Lesaka(US:LSAK)2024-09-12 15:37Financial Data and Key Metrics Changes - Group adjusted EBITDA increased by 55% to ZAR 691 million, aligning with annual guidance [5][41] - Operating income improved from a loss of ZAR 275 million in FY 2023 to a profit of ZAR 67 million in FY 2024 [5][41] - Fundamental earnings per share turned positive to ZAR 1.06, an improvement of ZAR 3.72 per share [47] - Net debt to group adjusted EBITDA ratio improved to 2.5 times from 4.5 times a year ago [5][49] Business Line Data and Key Metrics Changes - Merchant revenue grew by 12% year-on-year, while consumer revenue increased by 15% [43][41] - The consumer division's adjusted EBITDA grew by 361% to ZAR 274 million [40] - The merchant division's adjusted EBITDA grew by 4% for the year, with expectations of 20% growth for FY 2025 [44][24] Market Data and Key Metrics Changes - The consumer segment saw a 14% year-on-year revenue growth, with a significant increase in account activations [39][29] - The merchant division processed over ZAR 270 billion in throughput annually, servicing more than 120,000 merchants [24][59] Company Strategy and Development Direction - The company aims to enhance its platform through the Adumo acquisition, expected to close in October 2024, which will broaden customer base and product offerings [51][62] - A focus on customer-centric operating models and expanding into underserved markets is emphasized [53][66] - The company plans to continue pursuing M&A opportunities to augment organic growth and improve operational synergies [64][65] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the operating environment, anticipating improvements due to easing load shedding and inflation [20][18] - The company expects revenue for FY 2025 to be between ZAR 10 billion and ZAR 11 billion, with adjusted EBITDA growth projected between 30% and 45% [62][63] Other Important Information - The company achieved a Level 4 rating in Black Economic Empowerment as a strategic priority [41] - Cash provided by operating activities improved significantly to ZAR 538 million from ZAR 7.4 million a year ago [42][48] - The company has over ZAR 1 billion in cash on hand at year-end, indicating strong liquidity [49] Q&A Session Summary Question: What are the expectations for the Adumo acquisition? - The Adumo acquisition is expected to close in October 2024 and will enhance the platform by adding customers and products, marking a new chapter for the company [51][62] Question: How does the company plan to address the challenges in the current economic environment? - Management highlighted a focus on improving customer service and product offerings to adapt to the changing economic landscape, with expectations of reduced churn and improved credit performance [18][20] Question: What is the outlook for revenue and EBITDA growth in FY 2025? - The company anticipates revenue between ZAR 10 billion and ZAR 11 billion for FY 2025, with adjusted EBITDA growth projected between 30% and 45% [62][63]