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Lesaka (LSAK)

Participants
Bronwyn Nielsen The Nielsen Network
Chris Meyer Group CEO
Lincoln Mali South African CEO
Steven Heilbron Head Of Merchant Business, and CEO of the Connect Group
Naeem Kola Group CFO
Ngozi Dozie Kaizen Venture
Call transcript
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Bronwyn Nielsen

Hello, everyone, and welcome to the Lesaka Fiscal Third Quarter 2022 Earnings Webcast. At this time, all participants are in listen-only mode.

As a reminder, this webcast is being recorded. With me for the webcast today are Chris Meyer, Group CEO; Lincoln Mali, South African CEO; Steven Heilbron, Head Of Merchant Business, and CEO of the Connect Group; and of course, Naeem Kola, Group CFO. A reminder to everyone that we are streaming, both a webcast as well as a teleconference. only will presentation to versus they the which webcast team the dialing the teleconference, the audio. and will will into allow see you management into Dialing the stream be presenting links investor website. our well available relations our release press Both are as on as

looking statements. the regarding As reminder, forward cautionary associated in form XXQ looking language risks call, ask and you with be making we contained a I will to the uncertainties this forward during And statements. look at our

Our our are African assist which in results underlying in discussed Rand, results to the is South our analyze trends of non-GAAP. business. in investors Rand press We in understanding operations our in release

U.S. can Rand. the you results dollar significantly company the the As be South African by the affected know, and currency between fluctuations

address the may the have We questions you at presentation. will end any of

link, For can the you webcast submit your those via page. joining via the us webcast questions

joining via those teleconference. For

the presentation. CEO, the Chris? raise given your group your Chris be it's to hand to at to that, pleasure With questions opportunity over You'll the Meyer. of end my

Chris Meyer

third of for Lesaka the this Thank our and Presentation] shaped Lesaka financial our of the for and areas. beginning brand by committed for we've opportunity agenda, our XXXX corporate introduce new in new on progress Good to shareholders earnings strategy a quick will day, discuss period. our at strategic to Steve our welcome would thank the made year voting strategic I'll we our will Naeem to as Taking to an today's the the Lincoln some introduce performance focus provide a and will overview you, highlights identity, and look [Audio/Video on Group. the webcast. areas, on almost Bronwyn. name. to focus a also I FY era quarter focus our like Connect group ago. take new marks favor

Chris Meyer

of innovative integrate the represents block authentically solutions and the to how FinTech stated leading a and which video This is businesses Lesaka identity Group, to local the coincide important combination communities objective complimentary merchants achieving digital our we and on in in evolution the provide Southern our Our The serve. for of providing a and consumers focused our X name establishing exciting is transformational with as an our business Group financial inclusion new unveils Southern milestone Connect commitment acquisition Connect Lesaka building to opportunity consumers in of our is in explains the to opening an with Africa. and to Africa. key creates merchants the timed

We in are focused up increased opportunities the scale for on our our key of advantage that us. growth significant markets opens taking

very focus our sectors and Lesaka, The management we but end-to-end we merchants, not solutions, Group, X% and Connect of in have growth, consumers than our and less to a track We this we leverage formal aim its space excellent in market than integration. payment facilitate innovative on supplier and with the for As believe through country. solution the distribution, the estimate the we of we our business, in real delivering clear informal to a together provide and micro growth X% can also in be merchant informal we formal as the enterprises acquiring, together less currently space, profitability record them and Group Connect will We medium make in solutions VA, with digitization cash share have difference MSMEs. have that Connect card cornerstone for small space. incorporating underserved Group's the capital can ability with of provision in only our the an cash payment and

These market. credit Africa has low. South are of consumer financial common our insurance our there rely the whilst consumers savings increased cash still on approximately who inclusion predominantly XX million in to people and fall remains utilization Turning transactions. target business, for into And

NetX of significant and a Group, presenting market. share us with I'm to merchant currently join leadership big gain and and steadily company thousand potential in a Lesaka leadership flare, $XX affordable the walked join billion As group, Africa. who positioning mission to excellent million scale that with it provision we this FinTech by away South We products the Most an transformation really businesses has our have the startup opportunity over and customers governance significant XX the market team. insurance Since offers. Connect touch on caliber a Together XXXX, team. corporate customers X% or to FinTech points and our the the market, now our jobs, financial even operational into of develop this we of this this this service have mix of us business X.X careers, in or of their with those with market. successful our leading half both banking around consumers estimated just humbled and and excited in to of early experience, own chosen lending a building embarking in entrepreneurial inclusion opportunity over to have from

reported on operational over XX% $XX.X on And constant and of increase year the of for dollar which Turning a to third an basis. revenue currency million, we our total financial is a year XX% highlights quarter, basis.

