UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM10-Q/A (Amendment No. 1)

(Mark One)

☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934 For the quarterly period endedSeptember 30, 2024

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND

EXCHANGE ACT OF 1934 For the transition period fromTo

Commission file number:000-31203

LESAKA TECHNOLOGIES, INC.

(Exact name of registrant as specified in its charter)

Florida98-0171860 (State or other jurisdiction(IRS Employer of incorporation or organization)Identification No.)

President Place, 4thFloor,Cnr. Jan Smuts Avenue and Bolton Road,

Rosebank, Johannesburg,2196,South Africa (Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code:27-11-343-2000

Not Applicable (Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

Name of each exchange Title of each classTrading Symbol(s)on which registered Common stock, par value $0.001 per shareLSAKNASDAQGlobal Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d)
of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.YES☒NO☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).YES☒NO☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act (check one):

☐Large accelerated filer☒Accelerated filer

☐Non-accelerated filer☒Smaller reporting company

☐Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act). YES☐NO☒

As of November 4, 2024 (the latest practicable date),78,018,643shares of the registrant’s common stock, par value $0.001 per share, net of treasury shares, were outstanding.

EXPLANATORY NOTE

This Amendment No. 1 on Form 10-Q/A (“Amendment No. 1”) amends the Quarterly Report on Form 10-Q of Lesaka Technologies, Inc. (the “Company”) for the quarter ended September 30, 2024, as originally filed with the Securities and Exchange Commission (the “SEC”) on November 6, 2024, (the “Original Filing”).

On September 10, 2025, the Company filed a Current Report on Form 8-K under Item 4.02(a) with the SEC relating to the Original Filing. This Amendment No. 1 amends the Original Filing to reflect the restatement of the Company’s unaudited condensed consolidated financial statements for the three months ended September 30, 2024, in order to correct an error related to the Company’s accounting for revenue, as more fully described in Note 1 to the unaudited condensed consolidated financial statements contained in this Amendment No. 1. In correcting the misstatement in this Amendment No. 1, the Company has also revised other financial statement line item amounts, including but not limited to its long-term borrowings and current portion of long-term borrowings to revise its presentation between these accounts as a result of a misclassification identified during the three and nine months ended March 31, 2025, refer to Note 1 for additional information. Additionally, conforming changes occur throughout this filing because of the changes to the unaudited condensed consolidated financial statements.

In addition, we have filed an amendment to our Quarterly Reports on Form 10-Q for quarterly periods ended December 31, 2024, originally filed with the SEC on February 5, 2025; and March 31, 2025, originally filed with the SEC on May 7, 2025.

Internal Control Considerations

Management has reassessed its evaluation of the effectiveness of its internal control over financial reporting as of September 30, 2024, as further described in Part I, Item 4 of this Amendment, and concluded that material weaknesses existed and that internal control over financial reporting was not effective as of September 30, 2024.

Items Amended in this Form 10-Q/A

For ease of reference, this Amendment No. 1 amends and restates the Original Filing in its entirety. Revisions to the Original Filing have been made to the following sections:
•Part I, Item 1 – Financial Statements •Part I, Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations •Part I, Item 4 - Controls and Procedures •Part II, Item 1A. – Risk Factors •Part II, Item 6 - Exhibits

In addition, this Form 10-Q/A updates the signature page. In accordance with Rule 12b-15 under the Securities Exchange Act of 1934, the Company is also including with this Form 10-Q/A new certifications required by Sections 302 and 906 of the Sarbanes-Oxley Act of 2022 from the Company’s Executive Chairman (as principal executive officer) and Group Chief Financial Officer (as principal financial officer) dated as of the filing date of this Form 10-Q/A (included in Part II, Item 6. “Exhibits” and attached as Exhibits 31.1, 31.2, and 32).

Except as described above, this Form 10-Q/A is presented as of the date of the Original Filing and does not substantively amend, update or change any other items or disclosures contained in the Original Filing. Accordingly, this Form 10-Q/A does not reflect or purport to reflect any information or events occurring subsequent to November 6, 2024, the filing date of the Original Filing, unless specifically noted herein, or otherwise modify or update those disclosures affected by subsequent events, except to the extent they are otherwise required to be included and discussed herein. Among other things, forward-looking statements made in the Original Filing have not been revised to reflect events, results or developments that occurred or facts that became known to the Company after the date of the Original Form 10-Q, other than the restatement.

Accordingly, this Form 10-Q/A should be read in conjunction with the Company’s filings with the SEC that were made after the filing of the Original Filing including any amendments to those filings. This Form 10-Q/A should be read with the Annual Report on Form 10-K filed with the SEC on or about September 29, 2025.

Form 10-Q

LESAKA TECHNOLOGIES, INC.

Table of Contents

Page No.

PART I. FINANCIAL INFORMATION Item 1.Financial Statements Unaudited Condensed Consolidated Balance Sheets as of September 30, 2024 and June2| | ended September 30, 2024 and 2023 | | |
| --- | --- | --- | --- |
| | Notes to Unaudited Condensed Consolidated Financial Statements | (as restated) | 8 |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | | 36 |
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk | | 53 |
| Item 4. | Controls and Procedures | | 54 |
| Part II. OTHER INFORMATION | | | |
| Item 1A. | Risk Factors | | 56 |
| Item 5. | Other Information | | 58 |
| Item 6. | Exhibits | | 59 |
| Signatures | | | 60 |
| EXHIBIT 2.2 | | | |
| EXHIBIT 39 | | | |
| EXHIBIT 40 | | | |
| EXHIBIT 41 | | | |

Part I. Financial information

Item 1. Financial Statements

LESAKA TECHNOLOGIES, INC.

Unaudited Condensed Consolidated Balance Sheets| | | | September 30, | | June 30, | |
| --- | --- | --- | --- | --- | --- | --- |
| | | | 2024(A) | | 2024(B) | |
| | | | (In thousands, except share data) | | | |
| | ASSETS | | | | | |
| CURRENT ASSETS | | | | | | |
| Cash and cash equivalents | | | $49,687 | | $59,065 | |
| Restricted cash related to ATM funding and credit facilities (Note 8) | | | | 122 | | 6,853 |
| Accounts receivable, net and other receivables (Note 2) | | | 29,825 | | 36,667 | |
| Finance loans receivable, net (Note 2) | | | 47,017 | | 44,058 | |
| Inventory (Note 3) | | | 20,194 | | 18,226 | |
| Total current assets before settlement assets | | | 146,845 | | 164,869 | |
| Settlement assets | | | 20,469 | | 22,827 | |
| Total current assets | | | 167,314 | | 187,696 | |
| PROPERTY, PLANT AND EQUIPMENT, net of accumulated depreciation of - September: $ | | 50,532June: | | | | |
| $49,762 | | | 34,481 | | 31,936 | |
| OPERATING LEASE RIGHT-OF-USE (Note 16) | | | | 7,411 | | 7,280 |
| EQUITY-ACCOUNTED INVESTMENTS (Note 5) | | | | 245 | | 206 |
| GOODWILL (Note 6) | | | 146,577 | | 138,551 | |
| INTANGIBLE ASSETS, NET (Note 6) | | | 114,052 | | 111,353 | |
| DEFERRED INCOME TAXES | | | | 3,734 | | 3,446 |
| OTHER LONG-TERM ASSETS, including equity securities (Note 5 and 7) | | | 78,075 | | 77,982 | |
| TOTAL ASSETS | | | 551,889 | | 558,450 | |


CURRENT LIABILITIES
Short-term credit facilities for ATM funding (Note 8)	-	6,737
Short-term credit facilities (Note 8)	9,895	9,351
Accounts payable	12,815	16,674
Other payables (Note 9)	45,923	56,051
Operating lease liability - current (Note 16)	2,600	2,343
Current portion of long-term borrowings (Note 8)	16,384	15,719
Income taxes payable	1,488	654
Total current liabilities before settlement obligations	89,105	107,529
Settlement obligations	19,899	22,358
Total current liabilities	109,004	129,887
DEFERRED INCOME TAXES	39,345	38,128
OPERATING LEASE LIABILITY - LONG TERM (Note 16)	4,968	5,087
LONG-TERM BORROWINGS (Note 8)	132,136	127,467
OTHER LONG-TERM LIABILITIES, including insurance policy liabilities (Note 7)	2,790	2,595
TOTAL LIABILITIES	288,243	303,164
REDEEMABLE COMMON STOCK	79,429	79,429

				EQUITY
COMMON STOCK (Note 10)
Authorized:	200,000,000	with $0.001	par value;
Issued and outstanding shares, net of treasury - September:				64,301,943	June:	64,272,243	83	83
PREFERRED STOCK
Authorized shares:	50,000,000	with $	0.001par value;
Issued and outstanding shares, net of treasury: September:				-June:	-		-	-
ADDITIONAL PAID-IN-CAPITAL							346,016	343,639
TREASURY SHARES, AT COST: September:			25,563,808	June:25,563,808			( 289,733 )	( 289,733 )
ACCUMULATED OTHER COMPREHENSIVE LOSS (Note 11)							( 177,830 )	( 188,355 )
RETAINED EARNINGS							305,681	310,223
TOTAL LESAKA EQUITY							184,217	175,857
NON-CONTROLLING INTEREST							-	-
TOTAL EQUITY							184,217	175,857

TOTAL LIABILITIES, REDEEMABLE COMMON STOCK AND SHAREHOLDERS’ EQUITY$551,889$558,450

(A) – The Company reclassified an amount of $ 12,543 from long-term borrowings to current portion of long-term borrowings , refer to Note 1.
(B) – The Company reclassified an amount of $ 11,841 from long-term borrowings to current portion of long-term borrowings , refer to Note 1.
See Notes to Unaudited Condensed Consolidated Financial Statements 2

LESAKA TECHNOLOGIES, INC.

Unaudited Condensed Consolidated Statements of Operations| | | | data) | |
| --- | --- | --- | --- | --- |
| REVENUE (Note 15) | | $153,568 | $ | 136,089 |
| EXPENSE | | | | |
| Cost of goods sold, IT processing, servicing and support | | 118,909 | | 107,490 |
| Selling, general and administration | | 26,726 | | 22,515 |
| Depreciation and amortization | | 6,276 | | 5,856 |
| Transaction costs related to Adumo acquisition (Note 20) | | 1,702 | | - |
| OPERATING (LOSS) INCOME | | | ( 45 ) | 228 |
| REVERSAL OF (ALLOWANCE) OF EMI DOUBTFUL DEBT (Note 2 and 5) | | | - | 250 |
| INTEREST INCOME | | | 586 | 449 |
| INTEREST EXPENSE | | 5,032 | | 4,909 |
| LOSS BEFORE INCOME TAX EXPENSE | | ( 4,491 ) | | ( 3,982 ) |
| INCOME TAX EXPENSE (Note 18) | | | 78 | 264 |
| NET LOSS BEFORE EARNINGS (LOSS) FROM EQUITY-ACCOUNTED INVESTMENTS | | ( 4,569 ) | | ( 4,246 ) |
| EARNINGS (LOSS) FROM EQUITY-ACCOUNTED INVESTMENTS (Note 5) | | | 27 | ( 1,405 ) |
| NET LOSS | | $( 4,542 ) | $ | ( 5,651 ) |
| Net loss per share, in United States dollars | (Note 13): | | | |
| Basic loss attributable to Lesaka shareholders | | $ | ( 0.07 )$ | ( 0.09 ) |
| Diluted loss attributable to Lesaka shareholders | | $ | ( 0.07 )$ | ( 0.09 ) |

(A) Revenue and Cost of goods sold, IT processing, servicing and support have been restated to correct the misstatements discussed in Note 1.
See Notes to Unaudited Condensed Consolidated Financial Statements

LESAKA TECHNOLOGIES, INC.

Unaudited Condensed Consolidated Statements of Comprehensive (Loss) Income

Three months ended

September 30,

20242023 (In thousands)

Net loss$( 4,542 )$( 5,651 )| Other comprehensive income (loss), net of taxes | | |
| --- | --- | --- |
| Movement in foreign currency translation reserve | 10,525 | ( 844 ) |
| Movement in foreign currency translation reserve related to equity-accounted | | |
| investments | - | 489 |
| Total other comprehensive income (loss), net of taxes | 10,525 | ( 355 ) |

Comprehensive income (loss)5,983( 6,006 )
Add comprehensive loss attributable to non-controlling interest--

Comprehensive income (loss) attributable to Lesaka$5,983$( 6,006 )

See Notes to Unaudited Condensed Consolidated Financial Statements

LESAKA TECHNOLOGIES, INC.

Unaudited Condensed Consolidated Statements of Changes in Equity

Lesaka Technologies, Inc. Shareholders

Accumulated Number ofNumber ofAdditionalotherTotalNon-Redeemable Number ofTreasuryTreasuryshares, net ofPaid-InRetainedcomprehensiveLesakacontrollingcommon SharesAmountSharesSharestreasuryCapitalEarningslossEquityInterestTotalstock

For the three months ended September 30, 2023 (dollar amounts in thousands)

Balance – July 1, 202388,884,532$83( 25,244,286 )$( 288,238 )63,640,246$335,696$327,663$( 195,726 )$179,478$-$179,478$79,429

Exercise of stock options6,793-6,793212121

Stock-based compensation charge (Note 12)-1,7681,7681,768| Reversal of stock-based compensation | | | | | |
| --- | --- | --- | --- | --- | --- |
| charge (Note 12)Stock-based compensation charge | ( 8,127 ) | ( 8,127 ) | ( 9 ) | ( 9 ) | ( 9 ) |
| related to equity-accounted investment(Note 5) | | - | 14 | 14 | 14 |

Net loss-( 5,651 )( 5,651 )-( 5,651 )

Other comprehensive loss (Note 11)( 355 )( 355 )-( 355 )

Balance – September 30, 202388,883,198$83( 25,244,286 )$( 288,238 )63,638,912$337,490$322,012$( 196,081 )$175,266$-$175,266$79,429

LESAKA TECHNOLOGIES, INC.

Unaudited Condensed Consolidated Statements of Changes in Equity

Lesaka Technologies, Inc. Shareholders

Accumulated Number ofNumber ofAdditionalotherTotalNon-Redeemable
Number ofTreasuryTreasuryshares, net ofPaid-InRetainedcomprehensiveLesakacontrollingcommon
SharesAmountSharesSharestreasuryCapitalEarningslossEquityInterestTotalstock

For the three months ended September 30, 2024 (dollar amounts in thousands)
Balance – July 1, 202489,836,051$83( 25,563,808 )$( 289,733 )64,272,243$343,639$310,223$( 188,355 )$175,857$-$175,857$79,429

Restricted stock granted (Note 12)32,80032,800--

Stock-based compensation charge (Note 12)--2,3772,3772,377

Reversal of stock-based compensation charge (Note 12)( 3,100 )( 3,100 )---| Net loss | | | | | | | ( 4,542 ) | | ( 4,542 ) | | -( 4,542 ) | |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Other comprehensive income (Note | | | | | | | | 10,525 | 10,525 | | -10,525 | |
| 11)Balance – September 30, 2024 | 89,865,751 | $83 | ( 25,563,808 ) | $( 289,733 ) | 64,301,943 | $346,016 | $305,681 | $( 177,830 ) | $184,217 | $ | -$184,217 | $79,429 |

LESAKA TECHNOLOGIES, INC.

Unaudited Condensed Consolidated Statements of Cash Flows

Three months ended

September 30,

20242023 (In thousands)| Cash flows from operating activities | | | |
| --- | --- | --- | --- |
| Net loss | $( 4,542 ) | $ | ( 5,651 ) |
| Depreciation and amortization | 6,276 | | 5,856 |
| Movement in allowance for doubtful accounts receivable and finance loans receivable | 1,499 | | 1,525 |
| (Earnings) Loss from equity-accounted investments (Note 5) | | ( 27 ) | 1,405 |
| Movement in allowance for doubtful loans to equity-accounted investments | | - | ( 250 ) |
| Fair value adjustment related to financial liabilities | | 190 | ( 34 ) |
| Interest payable | 1,693 | | 1,764 |
| Facility fee amortized | | 69 | 227 |
| Profit on disposal of property, plant and equipment | | ( 27 ) | ( 36 ) |
| Stock-based compensation charge (Note 12) | 2,377 | | 1,759 |
| Decrease (Increase) in accounts receivable and other receivables | 7,692 | | ( 2,345 ) |
| Increase in finance loans receivable | ( 1,590 ) | | ( 488 ) |
| Increase in inventory | | ( 889 ) | ( 479 ) |
| (Decrease) Increase in accounts payable and other payables | ( 17,177 ) | | 375 |
| Increase in taxes payable | | 765 | 308 |
| Decrease in deferred taxes | | ( 446 ) | ( 562 ) |
| Net cash (used in) provided by operating activities | ( 4,137 ) | | 3,374 |

Cash flows from investing activities
Capital expenditures	( 3,965 )	( 2,809 )
Proceeds from disposal of property, plant and equipment	850	284
Acquisition of intangible assets	( 173 )	( 135 )
Net change in settlement assets	3,570	( 11,237 )
Net cash provided by (used in) investing activities	282	( 13,897 )

Cash flows from financing activities
Proceeds from bank overdraft (Note 8)	23,893	59,574
Repayment of bank overdraft (Note 8)	( 31,028 )	( 62,793 )
Long-term borrowings utilized (Note 8)	774	2,471
Repayment of long-term borrowings (Note 8)	( 5,472 )	( 2,629 )
Proceeds from exercise of stock options	-	21
Net change in settlement obligations	( 3,648 )	10,696
Net cash (used in) provided by financing activities	( 15,481 )	7,340

Effect of exchange rate changes on cash	3,226
Net decrease in cash, cash equivalents and restricted cash	( 16,110 )	( 3,626 )
Cash, cash equivalents and restricted cash – beginning of period	65,919	58,632
Cash, cash equivalents and restricted cash – end of period (Note 14)	$49,809	$55,006

See Notes to Unaudited Condensed Consolidated Financial Statements

LESAKA TECHNOLOGIES, INC

Notes to the Unaudited Condensed Consolidated Financial Statements

for the three months ended September 30, 2024 and 2023 (All amounts in tables stated in thousands or thousands of U.S. dollars, unless otherwise stated)

