XML 63 R43.htm IDEA: XBRL DOCUMENT v3.21.2
Equity-Accounted Investments And Other Long-Term Assets (Tables)
12 Months Ended
Jun. 30, 2021
Ownership Percentage Of Equity-Accounted Investments
June 30,
June 30,
2021
2020
Finbond Group Limited (“Finbond”)
31
 
%
31
 
%
Carbon Tech Limited
 
(“Carbon”), formerly OneFi Limited
25
 
%
25
 
%
SmartSwitch Namibia (Pty) Ltd (“SmartSwitch Namibia”)
50
 
%
50
 
%
Revix (“Revix”)
15
 
%
25
 
%
Bank Frick & Co AG (“Bank Frick”)
-
 
35
 
%
V2 Limited (“V2”)
-
 
50
 
%
Walletdoc Proprietary
 
Limited (“Walletdoc”)
-
 
20
 
%
Summary Of Movement In Equity-Accounted Investments
Finbond
Bank Frick
DNI
Other
(1)
Total
Investment in equity
Balance as of June 30, 2019
$
32,611
$
47,240
$
61,030
$
7,398
$
148,279
Acquisition of shares
 
274
-
-
2,500
2,774
Stock-based compensation
 
71
-
-
-
71
Comprehensive (loss) income:
4,067
(17,273)
(9,744)
(4,365)
(27,315)
Other comprehensive income
 
2,227
-
-
-
2,227
Equity accounted (loss) earnings
1,840
(17,273)
(9,744)
(4,365)
(29,542)
Share of net income (loss)
1,857
1,421
4,676
(1,865)
6,089
Amortization of acquired intangible
assets
 
-
(569)
(1,874)
-
(2,443)
Deferred taxes on acquired intangible
assets
 
-
136
524
-
660
Dilution resulting from corporate
transactions
 
(17)
-
-
-
(17)
Impairment
-
(18,261)
(13,070)
(2,500)
(33,831)
Dividends received
 
(274)
(1,308)
(1,787)
(454)
(3,823)
Sale of DNI
-
-
(36,508)
-
(36,508)
Foreign currency adjustment
(2)
(5,873)
1,080
(12,991)
(478)
(18,262)
Balance as of June 30, 2020
30,876
29,739
-
4,601
65,216
Stock-based compensation
 
(25)
-
-
-
(25)
Comprehensive (loss) income:
(23,976)
1,156
-
(4,025)
(26,845)
Other comprehensive income
 
(1,967)
-
-
-
(1,967)
Equity accounted (loss) earnings
(22,009)
1,156
-
(4,025)
(24,878)
Share of net income (loss)
(4,359)
1,156
-
(531)
(3,734)
Impairment
(17,650)
-
-
(3,494)
(21,144)
Dividends received
 
-
-
-
(194)
(194)
Sale of DNI
-
(32,892)
-
(13)
(32,905)
Foreign currency adjustment
(2)
2,947
1,997
-
(187)
4,757
Balance as of June 30, 2021
$
9,822
$
-
$
-
$
182
$
10,004
Investment in loans:
Balance as of June 30, 2019
$
-
$
-
$
-
$
148
$
148
Loans granted
-
-
-
1,230
1,230
Allowance for doubtful loans
-
-
-
(730)
(730)
Foreign currency adjustment
(2)
-
-
-
(28)
(28)
Balance as of June 30, 2020
-
-
-
620
620
Loans repaid
-
-
-
(134)
(134)
Loans granted
-
-
-
1,238
1,238
Allowance for doubtful loans
-
-
-
(1,738)
(1,738)
Foreign currency adjustment
(2)
-
-
-
14
14
Balance as of June 30, 2021
$
-
$
-
$
-
$
-
$
-
Equity
Loans
Total
Carrying amount as of :
June 30, 2020
$
65,216
 
$
620
 
$
65,836
 
June 30, 2021
$
10,004
 
$
-
 
$
10,004
(1) Includes Carbon, SmartSwitch Namibia, V2 and Walletdoc;
(2)
 
The
 
foreign
 
currency
 
adjustment
 
represents
 
the
 
effects
 
of
 
the
 
fluctuations
 
of
 
the
 
Swiss
 
franc,
 
ZAR,
 
Nigerian
 
naira
 
and
Namibian
 
dollar,
 
against
 
the
 
U.S.
 