EBITDA ZAR segments $XX.X positively $X.X $XXX,XXX our of XXX excludes listing Segment The operating related excess recovery base And to million improved a is by via the our in to the our segment segment, has going improved from million of overhead revenue. impacted EBITDA African of past for merchant in operations United States adjusted X focus this costs consumer underpinned and $X forward. us annum, EBITDA to optimization returned per whilst by cost consumer should cost spring, of million significant result completed major or savings months. loss normalized $X.X it restructuring a merchant been profit South a Our milestone. and the cost work which this date Segment quarter. adjusted normalized project in annual business African in million, non-South a over million adjusted

base grew by ending accounts. with customer active the over quarter customers million X.X total around active XX,XXX Our just

book acquisition business into in informal leading with the expanded over developing service to key capitalize stakeholders. even, X merchant opportunity, Growing to which financial growing and being year lending deeper with requires Lesaka Southern on full group relationships business, an are and merchant X% Transforming a the on world-class positions us and FinTech service especially business platform returning African our FinTech delivery our break Our to organization, market. million. year $XX.X efforts consumer connect consistent focused growth pillars, stronger the competitively exceptional transformational key our a the

break moves focused the even in customers, on Our returning X the lever grow active and most costs. optimize the EPE in business grow the levers, needle strategy is to which Optimizing RP is consumer resulted turnaround This and the efforts in is the our of shows and are strong real loss, EBITDA evidence near term yielding a demonstrating in our the QX results. in improvement our business. operating leverage costs

transformation to of was anticipated. XX have are challenges from efficiencies, These However, the there complete accounts million such logistics activation to a challenges one of in resulted business each than grant which and we over our on month of focused the recipients focused distributing new culture sales being as organization. the slower

for the ago. work continue we achieving the break even a will than of a by quarter, few improvement longer business end our take anticipated. but started position where monthly EBITDA quarters fourth to show it we Regardless, consumer towards considerably to originally we We may continue for

the people, of extends the importance organizations vision level leadership area to focus last leaving join world the strategic third class where talented senior but and platform, have is to to building our new on and the being to from in we mission. of regional organization. This the FinTech of able high management the inspiration on Turning I a same evident successful caliber call, team, careers at retain only with our highlighted to our enthusiasm attract world a not people earnings across us our seen and local caliber

which transformation and will I focus like CEO Group on on. Connect to the Our group our Heilbronn, Connect the the business last introduce undoubtedly, the segment has stakeholder to of of recent been touch Lesaka. the And Group the relationships, connect would acquisition of marks Lincoln Steve fourth strategic in detail. ask significant closing merchant and Steve? improving area more

Steven Heilbron

me onset, Chris. how we to joining let be At Lesaka at say the you, excited Thank are stage. this

today auditors. numbers opportunity merchants various aware assist make inclusion complimentary to how we perfect that access merchants innovation some we sectors lives. promote waiting market. get the this former market is in generally under will signed and experience that day that enough As about converted of doing to our through and review. are. are closed understand disrupt us use market merchant acquisition traditional aim their in mile. Lesaka use Lesaka. various to Group doing looking became service many so the that the part combined SME of and our this color excited that to as in of to face exists X believed in receiving technology market are offerings IFRS, for journey, we would've to we have we that innovation product of connect group we of solutions the pro been business in that the are that numbers in sense the solutions formal both made we And progressed, more we per engaged accept the to now of to join both operate but that points banking months. prepares to group I'd at financial after forward as with given were our the I'm XX lower happen. When parties includes for pleased financial their the the to through merchants innovative quarter do, merchants key I'm our the so that bit for a help available it forces how at technology run as month done, can Once are be aligned daily and to so payment formal opportunity they our hopeful It's so for these the informal quest to I in and off sector. final business, day this mission provide we solve challenges to like share clear pain formal filed and We for can started your by be that and provide GOP will extremely end closely We've and very a our to and Notwithstanding to basis our U.S. South consumers it be important the and on this our what that been last financials Connect as last and deal that mile Lesaka's is business the formal sector market. The you informal and XXX,XXX and of real forms financial on could with excess negotiations Africa, we

significant the to not a informal market south merchant also cash lower the but levels much part sector, merchants are Approximately However, still conducted traditional restricts security represents these of which the and very transactions services. a the from income merchants' society. cash, XX% only which presents financial targets access risk, is still the of in African

to solutions opportunity formal both and with to informal Our them provide businesses. the the address that grow and tailored been points their face products and merchants have pain