Basis of Presentation , Restatement of Financial Statement and Summary of Significant Accounting Policies Unaudited Interim Financial Information The accompanying unaudited condensed consolidated financial statements include all majority-owned subsidiaries over which the Company exercises control and have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and the rules and regulations of the United States Securities and Exchange Commission for Quarterly Reports on Form 10-Q and include all of the information and disclosures required for interim financial reporting. The results of operations for the three months ended September 30, 2024 and 2023, are not necessarily indicative of the results for the full year. The Company believes that the disclosures are adequate to make the information presented not misleading. These unaudited condensed consolidated financial statements should be read in conjunction with the financial statements, accounting policies and financial notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024, except as noted below, there are no material changes to significant accounting policies. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments), which are necessary for a fair representation of financial results for the interim periods presented. References to “Lesaka” are references solely to Lesaka Technologies, Inc. References to the “Company” refer to Lesaka and its consolidated subsidiaries, collectively, unless the context otherwise requires. Restatement of Previously Issued Financial Statements Subsequent to the issuance of the Company’s unaudited condensed consolidated financial statements for the three months ended September 30, 2024, the Company’s management determined that the Company incorrectly classified and recorded revenue from the sale of certain vouchers on an agent basis instead of as a principal due to a misinterpretation of the accounting implications related to a change in an operating process with its supplier. The Company understated its revenue and cost of goods sold, IT processing, servicing and support by $ 8.0 million in its unaudited condensed consolidated statement of operations for the three months ended September 30, 2024. The correction of the misclassification did not impact the Company’s basic and diluted loss per share, condensed consolidated balance sheet as of September 30, 2024, or its unaudited condensed consolidated statements of comprehensive (loss) income, unaudited condensed consolidated statement of changes in equity and unaudited condensed consolidated statements of cash flows for the three months ended September 30, 2024. The tables below present the impact of the restatement on the Company’s unaudited condensed consolidated statement of operations for the three months ended September 30, 2024:

Three months ended September 30, 2024 As previously reported Restatement adjustment As restated (in thousands) Revenue $ 145,546 $ 8,022 $ 153,568 Cost of goods sold, IT processing, servicing and support $ 110,887 $ 8,022 $ 118,909

Basis of Presentation , Restatement of Financial Statement and Summary of Significant Accounting Policies (continued) Revision of Previously Issued Financial Statements In April 2025, the Company identified that it had misclassified certain of its long-term borrowings. The Company’s CCC Revolving Credit Facility was scheduled to be repaid in full on November 2024, but this has been extended to June 30, 2025. The Company incorrectly classified amounts due under its CCC Revolving Credit Facility as long-term borrowings instead of as current portion of long-term borrowings in its unaudited condensed consolidated balance sheet as of September 30, 2024, and its audited consolidated balance sheet as of June 30, 2024. The table below presents the impact of the revision of the Company’s financial statements as of September 30, 2024 and June 30, 2024:

Consolidated balance sheet As previously reported Correction Revised (in thousands) September 30, 2024 Current portion of long-term borrowings $ 3,841 $ 12,543 $ 16,384 Long-term borrowings $ 144,679 ( 12,543 ) $ 132,136 June 30, 2024 Current portion of long-term borrowings $ 3,878 $ 11,841 $ 15,719 Long-term borrowings $ 139,308 $ ( 11,841 ) $ 127,467

The correction of the misclassification did not impact the Company’s audited consolidated statements of operations, consolidated statements of comprehensive (loss) income, consolidated statement of changes in equity, or consolidated statements of cash flows for the year ended June 30, 2024 and, except as noted above, the Company’s audited balance sheet as of June 30, 2024. The misclassification did not affect compliance with any debt covenants. The Company assessed the materiality of this error and change in presentation on prior period consolidated financial statements in accordance with SEC Staff Accounting Bulletin (“SAB”) No. 99 “Materiality” and SAB No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in the Current Year Financial Statements.” Based on this assessment, the Company has concluded that previously issued financial statements were not materially misstated based upon overall considerations of both quantitative and qualitative factors. The effects of both the restatement relating to the correction of the misclassification of revenue and the revision relating to the correction of the misclassification of long-term borrowings have been corrected in all impacted tables and footnotes throughout these condensed consolidated financial statements. Recent accounting pronouncements adopted In November 2023, the Financial Accounting Standards Board (“FASB”) issued guidance regarding Segment Reporting (Topic 280) to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. In addition, the guidance enhances interim disclosure requirements, clarifies circumstances in which an entity can disclose multiple segment measures of profit or loss, provides new segment disclosure requirements for entities with a single reportable segment, and contains other disclosure requirements. This guidance is effective for the Company beginning July 1, 2024 for its year ended June 30, 2025, and for interim periods commencing from July 1, 2025 (i.e. for the quarter ended September 30, 2025). Recent accounting pronouncements not yet adopted as of September 30, 2024 In December 2023, the FASB issued guidance regarding Income Taxes (Topic 740) to improve income tax disclosure requirements. The guidance requires entities, on an annual basis, to (1) disclose specific categories in the income tax rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold (if the effect of those reconciling items is equal to or greater than five percent of the amount computed by multiplying pre-tax income or loss by the applicable statutory income tax rate). This guidance is effective for the Company beginning July 1, 2025. The Company is currently assessing the impact of this guidance on its financial statements and related disclosures.

Accounts receivable, net and other receivables and finance loans receivable, net Accounts receivable, net and other receivables The Company’s accounts receivable, net, and other receivables as of September 30, 2024, and June 30, 2024, are presented in the table below:

September 30, June 30, 2024 2024 Accounts receivable, trade, net $ 11,083 $ 13,262 Accounts receivable, trade, gross 12,569 14,503 Allowance for doubtful accounts receivable, end of period 1,486 1,241 Beginning of period 1,241 509 Reversed to statement of operations ( 50 ) ( 511 ) Charged to statement of operations 307 1,305 Utilized ( 87 ) ( 67 ) Foreign currency adjustment 75 5 Current portion of amount outstanding related to sale of interest in Carbon, net of allowance: September 2024: $ 750 ; June 2024: $ 750 - - Current portion of total held to maturity investments - - Investment in 7.625 % of Cedar Cellular Investment 1 (RF) (Pty) Ltd 8.625 % notes - - Other receivables 18,742 23,405 Total accounts receivable, net and other receivables $ 29,825 $ 36,667

Trade receivables include amounts due from customers which generally have a very short-term life from date of invoice or service provided to settlement. The duration is less than a year in all cases and generally less than 30 days in many instances. The short-term nature of these exposures often results in balances at month-end that are disproportionately small compared to the total invoiced amounts. The month-end outstanding balance are more volatile than the monthly invoice amounts because they are affected by operational timing issues and the fact that a balance is outstanding at month-end is not necessarily an indication of increased risk but rather a matter of operational timing. Credit risk in respect of trade receivables are generally not significant and the Company has not developed a sophisticated model for these basic credit exposures. The Company determined to use a lifetime loss rate by expressing write-off experience as a percentage of corresponding invoice amounts (as opposed to outstanding balances). The allowance for credit losses related to these receivables has been calculated by multiplying the lifetime loss rate with recent invoice/origination amounts. Management actively monitors performance of these receivables over short periods of time. Different balances have different rules to identify an account in distress. Once balances in distress are identified, specific allowances are immediately created. Subsequent recovery from distressed accounts is not significant. Current portion of amount outstanding related to sale of interest in Carbon represents an amount due related to the sale of the loan in Carbon Tech Limited (“Carbon”), with a face value of $ 3.0 million, which was sold in September 2022 for $ 0.75 million, net of an allowance for doubtful loans receivable of $ 0.75 million. The Company has not yet received the outstanding $ 0.75 million related to the sale of the $ 3.0 million loan, and continues to engage with the purchaser to recover the outstanding balance. Investment in 7.625 % of Cedar Cellular Investment 1 (RF) (Pty) Ltd 8.625 % notes represents the investment in a note which was due to mature in August 2022 and forms part of Cell C’s capital structure. The carrying value as of each of September 30, 2024, and June 30, 2024, respectively was $ 0 (zero). Other receivables include prepayments, deposits, income taxes receivable and other receivables.

Accounts receivable, net and other receivables and finance loans receivable, net (continued) Finance loans receivable, net The Company’s finance loans receivable, net, as of September 30, 2024, and June 30, 2024, is presented in the table below:

September 30, June 30, 2024 2024 Microlending finance loans receivable, net $ 30,732 $ 28,184 Microlending finance loans receivable, gross 32,851 30,131 Allowance for doubtful finance loans receivable, end of period 2,119 1,947 Beginning of period 1,947 1,432 Reversed to statement of operations - ( 210 ) Charged to statement of operations 609 2,454 Utilized ( 552 ) ( 1,795 ) Foreign currency adjustment 115 66 Merchant finance loans receivable, net 16,285 15,874 Merchant finance loans receivable, gross 19,380 18,571 Allowance for doubtful finance loans receivable, end of period 3,095 2,697 Beginning of period 2,697 2,150 Reversed to statement of operations - ( 359 ) Charged to statement of operations 632 2,479 Utilized ( 397 ) ( 1,672 ) Foreign currency adjustment 163 99 Total finance loans receivable, net $ 47,017 $ 44,058

Total finance loans receivable, net, comprises microlending finance loans receivable related to the Company’s microlending operations in South Africa as well as its merchant finance loans receivable related to Connect’s lending activities in South Africa. Certain merchant finance loans receivable with an aggregate balance of $ 15.6 million as of September 30, 2024 have been pledged as security for the Company’s revolving credit facility (refer to Note 8).

Allowance for credit losses Microlending finance loans receivable Microlending finance loans receivable is related to the Company’s microlending operations in South Africa whereby it provides unsecured short-term loans to qualifying customers. Loans to customers have a tenor of up to six months , with the majority of loans originated having a tenor of six months . The Company analyses this lending book as a single portfolio because the loans within the portfolio have similar characteristics and management uses similar processes to monitor and assess the credit risk of the lending book. Refer to Note 4 related to the Company risk management process related to these receivables. The Company has operated this lending book for more than five years and uses historical default experience over the lifetime of loans in order to calculate a lifetime loss rate for the lending book. The allowance for credit losses related to these microlending finance loans receivables is calculated by multiplying the lifetime loss rate with the month end outstanding lending book. The lifetime loss rate as of each of June 30, 2024 and September 30, 2024, was 6.50 %. The performing component (that is, outstanding loan payments not in arrears) of the book exceeds more than 98 %, of the outstanding lending book as of each of June 30, 2024 and September 30, 2024. Merchant finance loans receivable Merchant finance loans receivable is related to the Company’s Merchant lending activities in South Africa whereby it provides unsecured short-term loans to qualifying customers. Loans to customers have a tenor of up to twelve months , with the majority of loans originated having a tenor of approximately eight months . The Company analyses this lending book as a single portfolio because the loans within the portfolio have similar characteristics and management uses similar processes to monitor and assess the credit risk of the lending book. Refer to Note 4 related to the Company risk management process related to these receivables.

2.Accounts receivable, net and other receivables and finance loans receivable, net (continued)

Finance loans receivable, net (continued)

Allowance for credit losses (continued)

Merchant finance loans receivable (continued)

The Company has recently (in the past three years ) commenced lending to merchant customers and uses historical default experience over the lifetime of loans generated thus far in order to calculate a lifetime loss rate for the lending book. The allowance for credit losses related to these merchant finance loans receivables is calculated by adding together actual receivables in default plus multiplying the lifetime loss rate with the month-end outstanding lending book. The lifetime loss rate as of each of June 30, 2024 and September 30, 2024, was approximately 1.18 %. The performing component (that is, outstanding loan payments not in arrears), under- performing component (that is, outstanding loan payments that are in arrears) and non-performing component (that is, outstanding loans for which payments appeared to have ceased) of the book represents approximately 84 %, 15 % and 1 %, respectively, of the outstanding lending book as of June 30, 2024. The performing component, under-performing component and non-performing component of the book represents approximately 85 %, 15 % and 0 %, respectively, of the outstanding lending book as of September 30, 2024.

Inventory The Company’s inventory comprised the following categories as of September 30, 2024, and June 30, 2024:

September 30, June 30, 2024 2024 Raw materials $ 2,784 $ 2,791 Work-in-progress 744 71 Finished goods 16,666 15,364 $ 20,194 $ 18,226

Finished goods as of June 30, 2024, includes $ 1.8 million of Cell C airtime inventory that was previously classified as finished goods subject to sale restrictions. The Company sold all of this inventory during the three months ended September 30, 2024.

Fair value of financial instruments Initial recognition and measurement Financial instruments are recognized when the Company becomes a party to the transaction. Initial measurements are at cost, which includes transaction costs. Risk management The Company manages its exposure to currency exchange, translation, interest rate, credit, microlending credit and equity price and liquidity risks as discussed below. Currency exchange risk The Company is subject to currency exchange risk because it purchases components for its safe assets, that the Company assembles, and inventories that it is required to settle in other currencies, primarily the euro, renminbi, and U.S. dollar. The Company has used forward contracts in order to limit its exposure in these transactions to fluctuations in exchange rates between the South African rand (“ZAR”), on the one hand, and the U.S. dollar and the euro, on the other hand. Translation risk Translation risk relates to the risk that the Company’s results of operations will vary significantly as the U.S. dollar is its reporting currency, but it earns a significant amount of its revenues and incurs a significant amount of its expenses in ZAR. The U.S. dollar to the ZAR exchange rate has fluctuated significantly over the past three years. As exchange rates are outside the Company’s control, there can be no assurance that future fluctuations will not adversely affect the Company’s results of operations and financial condition.

Fair value of financial instruments (continued) Risk management (continued) Interest rate risk As a result of its normal borrowing activities, the Company’s operating results are exposed to fluctuations in interest rates, which it manages primarily through regular financing activities. Interest rates in South Africa have remained unchanged in recent quarters and in September 2024, the South African Reserve Bank announced a 25-basis point reduction in the South African repurchase rate, with further reductions expected in the short-term. Therefore, ignoring the impact of changes to the margin on its borrowings (refer to Note 8), the Company expects its cost of borrowing to decline moderately in the foreseeable future, however, the Company would expect a higher cost of borrowing if interest rates were to increase in the future. The Company periodically evaluates the cost and effectiveness of interest rate hedging strategies to manage this risk. The Company generally maintains surplus cash in cash equivalents and held to maturity investments and has occasionally invested in marketable securities. Credit risk Credit risk relates to the risk of loss that the Company would incur as a result of non-performance by counterparties. The Company maintains credit risk policies in respect of its counterparties to minimize overall credit risk. These policies include an evaluation of a potential counterparty’s financial condition, credit rating, and other credit criteria and risk mitigation tools as the Company’s management deems appropriate. With respect to credit risk on financial instruments, the Company maintains a policy of entering into such transactions only with South African and European financial institutions that have a credit rating of “B” (or its equivalent) or better, as determined by credit rating agencies such as Standard & Poor’s, Moody’s and Fitch Ratings. Consumer microlending credit risk The Company is exposed to credit risk in its Consumer microlending activities, which provides unsecured short-term loans to qualifying customers. Credit bureau checks as well as an affordability test are conducted as part of the origination process, both of which are in line with local regulations. The Company considers this policy to be appropriate because the affordability test it performs takes into account a variety of factors such as other debts and total expenditures on normal household and lifestyle expenses. Additional allowances may be required should the ability of its customers to make payments when due deteriorate in the future. Judgment is required to assess the ultimate recoverability of these finance loan receivables, including ongoing evaluation of the creditworthiness of each customer. Merchant lending The Company maintains an allowance for doubtful finance loans receivable related to its Merchant services segment with respect to short-term loans to qualifying merchant customers. The Company’s risk management procedures include adhering to its proprietary lending criteria which uses an online-system loan application process, obtaining necessary customer transaction-history data and credit bureau checks. The Company considers these procedures to be appropriate because it takes into account a variety of factors such as the customer’s credit capacity and customer-specific risk factors when originating a loan. Equity price and liquidity risk Equity price risk relates to the risk of loss that the Company would incur as a result of the volatility in the exchange-traded price of equity securities that it holds. The market price of these securities may fluctuate for a variety of reasons and, consequently, the amount that the Company may obtain in a subsequent sale of these securities may significantly differ from the reported market value. Equity liquidity risk relates to the risk of loss that the Company would incur as a result of the lack of liquidity on the exchange on which those securities are listed. The Company may not be able to sell some or all of these securities at one time, or over an extended period of time without influencing the exchange-traded price, or at all. Financial instruments The following section describes the valuation methodologies the Company uses to measure its significant financial assets and liabilities at fair value. In general, and where applicable, the Company uses quoted prices in active markets for identical assets or liabilities to determine fair value. This pricing methodology would apply to Level 1 investments. If quoted prices in active markets for identical assets or liabilities are not available to determine fair value, then the Company uses quoted prices for similar assets and liabilities or inputs other than the quoted prices that are observable either directly or indirectly. These investments would be included in Level 2 investments. In circumstances in which inputs are generally unobservable, values typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model- based techniques that include option pricing models, discounted cash flow models, and similar techniques. Investments valued using such techniques are included in Level 3 investments.

Fair value of financial instruments (continued) Financial instruments (continued) Asset measured at fair value using significant unobservable inputs – investment in Cell C The Company’s Level 3 asset represents an investment of 75,000,000 class “A” shares in Cell C, a significant mobile telecoms provider in South Africa. The Company used a discounted cash flow model developed by the Company to determine the fair value of its investment in Cell C as of September 30, 2024 and June 30, 2024, respectively, and valued Cell C at $ 0.0 (zero) and $ 0.0 (zero) as of September 30, 2024, and June 30, 2024, respectively. The Company incorporates the payments under Cell C’s lease liabilities into the cash flow forecasts and assumes that Cell C’s deferred tax assets would be utilized over the forecast period. The Company has assumed a marketability discount of 20 % and a minority discount from of 24 %. The Company utilized the latest business plan provided by Cell C management for the period ending December 31, 2027, for the September 30, 2024, and June 30, 2024, valuations. Adjustments have been made to the WACC rate to reflect the Company’s assessment of risk to Cell C achieving its business plan. The following key valuation inputs were used as of September 30, 2024 and June 30, 2024:

Weighted Average Cost of Capital ("WACC"): Between 21 % and 23 % over the period of the forecast Long term growth rate: 4.5 % ( 4.5 % as of June 30, 2024) Marketability discount: 20 % ( 20 % as of June 30, 2024) Minority discount: 24 % ( 24 % as of June 30, 2024) Net adjusted external debt - September 30, 2024: (1) ZAR 7.4 billion ($ 0.4 billion), no lease liabilities included Net adjusted external debt - June 30, 2024: (2) ZAR 8 billion ($ 0.4 billion), no lease liabilities included

(1) translated from ZAR to U.S. dollars at exchange rates applicable as of September 30, 2024. (2) translated from ZAR to U.S. dollars at exchange rates applicable as of June 30, 2024. The following table presents the impact on the carrying value of the Company’s Cell C investment of a 1.0 % decrease and 1.0 % increase in the WACC rate and the EBITDA margins respectively used in the Cell C valuation on September 30, 2024, all amounts translated at exchange rates applicable as of September 30, 2024:

Sensitivity for fair value of Cell C investment 1.0% increase 1.0% decrease WACC rate $ - $ 519 EBITDA margin $ 146 $ -

The fair value of the Cell C shares as of September 30, 2024, represented 0 % of the Company’s total assets, including these shares. The Company expects to hold these shares for an extended period of time and that there will be short-term equity price volatility with respect to these shares particularly given that Cell C remains in a turnaround process.

