Fintech group Lesaka Technologies has reported a revenue increase of 11%, to R10.6 billion, in its financial results for the year ended 30 June (FY 2024).
The firm today also announced some leadership changes, and restructuring following its acquisition of payments services provider Adumo in a R1.59 billion ($85.9 million) deal.
Formerly known as Net1 UEPS Technologies, Lesaka is listed on the Johannesburg Stock Exchange and the Nasdaq.
Lesaka reported another successful year of growth, improving profitability and execution of strategy, with operating income turning around from a R275 million loss in FY 2023, to a profit of R67 million for FY 2024, says the company in a statement.
Adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) increased 55% to R691 million.
According to the company, the balance sheet also strengthened considerably, with the net debt to group adjusted EBITDA ratio improving to 2.5 times, from 4.5 times a year ago.
“We continue to materially improve the profitability of Lesaka, achieving group adjusted EBITDA of R691 million in FY 2024, up from R445 million in FY 2023 and a significant positive transformation compared to a group adjusted EBITDA loss of R328 million in FY 2022,” says Lesaka chairman Ali Mazanderani.
“We have carried this momentum into FY 2025 and are providing a guidance range of R900 million to R1 billion. We have established ourselves as the leading independent fintech in Southern Africa, with significant room for increased growth and profitability over the coming years.”
Lesaka Southern Africa CEO Lincoln Mali adds: “I am particularly pleased with the consumer division’s performance. Our teams have worked hard to turn it into an important profit and cash flow contributor for the group, demonstrated by the four-fold increase in segment adjusted EBITDA to R274 million.
“We are entering an exciting period of growth for Lesaka, integrating the Adumo and Touchsides acquisitions with our existing fintech solutions, as we strive to empower Southern African consumers and merchants to fulfil their potential.”
With the anticipated closing of the Adumo acquisition in October, Lesaka says it has restructured its operations into four pillars with a customer-centric focus.
It says the consumer pillar will remain substantially the same; however, the perimeter will be expanded to include the Adumo Payouts business. With the incorporation of Adumo, Lesaka says it will serve approximately 1.7 million consumers.
The micro-merchant pillar will focus on sole proprietors, primarily operating in the informal economy, and addressed through the Kazang and Touchsides brands.
“We are already one of the leaders in this segment in the country and have over 90 000 micro merchants generating more than R68 billion of throughput annually,” the company notes.
It adds the merchant pillar will comprise the existing connect operations, as well as the bulk of Adumo, specifically its merchant acquiring and processing business and its GAAP hospitality platform.
“We will have almost 30 000 merchants with a direct throughput of over R133 billion annually and an indirect throughput that is far larger.”
It points out that the enterprise pillar will focus on large corporates, mobile network operators, banks, governments and municipalities. This pillar has over 750 customers and generates more than R70 billion of throughput annually.
As well as serving third-party corporates, Lesaka explains that enterprise will service some of the technology needs of consumer, micro-merchant and merchant businesses.
The Lesaka leadership team has been re-aligned along these pillars. Additionally, at group level, Naeem Kola is transitioning from group CFO to the role of group chief operating officer. This addresses an important gap in the leadership structure in unlocking operational synergies between the four business units and supporting post-acquisition integration, says the company.
Dan Smith takes over from Naeem Kola as group CFO. Smith joins from Value Capital Partners, Lesaka’s largest shareholder, where he was an investment director and played an active role in Lesaka’s development since 2021.
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