with secure enabled vault. bank store. from trading pay hardware the the that requirements. cash, cash Our which It from predominantly into with deposited putting a the digitizes cash Cash connect and is merchant is of risk combining environment, merchants in the store. buy the offering as the effectively safe solution, providing software, placed staff, FinTech cash importantly, or other instant to merchant It's immediate to working currently merchant moment connect the robust is access provides for inventory, allows a cash a formal meet And the merchants solution. transfer flow capital vault creative away with producing in

much innovation, we Although growth in we sector. for this South created informal a technology Through needed, trading merchants into efficient have environment encouraging safer and this and more are Africa. extending the in seeing

have XX into our We evolution merchants card at X,XXX the February retail was A approximately reach ended natural country to installed the taking our around XXXX. business cash billion of for the payment in months extend space. vaults $XX

and provide Traditionally, some post owners, at predominantly been solution affordable have very in market terminals our do card is This too market exciting this Kazang Further, us, been position payments formal in solution have space be South sector, card informal market. is because nascent a and could is targeted historically Our in but card offering exciting differentiate. store we for very at Africa. distinct developments which SME in prove for card to attractive We our we've a certain advantage to proposition instant very Pay this these merchants merchants. prices. connect to in the the the do competitive This expensive difficult pipeline, and for able technology hours competitive waiting settlement for than available, is opportunity with market. these the the be to have very allows us on XX rather for is funds merchants to to to normal transactions car made important XX which however,

doing November customers Pay facilitating XXth, million as Kazang devices. made these well is capability, card acceptance a ago, $X through at significant we opportunity back purchases XXXX were draw all. Pay a growth As month includes In cash for Kazang allowing for also months us. per to cash

challenges, Feb, a strong which and another supported major comes the which of red from year borrowing access traditional proud the the in and face, that with retail bank consuming growth may time our of their FinTech capital allows We innovation. me to we access funder awards tape merchants This million all XXXX, turn offering $XXX won forward to to. shark merchants the for with this provide XXXX have response grow merchants, brings growth or by businesses for involve our we us risks that merchants exceeded quick the formal processes informal very quick these to loan the the month with the lenders to the pain without at being historic trajectory. sector, In to formal As for Connect Capital capital. to to launched point, need operations for informal

and account digital merchants has disruptive. inception under excited extended for are SME this data in We transactional have to XX Capital is existing ancillary informal data be is XXXX, our provided to is challenges, capital merchant's points and capital of convention merchant's hours. through we approved in minutes worth about our formal This billion's the assessing Feb within ecosystem. product. proved our It From XX $X.X merchants. market and the through to

available through Connect exclusively Kazang extended our our have solution, our offering We advanced to Capital Pay Kazang is clients. which

We with our assess manage operations data is This working launched kind grow able solution and informal on a to and approve amongst have the capital, their efficiently. more in connect, allowing to quickly these detailed first as of and and in the capital merchants' merchants recently we are businesses its capital South Africa segment.

for have that We are real need have that date. sold significant and encouraged experienced we already to a we uptake

and allows added in buy make sport airtime of and shops, their family. as products and experienced uptake. It market solution, as is multifunctional ability WiFi, Kazang their device broad bouquet merchant bills allows gaming the which sell customers, well customers local send the prepaid business customers informal on for provides water, utility, to the Connect ever major dedicated to payouts pay and is informal money including data, excellent electricity. Another for and offering in their mobile as facilitation and to tickets, to This has team DSTV offerings. value a transfers other themselves services new friends the airtime, the including and to of development such launching expanding focusing international bills international with and lottery This

further above We into through to In their vice configured significant Kazang allows attracts using as now a can in card, stores, ownable supplier our advantage connect pay their devices. merchants providing operations connect devices, by customers market. that be the to merchant's addition devices XX,XXX and is have Kazang the which the also Kazang POS Connect approximately draw streamline Kazang A informal facilitating ecosystem. merchants footprint potential this payments representing

experience in When into Lesaka affordable a you So, Advanced the a connect existing this real need the informal adoption understand Kazang our FinTech banking to Pay, deeper card It percentage are we to size provides payments capital the Africa, valuable we last merchants, arena. a to the merchants a to understanding growth we've and which our the revenue allows the scale significant of stores flow. in facilitating connect have some are easy our our quick, growth then Likewise, Solutions in and bringing is to really clear turn our the capital into rate small achieve it Group, and cash advantage high X customers pandemic. merchants capture an and key Kazang you able providing and a establish able we If of an while opportunity Connect that and the better by immediate been solution our exponential. relationship enabled evidence card the informal informal being The our their growth significant extremely space with encouraged anticipate in business. cash of and access is the with be severely by adoption merchant is space traditional Connect solutions of disrupted that and infrastructure solutions. businesses. will of Kazang look to that the banking of very could for South rate COVID the our the of market, at connect attention drivers if in years market, cash Despite card