The following table presents the Company’s assets measured at fair value on a recurring basis as of September 30, 2024, according to the fair value hierarchy:

Quoted Price in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets Investment in Cell C $ - $ - $ - $ - Related to insurance business: Cash, cash equivalents and restricted cash (included in other long-term assets) 235 - - 235 Fixed maturity investments (included in cash and cash equivalents) 5,523 - - 5,523 Total assets at fair value $ 5,758 $ - $ - $ 5,758

Fair value of financial instruments The following table presents the Company’s assets measured at fair value on a recurring basis as of June 30, 2024, according to the fair value hierarchy:

Quoted Price in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets Investment in Cell C $ - $ - $ - $ - Related to insurance business Cash and cash equivalents (included in other long-term assets) 216 - - 216 Fixed maturity investments (included in cash and cash equivalents) 4,635 - - 4,635 Total assets at fair value $ 4,851 $ - $ - $ 4,851

There have been no transfers in or out of Level 3 during the three months ended September 30, 2024 and 2023, respectively. There was no movement in the carrying value of assets measured at fair value on a recurring basis, and categorized within Level 3, during the three months ended September 30, 2024 and 2023.

Summarized below is the movement in the carrying value of assets and liabilities measured at fair value on a recurring basis, and categorized within Level 3, during the three months ended September 30, 2024:

Carrying value Assets Balance as of June 30, 2024 $ - Foreign currency adjustment (1) - Balance as of September 30, 2024 $ -

(1) The foreign currency adjustment represents the effects of the fluctuations of the South African rand against the U.S. dollar on the carrying value.

Carrying value Assets Balance as of June 30, 2023 $ - Foreign currency adjustment (1) - Balance as of September 30, 2023 $ -

(1) The foreign currency adjustment represents the effects of the fluctuations of the South African rand against the U.S. dollar on the carrying value. Assets measured at fair value on a nonrecurring basis The Company measures equity investments without readily determinable fair values at fair value on a nonrecurring basis. The fair values of these investments are determined based on valuation techniques using the best information available and may include quoted market prices, market comparables, and discounted cash flow projections. An impairment charge is recorded when the cost of the asset exceeds its fair value and the excess is determined to be other-than-temporary. Refer to Note 5 for impairment charges recorded during the reporting periods presented herein. The Company has no liabilities that are measured at fair value on a nonrecurring basis.

Equity-accounted investments and other long-term assets Refer to Note 9 to the Company’s audited consolidated financial statements included in its Annual Report on Form 10-K for the year ended June 30, 2024, for additional information regarding its equity-accounted investments and other long-term assets. Equity-accounted investments The Company’s ownership percentage in its equity-accounted investments as of September 30, 2024, and June 30, 2024, was as follows:

September 30, June 30, 2024 2024 Sandulela Technology (Pty) Ltd ("Sandulela") 49.0 % 49.0 % SmartSwitch Namibia (Pty) Ltd (“SmartSwitch Namibia”) 50.0 % 50.0 %

Finbond impairments recorded during the three months ended September 30, 2023 On August 10, 2023, the Company, through its wholly owned subsidiary Net1 Finance Holdings (Pty) Ltd, entered into an agreement with Finbond to sell its remaining shareholding to Finbond for a cash consideration of ZAR 64.2 million ($ 3.4 million using exchange rates applicable as of September 30, 2023), or ZAR 0.2911 per share. Closed transaction closed in December 2023. The Company considered the August 10, 2023, agreement to be an impairment indicator. The Company is required to include any foreign currency translation reserve and other equity account amounts in its impairment assessment if it considers exiting an equity method investment. The Company performed an impairment assessment of its holding in Finbond, including the foreign currency translation reserve and other equity account amounts, as of September 30, 2023. The Company recorded an impairment loss of $ 1.2 million during the quarter ended September 30, 2023, which represented the difference between the determined fair value of the Company’s interest in Finbond and the Company’s carrying value, including the foreign currency translation reserve (before the impairment). The Company used the price of ZAR 0.2911 referenced in the August 2023 agreement referred to above to calculate the determined fair value for Finbond.

Carbon In September 2022, the Company, through its wholly-owned subsidiary, Net1 Applied Technologies Netherlands B.V. (“Net1 BV”), entered into a binding term sheet with the Etobicoke Limited (“Etobicoke”) to sell its entire interest, or 25 %, in Carbon to Etobicoke for $ 0.5 million and a loan due from Carbon, with a face value of $ 3.0 million, to Etobicoke for $ 0.75 million. Both the equity interest and the loan had a carrying value of $ 0 (zero) at June 30, 2022. The parties agreed that Etobicoke pledge the Carbon shares purchased as security for the amounts outstanding under the binding term sheet. The Company received $ 0.25 million on closing and the outstanding balance due by Etobicoke was expected to be paid as follows: (i) $ 0.25 million on September 30, 2023 (the amount was received in October 2023), and (ii) the remaining amount, of $ 0.75 million in March 2024 (the amount has not been received as of September 30, 2024 (refer to Note 2)).

Summarized below is the movement in equity-accounted investments and loans provided to equity-accounted investments during the three months ended September 30, 2024:

Total (1) Investment in equity Balance as of June 30, 2024 $ 206 Stock-based compensation - Comprehensive income: 27 Other comprehensive income - Equity accounted (loss) earnings 27 Share of net (loss) earnings 27 Impairment - Foreign currency adjustment (2) 12 Balance as of September 30, 2024 $ 245

(1) Includes Sandulela, and SmartSwitch Namibia; (2) The foreign currency adjustment represents the effects of the fluctuations of the ZAR and Namibian dollar, against the U.S. dollar on the carrying value.

Equity-accounted investments and other long-term assets (continued) Other long-term assets Summarized below is the breakdown of other long-term assets as of September 30, 2024, and June 30, 2024:

September 30, June 30, 2024 2024 Total equity investments $ 76,297 $ 76,297 Investment in 5 % of Cell C (June 30, 2024: 5 %) at fair value (Note 4) - - Investment in 10 % of MobiKwik (June 30, 2024: 10 %) (1) 76,297 76,297 Investment in 87.5 % of CPS (June 30, 2024: 87.5 %) at fair value (1)(2) - - Policy holder assets under investment contracts (Note 7) 235 216 Reinsurance assets under insurance contracts (Note 7) 1,543 1,469 Total other long-term assets $ 78,075 $ 77,982

(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. Summarized below are the components of the Company’s equity securities without readily determinable fair value and held to maturity investments as of September 30, 2024:

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 (Note 2) - - - - Total $ 26,993 $ 49,304 $ - $ 76,297

Summarized below are the components of the Company’s equity securities without readily determinable fair value and held to maturity investments as of June 30, 2024:

Goodwill and intangible assets, net Goodwill Summarized below is the movement in the carrying value of goodwill for the three months ended September 30, 2024:

Gross value Accumulated impairment Carrying value Balance as of June 30, 2024 $ 157,899 $ ( 19,348 ) $ 138,551 Foreign currency adjustment (1) 8,816 ( 790 ) 8,026 Balance as of September 30, 2024 $ 166,715 $ ( 20,138 ) $ 146,577

(1) – The foreign currency adjustment represents the effects of the fluctuations of the South African rand against the U.S. dollar on the carrying value.

Goodwill and intangible assets, net (continued) Goodwill (continued) Goodwill has been allocated to the Company’s reportable segments as follows:

Consumer Merchant Carrying value Balance as of June 30, 2024 $ - $ 138,551 $ 138,551 Foreign currency adjustment (1) - 8,026 8,026 Balance as of September 30, 2024 $ - $ 146,577 $ 146,577

(1) The foreign currency adjustment represents the effects of the fluctuations of the South African rand against the U.S. dollar on the carrying value.

Intangible assets, net Carrying value and amortization of intangible assets Summarized below is the carrying value and accumulated amortization of intangible assets as of September 30, 2024, and June 30, 2024:

As of September 30, 2024 As of June 30, 2024 Gross carrying value Accumulated amortization Net carrying value Gross carrying value Accumulated amortization Net carrying value Finite-lived intangible assets: Customer relationships $ 27,388 $ ( 15,390 ) $ 11,998 $ 25,880 $ ( 14,030 ) $ 11,850 Software, integrated platform and unpatented technology 122,099 ( 30,331 ) 91,768 115,213 ( 25,763 ) 89,450 FTS patent 2,230 ( 2,230 ) - 2,107 ( 2,107 ) - Brands and trademarks 15,188 ( 4,902 ) 10,286 14,353 ( 4,300 ) 10,053 Total finite-lived intangible assets $ 166,905 $ ( 52,853 ) $ 114,052 $ 157,553 $ ( 46,200 ) $ 111,353

Aggregate amortization expense on the finite-lived intangible assets for the three months ended September 30, 2024 and 2023, was $ 3.8 million and $ 3.6 million, respectively. Future estimated annual amortization expense for the next five fiscal years and thereafter, assuming exchange rates that prevailed on September 30, 2024, is presented in the table below. Actual amortization expense in future periods could differ from this estimate as a result of acquisitions, changes in useful lives, exchange rate fluctuations and other relevant factors.

Fiscal 2025 (excluding three months ended September 30, 2024) $ 11,888 Fiscal 2026 15,850 Fiscal 2027 15,790 Fiscal 2028 15,790 Fiscal 2029 15,602 Thereafter 39,132 Total future estimated annual amortization expense $ 114,052

Assets and policyholder liabilities under insurance and investment contracts Reinsurance assets and policyholder liabilities under insurance contracts Summarized below is the movement in reinsurance assets and policyholder liabilities under insurance contracts during the three months ended September 30, 2024:

Reinsurance Assets (1) Insurance contracts (2) Balance as of June 30, 2024 $ 1,469 $ ( 2,241 ) Increase in policy holder benefits under insurance contracts 180 ( 2,500 ) Claims and decrease in policyholders’ benefits under insurance contracts ( 190 ) 2,463 Foreign currency adjustment (3) 84 ( 131 ) Balance as of September 30, 2024 $ 1,543 $ ( 2,409 )

(1) Included in other long-term assets (refer to Note 5); (2) Included in other long-term liabilities; (3) Represents the effects of the fluctuations of the ZAR against the U.S. dollar.

Assets and policyholder liabilities under insurance and investment contracts (continued) Reinsurance assets and policyholder liabilities under insurance contracts (continued) The Company has agreements with reinsurance companies in order to limit its losses from various insurance contracts, however, if the reinsurer is unable to meet its obligations, the Company retains the liability. The value of insurance contract liabilities is based on the best estimate assumptions of future experience plus prescribed margins, as required in the markets in which these products are offered, namely South Africa. The process of deriving the best estimate assumptions plus prescribed margins includes assumptions related to claim reporting delays (based on average industry experience). Assets and policyholder liabilities under investment contracts Summarized below is the movement in assets and policyholder liabilities under investment contracts during the three months ended September 30, 2024:

Assets (1) Investment contracts (2) Balance as of June 30, 2024 $ 216 $ ( 216 ) Increase in policy holder benefits under investment contracts 6 ( 6 ) Foreign currency adjustment (3) 13 ( 13 ) Balance as of September 30, 2024 $ 235 $ ( 235 )

(1) Included in other long-term assets (refer to Note 5); (2) Included in other long-term liabilities; (3) Represents the effects of the fluctuations of the ZAR against the U.S. dollar.

The Company does not offer any investment products with guarantees related to capital or returns.

Borrowings Refer to Note 12 to the Company’s audited consolidated financial statements included in its Annual Report on Form 10-K for the year ended June 30, 2024, for additional information regarding its borrowings. South Africa The amounts below have been translated at exchange rates applicable as of the dates specified. The 3-month Johannesburg Interbank Agreed Rate (“JIBAR”), the rate at which private sector banks borrow funds from the South African Reserve Bank, on September 30, 2024, was 8.35 %. The prime rate, the benchmark rate at which private sector banks lend to the public in South Africa, on September 30, 2024, was 11.50 %. RMB Facilities, as amended, comprising a short-term facility (Facility E) and long-term borrowings Long-term borrowings - Facility G and Facility H As of September 30, 2024, the Company had not utilized any of its ZAR 200 million Facility G revolving credit facility. The interest rate on this facility as of September 30, 2024, was JIBAR plus 4.75 %. Available short-term facility - Facility E As of September 30, 2024, the aggregate amount of the Company’s short-term South African overdraft facility with RMB was ZAR 0.9 billion ($ 52.4 million). As of September 30, 2024, the Company had not utilized this overdraft facility. This overdraft facility may only be used to fund ATMs and therefore the overdraft utilized and converted to cash to fund the Company’s ATMs is considered restricted cash. The interest rate on this facility is equal to the prime rate.

Borrowings (borrowings) (continued) South Africa (continued) RMB Bridge Facilities, comprising a short-term facility obtained in October 2024 On September 30, 2024, Lesaka SA entered into a Facility Letter (the "F2024 Facility Letter") with RMB to provided Lesaka SA a ZAR 665.0 million funding facility (the “Facility”). The Facility has been used by Lesaka SA to (i) settle an amount of ZAR 232.2 due under the Adumo transaction (refer to Note 20); (ii) pay Crossfin Holdings (RF) Proprietary Limited (“Crossfin”) ZAR 207.2 million under a share purchase agreement concluded between Lesaka SA and Crossfin Holdings ((refer also to Note 20)); (iii) pay an amount of ZAR 147.5 million notified by Investec Bank Limited to Adumo and Lesaka SA as a result of the transaction described in Note 20, and (iv) pay an origination fee of ZAR 7.6 million to RMB. The Facility also provides Lesaka with ZAR 70.0 million for transaction -related expenses. Interest on the Facility is calculated at the prime rate plus 1.80 %. The Facility is unsecured and required to be repaid in full on or before December 13, 2024. Connect Facilities, comprising long-term borrowings and a short-term facility As of September 30, 2024, the Connect Facilities include (i) an overdraft facility (general banking facility) of ZAR 170.0 million (of which ZAR 170.0 million ($ 9.9 million) has been utilized); (ii) Facility A of ZAR 700.0 million ($ 40.7 million); (iii) Facility B of ZAR 550.0 million ($ 32.0 million) (both fully utilized); and (iv) an asset-backed facility of ZAR 200.0 million ($ 11.6 million) (of which ZAR 138.1 million ($ 8.0 million) has been utilized). On October 29, 2024, the Company, through its wholly owned subsidiary Cash Connect Management Solutions (Pty) Ltd, entered into an addendum to a facility letter with RMB, to obtain a ZAR 100.0 million temporary increase in its overdraft facility for a period of approximately four months to specifically fund the purchase of prepaid airtime vouchers. This temporary increase is repayable in equal daily instalments which commenced at the end of October 2024 and end of February 15, 2025. CCC Revolving Credit Facility, comprising long-term borrowings As of September 30, 2024, the amount of the CCC Revolving Credit Facility was ZAR 300.0 million (of which ZAR 215.5 million has been utilized). Interest on the Revolving Credit Facility is payable on the last business day of each calendar month and is based on the South African prime rate in effect from time to time plus a margin of 0.95 % per annum. RMB facility, comprising indirect facilities As of September 30, 2024, the aggregate amount of the Company’s short-term South African indirect credit facility with RMB was ZAR 135.0 million ($ 7.1 million), which includes facilities for guarantees, letters of credit and forward exchange contracts. As of September 30, 2024 and June 30, 2024, the Company had utilized ZAR 33.1 million ($ 1.9 million) and ZAR 33.1 million ($ 1.8 million), respectively, of its indirect and derivative facilities of ZAR 135.0 million (June 30, 2024: ZAR 135.0 million) to enable the bank to issue guarantees, letters of credit and forward exchange contracts (refer to Note 19). Nedbank facility, comprising short-term facilities As of September 30, 2024, the aggregate amount of the Company’s short-term South African credit facility with Nedbank Limited was ZAR 156.6 million ($ 9.1 million). The credit facility represents indirect and derivative facilities of up to ZAR 156.6 million ($ 9.1 million), which include guarantees, letters of credit and forward exchange contracts. As of September 30, 2024 and June 30, 2024, the Company had utilized ZAR 2.1 million ($ 0.1 million) and ZAR 2.1 million ($ 0.1 million), respectively, of its indirect and derivative facilities of ZAR 156.6 million (June 30, 2024: ZAR 156.6 million) to enable the bank to issue guarantees, letters of credit and forward exchange contracts (refer to Note 19).

Borrowings (borrowings) (continued) South Africa (continued)

Movement in short-term credit facilities (continued) Summarized below are the Company’s short-term facilities as of September 30, 2024, and the movement in the Company’s short- term facilities from as of June 30, 2024 to as of September 30, 2024:

RMB RMB RMB Nedbank Facility E Indirect Connect Facilities Total Short-term facilities available as of September 30, 2023 $ 52,384 $ 7,858 $ 9,895 $ 9,112 $ 79,249 Overdraft - - 9,895 - 9,895 Overdraft restricted as to use for ATM funding only 52,384 - - - 52,384 Indirect and derivative facilities - 7,858 - 9,112 16,970 Movement in utilized overdraft facilities: Restricted as to use for ATM funding only 6,737 - - - 6,737 No restrictions as to use - - 9,351 - 9,351 Balance as of June 30, 2024 6,737 - 9,351 - 16,088 Utilized 23,893 - - - 23,893 Repaid ( 31,028 ) - - - ( 31,028 ) Foreign currency adjustment (1) 398 - 544 - 942 Balance as of September 30, 2024 - - 9,895 - 9,895 Restricted as to use for ATM funding only - - - - - No restrictions as to use $ - $ - $ 9,895 $ - $ 9,895 Interest rate as of September 30, 2024 (%) (2) 11.50 - 11.40 - Movement in utilized indirect and derivative facilities: Balance as of June 30, 2024 $ - $ 1,821 $ - $ 116 $ 1,937 Foreign currency adjustment (1) - 106 - 7 113 Balance as of September 30, 2024 $ - $ 1,927 $ - $ 123 $ 2,050

(1) Represents the effects of the fluctuations between the ZAR and the U.S. dollar.
(2) Facility E interest set at prime and the Connect facility at prime less 0.10 %.

