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Operating Segments
 12 Months Ended
Jun. 30, 2024
Operating Segments [Abstract]  
Operating Segments
21.
 
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.
The
 
Company
 
currently
 
has
two
 
reportable
 
segments:
 
Merchant
 
and
 
Consumer.
 
The
 
Company
 
operates
 
mainly
 
within
 
South
Africa.
 
The
 
Company’s
 
reportable
 
segments
 
offer
 
different
 
products
 
and
 
services
 
and
 
require
 
different
 
resources
 
and
 
marketing
strategies but share the Company’s
 
assets.
The Merchant segment
 
includes activities related
 
to the provision
 
of goods and
 
services provided to
 
corporate and other juristic
entities. The Company
 
earns fees from
 
processing activities performed
 
for its customers
 
and revenue generated
 
from the distribution
of
 
prepaid
 
airtime.
 
The
 
Company
 
provides
 
cash
 
management
 
and
 
payment
 
services
 
to
 
merchant
 
customers
 
through
 
a
 
digital
 
vault
(valuts) which
 
is located
 
at the
 
customer’s premises
 
and through
 
which the
 
Company is
 
able to
 
provide the
 
services which
 
generate
processing
 
fee
 
revenue.
 
The
 
Company
 
provides
 
its
 
customers
 
with
 
transaction
 
processing
 
services
 
that
 
involve
 
the
 
collection,
transmittal and
 
retrieval of
 
all transaction data.
 
From July 1,
 
2023, the
 
segment includes fees
 
earned from
 
transactions performed
 
by
customers utilizing its ATM infrastructure. This segment also includes sales of hardware and licenses to customers. Hardware includes
the sale of POS devices, SIM
 
cards and other consumables which can
 
occur on an ad hoc
 
basis. Licenses include the right to
 
use certain
technology developed by the Company.
The Consumer segment
 
includes activities related
 
to the provision
 
of financial services
 
to customers,
 
including a bank
 
account,
loans and
 
insurance products.
 
The Company
 
charges monthly
 
administration fees
 
for all
 
bank accounts.
 
Customers that
 
have a
 
bank
account managed by the Company are issued cards that can be utilized to withdraw funds at an ATM or to transact at a merchant point
of sale device (“POS”). The Company earns processing fees from transactions processed
 
for these customers. The Company also earns
fees on
 
transactions
 
performed by
 
other banks’
 
customers utilizing
 
its ATM
 
(until
 
June 30,
 
2023) or
 
POS. The
 
Company
 
provides
short-term loans to customers in South
 
Africa for which it earns
 
initiation and monthly service fees.
 
The Company writes life insurance
contracts, primarily funeral-benefit policies, and policy holders pay
 
the Company a monthly insurance premium.
 
21.
 
OPERATING SEGMENTS
 
(continued)
The reconciliation
 
of the
 
reportable segment’s
 
revenue to
 
revenue from
 
external customers
 
for the
 
years ended
 
June 30,
 
2024,
2023 and 2022, respectively,
 
is as follows:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue
Reportable
Segment
Inter-segment
Unallocated
From external
customers
Merchant
$
498,314
$
3,303
$
-
$
495,011
Consumer
69,211
-
-
69,211
Total for the year
 
ended June 30, 2024
$
567,525
$
3,303
$
-
$
564,222
Merchant
$
463,701
$
-
$
-
$
463,701
Consumer
62,801
-
-
62,801
Other
-
-
1,469
1,469
Total for the year
 
ended June 30, 2023
$
526,502
$
-
$
1,469
$
527,971
Merchant
$
156,689
$
12
$
-
$
156,677
Consumer
65,932
-
-
65,932
Total for the year
 
ended June 30, 2022
$
222,621
$
12
$
-
$
222,609
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’s reportable segments’
measure of
 
profit or
 
loss. The
 
Company does
 
not allocate
 
once-off items,
 
stock-based compensation
 
charges, certain
 
lease expenses
(“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), interest income, interest expense, income tax expense
or (earnings) 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
 
represent
 
non-recurring
 
expense
 
items,
 
including
 
costs
 
related
 
to
acquisitions and transactions consummated or ultimately
 
not pursued. Unrealized loss FV for currency adjustments
 
represents foreign
currency mark-to-market adjustments
 
on certain intercompany accounts.
 
The Lease adjustments reflect lease
 
expenses 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.
21.
 
OPERATING SEGMENTS
 
(continued)
The reconciliation of the reportable segments’ measures of profit or loss to loss before income taxes for the years ended June
 
30,
2024, 2023 and 2022, respectively,
 
is as follows:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2024
2023
2022
Reportable segments measure of profit or loss
 
$
48,018
$
36,845
$
(9,028)
Operating loss: Group costs
(7,844)
(9,109)
(8,587)
Once-off costs
(1,853)
(1,922)
(8,088)
Unrealized Loss FV for currency adjustments
83
(222)
-
Lease adjustments
(3,238)
(2,906)
(3,955)
Stock-based compensation charge adjustments
(7,911)
(7,309)
(2,962)
Depreciation and amortization
(23,665)
(23,685)
(7,575)
Impairment loss
-
(7,039)
-
Reversal of allowance for doubtful EMI debt receivable (Note 9)
250
-
-
Loss on disposal of equity-accounted investment (Note 9)
-
(205)
(376)
Gain related to fair value adjustment to currency options
-
-
3,691
Gain on disposal of equity securities
-
-
720
Interest income
 
2,294
1,853
2,089
Interest expense
 
(18,932)
(18,567)
(5,829)
Loss before income taxes
 
$
(12,798)
$
(32,266)
$
(39,900)
The following tables summarize segment information for the years ended
 
June 30, 2024, 2023 and 2022:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2024
2023
2022
Reportable segment revenue
Merchant
$
498,314
$
463,701
$
156,689
Consumer
69,211
62,801
65,932
Total reportable segment
 
revenue
567,525
526,502
222,621
Segment Adjusted EBITDA
Merchant
(1)
33,368
33,531
12,646
Consumer
(1)(2)
14,650
3,314
(21,674)
Total Segment Adjusted
 
EBITDA
48,018
36,845
(9,028)
Depreciation and amortization
Merchant
8,543
7,422
2,186
Consumer
734
1,114
1,660
Subtotal: Operating segments
 
9,277
8,536
3,846
Group costs
14,388
15,149
3,729
Total
 
23,665
23,685
7,575
Expenditures for long-lived assets
Merchant
11,348
12,986
2,846
Consumer
1,317
3,170
1,712
Subtotal: Operating segments
 
12,665
16,156
4,558
Group costs
-
-
-
Total
 
$
12,665
$
16,156
$
4,558
(1)
 
Segment
 
Adjusted
 
EBITDA
 
for
 
Merchant
 
includes
 
retrenchment
 
costs
 
of
 
$
0.3
 
million
 
(ZAR
4.9
 
million)
 
and
 
Consumer
 
includes
retrenchment costs of $
0.2
 
million (ZAR
3.5
 
million) for the year ended June 30, 2024; and
(2) Consumer Segment Adjusted EBITDA for the year ended June 30, 2022, includes reorganization costs of $
5.9
 
million (refer also Note 1).
21.
 
OPERATING SEGMENTS
 
(continued)
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.
Long-lived assets based on their geographic location as of June 30, 2024,
 
2023 and 2022, are presented in the table below:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Long-lived assets
2024
2023
2022
South Africa
$
286,700
$
300,104
$
359,725
India - Investment in MobiKwik (Note 9)
76,297
76,297
76,297
Rest of world
2,548
2,197
2,811
Total
$
365,545
$
378,598
$
438,833