bill rate growth of payment at Kazang annual solutions, active XX% Looking VAs XX,XXX compound our in around business, devices. a device we've in X-year resulting providing and seen growth deployed

merchants, informal Kazang our transactional Pay at X-year significant throughput we growth year compound a in a in as been Feb connect provided months discussed ended increase informal has demonstrates merchants formal of This XXXX. the offering The and and terminals high $XX for approximately solutions in a and end increase months business card an ZAR Feb XX% our bring values solution the billion XXX% respectively. value combined billion Pay value real launch XXXX. recording a boost X of for story to in deployed to transactional past payment X annual Kazang provides through XXXX success of this to our fed at to XX% area, this XX targeted that XX and with As the activity in put the

in which returned cash disruption during and years transactional targets SME sector compound formal months XX connect throughput expansion the XX% for very share rate has to business, good growth billion the to Our our resilient the the over past of the annual as X-year been a anticipate the $XX save sector, this as sector, growth expanding market well in the recent informal with into to XXXX continue. formal predominantly we

absolutely of Finally, witnessed XX% significant advanced demands annual the X.X a compound book and growth positioned X-year number XXXX this we merchants. XX% rate growth inception this these to a in we The during trends our solution since of have has us Rams excellent compound to uncertainty solutions of loan markets offer seen up million capital being XX period was growth continuing targeted trend that achieved Kazang the economy, South pandemic businesses. our advanced the loan the capital of years. most capital the mentioned, that are with is group with SMEs we African SMEs as Fe looking a loan XXXX. connect providing economy, and previous have to the ended their the and recently it of from are we COVID loans to months connect closed continue solution over is are XXX significant its in being to XX% encouraging ZAR with for our are and inception. Feb has These extended that grow forward rate business. turmoil lifeblood innovative for with in annual since also and the is recovering a We've in billion What group exciting our to launched, the entrepreneurs passionate capital of and advanced about very and

have the financial this In done we Few technology by sector taken for as servicing excited we developed Africa part inroads informal last in allows inclusion the prospects a and low very infrastructure distinct business of the that deliver group large the significant so with market. market Lesaka and informal segments, especially developed platforms, market but income underserved. data and which this We consumer us have business, profitably connect made have to to delivery. to solutions and South with risk markets, both the respect we are have mile that market greater very businesses in very the an software which the in of in bringing the market, in process solutions these merchant Lesaka advantage effectively can have have

the well performance over over take Thank to targeted of years. our to like hand We Lincoln. placed you few merchant you, Lincoln, business be segments. a through player are who and next segment existing dominant you. I'd consumer Thank in the the merchant to will

Lincoln Mali

to great on you And everyone. you Steve, and with your working it's board. I'm really to have forward day, Good looking team.

by dealing to segment, operating grew year global XX% revenues briefly through we're X on I'd of business, negatively chip the performance point-of-sale shortages. on by business the While basis. impacted run our the segment end merchant existing year performance like an In the previous was the quarters, the with of which merchant

client increases XX% our prepaid EasyPay catch in in and during Although saw pleasing to In been electricity, XXX% market, we this of orders have prepaid this quarter. in shortage business, we respectively. continues airtime value processed, up the able on and vast

bill X%. payment by volumes Our increased

time to and consumer We And everyone. have the that trends, saving in to busy of and And learned Moving We're us. the and our continue they for it our we services leave meet needs of indeed made realize a have quarter. why X their of onto is been understanding deeper design very they products segment spending inspired learn. by number on good months customers, very a customers, fronts. to us last why our what we progress order last choose the gain important that and a have

insurance. with lending currently such large limited formal cohort services, of portion base banked, there targeted are our large underbanked access and is as a who a customer Although to is

during the the made channel the where customer We focused for, Transitioning launched accounts to by improved offering reflect than March, challenge understanding a over the campaigns can campaigns customers marketing And we growth quarter space EP needs. right switch into these EPE half best we are improved over Active meet of gained investment truly XXXX. the with, them EP latter looking of we what of what had huge data account products XX,XXX numbers and promotional active efforts just what active are we anticipated. their were growth designing our light innovative make in million. capabilities, sales at Utilizing anticipate centric financial to end slower these and driven engage the incentives initiatives and league approximately provider accounts our to and competitors with business X,XXX these We're the that have and period. customers on quarter. is active fourth drive We growth. third and we customer net encouraged knowledge, account the by effective services to a into $X.X into the the continue analytics being we champions developed added the results net recent disrupt