Borrowings (continued) Movement in long-term borrowings Summarized below is the movement in the Company’s long-term borrowing from as of as of June 30, 2024 to as of September 30, 2024:

Facilities G & H A&B CCC (6) Asset backed Total Included in current $ - $ - $ 11,841 $ 3,878 $ 15,719 Included in long-term 56,151 66,815 - 4,501 127,467 Opening balance as of June 30, 2024 56,151 66,815 11,841 8,379 143,186 Facilities utilized - - 559 215 774 Facilities repaid ( 3,911 ) - ( 554 ) ( 1,007 ) ( 5,472 ) Non-refundable fees paid - - - - - Non-refundable fees amortized 44 12 13 - 69 Capitalized interest 1,845 - - - 1,845 Capitalized interest repaid ( 95 ) - - - ( 95 ) Foreign currency adjustment (1) 3,188 3,890 684 451 8,213 Closing balance as of September 30, 2024 57,222 70,717 12,543 8,038 148,520 Included in current - - 12,543 3,841 16,384 Included in long-term 57,222 70,717 - 4,197 132,136 Unamortized fees ( 229 ) ( 176 ) - - ( 405 ) Due within 2 years 57,451 5,456 - 2,987 65,894 Due within 3 years - 8,367 - 836 9,203 Due within 4 years - 57,070 - 294 57,364 Due within 5 years $ - $ - $ - $ 80 $ 80 Interest rates as of September 30, 2024 (%): 13.10 12.10 12.45 12.25 Base rate (%) 8.35 8.35 11.50 11.50 Margin (%) 4.75 3.75 0.95 0.75 Footnote number (2) (3) (4) (5)

(1) Represents the effects of the fluctuations between the ZAR and the U.S. dollar. (2) Interest on Facility G and Facility H is based on the JIBAR in effect from time to time plus a margin, which margin is calculated as: (i) 5.50 % if the Look Through Leverage (“LTL”) ratio is greater than 3.50x; (ii) 4.75 % if the LTL ratio is less than 3.50x but greater than 2.75x; (iii) 3.75 % if the LTL ratio is less than 2.75x but greater than 1.75x; or (iv) 2.50 % if the LTL ratio is less than 1.75x. The LTL ratio is expressed as times (“x”), and was introduced to calculate the margin used in the determination of the interest rate. The LTL ratio is calculated as the Total Attributable Net Debt to the Total Attributable EBITDA, as defined in the Company’s borrowing arrangements with RMB, for the measurement period ending on a specified date. (3) Interest on Facility A and Facility B is calculated based on JIBAR plus a margin, of 3.75 %, in effect from time to time. (4) Interest is charged at prime plus 0.95 % per annum on the utilized balance. (5) Interest is charged at prime plus 0.75 % per annum on the utilized balance. (6) Amounts presented as of June 30, 2024, and as of September 30, 2024, have been revised, refer to Note 1 for additional information. The amounts as of June 30, 2024, and as of September 30, 2024, were incorrectly classified as long-term borrowings, instead of as current portion of long-term borrowings. Interest expense incurred under the Company’s South African long-term borrowings and included in the caption interest expense on the condensed consolidated statement of operations during the three months ended September 30, 2024 and 2023, was $ 4.2 million and $ 4.0 million, respectively. Prepaid facility fees amortized included in interest expense during the three months ended September 30, 2024 and 2023, respectively, were $ 0.1 million and $ 0.2 million, respectively. Interest expense incurred under the Company’s K2020 and CCC facilities relates to borrowings utilized to fund a portion of the Company’s merchant finance loans receivable and this interest expense of $ 0.4 million and $ 0.4 million, respectively, is included in the caption cost of goods sold, IT processing, servicing and support on the condensed consolidated statement of operations for the three months ended September 30, 2024 and 2023.

Other payables Summarized below is the breakdown of other payables as of September 30, 2024, and June 30, 2024:

September 30, June 30, 2024 2024 Clearing accounts $ 7,239 $ 17,124 Vendor wallet balances 13,397 14,635 Accruals 9,959 7,173 Provisions 3,414 7,442 Value -added tax payable 1,456 1,191 Payroll-related payables 2,929 922 Participating merchants' settlement obligation 2 1 Other 7,527 7,563 $ 45,923 $ 56,051

Other includes deferred income, client deposits and other payables.
10. Capital structure The following table presents a reconciliation between the number of shares, net of treasury, presented in the unaudited condensed consolidated statement of changes in equity as of September 30, 2024 and 2023, respectively:

September 30, September 30, 2024 2023 Number of shares, net of treasury: Statement of changes in equity 64,301,943 63,638,912 Non-vested equity shares that have not vested as of end of period 2,035,845 2,527,492 Number of shares, net of treasury, excluding non-vested equity shares that have not vested 62,266,098 61,111,420

Accumulated other comprehensive loss The table below presents the change in accumulated other comprehensive loss per component during the three months ended September 30, 2024:

Three months ended September 30, 2024 Accumulated foreign currency translation reserve Total Balance as of July 1, 2024 $ ( 188,355 ) $ ( 188,355 ) Movement in foreign currency translation reserve 10,525 10,525 Balance as of September 30, 2024 $ ( 177,830 ) $ ( 177,830 )

The table below presents the change in accumulated other comprehensive loss per component during the three months ended September 30, 2023:

Three months ended September 30, 2023 Accumulated foreign currency translation reserve Total Balance as of July 1, 2023 $ ( 195,726 ) $ ( 195,726 ) Movement in foreign currency translation reserve related to equity- accounted investment 489 489 Movement in foreign currency translation reserve ( 844 ) ( 844 ) Balance as of September 30, 2023 $ ( 196,081 ) $ ( 196,081 )

There were no reclassifications from accumulated other comprehensive loss to net (loss) income during the three months ended September 30, 2024 and 2023.

Stock-based compensation The Company’s Amended and Restated 2022 Stock Incentive Plan (“20 22 Plan”) and the vesting terms of certain stock-based awards granted are described in Note 17 to the Company’s audited consolidated financial statements included in its Annual Report on Form 10-K for the year ended June 30, 2024. Stock option and restricted stock activity Options The following table summarizes stock option activity for the three months ended September 30, 2024 and 2023:

Number of shares Weighted average exercise price ($) Weighted average remaining contractual term (in years) Aggregate intrinsic value ($'000) Weighted average grant date fair value ($) Outstanding - June 30, 2024 4,918,248 8.70 4.51 889 1.77 Forfeited ( 13,333 ) 11.23 - - 8.83 Outstanding - September 30, 2024 4,904,915 8.67 4.33 1,117 1.76 Outstanding - June 30, 2023 673,274 4.37 5.14 239 1.67 Exercised ( 6,793 ) 3.07 - 5 - Forfeited ( 175,776 ) 3.58 - - 1.22 Outstanding - September 30, 2023 490,705 4.68 6.30 199 1.82

No stock options were awarded during each of the three months ended September 30, 2024 and 2023. No stock options were exercised during the three months ended September 30, 2024. During the three months ended September 30, 2023, the Company received approximately $ 0.02 million from the exercise of 6,793 stock options. Employees forfeited an aggregate of 13,333 stock options during the three months ended September 30, 2024. Employees and a non-employee director forfeited an aggregate of 175,776 stock options during the three months ended September 30, 2023.

Options The following table presents stock options vested and expected to vest as of September 30, 2024:

Number of shares Weighted average exercise price ($) Weighted average remaining contractual term (in years) Aggregate intrinsic value ($’000) Vested and expecting to vest - September 30, 2024 4,904,915 8.67 4.33 1,117

These options have an exercise price range of $ 3.01 to $ 14.00 . The following table presents stock options that are exercisable as of September 30, 2024:

Number of shares Weighted average exercise price ($) Weighted average remaining contractual term (in years) Aggregate intrinsic value ($’000) Exercisable - September 30, 2024 378,009 4.49 5.32 364

No stock options became exercisable during each of the three months ended September 30, 2024 and 2023. The Company issues new shares to satisfy stock option exercises.

Stock-based compensation (continued) Stock option and restricted stock activity (continued) Restricted stock The following table summarizes restricted stock activity for the three months ended September 30, 2024 and 2023:

Number of shares of restricted stock Weighted average grant date fair value ($’000) Non-vested – June 30, 2024 2,084,946 8,736 Total granted 32,800 154 Granted – August 2024 32,800 154 Total vested ( 78,801 ) 394 Vested – July 2024 ( 78,801 ) 394 Forfeitures ( 3,100 ) 15 Non-vested – September 30, 2024 2,035,845 8,449 Non-vested – June 30, 2023 2,614,419 11,869 Total vested ( 78,800 ) 302 Vested – July 2023 ( 78,800 ) 302 Forfeitures ( 8,127 ) 32 Non-vested – September 30, 2023 2,527,492 11,475

Grants In August 2024, the Company granted 32,800 shares of restricted stock to employees which have time -based vesting conditions. No restricted stock was awarded during the three months ended September 30, 2023. Vesting In July 2024 and 2023, respectively, 78,801 and 78,800 shares of restricted stock granted to our former Group CEO vested. Forfeitures During the three months ended September 30, 2024 and 2023, respectively, employees forfeited 3,100 and 8,127 shares of restricted stock following their termination of employment with the Company. Stock-based compensation charge and unrecognized compensation cost The Company recorded a stock-based compensation charge, net during the three months ended September 30, 2024 and 2023, of $ 2.4 million and $ 1.8 million, respectively, which comprised:

Total charge Allocated to cost of goods sold, IT processing, servicing and support Allocated to selling, general and administration Three months ended September 30, 2024 Stock-based compensation charge $ 2,377 $ - $ 2,377 Total - three months ended September 30, 2024 $ 2,377 $ - $ 2,377 Three months ended September 30, 2023 Stock-based compensation charge $ 1,768 $ - $ 1,768 Reversal of stock compensation charge related to stock options and restricted stock forfeited ( 9 ) - ( 9 ) Total - three months ended September 30, 2023 $ 1,759 $ - $ 1,759

The stock-based compensation charges have been allocated to selling, general and administration based on the allocation of the cash compensation paid to the relevant employees.

Stock-based compensation (continued) Stock-based compensation charge and unrecognized compensation cost (continued) As of September 30, 2024, the total unrecognized compensation cost related to stock options was $ 3.9 million, which the Company expects to recognize over two years . As of September 30, 2024, the total unrecognized compensation cost related to restricted stock awards was $ 3.6 million, which the Company expects to recognize over two years . During the three months ended September 30, 2024 and 2023, the Company recorded a deferred tax benefit of $ 0.3 million and $ 0.05 million, respectively, related to the stock-based compensation charge recognized related to employees of Lesaka. During the three months ended September 30, 2024 and 2023 the Company recorded a valuation allowance of $ 0.3 million and $ 0.05 million, respectively, related to the deferred tax benefit recognized because it does not believe that the stock-based compensation deduction would be utilized as it does not anticipate generating sufficient taxable income in the United States. The Company deducts the difference between the market value on the date of exercise by the option recipient and the exercise price from income subject to taxation in the United States.
(Loss) Earnings per share The Company has issued redeemable common stock which is redeemable at an amount other than fair value. Redemption of a class of common stock at other than fair value increases or decreases the carrying amount of the redeemable common stock and is reflected in basic earnings per share using the two-class method. There were no redemptions of common stock, or adjustments to the carrying value of the redeemable common stock during the three months ended September 30, 2024 and 2023. Accordingly, the two- class method presented below does not include the impact of any redemption. The Company’s redeemable common stock is described in Note 14 to the Company’s audited consolidated financial statements included in its Annual Report on Form 10-K for the year ended June 30, 2024. Basic (loss) earnings per share includes shares of restricted stock that meet the definition of a participating security because these shares are eligible to receive non -forfeitable dividend equivalents at the same rate as common stock. Basic (loss) earnings per share has been calculated using the two-class method and basic (loss) earnings per share for the three months ended September 30, 2024 and 2023, reflects only undistributed earnings. The computation below of basic (loss) earnings per share excludes the net loss attributable to shares of unvested restricted stock (participating non-vested restricted stock) from the numerator and excludes the dilutive impact of these unvested shares of restricted stock from the denominator. Diluted (loss) earnings per share has been calculated to give effect to the number of shares of additional common stock that would have been outstanding if the potential dilutive instruments had been issued in each period. Stock options are included in the calculation of diluted (loss) earnings per share utilizing the treasury stock method and are not considered to be participating securities, as the stock options do not contain non-forfeitable dividend rights. The Company has excluded employee stock options to purchase 65,173 and 41,809 shares of common stock from the calculation of diluted loss per share during the three months ended September 30, 2024 and 2023, because the effect would be antidilutive. The calculation of diluted (loss) earnings per share includes the dilutive effect of a portion of the restricted stock granted to employees as these shares of restricted stock are considered contingently returnable shares for the purposes of the diluted (loss) earnings per share calculation and the vesting conditions in respect of a portion of the restricted stock had been satisfied.

(Loss) Earnings per share (continued) The vesting conditions for all awards made are discussed in Note 17 to the Company’s audited consolidated financial statements included in its Annual Report on Form 10-K for the year ended June 30, 2024. The following table presents net loss attributable to Lesaka and the share data used in the basic and diluted loss per share computations using the two-class method:

Three months ended September 30, 2024 2023 (in thousands except percent and per share data) Numerator: Net loss attributable to Lesaka $ ( 4,542 ) $ ( 5,651 ) Undistributed (loss) earnings $ ( 4,542 ) $ ( 5,651 ) Percent allocated to common shareholders (Calculation 1) 97 96 Numerator for (loss) earnings per share: basic and diluted ( 4,399 ) ( 5,402 ) Continuing ( 4,399 ) ( 5,402 ) Denominator Denominator for basic (loss) earnings per share: Weighted-average common shares outstanding 62,265 60,990 Denominator for diluted (loss) earnings per share: adjusted weighted average common shares outstanding and assuming conversion 62,265 60,990 (Loss) Earnings per share: Basic $ ( 0.07 ) $ ( 0.09 ) Diluted $ ( 0.07 ) $ ( 0.09 ) (Calculation 1) Basic weighted-average common shares outstanding (A) 62,265 60,990 Basic weighted-average common shares outstanding and unvested restricted shares expected to vest (B) 64,293 63,805 Percent allocated to common shareholders (A) / (B) 97 96

Options to purchase 4,224,210 shares of the Company’s common stock at prices ranging from $ 4.87 to $ 14.00 per share were outstanding during the three months ended September 30, 2024, but were not included in the computation of diluted (loss) earnings per share because the options’ exercise price was greater than the average market price of the Company’s common stock. Options to purchase 262,506 shares of the Company’s common stock at prices ranging from $ 4.87 to $ 11.23 per share were outstanding during the three months ended September 30, 2023, respectively, but were not included in the computation of diluted (loss) earnings per share because the options’ exercise price was greater than the average market price of the Company’s common stock. The options, which expire at various dates through February 3, 2032, were still outstanding as of September 30, 2024.

Supplemental cash flow information The following table presents supplemental cash flow disclosures for the three months ended September 30, 2024 and 2023:

Three months ended September 30, 2024 2023 Cash received from interest $ 581 $ 445 Cash paid for interest $ 3,271 $ 2,925 Cash (refund) paid for income taxes $ ( 45 ) $ 604

Supplemental cash flow information (continued) Leases The following table presents supplemental cash flow disclosure related to leases for the three months ended September 30, 2024 and 2023:

Three months ended September 30, 2024 2023 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 1,004 $ 693 Right-of-use assets obtained in exchange for lease obligations Operating leases $ 510 $ 243

Revenue recognition Disaggregation of revenue The following table presents the Company’s revenue disaggregated by major revenue streams, including a reconciliation to reportable segments for the three months ended September 30, 2024:

Merchant Consumer Total (As restated) (A) (As restated) (A) Processing fees (A) $ 30,880 $ 7,530 $ 38,410 South Africa (A) 29,078 7,530 36,608 Rest of world 1,802 - 1,802 Technology products 3,136 2 3,138 South Africa 3,063 2 3,065 Rest of world 73 - 73 Prepaid airtime sold (A) 95,456 17 95,473 South Africa (A) 89,576 17 89,593 Rest of world 5,880 - 5,880 Lending revenue - 6,956 6,956 Interest from customers 1,676 - 1,676 Insurance revenue - 4,340 4,340 Account holder fees - 1,699 1,699 Other 1,348 528 1,876 South Africa 1,291 528 1,819 Rest of world 57 - 57 Total revenue, derived from the following geographic locations (A) 132,496 21,072 153,568 South Africa (A) 124,684 21,072 145,756 Rest of world $ 7,812 $ - $ 7,812

(A) Processing fees (and South Africa) have reduced by $ 0.7 million and Prepaid airtime sold (and South Africa) have increased by $ 8.7 million as a result of the correction discussed in Note 1. The net correction to revenue was $ 8.0 million.

Disaggregation of revenue (continued) The following table presents the Company’s revenue disaggregated by major revenue streams, including a reconciliation to reportable segments for the three months ended September 30, 2023:

Merchant Consumer Total Processing fees $ 28,760 $ 5,733 $ 34,493 South Africa 27,400 5,733 33,133 Rest of world 1,360 - 1,360 Technology products 2,037 19 2,056 South Africa 1,986 19 2,005 Rest of world 51 - 51 Prepaid airtime sold 87,313 41 87,354 South Africa 82,559 41 82,600 Rest of world 4,754 - 4,754 Lending revenue - 5,373 5,373 Interest from customers 1,520 - 1,520 Insurance revenue - 2,611 2,611 Account holder fees - 1,368 1,368 Other 879 435 1,314 South Africa 830 435 1,265 Rest of world 49 - 49 Total revenue, derived from the following geographic locations 120,509 15,580 136,089 South Africa 114,295 15,580 129,875 Rest of world $ 6,214 $ - $ 6,214

Leases The Company has entered into leasing arrangements classified as operating leases under accounting guidance. These leasing arrangements relate primarily to the lease of its corporate head office, administration offices and branch locations through which the Company operates its consumer business in South Africa. The Company’s operating leases have remaining lease terms of between one and five years . The Company also operates parts of its consumer business from locations which it leases for a period of less than one year . The Company’s operating lease expense during the three months ended September 30, 2024 and 2023 was $ 1.0 million and $ 0.7 million, respectively. The Company has also entered into short-term leasing arrangements, primarily for the lease of branch locations and other locations, to operate its consumer business in South Africa. The Company’s short-term lease expense during the three months ended September 30, 2024 and 2023, was $ 1.0 million and $ 0.9 million, respectively.

