5.5.%20Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) Attachment B presents the unaudited condensed consolidated balance sheets as of June 30, 2025, and June 30, 2024, showing assets, liabilities, and equity Condensed Consolidated Balance Sheets (USD '000) | Metric | June 30, 2025 | June 30, 2024 | | :------------------------------------------ | :------------ | :------------ | | Total current assets | 243,923 | 187,696 | | Total assets | 657,688 | 558,450 | | Total current liabilities | 160,473 | 129,887 | | Total liabilities | 396,305 | 303,164 | | Total equity | 172,426 | 175,857 | - An amount of **$11,841** was reclassified from long-term borrowings to current portion of long-term borrowings[44](index=44&type=chunk) [Reconciliation of Net Loss to Headline Loss Per Share](index=12&type=section&id=5.6.%20Reconciliation%20of%20Net%20Loss%20to%20Headline%20Loss%20Per%20Share) Attachment C provides the reconciliation of net loss to headline loss per share (basic and diluted) for Q4 2025, Q4 2024, FY2025, and FY2024, including adjustments for impairment losses and profit/loss on asset sales Headline Loss Per Share Reconciliation (USD '000) | Metric | Q4 2025 | Q4 2024 | FY2025 | FY2024 | | :------------------------------------------ | :------ | :------ | :----- | :----- | | Net loss (USD'000) | (22,058) | (5,035) | (87,504) | (17,440) | | Adjustments: Impairment loss | 18,864 | - | 18,864 | - | | Adjustments: Profit on sale of property, plant and equipment | (12) | (17) | 13 | (305) | | **Net loss used to calculate headline loss** | **(3,203)** | **(5,047)** | **(68,631)** | **(16,496)** | Headline Loss Per Share (USD) | Metric | Q4 2025 | Q4 2024 | FY2025 | FY2024 | | :---------------- | :------ | :------ | :----- | :----- | | Basic | (0.04) | (0.08) | (0.90) | (0.26) | | Diluted | (0.04) | (0.08) | (0.90) | (0.26) | - Weighted average number of shares used to calculate net loss per share basic loss and headline loss per share basic loss for FY2025 was **76,466 thousand**[46](index=46&type=chunk)