register center assisting we on improving includes focusing initiated account a during we of This activating did And quarter. dedicated on However, focus activation work openings stream call the the accounts. and growth their customers a with utilization. introduction account XXX,XXX

force on incentivized is now sales account and our openings. account not Additionally, activation merely

quarter performance XXX,XXX achieved XXX into the third were on approximately an XXX in by our X% penetration average very XX% loans ending repeated with optimization. The with of were XX% the profitability in with increased last customer of was year book, An with book million. remains to loan outstanding loan around around ratio year approximately the the The value currency. good balance quarter the capital business issued million consumer loans The new the of a of by borrowers. XXX,XXX outstanding base retaining cost is size loss to ZAR initiated loan in Turning which our of X%. lever

of staff quarter. earnings of cost in the and ZAR The overall an which We our painful network. a project on this last a process process, million deliver in and review savings to being of reorganization that went base. highlighted The is call, our in employees basis. which project rationalization the we million optimization is spring, excess to annualized a through quarter XXX and disruptive large the distribution combined significant estimated pursuant and of USD Chris As launched involved number spring resulted cost or that retrenched was completed XX.X reorganization

However, To to to our continue assess as mile. our customers we we end, optimal the points have good of network. through we presence service significant was I'm this order engagement, us to the see in representation enable have in to distribution last a country. advantage better ensure to begun progress that have visibility to their made optimizing in our to to and the pleased morale team throughout improved leadership, teams the the In reenergize communities, continue in

footfall majority costs positive of impact mobile our a will is a branches, ATMs repositioned ATM These our our eliminated. have this into hours utilize. channel provide retailers. in Our and was of the and locations more of Over have than distribution fleet productive which locations large XX% within the operating associated greater longer security customers as been network significantly

in quarter during X.X were normalized largely on offset an USD the reorganization XX improvement costs Although spring this EBITDA by encouraging XX% saw on of cost basis, year million we associated savings loss million an project ZAR or year.

we put everyone It is services financial order senior work about the not in here to deliver the X proud environment is Southern Lesaka of merchants it certain mission to is that environments, are in that In jobs. where Africa. key in of and at. Building organization leadership can to just everyone thrive and committed the quarter a efforts range the in [indiscernible] underserved It skills create identified to team to our FinTech The what and people Lesaka. building spoke day and on leaders. group the organization each relationships is consumers with out. result, outperform we will leadership paramount culture to are that which team Lesaka importance at and community building in they and mission. believe world spoke on have operate bring our an communities a communities trust. that must to our entire takes a an together focused relationship We the in lasting build of achieve day these this, class stakeholders I we Chris about a build As creating are and in deeper of have and This

the branded sponsor CSI number we of of in large blankets, communities continue work a to part sponsor initiatives, offer tanks. wheelchairs, leadership, freshwater education, our As and to financial

the [Durban], in families staff assist With assist personal our those need. an channeled displaced. experienced who to recent in donations made some initiative flood to were of funding we they those drove where And communities

continue relationship regular level. and with our through We SASA build national, both provincial, engagements at local constructive to

strategy increase I Taken growth opportunities. over our together, now Naeem? an are financials. important discuss to the these our part broaden will hand to partnerships visibility of Naeem to Lesaka's and

Naeem Kola

Thank you, Lincoln.

what in Now let's and I'm the has our turn with very this visibility financial provide QX happened Overall, on to the pleased well quarter. details been has some as of achieved as for outlook. results

positive being EBITDA trends the With and in reported. revenue, costs,

past basis. the X turnaround dollars the a by merchant on and characterized our showing continued total quarter year performance quarters. in discussed year XX% increase has consistently our year over in XX% execution our On which on $XX.X strong a was the revenue terms third basis, over in Rand on U.S. the business consumer reported was year been quarter for million, of segment improvements been has and As performance,

million in a restructuring is our to spring. seen of operating charges of improvement $XX.X part in after have million $X.X project in loss quarter, XX% million for We this accounting $X.X as XXXX which one from

very as for our currency acquisition, which of improvement, quarter group during contracts loss this recognized and in a $X.X year-to-date again holding also million contracts Overall, order the to $X.X of are hedging risk report. taken And these an we for these we management to of net protect cash the position have XXXX. million is were we we on This reported February, quarterly connect comparison. out part very, quarter. matured pleased in on We a a the

into satisfied in initiated this to higher segment the segment. point resulted segment, will remind primarily that quarter. our during perspective This driver resulting revenue quarter. contributes number delays to external want with BXC of our merchant higher the first XX% in merchant buildup fiscal the devices split a the group I the segmental the segments. and We our demands chip increased customer-centric second for was were is start it which have X business BXB quarters and sales. manage The our orders, in to a of business a everyone was consumer I in $XX.X have main from of fulfilling disclosure client a million. sale quarter. shortages this revenue of global Merchant revenue for customers which to in due device Turning