The following table presents supplemental balance sheet disclosure related to the Company’s right-of-use assets and its operating lease liabilities as of September 30, 2024 and June 30, 2024:

September 30, June 30, 2024 2024 Right of use assets obtained in exchange for lease obligations: Weighted average remaining lease term (years) 2.7 3.1 Weighted average discount rate (percent) 10.7 10.5

Leases (continued) The maturities of the Company’s operating lease liabilities as of September 30, 2024, are presented below:

Maturities of operating lease liabilities Year ended June 30, 2025 (excluding three months to September 30, 2024) $ 2,581 2026 2,840 2027 2,011 2028 1,298 2029 165 Thereafter - Total undiscounted operating lease liabilities 8,895 Less imputed interest 1,327 Total operating lease liabilities, included in 7,568 Operating lease liability - current 2,600 Operating lease liability - long-term $ 4,968

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, 2024. The Company analyzes its business and operations in terms of two inter-related but independent operating segments: (1) Consumer Division (“Consumer”) and (2) Merchant Division (“Merchant ”). The reconciliation of the reportable segment’s revenue to revenue from external customers for the three months ended September 30, 2024 and 2023, is as follows:

Revenue Reportable Segment Inter- segment From external customers (As restated) (A) (As restated) (A) Merchant (as restated) (A) $ 133,283 $ 787 $ 132,496 Consumer 21,072 - 21,072 Total for the three months ended September 30, 2024 (as restated) (A) $ 154,355 $ 787 $ 153,568 Merchant $ 121,361 $ 852 $ 120,509 Consumer 15,580 - 15,580 Total for the three months ended September 30, 2023 $ 136,941 $ 852 $ 136,089

(A) Revenue has been restated to correct the misstatement of $ 8.0 million as discussed in Note 1.

Operating segments (continued) Operating segments (continued) 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 intends to obtain a separate lending facility to fund a portion of its Consumer lending during the twelve months ended June 30, 2025. The Company expected to have this facility in place on July 1, 2024, however, the Company has been unable to finalize terms as the separate lending facility will form part of a broader financing package. Therefore, the Company has included an intercompany interest expense in its Consumer Segment Adjusted EBITDA for the three months ended September 30, 2024. The Company does not allocate once-off items, stock-based compensation charges, 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, certain 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. Unrealized loss FV for currency adjustments represents foreign currency mark-to-market adjustments on certain intercompany accounts. Interest adjustment represents the intercompany interest expense included in the Consumer Segment Adjusted EBITDA. The Stock-based compensation adjustments reflect stock-based compensation expense and are 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. Effective from fiscal 2025, all lease charges are allocated to the Company’s operating segments, whereas in fiscal 2024 the Company presented certain lease charges on a separate line outside of its operating segments. Prior period information has been re-presented to include the lease charges which were previously reported on a separate line in the Company’s Consumer and Merchant operating segments. The reconciliation of the reportable segments’ measures of profit or loss to loss before income tax expense for the three months ended September 30, 2024 and 2023, is as follows:

Three months ended September 30, 2024 2023 Reportable segments measure of profit or loss $ 12,312 $ 9,845 Operating loss: Group costs ( 2,949 ) ( 1,822 ) Once-off costs ( 1,805 ) ( 78 ) Unrealized Loss FV for currency adjustments 219 ( 102 ) Interest adjustment 831 - Stock-based compensation charge adjustments ( 2,377 ) ( 1,759 ) Depreciation and amortization ( 6,276 ) ( 5,856 ) Reversal of allowance of EMI doubtful debt - 250 Interest income 586 449 Interest expense ( 5,032 ) ( 4,909 ) Loss before income tax expense $ ( 4,491 ) $ ( 3,982 )

Operating segments (continued) Operating segments (continued) The following tables summarize segment information that is prepared in accordance with GAAP for the three months ended September 30, 2024 and 2023:

Three months ended September 30, 2024 2023 (As restated) (A) Revenues Merchant (as restated) (A) $ 133,283 $ 121,361 Consumer 21,072 15,580 Total reportable segment revenue (as restated) (A) 154,355 136,941 Segment Adjusted EBITDA Merchant (1) 7,916 7,725 Consumer (1) 4,396 2,120 Total Segment Adjusted EBITDA 12,312 9,845 Depreciation and amortization Merchant 2,327 2,078 Consumer 202 169 Subtotal: Operating segments 2,529 2,247 Group costs 3,747 3,609 Total 6,276 5,856 Expenditures for long-lived assets Merchant 3,908 2,763 Consumer 57 46 Subtotal: Operating segments 3,965 2,809 Group costs - - Total $ 3,965 $ 2,809

(A) Revenue has been restated to correct the misstatement of $ 8.0 million as discussed in Note 1. (1) Segment Adjusted EBITDA for the three months ended September 30, 2024, includes retrenchments costs for Consumer of $ 0.06 million (ZAR 1.1 million) and for Merchant, costs of $ 0.01 million (ZAR 0.2 million). Segment Adjusted EBITDA for the three months ended September 30, 2023, includes retrenchments costs for Merchant of $ 0.2 million (ZAR 4.6 million) and for Consumer, costs of $ 0.1 million (ZAR 1.5 million). 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.

Income tax Income tax in interim periods For the purposes of interim financial reporting, the Company determines the appropriate income tax provision by first applying the effective tax rate expected to be applicable for the full fiscal year to ordinary income. This amount is then adjusted for the tax effect of significant unusual items, for instance, changes in tax law, valuation allowances and non-deductible transaction-related expenses that are reported separately, and have an impact on the tax charge. The cumulative effect of any change in the enacted tax rate, if and when applicable, on the opening balance of deferred tax assets and liabilities is also included in the tax charge as a discrete event in the interim period in which the enactment date occurs. For the three months ended September 30, 2024, the Company’s effective tax rate was impacted by the tax expense recorded by the Company’s profitable South African operations, non-deductible expenses (including transaction-related expenditures), the on- going losses incurred by certain of the Company’s South African businesses and the associated valuation allowances created related to the deferred tax assets recognized regarding net operating losses incurred by these entities. For the three months ended September 30, 2023, the Company’s effective tax rate was impacted by the tax expense recorded by the Company’s profitable South African operations, non-deductible expenses, the on-going losses incurred by certain of the Company’s South African businesses and the associated valuation allowances created related to the deferred tax assets recognized regarding net operating losses incurred by these entities. Uncertain tax positions As of three months ended September 30, 2024 and June 30, 2023, the Company had no unrecognized tax benefits. The Company files income tax returns mainly in South Africa, Botswana, Namibia and in the U.S. federal jurisdiction. As of September 30, 2024, the Company’s South African subsidiaries are no longer subject to income tax examination by the South African Revenue Service for periods before June 30, 2020. The Company is subject to income tax in other jurisdictions outside South Africa, none of which are individually material to its financial position, statement of cash flows, or results of operations.
Commitments and contingencies Guarantees The South African Revenue Service and certain of the Company’s customers, suppliers and other business partners have asked the Company to provide them with guarantees, including standby letters of credit, issued by South African banks. The Company is required to procure these guarantees for these third parties to operate its business. RMB has issued guarantees to these third parties amounting to ZAR 33.1 million ($ 1.9 million, translated at exchange rates applicable as of September 30, 2024) thereby utilizing part of the Company’s short-term facilities. The Company pays commission of between 3.42 % per annum to 3.44 % per annum of the face value of these guarantees and does not recover any of the commission from third parties. Nedbank has issued guarantees to these third parties amounting to ZAR 2.1 million ($ 0.1 million, translated at exchange rates applicable as of September 30, 2024) thereby utilizing part of the Company’s short-term facilities. The Company pays commission of between 0.47 % per annum to 1.84 % per annum of the face value of these guarantees and does not recover any of the commission from third parties. The Company has not recognized any obligation related to these guarantees in its consolidated balance sheet as of September 30, 2024. The maximum potential amount that the Company could pay under these guarantees is ZAR 35.2 million ($ 1.9 million, translated at exchange rates applicable as of September 30, 2024). As discussed in Note 8, the Company has ceded and pledged certain bank accounts to Nedbank as security for the guarantees issued by them with an aggregate value of ZAR 2.1 million ($ 0.1 million, translated at exchange rates applicable as of September 30, 2024). The guarantees have reduced the amount available under its indirect and derivative facilities in the Company’s short-term credit facilities described in Note 8. Contingencies The Company is subject to a variety of insignificant claims and suits that arise from time to time in the ordinary course of business. Management currently believes that the resolution of these other matters, individually or in the aggregate, will not have a material adverse impact on the Company’s financial position, results of operations or cash flows.

Acquisitions 2025 Acquisitions October 2024 acquisition of Adumo On May 7, 2024, the Company entered into a Sale and Purchase Agreement (the “Purchase Agreement”) with Lesaka SA, and Crossfin Apis Transactional Solutions (Pty) Ltd and Adumo ESS (Pty) Ltd (“the Sellers”). Pursuant to the Purchase Agreement and subject to its terms and conditions, Lesaka, through its subsidiary, Lesaka SA, agreed to acquire, and the Sellers agreed to sell, all of the outstanding equity interests and certain claims in the Adumo (RF) Proprietary Limited (“Adumo”). The transaction closed on October 1, 2024. Adumo is an independent payments and commerce enablement platform in Southern Africa, serving approximately 23,000 active merchants with operations across South Africa, Namibia, Botswana and Kenya. For more than two decades, Adumo has facilitated physical and online commerce between retail merchants and end-consumers by offering a unique combination of payment processing and integrated software solutions, which currently include embedded payments, integrated payments, reconciliation services, merchant lending, customer engagement tools, card issuing program management and data analytics. Adumo operates across three businesses, which provide payment processing and integrated software solutions to different end markets: ● The Adumo Payments business offers payment processing, integrated payments and reconciliation solutions to small-and- medium (“SME”) merchants in South Africa, Namibia and Botswana, and also provides card issuing program management to corporate clients such as Anglo American and Coca-Cola; ● The Adumo ISV business, also known as GAAP, has operations in South Africa, Botswana and Kenya, and clients in a further 21 countries, and is the leading provider of integrated point-of-sales software and hardware to the hospitality industry in Southern Africa, serving clients such as KFC, McDonald’s, Pizza Hut, Nando’s and Krispy Kreme; and, ● The Adumo Ventures business offers online commerce solutions (Adumo Online), cloud-based, multi-channel point-of-sales solutions (Humble) and an aggregated payment and credit platform for in-store and online commerce (SwitchPay) to SME merchants and corporate clients in South Africa and Namibia. The acquisition continues the Company’s consolidation in the Southern African fintech sector. The Company’s ecosystem now serves approximately 1.7 million active consumers, 120,200 merchants, and processes over ZAR 270 billion in throughput (cash, card and VAS) per year. The acquisition of Adumo enhances the Company’s strength in both the consumer and merchant markets in which it operates. The purchase consideration was settled through the combination of an issuance of 17,279,803 shares of the Company’s common stock (“Consideration Shares”) and a ZAR 232.2 million ($ 13.4 million, translated at the prevailing rate of $1: ZAR 17.3354 as of October 1, 2024) payment in cash. The Company’s closing price on the Johannesburg Stock Exchange on October 1, 2024, was ZAR 83.05 ($ 4.79 using the October 1, 2024, $1: ZAR exchange rate). The total purchase consideration was ZAR 1.67 billion ($ 96.2 million). The closing of the transaction was subject to customary closing conditions, including (i) approval from the competition authorities of South Africa and Namibia; (ii) exchange control approval from the financial surveillance department of the South African Reserve Bank; (iii) approval from all necessary regulatory bodies and from shareholders to issue the Consideration Shares to the Sellers; (iv) obtaining certain third-party consents; (v) the Company obtained confirmation from RMB that it has sufficient funds to settle the cash portion of the purchase consideration; (vi) approval of Adumo shareholders (including preference shareholders) with respect to entering into and implementation of the Purchase Agreement, and all other agreements and transactions contemplated in the Purchase Agreement; (vii) obtained the consent of Adumo’s lender regarding Adumo entering into and implementing the Purchase Agreement, and all other agreements and transactions contemplated in the Purchase Agreement; (viii) the release of certain Seller’s shares held as security by such bank; (ix) consent of the lender of one of Adumo’s shareholders regarding Adumo entering into the transaction; (x) the Company signing a written addendum to the Policy Agreement with International Finance Corporation that provides for the inclusion of the Consideration Shares attributable to certain Seller shareholders in the definition of “Put Shares” under the Policy Agreement, and related change; and (xi) a Seller (or their nominee), which ultimately was Crossfin, concluding share purchase agreements to dispose of an amount of Consideration Shares (which ultimately was determined as 3,587,332 Consideration Shares). The Company has agreed to file a resale registration statement with the United States Securities and Exchange Commission (“SEC”) covering the resale of the Consideration Shares by the Sellers. The Company has undertaken to use its commercially reasonable efforts to have the resale registration statement declared effective by the SEC following its filing. The Company incurred transaction-related expenditures of $ 1.7 million during the three months ended September 30, 2024, related to acquisition of Adumo. The Company’s accruals presented in Note 9 of as September 30, 2024, includes an accrual of transaction related expenditures of $ 2.2 million and the Company does not expect to incur any further significant transaction costs over the remainder of the 2025 fiscal year.

20. Acquisitions (continued)

2025 Acquisitions (continued)

October 2024 acquisition of Adumo (continued)

On October 1, 2024, Lesaka SA and Crossfin entered into a share purchase agreement under which Lesaka SA purchased 2,601,410 of the 3,587,332 Consideration Shares for ZAR 207.2 million ($ 12.0 million). The transaction was settled in early October 2024, and the shares of Company’s common stock repurchased will be included in the Company’s treasury shares. The Company has commenced the purchase price allocation related to this transaction. However, the process had not been completed as of the date of filing this Quarterly Report on Form 10-Q on November 6, 2024. The Company expects to include its preliminary allocation of the purchase consideration related to this acquisition in its unaudited financial statements to be included in its Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2024.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with our Annual Report on Form 10-K for the year ended June 30, 2024, and the unaudited condensed consolidated financial statements and the accompanying notes included in this Form 10-Q.

U.S. securities laws require that when we publish any non-GAAP measures, we disclose the reason for using these non-GAAP measures and provide reconciliations to the most directly comparable GAAP measures. We discuss why we consider it useful to present these non -GAAP measures and the material risks and limitations of these measures, as well as a reconciliation of these non- GAAP measures to the most directly comparable GAAP financial measure below at “—Results of Operations—Use of Non-GAAP Measures” below.

Restatement

As previously described in the Explanatory Note above and in Note 1 to our unaudited condensed consolidated financial statements, we have restated our previously issued unaudited condensed consolidated financial statements and related notes as of September 30, 2024, and for the three months ended September 30, 2024. As a result, the previously reported financial information as of and for the three months ended September 30, 2024 in this Item 2, Management’s Discussion and Analysis of Financial Condition and Results of Operations has been updated to reflect the relevant restatement. Refer to Note 1 in our unaudited condensed consolidated financial statements for additional information related to the restatement, including descriptions of the adjustments and the impacts on our unaudited condensed consolidated financial statements.

Other than the effect of the restatement as described in Note 1 in our unaudited condensed consolidated financial statements, this section has not been otherwise modified and does not reflect any information or events occurring after November 6, 2024, the filing date of the Original Filing, or modify or update those disclosures affected by events that occurred at a later date or facts that subsequently became known to the Company, except to the extent they are otherwise required to be included and discussed herein.

Forward-looking statements

Some of the statements in this Form 10-Q constitute forward-looking statements. These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed, implied or inferred by these forward-looking statements. Such factors include, among other things, those listed under Item 1A.—“Risk Factors” in our Annual Report on Form 10-K for the year ended June 30, 2024. In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should ”, “could”, “would”, “expects”, “plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of such terms and other comparable terminology.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we do not know whether we can achieve positive future results, levels of activity, performance, or goals. Actual events or results may differ materially. We undertake no obligation to update any of the forward-looking statements after the date of this Form 10-Q to conform those statements to reflect the occurrence of unanticipated events, except as required by applicable law.

You should read this Form 10-Q and the documents that we reference herein and the documents we have filed as exhibits hereto and thereto and which we have filed with the United States Securities and Exchange Commission (“SEC”) completely and with the understanding that our actual future results, levels of activity, performance and achievements may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.

Recent Developments

Our mission at Lesaka is driven by a purpose to provide financial services and software to Southern Africa’s underserviced consumers (B2C) and merchants (B2B), improving people’s lives and increasing financial inclusion in the markets in which we operate. We offer a wide range of integrated payment solutions including transactional accounts (banking), lending, insurance, payouts, cash management solutions, card acceptance, supplier payments, software services and bill payments. By providing a full-service fintech platform in our connected ecosystem, we facilitate the digitization of commerce in our markets.

We experienced continued improvement in our financial and operational performance in the first quarter of fiscal 2025. Revenue of $145.5 million (ZAR 2.6 billion) was at the mid-point of our revenue guidance and compares to $136.1 million (ZAR 2.5 billion)
in 2024.

Operating loss of $0.05 million (ZAR 0.3 million) includes the impact of $1.7 million (ZAR 30.0 million) one-off Adumo transaction costs. We reported a net loss attributable to the company of $4.5 million (ZAR 81.0 million) during the first quarter of fiscal 2025 compared with a net loss of $5.7 million (ZAR 105.6 million) during the first quarter of fiscal 2024.

Group Adjusted EBITDA of $9.4 million (ZAR 168.1 million) was at the mid-point of our guidance range, representing the ninth successive quarter of Lesaka achieving or outperforming its Group Adjusted EBITDA guidance. Group Adjusted EBITDA is a non- GAAP measure, refer to reconciliation below at “—Results of Operations —Use of Non-GAAP Measures”.

We continue to broaden our product proposition and solve for both consumer and merchant pain-points.

Merchant Division

The year-on-year performance in our Merchant Division (“Merchant”) is supported by the robust secular trends underpinning financial inclusion, cash management and digitalization to empower micro-merchants, merchants and enterprise clients to transact efficiently and fulfill their potential.

Performance in Merchant has been driven by:

Our VAS and supplier payments business continues to see adoption by micro -merchants.| | | Q1 | Q1 | Q1 | 2025 | 2 year |
| --- | --- | --- | --- | --- | --- | --- |
| Fiscal quarter ended September 30, | | 2025 | 2024 | 2023 | vs. | CAGR |
| | | | | | 2024 | % |
| Approximate number of devices in deployment | 1 | 89,040 | 77,000 | 57,000 | 16% | 25% |

Total Throughput for the quarter (ZAR billions)9.97.25.938%30%| Throughput for the quarter international money transfers | 1.3 | 0.3 | 1.6333% | (10%) |
| --- | --- | --- | --- | --- |
| (“IMT”) (ZAR billions) | | | | |
| Throughput for the quarter supplier payments (ZAR billions) | 3.2 | 2 | 0.660% | 131% |

Total throughput for the quarter excluding IMT and supplier	5.4	4.9	3.710%	21%
payments (ZAR billions)

1.2025 includes approximately 5,430 devices attributable to the acquisition of Touchsides, effective May 1, 2024, which are not enabled for VAS and supplier payments on the Kazang platform.

