Lesaka posts Q1 revenue of R2.6bn in 2024

Lesaka Technologies, formerly known as Net1 UEPS Technologies, has achieved its revenue and profitability targets for the first quarter of the year, despite incurring a net loss due to one-off transaction costs related to the acquisition of Adumo. The JSE and Nasdaq-listed company reported a 3% year-on-year increase in revenue and a 16% growth in net revenue. Group-adjusted EBITDA also saw a 12% growth compared to the previous year. CEO Lincoln Mali expressed satisfaction with the company's operating performance and financial results, highlighting the ninth consecutive quarter where Lesaka Technologies met its guidance to the market. Mali emphasized the positive trajectory of the company's fundamental earnings, which increased to 43 million rands from a negative position last year. Additionally, fundamental earnings per share rose to 66 cents from a loss of eight cents, indicating significant progress for the business. The restructuring of the balance sheet resulted in a lower net debt to EBITDA ratio, positioning the company for future growth and stability. Mali also discussed the impact of the Adumo transaction on Lesaka Technologies, noting the increase in active customers and merchants as well as the expanded range of financial solutions now offered by the company. The acquisition has positioned Lesaka Technologies as a leader in the fintech space in Southern Africa, providing a comprehensive suite of services from cash to card to credit to value-added services and payment solutions. The integration of Adumo has brought a dynamic team led by Paul Kent, adding further strength to Lesaka Technologies' leadership. In terms of the company's divisions, Mali highlighted the remarkable transformation of the consumer division, which has transitioned from a loss-making business to one that is profitable, cash-generating, and growing. Key metrics such as EBITDA, revenue, core customers, loan book, insurance, and average revenue per user have shown significant improvement, reflecting the success of Lesaka Technologies' strategic initiatives in serving grant recipients and understanding their financial needs. The company's focus on providing additional products, digital capabilities, and personalized services has resulted in increased customer engagement and satisfaction. Despite challenges in the merchant division, including flat revenue and a marginal EBITDA contraction, Mali remains optimistic about the core drivers of growth within the business segment. By addressing competitive challenges, focusing on a suite of products, building around the customer, and leveraging the synergies with Adumo, Lesaka Technologies aims to enhance its merchant division's performance and achieve future growth targets. Looking ahead, Mali confirmed that the company is actively exploring potential acquisitions in the fintech space to further scale its operations, expand its product offerings, and drive sustainable growth. With a continued focus on organic and inorganic growth strategies, Lesaka Technologies is poised to capitalize on emerging opportunities in the market and deliver long-term value to its stakeholders.