time. selling for We models X have air

our of where our to due a balance one this for this products in down is wholesale the classified we we did one revenue on model services operations. comparison, and in a first Sales sheet. disclosures. and a model On drop clients inventory are largely the The year-on-year acquire key our hold scaling telecom see revenue as

selling Rand capital is such board. and revenue. on volumes, compared Processing driver fees bulk as last model second larger payment from easy air dollars coming processing this on electricity the classified new agency for XX% the in as Benefiting time is The through in where year. and to of were up time income the fees. pay XX% healthy model is Notably, our point the increase with air of sale basis retailers customers, and

at segment and fees the on At were dollar to line processing year. and in slight the elaborated in a last lending profitability. with to terms revenues been X% Account basis. Rand all a X% Turning of as revenue segment we returning compared consumer we our earlier, focused XXXX to fees, line, saw have LinkedIn very increase

in Our was Rand live a XX% primarily dollar and up insurance book terms sales credit by growth. due XX% on to inclusion a new of basis,

distributing savings an loss EBITDA million, a to ratio. corporate listing overheads. our last States of million encouraging the total, consumer adjusted quarter a to on EBITDA which African all of in of and initiatives normalized EBITDA excluding spring orientated month cost we EBITDA This this significant to a has improvement by recorded cost strategy. of trend turnaround quarter, a we the of is an a compared encouraging process our related X consumer which segment and was turnaround in with we in base $XXX months months with million. The access efforts represents a earlier. non-South deliver impact a normalized Lincoln EBITDA each annualized project This was over first our a business. evident $X.X in income project to completed XXXX. the financial million taking focus saving on in the expect millions is team cost book fiscal to In quarter, our of customer us $X.X of the of the after segment The to our $X.X is for contributes last $XX.X was the reorganization of cost that that and contraction million, to When our transformation XX% around of X of basis. positively segment, approximately very combined strategy and that pillars efforts Chris into the At sales line the costs strategic the made segment in deliver about to put business past spoke becoming and over quarterly year's merchant result this have on cost spring. and X%. loss grants achieved expenses million the resulted restructuring expense highlight resulted level, operating business in Excluding United the an adjusted demonstrate account we progress consumer this and turn The the a The of our employee during focus the consumer have in X since cutting our base, on consistent from commitment, very

coming to saw make improvements our book client approximately the peak seasonal new at remains portfolio December, continue of XXX improving flow cash On quarter a lending on repeat our a our $XX.X with cash low basis. we loss ratio the in in lending expect ended perspective, X% book, of and lending at conservative with on reserve quarter, and book million. from a quarters. good a year performance constant gross we with or currency our in a loan Looking million year on After growth X% the for to a all contributions implementation we operations. data From see to to activities our reduced find borrowings, reliance criteria

significantly number and cash me. down to which encouraging normalized rate a a quarter is burned Our reduced on very this basis was for negative a $XXX,XXX, was

end net at cash of of unrestricted $XXX performer had we debt position, quarter million. aware, reserves you're Our the as

our the However, post the has the with of of the XXth changed position on cash significantly April, connect end quarter closing acquisition group XXXX.

reserves million As utilized $XXX to of with debt an our release, raised. of disclosed now cash XX acquisition have press additional million fund we

of debt on We also pro-former position of connect on net basis. group a took million $XX

debt the of XXst its balance of will March, this As sheet place with on company $XXX million. a net

We are working busy to capital our capital efficient, sustainable and our bankers ensure reviewing an and we achieve our structure for with term long advisors structure business.

held arise. a am [CELC] assets capital the quarter, As pleased carbon as at these And investments our at as these hold raise. million manner [MobiQuick] with in should X. Overall, results look line would quarter. both we non-core well is and born last to with I in our last opportunity as investment the fund see $XX investment this divest responsible really We in continue the of with to

has our Chris? call Chris. business. I presentation past on to business, that our over the taken when would to world a team now months to demonstrate over on the look financial this have this to We strategic I can Connect X are on Group deliver to pillar on impact and journey like put forward the we FinTech actions turn transform to provide company a are that the starting class be able I'll forward. more next detail that back the into

Chris Meyer

Naeem. you, Thank

fourth quarter, to connect focus acquisition. on with the FY we the continue strategic for group pillars our will During XXXX

closed, can and successful which formally to presents. on businesses capitalizing the of combination Now the turn our opportunity, sector we X the attention the growth

base challenge, Q&A for like Salesforce focusing but we distribution to the the channels. to On the you. continue that, to marketing is over make account effective Bronwyn on turn growing Thank product our With session. consumer the call more progress initiatives biggest segment, and we'd active our

