Cape Town - Net 1 UEPS Technologies, an electronic payment operator, said it’s focusing on expanding outside of South Africa, where growth opportunities are limited and the government is reviewing its biggest contract in line with a court ruling.
The Constitutional Court in April 17 ordered the South African Social Security Agency, or SASSA, to cancel a 10 billion rand contract awarded to Net1’s Cash Paymaster Services unit and start a new tender process within 30 days.
The court said the company could continue to pay out social grants to 15 million beneficiaries until SASSA appoints a new supplier.
“That’s in the hands of SASSA, we really have nothing to do with it,” Net 1 chief executive Serge Belamant said by phone from Johannesburg today.
The SASSA contract “is becoming a smaller and smaller part of our business. It used to 70 to 80 percent. The new number is 27 percent. We have been expanding outside of South Africa.”
Besides South Africa, Net 1 also does business in South Korea, the US, India, Botswana and Namibia.
Yesterday the company said fundamental per-share earnings surged 184 percent to $2.16 (R23) in the year through June, as sales gained 29 percent to $581.7 million.
The company’s shares trade in New York and Johannesburg.
Net 1 spent more than 1 billion rand implementing systems for SASSA, which constrained prior year earnings, Belamant said.
“We have been able to work on reducing costs and expand other areas of our business,” he said.
“The most exciting thing for us is our mobile technology” which enables money transfers, billing and secure “card-not-present” transactions across the Internet, he said. - Bloomberg News