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Net 1 UEPS rebrands as Lesaka

THE JSE-listed company that provides fintech products and services in South Africa and internationally said the branding was effective from May 18.

THE JSE-listed company that provides fintech products and services in South Africa and internationally said the branding was effective from May 18.

Published May 12, 2022

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IN A BID to reposition itself for growth, Net 1 UEPS Technologies, a financial technology company, while releasing its results yesterday, announced that it had launched its new brand identity and named itself Lesaka.

The JSE-listed company that provides fintech products and services in South Africa and internationally said the branding was effective from May 18.

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“The word Lesaka means kraal in Setswana and Sesotho, which aptly represents our new group and its vision,” the company said.

It said it was important for it to have a new identity to express its commitment to the local communities it serves authentically.

“Our ambition is to drive financial inclusion by giving ordinary people and small businesses access to essential financial services,” the company said.

Lesaka Group chief executive Chris Meyer said: “We launched our new brand identity, Lesaka, which authentically represents our commitment to the local communities we serve and our mission of improving lives by driving widespread financial inclusion.”

The company also released its third quarter 2020 results yesterday and flagged an improvement in its performance, bolstered by the recovery in its merchant division and delivery on the turnaround in its consumer division.

Revenue increased to $35.2 million (R555m), up 27 percent in rand terms and 22 percent in dollar terms, underpinned by stronger merchant revenue.

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In its merchant section, segment revenue was $18.5m in the third quarter (3Q) 2022, up 58 percent compared with the prior comparative period and up 33 percent compared to quarter two (Q2) 2022 on a constant currency basis.

Segment revenue increased year on year owing to an increase in hardware sales and processing fees, which was partially offset by fewer prepaid airtime sales.

The increase in segment earnings before interest, taxes, depreciation, and amortisation (Ebitda) was primarily due to the increase in hardware sales. Its Ebitda margin for the third quarter and 2021 was 6.9 percent and 2.2 percent, respectively.

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In the consumer segment, revenue was $16.4m, up 6 percent compared with Q3 2021, and flat compared with Q2 2022 on a constant currency basis.

Segment revenue increased primarily due to higher lending and insurance revenues and moderately higher account holder fees. The firm embarked on a retrenchment process during Q3 and recorded an expense of $5.9m, which was included in the segment Ebitda loss.

Segment Ebitda loss had decreased primarily due to the implementation of various cost reduction initiatives. Its Ebitda loss margin (calculated as Ebitda loss divided by revenue) for Q3 2022 and 2021 was 41.8 percent and 46.9 percent, respectively, it said.

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“We are encouraged by the results we achieved this quarter, with a marked improvement in our performance, positively influenced by the recovery in our merchant division and delivery on the turnaround in our consumer financial services division," Meyer said.

The company said the Connect Group acquisition closed post quarter end on April 14.

"Having successfully completed the transformational Connect Group acquisition, our combined unique ecosystem positively positions us to provide innovative essential financial services to previously under-served consumers and merchants across southern Africa and to benefit from secular growth opportunities especially in the high growth informal merchant market,” Meyer said.

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