Bronwyn Nielsen

Welcome job good to Lesaka the in you've done presenting -- investor Q&A a rebrand. results, the and the Q&A,

You're community. have the conference back questions call, a a now have course and the investor of We for we webcast. from

see those are need ask the call, on you If the if webcast, simply in questions we'll coming star on you're push on up type to questions, the then your to And you conference one. iPad. and

that this the at going side? anybody on I'm call conference there to stage. So, any to come Are questions from through to open

Operator

Yes, line. we on questions the have do

from The first Kaizen Venture. question Ngozi Dozie from is

Ngozi Dozie

Congrats Co-Founder a and acquisition. on Question the the Carbon. presentation I'm Kola. of to Naeem

what from your comments, we've to your have to clarify keen we're written for and a other to would to us off. do legitimate it wanted investors take time. this exit have Just to been exit for trying carbon? very Similar some And that

Chris Meyer

take I one? Can that

Bronwyn Nielsen

of course you Chris. can, Yes,

Chris Meyer

the listen us from today. to you hear time to for Thank to you. Nice taking

As we've past, we've been of spoken supporter yours. the in a

terms continue the to happy in of and here South your directly, this engage. you outside We'll changed strategy focus to Africa of pick has time. it question thank direction Our fundamentally in and our Lesaka taking and but take as new up for

Bronwyn Nielsen

conference Any questions call? coming other through on

Operator

Yes.

[Raj is Sharma.] question next Our from

Unidentified Analyst

combination. solid talk foresee how or the a it's--what new If the revenue growth and presentation after you for how terms about business be more helpful. you of that. the Thank color forward? could and can group on few anything in connect And got of did we that'd some of there Is that, you more a I've can kind very going give questions individually

Chris Meyer

to for get and then to things. connect we've much to got some XX few consolidated we transaction are earlier said release group, around from Raj, particular proformas. as performers. Steve a as of it those want waiting far, today, as share we've In and so signed and days of audited we the off the of just close financials date the numbers said And

So, share with you. information some we very eager are to

we've to far. what been thus seen disclose You've able

one was the to ZAR maybe EBITDA for at think, warranted February XXXX is number point the again, XXX I million. I'd

we historical are. some So, of that's where And might that a sense an comment maybe Steve little point. give a I the might ask, of you bit then important performance around

Steven Heilbron

XX%, a compound rate EBITDA. returned has business X-year the historically think growth in I Raj, Sure.

from did to business. the which these payment with capital share fundamentals are and XXXX some which the of the XXXX. numbers, underpin essentially cash We through card various continue And underpin So, to fundamental that's points, offerings. historic you

I we As we'll, think to soon as the the U.S. them directly those is when fourth our think share combined for where you. to do Chris with conversion sit we you'll numbers. get and GAAP underpin And historic filed, But my we'll I we complete fundamentals, today. said, see as as RFRS then said, our be will quarter,

Bronwyn Nielsen

Raj, you've got additional questions. Go ahead, please.

Unidentified Analyst

can Yes, marketing, talk maybe is around color a What the bit, any any Lincoln? and thank that, accounts, more side? give traction are on for we little strategies SASA the SASA for any developments Steve more this with you you for Chris. Can and there consumers

Lincoln Mali

Yes, sir. Thank you for your call.

that. ourselves has I as is on to they that think that beneficiaries any focused customers choice financial to we because And give adopted institution. heavily SASA these can choice grant principle the in so that advantage fundamental go primarily see in we customers, are or

many time into reduce turn relationship active so, NA to friction see building And there. the the accounts we we've that's with of them open going accounts lot and a how our provincial at to can SASA, of with local level, spent through

So, coming through. making that. progress see good months to we progress we want And few the on more of in that are coming

Bronwyn Nielsen

very much Thanks to there. Sharma Raj

Ben down from and question Signal he's has asking ZAR in XX to The got Pula investment a CELC. assuming on debt. been management, we've billion X, CELC So from Asset written

to there of station proposed was However, the and the you significantly in this account be it mean, who And quick valuing a update CELC restructure cuts you if also I any will half taken value when to concluded. do restructuring Why CELC? finalized? the wants proposed recap plan is also expect not can of owners Philip two, on reduction think the in benefiting debt when equity. into Short, current be recovery include want I

