Net1 has reported revenue of $155-million for the fourth quarter of 2017, up 3% on the same period last year. Revenue for the full year was $610-million.
Net income for the quarter was $11,28-million, down on last year’s $24,35-million, while full-year income decreased to $72,9-million from $82,4-million.
The results were negatively impacted by share issues, separation costs of $8-million to the former CEO, ongoing contributions to EasyPay Everywhere, Masterpayment expansion costs and a $3,8-million allowance for credit losses, regulatory changes on card transactions in South Korea, lower prepaid sales on Manje products and higher transaction-related costs.
Positive impacts were felt by a weakening of the US dollar against the South African rand, and a change in accounting for Finbond.
“The past five months have been among the most eventful and turbulent in the Company’s history, but despite the multiple challenges, we have successfully steadied the ship and put in place the mechanisms and structure to optimize and consolidate our existing businesses where applicable,” says Herman Kotze, CEO of Net1.
“We have identified the key opportunities to focus on to create a, sustainable and diversified global financial inclusion solutions company.
“In fiscal 2018, our focus will be on
successfully implementing the identified synergies with Cell C and DNI, expanding our financial inclusion businesses, optimising our international operations and focusing on key markets and solutions, while actively re-engaging with our shareholders. We also remain fully committed to supporting the South African government to ensure uninterrupted social grant service delivery,” he adds.
“We expect the funding of our Cell C and DNI investments to be dilutive to our fiscal 2018 fundamental earnings, partially offset by DNI’s equity accounted earnings, but to be accretive on a combined basis from fiscal 2019. We therefore anticipate our fundamental earnings per share for fiscal 2018 to be at least $1.61.
“Our guidance assumes that our contract with SASSA remains in effect for the full year on the existing terms and conditions, an updated constant currency base of ZAR 13.62/$1, a share count of 56.6 million shares, and a tax rate of between 34%-36%.”