Net 1 sees 18% decrease in earnings for Q3
Net 1 UEPS Technologies, Inc (NT1), which is listed on the JSE as well as the Nasdaq, said on Friday (11 May 2012) that fundamental earnings per share for the third quarter had decreased by 18% in constant currency terms to US$0.28.
This was despite a 10% increase in revenue in constant currency terms to US$90.7 million.
“We are extremely pleased with the progress made thus far on the implementation of our new SASSA contract. As a result of our efforts, we successfully commenced social grant payment on schedule as of April 2, 2012, said Dr. Serge Belamant, Chairman and Chief Executive Officer of Net1.
“The first phase of our implementation process involved issuing 2.5 million temporary MasterCard branded debit cards to grant recipients and establishing the payment infrastructure to pay all beneficiaries that we did not pay under our old contract. I am particularly pleased with the commitment displayed by our implementation teams during the first phase and the focus over the next few months will be to replicate the same success through the second phase of implementation,” he concluded.
“Our quarterly performance for the next two to three quarters will be difficult to predict given the timing and quantum of investments and start up costs to be incurred to ensure the implementation of our SASSA contract,” said Herman Kotze, Chief Financial Officer of Net1.
“However, for fiscal year 2012, we expect fundamental earnings per share to be at least $1.40, assuming the constant currency base of ZAR 7/$1 and using our third quarter-ended share count of 45 million shares. As always, fundamental earnings exclude amortization of intangibles, stock-based charges and other one-time items,” he concluded.
Commenting on the first phase of the group’s new SASSA contract implementation, Net1 said: “We successfully initiated the national grant payment process for approximately 9.2 million beneficiaries on April 2, 2012 having commenced implementation during Q3 2012. The implementation will be conducted in two phases. The first phase involved issuing approximately 2.5 million MasterCard-branded debit cards to beneficiaries that we did not serve under our previous contract in order to establish the payment process to pay all social grants in the country.
“The second phase will commence during June 2012 and will require the re-registration of all 9.2 million beneficiaries,” the group added.
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