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Operating Segments
 6 Months Ended
Dec. 31, 2022
Operating Segments [Abstract]  
Operating Segments

17.Operating segments

 

Operating segments

 

The Company discloses segment information as reflected in the management information systems reports that its chief operating decision maker uses in making decisions and to report certain entity-wide disclosures about products and services, and the countries in which the entity holds material assets or reports material revenues. A description of the Company’s operating segments is contained in Note 21 to the Company’s audited consolidated financial statements included in its Annual Report on Form 10-K for the year ended June 30, 2022.

 

Reallocation of certain activities in Other to Merchant

 

During the second quarter of fiscal 2023, certain processing activities performed outside South Africa which were within our Other operating segment commenced reporting to management within our Merchant operating segment as part of the integration of Connect. The Company has allocated these operations from its Other reporting segment to Merchant in its reportable segments during the second quarter of fiscal 2023. Previously reported information has been restated.

The reconciliation of the reportable segment’s revenue to revenue from external customers for the three months ended December 31, 2022 and 2021, is as follows:

 

 

 

 

 

 

Revenue

 

 

 

 

 

 

Reportable Segment

 

 

Inter-segment

 

 

From external customers

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer

$

15,434

 

$

-

 

$

15,434

 

Merchant

 

120,634

 

 

-

 

 

120,634

 

 

Total for the three months ended December 31, 2022

$

136,068

 

$

-

 

$

136,068

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer

$

16,639

 

$

-

 

$

16,639

 

Merchant

 

14,475

 

 

-

 

 

14,475

 

 

 

Total for the three months ended December 31, 2021

$

31,114

 

$

-

 

$

31,114

The reconciliation of the reportable segment’s revenue to revenue from external customers for the six months ended December 31, 2022 and 2021, is as follows:

 

 

 

 

 

 

Revenue

 

 

 

 

 

 

Reportable Segment

 

 

Inter-segment

 

 

From external customers

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer

$

30,438

 

$

-

 

$

30,438

 

Merchant

 

230,416

 

 

-

 

 

230,416

 

 

Total for the six months ended December 31, 2022

$

260,854

 

$

-

 

$

260,854

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer

$

33,803

 

$

-

 

$

33,803

 

Merchant

 

31,815

 

 

-

 

 

31,815

 

 

 

Total for the six months ended December 31, 2021

$

65,618

 

$

-

 

$

65,618

 

The Company evaluates segment performance based on segment earnings before interest, tax, depreciation and amortization (“EBITDA”), adjusted for items mentioned in the next sentence (“Segment Adjusted EBITDA”). The Company does not allocate once-off items, stock-based compensation charges, certain lease charges (“Lease adjustments”), depreciation and amortization, impairment of goodwill or other intangible assets, other items (including gains or losses on disposal of investments, fair value adjustments to equity securities, fair value adjustments to currency options), interest income, interest expense, income tax expense or loss from equity-accounted investments to its reportable segments. Group costs generally include: employee related costs in relation to employees specifically hired for group roles and related directly to managing the US-listed entity; expenditures related to compliance with the Sarbanes-Oxley Act of 2002; non-employee directors’ fees; legal fees; group and US-listed related audit fees; and directors and officer’s insurance premiums. Once-off items represents non-recurring expense items, including costs related to acquisitions and transactions consummated or ultimately not pursued. The Lease adjustments reflect lease charges and the Stock-based compensation adjustments reflect stock-based compensation expense and are both excluded from the calculation of Segment Adjusted EBITDA and are therefore reported as reconciling items to reconcile the reportable segments’ Segment Adjusted EBITDA to the Company’s loss before income tax expense.

17.Operating segments (continued)

 

Operating segments (continued)

 

The reconciliation of the reportable segments measure of profit or loss to loss before income taxes for the three and six months ended December 31, 2022 and 2021, is as follows:

 

 

 

 

 

Three months ended

 

 

Six months ended

 

 

 

 

 

December 31,

 

 

December 31,

 

 

 

 

2022

 

2021

 

2022

 

2021

 

Reportable segments measure of profit or loss

$

9,698

 

$

(3,362)

 

$

16,197

 

$

(10,643)

 

 

Operating loss: Group costs

 

(2,256)

 

 

(2,076)

 

 

(4,556)

 

 

(3,649)

 

 

Once-off items

 

(119)

 

 

(1,642)

 

 

(717)

 

 

(1,885)

 

 

Lease adjustments

 

(747)

 

 

(833)

 

 

(1,559)

 

 

(1,757)

 

 

Stock-based compensation charge adjustments

 

(2,849)

 

 

(788)

 

 

(4,311)

 

 

(1,097)

 

 

Depreciation and amortization

 

(5,919)

 

 

(726)

 

 

(11,917)

 

 

(1,621)

 

 

Unrealized loss related to fair value adjustment to currency options

 

-

 

 

(2,429)

 

 

-

 

 

(2,429)

 

 

Loss (Gain) on disposal of equity-accounted investment

 

(112)

 

 

-

 

 

136

 

 

-

 

 

Interest income

 

389

 

 

313

 

 

800

 

 

702

 

 

Interest expense

 

(4,388)

 

 

(765)

 

 

(8,424)

 

 

(1,581)

 

 

 

Loss before income taxes

$

(6,303)

 

$

(12,308)

 

$

(14,351)

 

$

(23,960)

17.Operating segments (continued)

 

Operating segments (continued)

 

The following tables summarize supplemental segment information for the three and six months ended December 31, 2022 and 2021:

 

 

 

 

 

 

 

 

 

Three months ended

 

Six months ended

 

 

 

 

 

 

 

 

 

December 31,

 

December 31,

 

 

 

 

 

 

 

 

 

2022

 

2021

 

2022

 

2021

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer

$

15,434

 

$

16,639

 

$

30,438

 

$

33,803

 

 

Merchant

 

120,634

 

 

14,475

 

 

230,416

 

 

31,815

 

 

 

Total

 

136,068

 

 

31,114

 

 

260,854

 

 

65,618

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment Adjusted EBITDA

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer

 

578

 

 

(4,366)

 

 

(816)

 

 

(13,722)

 

 

Merchant

 

9,120

 

 

1,004

 

 

17,013

 

 

3,079

 

 

 

Total Segment Adjusted EBITDA

 

9,698

 

 

(3,362)

 

 

16,197

 

 

(10,643)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer

 

278

 

 

499

 

 

523

 

 

1,151

 

 

Merchant

 

1,823

 

 

211

 

 

3,624

 

 

436

 

 

 

Subtotal: Operating segments

 

2,101

 

 

710

 

 

4,147

 

 

1,587

 

 

 

Group costs

 

3,818

 

 

16

 

 

7,770

 

 

34

 

 

 

 

Total

 

5,919

 

 

726

 

 

11,917

 

 

1,621

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenditures for long-lived assets

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer

 

340

 

 

168

 

 

968

 

 

810

 

 

Merchant

 

3,652

 

 

21

 

 

7,525

 

 

77

 

 

 

Subtotal: Operating segments

 

3,992

 

 

189

 

 

8,493

 

 

887

 

 

 

Group costs

 

-

 

 

-

 

 

-

 

 

-

 

 

 

 

Total

$

3,992

 

$

189

 

$

8,493

 

$

887

The segment information as reviewed by the chief operating decision maker does not include a measure of segment assets per segment as all of the significant assets are used in the operations of all, rather than any one, of the segments. The Company does not have dedicated assets assigned to a particular operating segment. Accordingly, it is not meaningful to attempt an arbitrary allocation and segment asset allocation is therefore not presented.