Chris Meyer

that. take I'll Bronwyn. Thanks,

most or fact the the not is approved thing important I point. I So, think formally closed the the recap, this restructure has been that mean, at

and auditors And which restructure and with take I, is is our the valuation through pre when so, again that it comes will we and look the on if, our situation, at current restructure based and view. a

in To terms much and aware and have know before participated know in you take of we So, important I most the to we've seen are released broad thing I timeframes think we exact that's as make. sheet to the few place, around terms know, the of. Phillip's CELC of indicated term announced as are And question restructuring. not that timing, the fully we do the steps think being and the we would details there final thereof broad

getting X here. as are We prudent are to similar said try and watch on it that and close the to, written our we situation as We carefully past. to it just to reasonably confident from end down the and sheet an the I we've repeat, here. in know have managing possible to be balance we position with

Bronwyn Nielsen

conference some believe on additional got I call. we've calls

Operator

Yes, we do.

[indiscernible] from Bank. Our from is next question Standard

Unidentified Analyst

that. congrats think on strategy? and Lincoln this so, on question strong, Naeem, you plans have Steve. or think impact you more forward any year? roll Kazang on group connect And of the of is be do it's RPP sort if will launched do the turnaround and how that Steve, for the you What going may that The be Chris,

Steven Heilbron

Yes.

we've say that time amount to impact. fair spent a focusing of nice it's So on

but club. well the probably plays our we into that the as hands private card Specifically, think on be digital with as the RPP would open also I take I the prefer focus fact rather we question some there'll breaks would both this offline in to feel a you to fair that I answer regard think and want to space, impact in cash,

I'm so, ideas to can got leverage from FinTech a that this presents And excited we've about perspective. how very of exciting use what we some our position. And

can little a more bit we that but you perhaps give on info So, offline.

Bronwyn Nielsen

We're staying any questions? call, conference with additional

Operator

at No moment. further this questions

Bronwyn Nielsen

Capital. that producing Rob come include from for We'll is to the shortly. from numbers timing you And back What he's the Besinger, Valorian proforma that's group? connect

Chris Meyer

from which, got days closing date the we've close the April. was of so the transaction, of Rob, XXth dates XX

time with. the to the that we're think that I That's us takes end of period June. So, working

Bronwyn Nielsen

past Judson quarters. products You've doing? from That's business few Partners. the launched Penny the few new from over a consumer they Taphagen Plough in How are

Lincoln Mali

good We of to very on progress. we're that momentum, looking are come good will think through all satisfied at months as results But that displaying the gathering team we're the those and quite we start through. the is momentum ground. come the with We think

space. this So, watch

Bronwyn Nielsen

from closed similar Crossfin Paul the Rosendale FinTech a substantial a recently, paid deal are for at NetX Whitburn discount of Ethos was by connect what partners; to businesses.

is to value connect Crossfin, reasonable the the higher have to funding XX and over different than with the many last tech XX% times MobiQuick meaningfully round year? fallen So businesses that multiple last where X at X

Chris Meyer

the one second one. the first, take come back we I'll Maybe cross to

we sheet has and it on last that that's of in line value have Yes, happened cetera. observable IFRS nothing MobiQuick, our funding, we then round, material with the GAAP. and since So, at balance

at position a We the close stay business, to the close their monitor that hold to continue we to so, continue situation. level. And to we performance, stay and

you we on etcetera. don't and apples all sorts are think services. other growth, start when capital I that degree merchant of of think end, drivers think end X in we businesses but to end by connect space. as sure, solutions acquiring provider of management at I but you valuation Crossfin look in then the end, the of with know, the for digital mean these And connect group across apples cash group, card, growth I very compare to the overlap, that various into terms to Crossfin seeing and, pears, there's and apples and different with as And smart we would look at And of ecosystem cash an our to you're sense. rather some through of and there And things. or provision entire

I think we're at but how comment don't if want looking kind of I Steve, and you know we on it, things. different So, come X in to that's

Steven Heilbron

Great. And very to difficult compare.

the rate. XX%, over I XX in that if was growth the And months you been bought last X-year environment said, that easiest trading say we rate growth period. into the a underlying hasn't can As compound it

pears the points it's growth that an said, So market. based a better again, comparison. you the I excitement around we as on think in pain that and apples solve But Chris,

Bronwyn Nielsen

Are further the on questions webcast. conference got more there the through any call? I Now coming on questions no have

Operator

further Thank moment. you. the questions at lines on No the

Bronwyn Nielsen

little or want bit more give Fantastic. it you very time, a much. to wrap? you should Thank Do we

You Steve, and have had Great fantastic. Naeem. your for board. the a been It's thanks long day. Lincoln, Chris, across very much presenting time.

third for Lesaka is question-and-answer investor This have Group. been session. Lesaka watching quarter the results You the