dollar
 
on
 
the
 
carrying
 
value.
Summary Financial Information Of Equity-Accounted Investments
Finbond
(1)
Bank Frick
(2)
DNI
Other
(3)
Balance sheet, as of
February 28
June 30
June 30
Various
Current assets
(4)
2021
$
n/a
$
n/a
$
n/a
$
24,066
2020
n/a
n/a
n/a
19,910
Long-term assets
2021
289,260
n/a
n/a
4,977
2020
294,734
1,042,366
n/a
6,145
Current liabilities
(4)
2021
n/a
n/a
n/a
26,983
2020
n/a
n/a
n/a
7,824
Long-term liabilities
2021
208,043
n/a
n/a
5,732
2020
189,159
940,948
n/a
18,076
Non-controlling interest
2021
13,574
n/a
n/a
-
2020
15,795
-
n/a
(73)
Statement of operations, for the period ended
February 28
June 30
(2)
June 30
(5)
Various
Revenue
2021
95,847
35,641
n/a
6,404
2020
161,378
37,864
68,983
7,862
2019
174,177
41,126
15,898
33,707
Operating income (loss)
2021
(18,980)
3,860
n/a
(2,413)
2020
17,483
4,815
24,563
(5,064)
2019
20,355
3,633
5,814
(753)
Income (loss) from continuing operations
2021
(15,466)
3,303
n/a
(2,539)
2020
14,449
4,053
17,092
(5,116)
2019
17,761
3,169
4,306
(915)
Net income (loss)
2021
(17,889)
3,303
n/a
(2,539)
2020
6,433
4,053
15,772
(5,014)
2019
$
9,385
$
3,169
$
4,481
$
(1,029)
(1) Finbond balances included were derived from its publicly
 
available information and presented for its years ended February;
(2) Bank Frick
 
disposed of in February
 
2021. Statement of operations
 
information for Bank
 
Frick is for the
 
period from July 1,
2020 to January 31, 2021, and the full twelve months for both fiscal 2020
 
and 2019.
(3) Includes
 
Carbon, SmartSwitch
 
Namibia, Revix,
 
Walletdoc
 
and V2,
 
as appropriate.
 
Balance sheet
 
information
 
for Carbon,
SmartSwitch Namibia, Revix and
 
V2 is as of June 30,
 
2021 and 2020,
 
and Walletdoc
 
as of February 29, 2021 and
 
February 28,
2020,
 
respectively.
 
Statement of
 
operations information
 
for Carbon,
 
SmartSwitch Namibia,
 
Revix, and
 
V2 for
 
the year
 
ended
June 30, and Walletdoc
 
for the year ended February 28/29 (as appropriate);
(4) Bank Frick and Finbond are banks and do not present current and
 
long-term assets and liabilities. All assets and liabilities of
these two entities are included under the long-term caption;
(5) Statement of operations information for DNI is for the period from July 1,
 
2019 to March 31, 2020, and April 1, 2019 to
 
June
30,
 
2019.
Summary Of Other Long-Term Asset
June 30,
June 30,
2021
2020
Total equity investments
 
$
76,297
$
26,993
Investment in
11
% (2020:
12
%) of MobiKwik
(1)
76,297
26,993
Investment in
15
%
 
of Cell C, at fair value (Note 5)
-
-
Investment in
87.50
% of CPS (Note 23)
(1)(2)
-
-
Total held to maturity
 
investments
 
-
-
Investment in
7.625
% of Cedar Cellular Investment 1 (RF) (Pty) Ltd
8.625
% notes
-
-
Long-term portion of amount due related to sale of interest in Bank Frick
(3)
3,890
-
Long-term portion of amount due from DNI related to sale of remaining interest
 
in DNI
-
2,857
Policy holder assets under investment contracts (Note 10)
381
490
Reinsurance assets under insurance contracts (Note 10)
1,298
1,006
Total other long-term
 
assets
$
81,866
$
31,346
(1)
 
The Company
 
determined
 
that
 
MobiKwik
 
and CPS
 
do not
 
have
 
readily
 
determinable
 
fair
 
values
 
and
 
therefore
 
elected to
record these investments
 
at cost minus impairment,
 
if any,
 
plus or minus changes
 
resulting from observable
 
price changes in orderly
transactions for the identical or a similar investment of the same issuer.
(2) On October 16, 2020,
 
the High Court of
 
South Africa, Gauteng Division, Pretoria
 
ordered that CPS be
 
placed into liquidation.
(3) Long-term portion of amount due related to sale of interest in Bank Frick represents the amount due by the purchaser
 
in July
2022.
Summary Of Components Of Equity Securities Without Readily Determinable Fair Value And Held To Maturity Investments
Cost basis
Unrealized
holding
Unrealized
holding
Carrying
gains
losses
value
Equity securities:
Investment in Mobikwik
$
26,993
$
49,304
$
-
$
76,297
Investment in CPS
-
-
-
-
Held to maturity:
Investment in Cedar Cellular notes
 