●We had approximately 89,040 devices deployed at September 30, 2024, representing a 16% year-on-year growth

compared to approximately 77,000 devices as of September 30, 2023, and a 2-year CAGR of 25% compared to September 30, 2022. This includes approximately 5,430 devices in Touchsides sites that are not yet enabled for VAS and supplier payments on the Kazang platform.
●Core to our device placement strategy is the decision to focus on quality business and optimizing our existing fleet, which is reflected in a healthy throughput growth and margin per device.
●VAS and supplier payments throughput increased 38% to R9.9 billion. We have separately disclosed supplier payments from traditional VAS as it is becoming a material contributor to our throughput and attracts a lower gross profit margin.
Supplier payments is an important part of the micro -merchant ecosystem we are developing as part of our strategy to provide a holistic offering to micro-merchants in informal markets.
●VAS throughput, excluding IMT and supplier payments increased 10% to R5.4 billion. Our supplier payments throughput increased by 60% year on year to R3.2 billion as we added further suppliers onto our platform. The international money transfer throughput recovered significantly and is approaching the levels from quarter one fiscal 2022.

Our card acceptance solutions to micro-merchants is through Kazang Pay and to merchants through Card Connect.| | Q1 | | Q1 | Q1 | 2025 vs. | 2 year |
| --- | --- | --- | --- | --- | --- | --- |
| Fiscal quarter ended September 30, | 2025 | | 2024 | 2023 | 2024 | CAGR |
| | | | | | | % |
| Approximate number of devices in deployment | 1 | 53,450 | 46,600 | 27,700 | 15% | 39% |
| Total Throughput for the quarter (ZAR billions) | | 4.3 | 3.6 | 2.3 | 18% | 36% |

●The trend towards digital payments continued year on year with a 15% increase in devices and a 18% increase in throughput to R4.2 billion for the quarter

Our lendingsolutions offered to merchants through Capital Connect in the merchant market.| | Q1 | Q1 | Q1 | 2025 | 2 year |
| --- | --- | --- | --- | --- | --- |
| Fiscal quarter ended September 30, | 2025 | 2024 | 2023 | vs. | CAGR |
| | | | | 2024 | % |

Total credit disbursed (ZAR millions)166196226(15%)(14%)| Total net loan book size at period end | 273 | 285 | 274 | (4%) | 0% |
| --- | --- | --- | --- | --- | --- |
| (ZAR millions) | | | | | |
| Capital Connect credit disbursed | 166 | 173 | 190 | (4%) | (7%) |
| (ZAR millions) | | | | | |
| Capital Connect loan book size at period end (ZAR | 273 | 280 | 254 | (3%) | 4% |
| millions) | | | | | |
| Kazang Pay Advance credit disbursed | 0 | 23 | 36 | n/m | n/m |
| (ZAR millions) | | | | | |
| Kazang Pay Advance loan book size at period end (ZAR | 0 | 5 | 20 | n/m | n/m |
| millions) | | | | | |

●Capital Connect disbursed ZAR 166 million during Q1 2025, compared to ZAR 173 million in the comparable period last year, representing a 4% decrease, reflective of the deterioration in financial strength of our merchants compared to

a year ago. We have maintained our strict credit criteria during the high interest rate and inflationary cycle resulting in less merchants qualifying for new or renewals of credit lines.
●With a more positive political environment, the suspension of load-shedding and hopefully the start of an interest rate down cycle, we are more optimistic this business can resume a growth trend reflective in the 8% increase in Capital Connect disbursements this quarter compared to ZAR 154 million a quarter ago (quarter four fiscal 2024.)
●Capital Connect’s lending proposition is an important component in enabling the merchants we serve to compete and grow. Since inception, Capital Connect has distributed more than ZAR 3 billion of funding to merchants and can provide funding of up to ZAR 5 million in under 24 hours. Quick access to affordable and flexible opportunity capital is vital in every stage of a merchant’s lifecycle, enabling them to never miss an opportunity.
●Kazang Pay Advance, our lending offering in the micro-merchant sector, was suspended in early fiscal 2024 following the decision to discontinue the current product, especially in the high interest rate environment. We continued to explore other options with respect to this offering with it now in live pilot phase. We are monitoring payment behavior on a smaller loan book and applying stricter lending criteria before the official relaunch later in fiscal 2025.

Our cash management and digitalizationsolutions effectively “puts the bank” in approximately 4,480 merchants’ stores.| Fiscal quarter ended September 30, | | Q1 2025 | Q1 2024 | Q1 2023 | 2025 vs. | 2 year |
| --- | --- | --- | --- | --- | --- | --- |
| | | | | | 2024 | CAGR % |
| Approximate number of devices in deployment | 1 | 4,480 | 4,400 | 4,200 | 2% | 3% |
| Cash settlements (throughput) for the quarter (ZAR | | 28.7 | 27.6 | 27.5 | 4% | 2% |
| billions) | | | | | | |

oOur cash business remains a vital product in our merchant offering and is a key differentiator for us in the digitalization of cash. We provide robust cash vaults in the SME sector (Cash Connect) and are building a presence

in the micro-merchant sector (Kazang Vaults), which enables our merchant customer base to significantly mitigate their operational risks pertaining to cash management and security.
oWhilst there is trend towards digital payments, cash remains as the most significant portion of retail transactions especially in informal markets. This business is primarily exposed to the mid-market SMEs, a sector which has experienced challenges such as power outages, high price inflation and a slowdown in consumer spending, over the past 24 months. This impacted the merchants we serve in this sector and resulted in increased bankruptcies and vault upliftments which affected the net growth in the vault estate.

Consumer Division

In our Consumer Division we offer transactional accounts (banking), insurance, lending and payments solutions designed to improve the lives of historically underserviced consumers and continue to deliver against our strategic focus areas underpinning our growth strategy. Progress made on these levers: (i) growing active EasyPay Everywhere (“EPE”) account numbers; (ii) increasing average revenue per user (“ARPU”) through cross-selling; (iii) cost optimization; and (iv) enhancing our product and service offering, resulted in revenue and profitability growth in the Consumer Division in the first quarter of fiscal 2025.

Consumer

2025 vs.

Fiscal quarter ended September 30,Q1 2025Q1 2024Q1 2023

2024

Transactional accounts (banking) - EasyPay Everywhere ("EPE")| Total active EPE transactional account base at quarter | 1.5 | 1.3 | 1.2 | 14% |
| --- | --- | --- | --- | --- |
| end (millions) | | | | |
| Total active EPE transactional account base at quarter | 1.3 | 1.1 | 1.1 | 18% |
| end - Permanent grant recipients (millions) | | | | |
| Approximate Gross EPE account activations for the | 62,000 | 76,000 | 45,000 | (19%) |
| quarter -Permanent grant recipients (number) | | | | |
| Approximate Net EPE account activations for the | 26,000 | 42,000 | 3,000 | (39%) |

Lending - EasyPay Loans
Approximate number of loans originated during the	286,000		222,000	198,000	28%
quarter (number)
Gross advances in the quarter (ZAR millions)		451	353	289	28%
Loan book size, before allowances, at quarter end	1	564	423	351	34%
(ZAR millions)
Insurance - EasyPay Insurance
Approximate number of insurance policies written in		49,000	38,000	25,000	29%
the quarter (number)
Total active insurance policies on book at quarter end	466,000		359,000	268,000	30%
(number)
Average revenue per customer per month, as of
September 30, (permanent grant beneficiaries)		91	83	71	10%
(ZAR)

1.Gross loan book, before provisions.

●Driving customer acquisition

oGross EPE account activations, continue to grow at the new levels for the permanent base, post our marketing and

distribution network enhancements in fiscal 2024. We achieved approximately 62,000 gross account activations in the quarter which was pleasing in a traditionally quiet quarter for us. This compares to a higher than usual activation rate in quarter one fiscal 2024 due to significant migration away from the South African Post Office in that quarter driven by concerns around its going concern status and its failure to timeously distribute grants timeously. Net activations of 26,000 in the quarter was negatively impacted by the closure of the SASSA (South African Social Security Agency)digital portal for switching.
oOur total active EPE transactional account base stood at approximately 1.5 million at the end of September 2024, of which approximately 1.3 million (or approximately 88%) are permanent grant recipients. The balance comprises Social Relief of Distress (“SRD”) grant recipients, which was introduced during the COVID pandemic and extended in calendar year 2023.
oOur priority is to grow our permanent grant recipient customers base, where we can build deeper relationships by offering products such as insurance and lending. We do not offer the same breadth of service to the SRD grant base due to the temporary nature of the grant.

●Progress on cross selling

EasyPay Loans

oWe originated approximately 286 000 loans during the quarter, with our consumer loan book, before allowances (“gross book”), increasing 34% to ZAR 564 million as of September 30, 2024, compared to ZAR 423 million as of

September 30, 2023.
oWe have not amended our credit scoring or other lending criteria, and the growth is reflective of the demand for our tailored loan product for this market, growth in EPE bank account customer base and improved cross-selling capabilities.
oThe loan conversion rate continues to improve following the implementation of a number of targeted Consumer lending campaigns and encouraging results from our digital channels.
oThe portfolio loss ratio of approximately 6%, calculated as the loans written off over the last 12 months as a percentage of the total gross loan book at the end of the quarter, remained stable on an annualized basis, compared to quarter one fiscal 2024.

EasyPay Insurance

oOur insurance product sales continue to grow and is a material contributor to the improvement in our overall ARPU.
We have been able to improve customer penetration to 34% of our active permanent grant account base as of

September 30, 2024, compared to 31% as of September 30, 2023. Approximately 49,000 new policies were written in the quarter, compared to approximately 38,000 in the comparable period in fiscal 2024. The total number of active policies has grown 30% to approximately 466,000 policies as of September 30, 2024, compared to 359,000 policies as of September 30, 2023.
oIn April 2024 we launched a new benefit where existing policyholders and new clients could elect to cover up to six of their dependent family members with cover ranging from ZAR 5 000 to ZAR 30 000. Since the launch of this benefit more than 25 00 clients have elected to cover their dependent family members.

ARPU oARPU for our permanent client base has increased to approximately ZAR 91 for the first quarter of fiscal 2025, from approximately ZAR 83 in the first quarter of fiscal 2024.

Adumo Payouts

oOn 1 October the Adumo Payouts business officially became part of the Consumer Division. We are looking forward to working with them as we build out the Consumer offering beyond the grant recipient space. The Adumo contribution will be reflected in our quarter two fiscal 2025 results.

Board and Leadership Changes in quarter one fiscal 2025

Leadership changes

On October, 1 2024 Dan Smith was appointed as Group Chief Financial Officer taking over these responsibilities from Naeem Kola, who transitioned to Group Chief Operating Officer. Mr. Smith was also appointed to the Board. As Lesaka scales, we will continue to augment our executive capability to accommodate the growing size of the business and deliver on the opportunity in front of us.

Paul Kent, the CEO of Adumo, joined the Lesaka executive team on completion of the Adumo transaction to oversee the Merchant pillar within Lesaka’s Merchant Division.

Board changes

Similarly, on completion of the Adumo acquisition Dean Sparrow, Group CEO of Crossfin Technology Holdings (RF) (Pty) Ltd, was appointed to the Board as an independent non-executive director and joined Lesaka’s Capital Allocation Committee.

Chris Meyer and Monde Nkosi, non-executive directors, stepped down as directors of the Board in October 2024.

Acquisition of Adumo

On October 1, 2024, we announced the closing of the Adumo transaction which enhances our platform, adding customers and products, as well as scale. The completion of this transaction marks the beginning of a new chapter in the Lesaka story. Adumo will be included in our results for the full second quarter of fiscal 2025.

Going forward Lesaka will be run in four distinct pillars

The Adumo transaction is the catalyst to approach the market with a more customer -centric operating model. From a financial reporting standpoint, we will continue to maintain the Consumer Division and Merchant Division split however we will present our KPIs and performance with a more granular breakdown.

Our Consumer segment will remain substantially the same however the perimeter will be expanded to include the Adumo Payouts business.

In our Merchant segment, the Adumo transaction provides the opportunity to segment the business into three component parts organized around distinct customers. Micro-Merchant, Merchant and Enterprise.

Micro-merchants are typically sole proprietors, often operating in the informal economy. We address these customers through the Kazang and Touchsides brands. In South Africa the focus will be to augment the product offering and cross-sell to existing customers so that we can materially improve the unit economics, as we have been doing. Outside of South Africa, in neighboring geographies, there are a substantial number of sole traders who have very limited offerings available to them to empower them on their digital journey. Here we have an opportunity again to expand our total addressable market through wallet growth.

The Merchant pillar is made up of the existing Connect operations, as well as the bulk of Adumo, specifically its merchant acquiring and processing business and its GAAP hospitality platform. The Connect business has cash and credit as key product offerings, the Adumo business has merchant acquiring and software at point of sale. Combined the Lesaka offering will be amongst most comprehensive in the market in meeting the needs of small and medium size businesses in the region.

Our Enterprise segment will focus on large corporates, mobile network operators, banks, governments and municipalities. Our solutions include a new payment switch, Prism Switch, our Point Of Sale hardware business branded Prism POS (previously known as NUETS), our bill payments platform EasyPay, as well as a third party vending and security business. As well as serving third party corporates it will also service some of the technology needs of our other pillars, Consumer, Micro-Merchant and Merchant.

Critical Accounting Policies

Our unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP, which requires management to make estimates and assumptions about future events that affect the reported amount of assets and liabilities and

disclosure of contingent assets and liabilities. As future events and their effects cannot be determined with absolute certainty, the determination of estimates requires management’s judgment based on a variety of assumptions and other determinants such as historical experience, current and expected market conditions and certain scientific evaluation techniques. Critical accounting policies are those that reflect significant judgments or uncertainties and may potentially result in materially different results under different assumptions and conditions. We have identified the following critical accounting policies that are described in more detail in our Annual Report on Form 10-K for the year ended June 30, 2024:

●Business Combinations and the Recoverability of Goodwill;
●Intangible Assets Acquired Through Acquisitions;
●Revenue recognition – principal versus agent considerations;
●Valuation of investment in Cell C;
●Recoverability of equity securities and equity-accounted investments;
●Deferred Taxation;
●Stock-based Compensation;
●Accounts Receivable and Allowance for Doubtful Accounts Receivable; and
●Lending.

Recent accounting pronouncements adopted

Refer to Note 1 to our unaudited condensed consolidated financial statements for a full description of accounting pronouncements adopted, including the dates of adoption and the effects on our unaudited condensed consolidated financial statements.

Recent accounting pronouncements not yet adopted as of September 30, 2024

Refer to Note 1 to our unaudited condensed consolidated financial statements for a full description of recent accounting pronouncements not yet adopted as of September 30, 2024, including the expected dates of adoption and effects on our financial condition, results of operations and cash flows.

Currency Exchange Rate Information

Actual exchange rates

The actual exchange rates for and at the end of the periods presented were as follows:| Table 1 | Three months ended | | Year ended |
| --- | --- | --- | --- |
| | September 30, | | June 30, |
| | 2024 | 2023 | 2024 |
| ZAR : $ average exchange rate | 17.9601 | 18.6457 | 18.7070 |
| Highest ZAR : $ rate during period | 18.5100 | 19.2202 | 19.4568 |
| Lowest ZAR : $ rate during period | 17.1144 | 17.6278 | 17.6278 |
| Rate at end of period | 17.1808 | 18.9236 | 18.1808 |

Translation exchange rates for financial reporting purposes

We are required to translate our results of operations from ZAR to U.S. dollars on a monthly basis. Thus, the average rates used to translate this data for the three months ended September 30, 2024 and 2023, vary slightly from the averages shown in the table above. Except as described below, the translation rates we use in presenting our results of operations are the rates shown in the following table:| | Three months ended | | Year ended |
| --- | --- | --- | --- |
| Table 2 | September 30, | | June 30, |
| | 2024 | 2023 | 2024 |
| Income and expense items: $1 = ZAR | 17.7176 | 18.7088 | 18.6844 |
| Balance sheet items: $1 = ZAR | 17.1808 | 18.9236 | 18.1808 |

We have translated the results of operations and operating segment information for the three months ended September 30, 2024 and 2023, provided in the tables below using the actual average exchange rates per month (i.e. for each of July 2024, August 2024,

and September 2024 for the first quarter of fiscal 2025) between the USD and ZAR in order to reduce the reconciliation of information presented to our chief operating decision maker. The impact of using this method compared with the average rate for the quarter and year to date is not significant, however, it does result in minor differences. We believe that presentation using the average exchange rates per month compared with the average exchange rate per quarter and year to date improves the accuracy of the information presented in our external financial reporting and leads to fewer differences between our external reporting measures which are supplementally presented in ZAR, and our internal management information, which is also presented in ZAR.

Results of Operations

The discussion of our consolidated overall results of operations is based on amounts as reflected in our unaudited condensed consolidated financial statements which are prepared in accordance with U.S. GAAP. We analyze our results of operations both in

U.S. dollars, as presented in the unaudited condensed consolidated financial statements, and supplementally in ZAR, because ZAR is the functional currency of the entities which contribute the majority of our results and is the currency in which the majority of our transactions are initially incurred and measured. Presentation of our reported results in ZAR is a non-GAAP measure. Due to the significant impact of currency fluctuations between the U.S. dollar and ZAR on our reported results and because we use the U.S. dollar as our reporting currency, we believe that the supplemental presentation of our results of operations in ZAR is useful to investors to understand the changes in the underlying trends of our business.

Our operating segment revenue presented in “—Results of operations by operating segment” represents total revenue per operating segment before intercompany eliminations. A reconciliation between total operating segment revenue and revenue, as well

as the reconciliation between our segment performance measure and net loss before tax (benefits) expense, is presented in our unaudited condensed consolidated financial statements in Note 17 to those statements. Our chief operating decision maker is our Executive Chairman and he 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”) for each operating segment. We do not allocate once -off items (as defined below), stock-based compensation charges, 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 our reportable segments. Once-off items represents non-recurring expense items, including costs related to acquisitions and transactions consummated or ultimately not pursued. 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 our loss before income tax expense.
Effective from fiscal 2025, all lease charges are allocated to our operating segments, whereas in fiscal 2024 we presented certain lease charges on a separate line outside of our operating segments. Prior period information has been re-presented to include the lease charges which were previously reported on a separate line in our Consumer and Merchant operating segments.

Group Adjusted EBITDA represents Segment Adjusted EBITDA after deducting group costs. Refer also “Results of Operations—Use of Non-GAAP Measures” below.

We analyze our business and operations in terms of two inter-related but independent operating segments: (1) Merchant Division and (2) Consumer Division. In addition, corporate activities that are impracticable to allocate directly to the operating segments, as well as any inter-segment eliminations, are included in Group costs. Inter-segment revenue eliminations are included in Eliminations.

First quarter of fiscal 2025 compared to first quarter of fiscal 2024

The following factors had a significant impact on our results of operations during the first quarter of fiscal 2025 as compared with the same period in the prior year:

●Higher revenue:Our revenues increased 0% in ZAR, primarily due to an increase in value-added services activity, higher

low margin prepaid airtime sales and processing fees in Merchant, as well as higher transaction, insurance and lending revenues in Consumer;
●Operating income improvement, before transaction costs:Operating income, before Adumo-related transaction costs, increased due to an increase trading activity as noted above;
●Lower net interest charge:Net interest charge decreased to $4.4 million (ZAR 79.8 million) from $4.5 million (ZAR 83.1 million) primarily due to lower interest rates on our borrowings, which was partially offset by higher over borrowings; and ●Foreign exchange movements:The U.S. dollar was 5% stronger against the ZAR during the first quarter of fiscal 2025 compared to the prior period, which adversely impacted our U.S. dollar reported results The ZAR was 5% stronger against the U.S. dollar during first quarter of fiscal 2025 compared to the prior period, which positively impacted our U.S. dollar reported results.

Consolidated overall results of operations

This discussion is based on the amounts prepared in accordance with U.S. GAAP.

The following tables show the changes in the items comprising our statements of operations, both in U.S. dollars and in ZAR:| | 2024 | | 2023 | | |
| --- | --- | --- | --- | --- | --- |
| | (As restated) | (A) | | (As restated) | (A) |
| | $ ’000 | | $ ’000 | % change | |
| Revenue | 153,568 | | 136,089 | | 13% |
| Cost of goods sold, IT processing, servicing and support | 118,909 | | 107,490 | | 11% |
| Selling, general and administration | 26,726 | | 22,515 | | 19% |
| Depreciation and amortization | | 6,276 | 5,856 | | 7% |
| Transaction costs related to Adumo acquisition | | 1,702 | | - | nm |
| Operating (loss) income | | (45) | 228 | | nm |
| Reversal of allowance for EMI doubtful debt receivable | | - | 250 | | nm |
| Interest income | | 586 | 449 | | 31% |
| Interest expense | | 5,032 | 4,909 | | 3% |
| Loss before income tax expense | (4,491) | | (3,982) | | 13% |
| Income tax expense | | 78 | 264 | | (70%) |
| Net loss before earnings (loss) from equity-accounted investments | (4,569) | | (4,246) | | 8% |
| Earnings (Loss) from equity-accounted investments | | 27 | (1,405) | | nm |
| Net loss attributable to us | (4,542) | | (5,651) | | (20%) |

	2024		2023
	(As restated)	(A)		(As restated)	(A)
	ZAR ’000		ZAR ’000	% change
Revenue	2,756,877		2,537,659		9%
Cost of goods sold, IT processing, servicing and support	2,134,828		2,004,465		7%
Selling, general and administration	479,677		419,861		14%
Depreciation and amortization	112,660		109,166		3%
Transaction costs related to Adumo acquisition	29,997			-	nm
Operating (loss) income		(285)	4,167		nm
Reversal of allowance for EMI doubtful debt receivable		-	4,741		nm
Interest income	10,517		8,368		26%
Interest expense	90,328		91,429		(1%)
Loss before income tax expense	(80,096)		(74,153)		8%
Income tax expense		1,402	4,825		(71%)
Net loss before earnings (loss) from equity-accounted investments	(81,498)		(78,978)		3%
Earnings (Loss) from equity-accounted investments		475	(26,657)		nm
Net loss attributable to us	(81,023)		(105,635)		(23%)

Revenue increased by $17.5 million (ZAR 219.2 million), or 12.8% (in ZAR, 8.6%), primarily due to an increase in the volume of value-added services provided (prepaid airtime and gaming), high transactions volumes from our vault and cash management

operations resulting in higher processing fees, an increase in certain issuing fee base prices and transaction activity in our issuing business, an increase in low margin prepaid airtime sales and an increase in insurance premiums collected and lending revenues following higher loan originations. Refer to discussion above at “—Recent Developments” for a description of key trends impacting our revenue this quarter.

Cost of goods sold, IT processing, servicing and support increased by $11.4 million (ZAR 130.4 million) or 10.6% ( 6.5%), primarily due to the increase in low margin prepaid airtime sales, higher insurance-related claims and third-party transaction fees.

Selling, general and administration expenses increased by $4.2 million (ZAR 59.8 million), or 18.7% (in ZAR 14.2%). The increase was primarily due to higher employee-related expenses (including annual bonuses and annual salary increases) and higher stock-based compensation charges; higher consulting, legal and travel expenses, and the year-over-year impact of inflationary increases on certain expenses.

Depreciation and amortization expense increased by $0.4 million (ZAR 3.5 million), or 7.2% (3.2%). The increase was due to an increase in depreciation expense related to additional POS devices deployed .

Transaction costs related to Adumo acquisition includes fees paid to external service providers associated with legal and advisory services procured to close the transaction on October 1, 2024.

Our operating (loss) income margin for the first quarter of fiscal 2025 and 2024 was (0.0)% and 0.2%, respectively. We discuss the components of operating loss margin under “—Results of operations by operating segment.”

We did not record any changes in the fair value of equity interests in MobiKwik and Cell C during the first quarter of fiscal 2025 or 2024, respectively. We continue to carry our investment in Cell C at $0 (zero). Refer to Note 4 for the methodology and inputs used in the fair value calculation for Cell C.

Interest on surplus cash increased to $0.6 million (ZAR 10.5 million) from $0.4 million (ZAR 8.4 million), primarily due to higher overall average cash balances on deposit during the first quarter of fiscal 2025 compared with 2024.

Interest expense increased to $5.0 million from $4.9 million and, in ZAR, decreased to ZAR 90.3 million from ZAR 91.4 million.
In ZAR, the decrease was primarily as a result of lower interest expense incurred on certain of our borrowing for which we were able to negotiate lower rates of interest towards the end of calendar 2024, which was partially offset by higher overall borrowings during the first quarter of fiscal 2025 compared with comparable period in the prior quarter.

Fiscal 2025 tax expense was $0.1 million (ZAR 1.4 million) compared to $0.3 million (ZAR 4.8 million) in fiscal 2024. Our effective tax rate for fiscal 2025 was impacted by the tax expense recorded by our profitable South African operations, a deferred tax benefit related to acquisition-related intangible asset amortization, non-deductible expenses (in transaction-related expenses), the ongoing losses incurred by certain of our South African businesses and the associated valuation allowances created related to the deferred tax assets recognized regarding net operating losses incurred by these entities.

Our effective tax rate for fiscal 2024 was impacted by the tax expense recorded by our profitable South African operations, a deferred tax benefit related to acquisition-related intangible asset amortization, non-deductible expenses, the on-going losses incurred by certain of our South African businesses and the associated valuation allowances created related to the deferred tax assets recognized regarding net operating losses incurred by these entities.

Finbond is listed on the Johannesburg Stock Exchange and reports its six-month results during our first quarter and its annual results during our fourth quarter. We sold our entire remaining interest in Finbond during the first quarter of fiscal 2024. The table below presents the relative (loss) earnings from our equity-accounted investments:| Table 5 | Three months ended September 30, | | | |
| --- | --- | --- | --- | --- |
| | 2024 | | 2023 | $ % |
| | $ ’000 | | $ ’000 | change |
| Finbond | | - | (1,445) | nm |
| Share of net loss | | - | (278) | nm |
| Impairment | | - | (1,167) | nm |
| Other | 27 | | 40 | (33%) |
| Total income (loss) from equity-accounted investments | 27 | | (1,405) | nm |

Results of operations by operating segment

The composition of revenue and the contributions of our business activities to operating loss are illustrated below:| | | | | Three months ended September 30, | | | | | |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| | | | 2024 | | | 2023 | % of | | |
| | | | (As | (As | | | | | |
| | | | restated)(A) | restated) | (A) | | | (As restated) | (A) |
| Operating Segment | | | $ ’000 | % of total | | $ ’000 | total | % change | |
| Consolidated revenue: | | | | | | | | | |
| Merchant | (A) | | 133,283 | 86% | | 121,361 | 89% | | 10% |
| Consumer | | | 21,072 | 14% | | 15,580 | 11% | | 35% |
| Subtotal: Operating segments | | | 154,355 | 100% | | 136,941 | 100% | | 13% |
| Eliminations | | | (787) | | - | (852) | - | | (8%) |
| Total consolidated revenue | | (A) | 153,568 | 100% | | 136,089 | 100% | | 13% |

Group Adjusted EBITDA:
Merchant	(1)(2)	7,916	84%	7,725	96%	2%
Consumer	(1)(2)	4,396	47%	2,120	26%	107%
Group costs		(2,949)	(31%)	(1,822)	(22%)	62%
Group Adjusted EBITDA (non-GAAP)		9,363	100%	8,023	100%	17%

(A) Revenue has been restated and increased by $8.0 million to correct the misstatements discussed in Note 1 to the unaudited condensed consolidated statement of operations.
(1) Segment Adjusted EBITDA Merchant and Segment Adjusted EBITDA Consumer include retrenchment costs of $0.01

million and $0.06 million, respectively, for the first quarter of fiscal 2025.
(2) Lease expenses which were previously presented on a separately line in fiscal 2024 are now included in Merchant and Consumer Segment Adjusted EBITDA. The prior period has been re-presented to conform with current period presentation. See also “—Results of Operations— Presentation of Merchant and Consumer by segment for fiscal 2024 and 2023 including lease charges”.
(3) Group Adjusted EBITDA is a non-GAAP measure, refer to reconciliation below at “—Results of Operations—Use of Non- GAAP Measures”.| | | | | Three months ended September 30, | | | | |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| | | | 2024 | % of | 2023 | % of | | |
| | | | (As | | | | | |
| | | | restated)(A) | | | | (As restated) | (A) |
| Operating Segment | | | ZAR ’000 | total | ZAR ’000 | total | % change | |
| Consolidated revenue: | | | | | | | | |
| Merchant | (A) | | 2,393,012 | 87% | 2,263,001 | 89% | | 6% |
| Consumer | | | 378,063 | 14% | 290,629 | 11% | | 30% |
| Subtotal: Operating segments | | | 2,771,075 | 101% | 2,553,630 | 100% | | 9% |
| Eliminations | | | (14,198) | (1%) | (15,971) | - | (11%) | |
| Total consolidated revenue | | (A) | 2,756,877 | 100% | 2,537,659 | 100% | | 9% |

Group Adjusted EBITDA:
Merchant	(1)(2)	142,078	84%	143,910	96%	(1%)
Consumer	(1)(2)	78,681	47%	39,612	26%	99%
Group costs		(52,654)	(31%)	(33,980)	(22%)	55%
Group Adjusted EBITDA (non-GAAP)		168,105	100%	149,542	100%	12%

(A) Revenue has been restated and increased by ZAR 141.2 million to correct the misstatements discussed in Note 1 to the unaudited condensed consolidated statement of operations.
(1) Segment Adjusted EBITDA Merchant and Segment Adjusted EBITDA Consumer include retrenchment costs of ZAR 0.2 million and ZAR 1.1 million, respectively, for the first quarter of fiscal 2025.

(2) Lease expenses which were previously presented on a separately line in fiscal 2024 are now included in Merchant and Consumer Segment Adjusted EBITDA. The prior period has been re-presented to conform with current period presentation.
(3) Group Adjusted EBITDA is a non-GAAP measure, refer to reconciliation below at “—Results of Operations—Use of Non- GAAP Measures”.

Merchant

Segment revenue primarily increased due to a higher volume of value-added services provided (prepaid airtime and gaming), higher low margin prepaid airtime sales and high transactions volumes from our vault and cash management operations resulting in

higher processing fees. In ZAR, the modest decrease in Segment Adjusted EBITDA is primarily due higher operating expenses incurred, especially employment-related expenditures, to expand our offering, which was partially offset by higher gross margin (calculated as revenue less cost of goods sold, IT processing, servicing and support).Werecord a significant proportion of our airtime sales in revenue (see further below) and cost of sales, while only earning a relatively small margin. This significantly depresses the Segment Adjusted EBITDA margins shown by the business.

Our Segment Adjusted EBITDA margin (calculated as Segment Adjusted EBITDA divided by revenue) for the first quarter of fiscal 2025 and 2024 was 5.9% and 6.4%, respectively.

Prepaid airtime sales

In South Africa and other countries, mobile network operators (“MNOs”) offer prepaid or contract (or postpaid) services to their customers to telephony services using a mobile telephony network or networks. MNOs also offer similar products (prepaid or postpaid)
for mobile data which uses other wireless network protocols such as wireless fidelity (“wifi”). We use the term “prepaid airtime” to include both of these prepaid products.

Generally speaking, the difference between the two models is that prepaid is paid for upfront by the customer and contract is paid in arrears. MNOs sell prepaid products directly to their customers and also indirectly to their customers through distribution channels (which include wholesalers, retailers and other parties, including ourselves).

We sell a variety of products through our distribution channels, including prepaid airtime, prepaid electricity, gaming vouchers.
We refer to these products collectively as VAS.

In order to “load” airtime onto a mobile device an MNOs customer requires a prepaid airtime voucher. A unique code is assigned to each prepaid airtime voucher and is required to activate the prepaid airtime on a mobile device. Like certain tangible goods, once sold, our customers cannot return prepaid airtime vouchers to us (except of course if there is a defect in the service provided by us, which rarely occurs).

We can either purchase an agreed quantity of prepaid airtime vouchers upfront directly from wholesalers or other parties (so called “Pinned airtime” - these electronic vouchers are stored on a server owned and maintained by us and we treat these vouchers as inventory) or we can “interface” directly into a wholesaler and deliver the airtime voucher directly to our customers (typically merchants) as the airtime is sold by the merchant to MNOs customers (so called Pinless airtime).

Consumer

Segment revenue increased primarily due to higher transaction fees generated from the higher EPE account holders base, an increase in certain issuing fee base prices and transaction activity in our issuing business, insurance premiums collected and lending

revenues following an increase in loan originations. This increase in revenue has translated into improved profitability, which was partially offset by higher insurance-related claims and interest expenses (of approximately ZAR 15.0 million) incurred to fund our lending book and the year-over-year impact of inflationary increases on certain expenses.Weintend to obtain a separate lending facility to fund a portion of our lending during fiscal 2025.Weexpected to have this facility in place on July 1, 2024, however, we have been unable to finalize terms as the separate lending facility will form part of a broader financing package. Therefore, we have included an intercompany interest expense in our Consumer Segment Adjusted EBITDA for the first quarter of fiscal 2025.

Our Segment Adjusted EBITDA margin for the first quarter of fiscal 2025 and 2024 was 20.9% and 13.6%, respectively.

Group costs

Our group costs primarily include employee related costs in relation to employees specifically hired for group roles and costs related directly to managing the US-listed entity; expenditures related to compliance with the Sarbanes-Oxley Act of 2002; nonemployee directors’ fees; legal fees; group and US-listed related audit fees; and directors’ and officers’ insurance premiums.

Our group costs for fiscal 2025 increased compared with the prior period due to higher employee costs resulting from an increase in the number of individuals allocated to group costs and base salary adjustments, higher bonus expense, travel, consulting and legal fees.

Presentation of Merchant and Consumer by segment for fiscal 2024 and 2023 including lease charges

The tables below present Merchant and Consumer EBITDA for fiscal 2024 and 2023, including lease charges, as well as the U.S. dollar/ ZAR exchange rates applicable per fiscal quarter and year:| | | In United States dollars | | | |
| --- | --- | --- | --- | --- | --- |
| | Quarter 1 | Quarter 2 | Quarter 3 | Quarter 4 | F2024 |
| | $ ’000 | $ ’000 | $ ’000 | $ ’000 | $ ’000 |
| Group Adjusted EBITDA: | | | | | |
| Merchant | 7,725 | 8,388 | 8,145 | 7,843 | 32,101 |
| Consumer | 2,120 | 2,575 | 3,757 | 4,227 | 12,679 |
| Group costs | (1,822) | (2,011) | (2,199) | (1,812) | (7,844) |
| Group Adjusted EBITDA (non-GAAP) | 8,023 | 8,952 | 9,703 | 10,258 | 36,936 |

Income and expense items: $1 = ZAR18.7118.7118.8818.4718.68| | | In United States dollars | | | |
| --- | --- | --- | --- | --- | --- |
| | Quarter 1 | Quarter 2 | Quarter 3 | Quarter 4 | F2023 |
| | $ ’000 | $ ’000 | $ ’000 | $ ’000 | $ ’000 |
| Group Adjusted EBITDA: | | | | | |
| Merchant | 7,580 | 8,780 | 7,980 | 7,924 | 32,264 |
| Consumer | (1,893) | 171 | 1,263 | 2,134 | 1,675 |
| Group costs | (2,300) | (2,256) | (2,293) | (2,260) | (9,109) |
| Group Adjusted EBITDA (non-GAAP) | 3,387 | 6,695 | 6,950 | 7,798 | 24,830 |

Income and expense items: $1 = ZAR17.1317.5217.9318.7417.94

Use of Non-GAAP Measures

is a non-GAAP measure. We provide this non-GAAP measure to enhance our evaluation and understanding of our financial performance and trends. We believe that this measure is helpful to users of our financial information understand key operating performance and trends in our business because it excludes certain non-cash expenses (including depreciation and amortization and stock-based compensation charges) and income and expenses that we consider once-off in nature.

Non-GAAP Measures

Group Adjusted EBITDA is earnings before interest, tax, depreciation and amortization (“EBITDA”), adjusted for nonoperational transactions (including loss on disposal of equity-accounted investments, gain related to fair value adjustments to currency options), (earnings) loss from equity-accounted investments, stock-based compensation charges and once-off items. Once-off items represents non-recurring income and expense items, including costs related to acquisitions and transactions consummated or ultimately not pursued.