-
-
-
-
Total
 
$
26,993
$
49,304
$
-
$
76,297
Cost basis
Unrealized
holding
Unrealized
holding
Carrying
gains
losses
value
Equity securities:
Investment in MobiKwik
$
26,993
$
-
$
-
$
26,993
Investment in CPS
-
-
-
-
Held to maturity:
Investment in Cedar Cellular notes
 
-
-
-
-
Total
 
$
26,993
$
-
$
-
$
26,993
Summary Of Contractual Maturity Of Investment
Cost basis
Estimated
fair
value
(1)
Due in one year or less
 
$
-
$
-
Due in one year through five years
(2)
-
-
Due in five years through ten years
 
-
-
Due after ten years
 
-
-
Total
 
$
-
$
-
(1)
 
The
 
estimated
 
fair
 
value
 
of
 
the
 
Cedar
 
Cellular
 
note
 
has
 
been
 
calculated
 
utilizing
 
the
 
Company’s
 
portion
 
of
 
the
 
security
provided to the Company by Cedar Cellular, namely,
 
Cedar Cellular’s investment in Cell C.
(2) The cost basis is zero ($
0.0
 
million).
Disposal Of DNI On April 1, 2020 [Member]  
Schedule Of Calculation Of Gain (Loss) On Disposal
April 1
2020
Consideration received in cash on April 1, 2020 -
26,886,310
 
shares
$
42,477
Consideration received with note on April 1, 2020 - present value of note
 
-
3,508,455
 
shares
5,354
Less: transaction costs
(1,010)
Less: carrying value of DNI
(36,508)
Less: release of foreign currency translation reserve from accumulated other
 
comprehensive loss
(11,323)
Loss on sale of DNI before tax
(1,010)
Taxes related to sale of
 
DNI
-
Capital gains tax related to sale of DNI
(1)
2,475
Utilization of capital loss carryforwards
(1)
(2,475)
Loss on disposal of DNI after tax
$
(1,010)
(1) Net1 SA recorded a valuation allowance related to capital losses previously generated but
 
not utilized. The Company utilized
approximately $
12.0
 
million of these unutilized capital losses as a result of the disposal of its remaining interest in DNI in April 2020
and, therefore, the equivalent portion of the valuation allowance
 
created was released.
Disposal Of DNI On May 3, 2019 [Member]  
Schedule Of Calculation Of Gain (Loss) On Disposal
May 3,
2019
May 3, 2019 fair value of consideration received
$
15,011
Less: equity-method interest sold
(14,996)
Less: released from accumulated other comprehensive loss – foreign
 
currency translation reserve (as restated)
(Note 1 and Note 14)
162
May 2019 gain recognized on disposal, before tax
177
Capital loss related to disposal
(1)
-
Gain recognized on disposal, after tax, as of May 3, 2019
$
177
(1)
 
The disposal
 
of the
8
% interest
 
in DNI
 
resulted
 
in a
 
capital loss
 
for
 
tax purposes
 
of approximately
 
$
23.9
 
million and
 
the
Company provided a
 
valuation allowance of
 
$
23.9
 
million against this capital
 
loss because it did
 
not have any
 
capital gains to offset
against this amount at the time.
Disposal Of Bank Frick on February 3, 2021 [Member]  
Schedule Of Calculation Of Gain (Loss) On Disposal
February 3,
2021
Loss on sale of Bank Frick:
Consideration received in cash on February 3, 2021
$
18,600
Consideration received with note on February 3, 2021, refer to (Note 3) and
 
other long-term assets below
11,400
Less: transaction costs
(42)
Less: carrying value of Bank Frick
(32,892)
Add: release of foreign currency translation reserve from accumulated other
 
comprehensive loss
2,462
Loss on sale of Bank Frick
(1)
$
(472)
(1)
 
The Company does not
 
expect to pay taxes related
 
to the sale of Bank
 
Frick because the base
 
cost of its investment
 
exceeds
the sales consideration received. The Company does not
 
believe that it will be able
 
to utilize any capital loss, if
 
any, generated because
Net1
 
LI
 
does
 
not
 
own
 
any
 
other
 
capital
 
assets.
 
 
8.
 
EQUITY
-
ACCOUNTED
 
INVESTMENTS
 
AND
 
OTHER
 
LONG
-
TERM
 
ASSETS
 
(continued)
 
 
Equity-accounted investments (continued)