The table below presents the reconciliation between GAAP net loss attributable to Lesaka to Group Adjusted EBITDA:| Table 10 | | Three months ended | |
| --- | --- | --- | --- |
| | | 2024September 30, | 2023 |
| | | $ ’000 | $ ’000 |
| Loss attributable to Lesaka - GAAP | | (4,542) | (5,651) |
| (Earnings) loss from equity accounted investments | | (27) | 1,405 |
| Net loss before (earnings) loss from equity-accounted investments | | (4,569) | (4,246) |
| Income tax expense | | 78 | 264 |
| Loss before income tax expense | | (4,491) | (3,982) |
| Interest expense | | 5,032 | 4,909 |
| Interest income | | (586) | (449) |
| Reversal of allowance for doubtful EMI loan receivable | | - | (250) |
| Operating income (loss) | | (45) | 228 |
| PPA amortization (amortization of acquired intangible assets) | | 3,747 | 3,608 |
| Depreciation and amortization | | 2,529 | 2,248 |
| Stock-based compensation charges | | 2,377 | 1,759 |
| Interest adjustment | | (831) | - |
| Once-off items | (1) | 1,805 | 78 |
| Unrealized (gain) loss FV for currency adjustments | | (219) | 102 |
| Group Adjusted EBITDA - Non-GAAP | | 9,363 | 8,023 |

(1) The table below presents the components of once-off items for the periods presented:| Table 11 | Three months ended | |
| --- | --- | --- |
| | 2024September 30, | 2023 |
| | $ ’000 | $ ’000 |
| Transaction costs | 103 | 78 |
| Transaction costs related to Adumo acquisition | 1,702 | - |
| Total once-off items | 1,805 | 78 |

Once-off items are non-recurring in nature, however, certain items may be reported in multiple quarters. For instance, transaction costs include costs incurred related to acquisitions and transactions consummated or ultimately not pursued. The transactions can span multiple quarters, for instance in fiscal 2025 we incurred significant transaction costs related to the acquisition of Adumo over a number of quarters, and the transactions are generally non-recurring.

Liquidity and Capital Resources

As of September 30, 2024, our cash and cash equivalents were $49.7 million and comprised of U.S. dollar-denominated balances of $2.0 million, ZAR-denominated balances of ZAR 791.0 million ($46.0 million), and other currency deposits, primarily Botswana

pula, of $1.7 million, all amounts translated at exchange rates applicable as of September 30, 2024. The decrease in our unrestricted cash balances from June 30, 2024, was primarily due to the utilization of cash reserves to fund certain scheduled and other repayments of our borrowings, purchase ATMs and vaults, pay annual bonuses, pay for expenses included in our group costs, and to make an investment in working capital, which was partially offset by positive contribution from our Merchant and Consumer operations and utilization.

We generally invest any surplus cash held by our South African operations in overnight call accounts that we maintain at South African banking institutions, and any surplus cash held by our non-South African companies in U.S. dollar-denominated money market accounts.

Historically, we have financed most of our operations, research and development, working capital, and capital expenditures, as well as acquisitions and strategic investments, through internally generated cash and our financing facilities. When considering

whether to borrow under our financing facilities, we consider the cost of capital, cost of financing, opportunity cost of utilizing surplus cash and availability of tax efficient structures to moderate financing costs. For instance, in fiscal 2022, we obtained loan facilities from RMB to fund a portion of our acquisition of Connect. Following the acquisition of Connect, we now utilize a combination of short and long-term facilities to fund our operating activities and a long-term asset-backed facility to fund the acquisition of POS devices and vaults. Refer to Note 12 to our consolidated financial statements for the year ended June 30, 2024, for additional information related to our borrowings.

Available short-term borrowings

Summarized below are our short-term facilities available and utilized as of September 30, 2024:

Table 12RMB Facility ERMB IndirectRMB ConnectNedbank $ ’000ZAR ’000$ ’000ZAR ’000$ ’000ZAR ’000$ ’000ZAR ’000

Total short-term facilities

available, comprising: Overdraft----9,895170,000-- Overdraft restricted as to use(1)52,384900,000------ Total overdraft52,384900,000--9,895170,000-- Indirect and derivative facilities(2)--7,858135,000--9,112156,556

Total short-term facilities available52,384900,0007,858135,0009,895170,0009,112156,556

Utilized short-term

facilities: Overdraft----9,895170,000-- Indirect and derivative facilities(2)--1,92733,100--1232,110

Total short-term facilities available--1,92733,1009,895170,0001232,110

Interest rate, based on11.50%11.40%

South African prime rate (1) Overdraft may only be used to fund ATMs and upon utilization is considered restricted cash. We did not utilize this facility at the end of September 2024, and expect to cancel the facility in the second quarter of fiscal 2025.
(2) Indirect and derivative facilities may only be used for guarantees, letters of credit and forward exchange contracts to support guarantees issued by RMB and Nedbank to various third parties on our behalf.

Long-term borrowings

We have aggregate long-term borrowing outstanding of ZAR 2.6 billion ($148.5 million translated at exchange rates as of September 30, 2024) as described in Note 8. These borrowings include outstanding long-term borrowings obtained by Lesaka SA of

ZAR 1.0 billion, including accrued interest, which was used to partially fund the acquisition of Connect. The Lesaka SA borrowing arrangements were amended in March 2023 to include a ZAR 200 million revolving credit facility. We have settled all drawn amounts in full as of September 30, 2024, with the full balance available for utilization in the future. In contemplation of the Connect transaction, Connect obtained total facilities of ZAR 1.3 billion, which were utilized to repay its existing borrowings, to fund a portion of its capital expenditures and to settle obligations under the transaction documents, and which has subsequently been upsized for its operational requirements and has an outstanding balance as of September 30, 2024, of ZAR 1.2 billion, We also have a revolving credit facility, of ZAR 300.0 million which is utilized to fund a portion of our merchant finance loans receivable book.

On September 30, 2024, we obtained a ZAR 665.0 million funding facility from RMB which has been used on October 1, 2024 to (i) settle an amount of ZAR 232.2 million due to the Adumo sellers; (ii) pay ZAR 207.2 million to acquire 2,601,410 shares of our common stock from one of the Adumo sellers’ indirect shareholders; (iii) pay ZAR 147.5 million notified by Investec Bank Limited to Adumo and us as a result of the acquisition, (iv) pay an origination fee of ZAR 7.6 million to RMB and (v) pay ZAR 70.0 million of transaction-related expenses.

Restricted cash

As of September 30, 2024, we had credit facilities with RMB in order to access cash to fund our ATMs in South Africa. Utilization of this facility is included in our cash, cash equivalents and restricted cash presented in our consolidated statement of cash flows. We did not utilize the facility at the end of September 2024. Any cash drawn under the facility may only be used to fund ATMs and is considered restricted as to use and therefore is classified as restricted cash on our consolidated balance sheet.

We have also entered into cession and pledge agreements with Nedbank related to our Nedbank indirect credit facilities and we have ceded and pledged certain bank accounts to Nedbank. The funds included in these bank accounts are restricted as they may not be withdrawn without the express permission of Nedbank. Our cash, cash equivalents and restricted cash presented in our consolidated statement of cash flows as of September 30, 2024, includes restricted cash of $0.1 million that has been ceded and pledged.

Arrangement with African Bank to fund our ATMs

In September 2024, we entered into an arrangement with African Bank Limited (“African Bank”) and certain cash-in-transit service providers to fund our ATMs. Under this arrangement, African Bank will use its cash resources to fund our ATMs and it is

specifically recorded that the cash in our ATMs are African Bank’s property. Therefore, as we have not utilized a facility to obtain the cash, and do not own or control the cash for an extended period of time, we do not record cash or cash equivalents and borrowings in our consolidated statement of financial position. Cash withdrawn from our ATMs by our EPE customers and other consumers are settled through the interbank settlement system from the ATM users bank account to African Bank’s bank accounts. We pay African Bank a monthly fee for the service provided which is calculated based on the cumulative daily outstanding balance of cash utilized multiplied by the South African prime interest rate less 1%. We are exposed to the risk of cash lost while it is in our ATMs (i.e. from theft) and are required to repay African Bank for any shortages.

Cash flows from operating activities

First quarter

Net cash used operating activities during the first quarter of fiscal 2025 was $4.1 million (ZAR 73.3 million) compared to net cash provided by operating activities of $3.4 million (ZAR 63.1 million) during the first quarter of fiscal 2024. Excluding the impact

of income taxes, our cash used in operating activities during the first quarter of fiscal 2025 includes cash utilized for the settlement of working capital movements within our merchant business related to quarter-end transaction processing activities and which were settled in the following week (our fourth quarter of fiscal 2024 closed on a Sunday), and the net growth in our consumer and merchant finance loans receivable books, which was partially offset by was positively impacted by the contribution from Merchant and Consumer businesses.

We didn’t pay any significant taxes during the first quarter of fiscal 2025. During the first quarter of fiscal 2024, we paid second provisional South African tax payments of $- million (ZAR - million) related to certain Connect entities’ 2024 tax year that had not yet been aligned with ours.

Taxes (refunded) paid during the first quarter of fiscal 2025 and 2024 were as follows:| Table 13 | Three months ended September 30, | | | |
| --- | --- | --- | --- | --- |
| | 2024 | 2023 | 2024 | 2023 |
| | $ | $ | ZAR | ZAR |
| | ‘000 | ‘000 | ‘000 | ‘000 |
| Taxation paid related to prior years | - | 572 | - | 10,859 |
| Tax refund received | (113) | (31) | (2,053) | (640) |
| Total South African taxes paid | (113) | 541 | (2,053) | 10,219 |
| Foreign taxes paid | 68 | 63 | 1,213 | 1,196 |
| Total tax (refund) paid | (45) | 604 | (840) | 11,415 |

Cash flows from investing activities

First quarter

Cash used in investing activities for the first quarter of fiscal 2025 included capital expenditures of $4.0 million (ZAR 70.3 million), primarily due to the acquisition of vaults and POS devices .

Cash used in investing activities for the first quarter of fiscal 2024 included capital expenditures of $2.8 million (ZAR 52.6 million), primarily due to the acquisition of vaults.

Cash flows from financing activities

First quarter

During the first quarter of fiscal 2025, we utilized $23.9 million from our South African overdraft facilities to fund our ATMs and our cash management business through Connect, and repaid $31.0 million of those facilities. We utilized $0.8 million of our longterm borrowings to fund the acquisition of certain capital expenditures and for working capital requirements. We repaid $5.5 million of long-term borrowings in accordance with our repayment schedule as well as to settle a portion of our revolving credit facility utilized.

During the first quarter of fiscal 2024, we utilized $59.6 million from our South African overdraft facilities to fund our ATMs and our cash management business through Connect, and repaid $62.8 million of those facilities. We utilized approximately $2.5 million of our long-term borrowings to fund the acquisition of certain capital expenditures and for working capital requirements. We repaid approximately $2.6 million of long-term borrowings in accordance with our repayment schedule as well as to settle a portion of our revolving credit facility utilized.

Off-Balance Sheet Arrangements

We have no off -balance sheet arrangements.

Capital Expenditures

We expect capital spending for the second quarter of fiscal 2025 to primarily include spending for acquisition of POS devices, vaults, computer software, computer and office equipment, as well as for our ATM infrastructure and branch network in South Africa.
Our capital expenditures for the first quarter of fiscal 2025 and 2024 are discussed under “—Liquidity and Capital Resources —Cash flows from investing activities.” All of our capital expenditures for the past three fiscal years were funded through internally generated funds, or, following the Connect acquisition, our asset-backed borrowing arrangement. We had outstanding capital commitments as of September 30, 2024, of $0.3 million. We expect to fund these expenditures through internally generated funds and available facilities.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

In addition to the tables below, see Note 4 to the unaudited condensed consolidated financial statements for a discussion of market risk.

We have short and long-term borrowings in South Africa which attract interest at rates that fluctuate based on changes in the South African prime and 3-month JIBAR interest rates. The following table illustrates the effect on our annual expected interest charge, translated at exchange rates applicable as of September 30, 2024, as a result of changes in the South African prime and 3-month JIBAR interest rates, using our outstanding short and long-term borrowings as of September 30, 2024. The effect of a hypothetical 1% (i.e.
100 basis points) increase and a 1% decrease in the interest rates applicable to the borrowings as of September 30, 2024, are shown.
The selected 1% hypothetical change does not reflect what could be considered the best- or worst-case scenarios.

Table 14As of September 30, 2024| | | | | | charge after | |
| --- | --- | --- | --- | --- | --- | --- |
| | Annual expected | | Hypothetical | | hypothetical change | |
| | interest charge | | change in | | in interest rates | |
| | ($ ’000) | | interest rates | | ($ ’000) | |
| Interest on South African borrowings | | 19,780 | | 1% | | 21,367 |
| | | | | (1%) | | 18,190 |

Item 4. Controls and Procedures

Under the supervision and with the participation of our management, including our executive chairman and our group chief financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e)
promulgated under the Securities Exchange Act of 1934, as amended, as of September 30, 2024.

We previously identified and disclosed in Part II, Item 9A of our Annual Report on Form 10-K for the year ended June 30, 2024, material weaknesses (the “Original Material Weaknesses”) in our internal control over financial reporting related to: (1) information technology general controls (“ITGCs”), specifically insufficient risk assessment, design and implementation, monitoring activities and training of individuals to operate controls in the areas of user access and program-change management for certain information technology systems that support our financial reporting processes and (2) insufficient design and implementation of controls and associated policies and procedures in our annual goodwill impairment assessment. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis.

As a result of insufficient time to design, implement and fully test controls to ensure we have remediated the Original Material Weaknesses discussed in our Annual Report on Form 10-K for our fiscal year ended June 30, 2024 (as described above), the executive chairman and the group chief financial officer concluded that our disclosure controls and procedures were not effective as of September 30, 2024. due to the Original Material Weaknesses described above.

Subsequent to the date of the Original Filing, including in connection with the restatement, management identified the following material weaknesses (the “Subsequent Material Weaknesses” and together with the “Original Material Weaknesses”, the “Material Weaknesses”) in the Company’s internal control over financial reporting:

●Our Consumer lending process, specifically insufficient risk assessment and monitoring activities relating to changes in

systems and processes, insufficient controls over internal information and information from service organizations, and insufficient design and implementation of information technology general controls (“ITGCs”), controls over service organizations and process level controls, resulting in ineffective process level controls, including a lack of validation of the completeness and accuracy of information used within the process;
●Our payroll process, specifically insufficient risk assessment and monitoring activities relating to changes over the transfer of ownership to the centralized payroll processes, insufficient controls over information from service organizations, and insufficient design and implementation of ITGCs, controls over service organizations and process level controls resulting in ineffective process level controls including a lack of validation of the completeness and accuracy of information used within this process;
●Our annual goodwill impairment process, specifically related to insufficient risk assessment and ineffective design and implementation of controls resulting in ineffective process level controls;
●Our revenue recognition process relating to prepaid airtime sold and processing fees relating to certain agreements, specifically insufficient risk assessment and ineffective design and implementation of controls related to our judgement over revenue recognized either as principal versus as agent resulting in ineffective process level controls;
●Our journal entry process, specifically relating to insufficient risk assessment, and ineffective design and implementation of controls including insufficient controls over information resulting in ineffective process level controls including a lack of validation of the completeness of the journal entry population and a lack of validation of the completeness and accuracy of information used within the process; and ●An insufficient number of experienced and trained resources to execute on their internal control responsibilities resulting in ineffective design, implementation and operating effectiveness of process level controls for processes in the scope of our internal control over financial reporting evaluation.

Of the material weaknesses described above, the material weaknesses related to the revenue recognition process resulted in a material corrected misstatement for the year ended September 30, 2024 and a restatement for each of the quarters ended September

30, 2024, December 31, 2024 and March 31, 2025 of our revenue and cost of goods sold, IT processing, servicing and support, exclusive of depreciation and amortization. There was no impact on the Company’s reported operating income (loss), net loss or loss per share in any of such quarters. For further information on the restatement, refer to the section titled "Restatement of Previously Issued Financial Statements” in Note 1 to the unaudited interim condensed consolidated financial statements as of and for the three months ended September 30, 2024. included in this Form 10-Q/A.

Of the material weaknesses described above, the material weaknesses related to the annual goodwill impairment process resulted in a corrected material misstatement and a corrected immaterial misstatement of goodwill and impairment loss in the Company’s consolidated financial statements for the year ended June 30, 2025 .

Of the material weaknesses described above, the material weaknesses related to the journal entry process resulted in a corrected immaterial misstatement to our revenue and cost of goods sold, IT processing, servicing and support, exclusive of depreciation and amortization in the Company’s consolidated financial statements for the year ended June 30, 2025.

Of the material weaknesses described above, the material weakness related to an insufficient number of experienced and trained resources to execute on their internal control responsibilities also resulted in a corrected material misstatement of current and longterm borrowings in the Company’s consolidated financial statements for the year ended June 30, 2025.

All other material weaknesses did not result in any corrected material or immaterial misstatements, however a reasonable possibility exists that material misstatements in the Company’s consolidated financial statements may not be prevented or detected on a timely basis.

Subsequent to the date of the Original Filing and as a result of the Subsequent Material Weaknesses in the Company's internal control over financial reporting discussed above, our management, with the participation of our executive chairman and our group chief financial officer, concluded that, as of September 30, 2024., our disclosure controls and procedures were not effective at the reasonable assurance level due to the Subsequent Material Weakness described above.

Notwithstanding the previously identified Material Weaknesses, management believes the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q/A fairly present, in all material respects, our financial condition, results of operations and cash flows as of and for the periods presented in accordance with GAAP.

Remediation of Subsequent Material Weaknesses

To address the material weaknesses, our management, including our Information Technology (“IT”) team, has commenced with remediation of these material weaknesses including, but not limited to: (1) developing and implementing a comprehensive remediation

plan that includes specific actions aimed at enhancing the understanding of control owners related to the operation and importance of internal controls over financial reporting, including the principles and requirements of each control, with a focus on the impacted processes, including controls over service organizations, ITGCs and other process level controls; (2) mandating improved risk assessment procedures with governance requirements upon implementing new systems within the Group together with the design, implementation and monitoring of control activities; (3) the recruitment of additional appropriately skilled resources across the Finance and Risk and Compliance disciplines coupled with the further upskilling and training of existing resources responsible for the execution of key controls as well as a focus on a greater degree of automation of controls throughout the organization, (4) the embedding of controls compliance in the key performance indicators of senior executives across the business and (5) collaborating closely with internal and external assurance partners to ensure the robustness of our remediation plan.

While we are actively taking steps to implement our remediation plan, the Subsequent Material Weaknesses will not be deemed resolved until the enhanced controls operate for a sufficient period of time and management has confirmed through testing that the same are operating effectively. We will continue to monitor the remediation plan's effectiveness and adjust our efforts as needed. As we assess and test our internal control over financial reporting, we may identify the need for additional measures or modifications to the plan.

Remediation of Original Material Weaknesses

Management has, however, made progress in remediating the material weaknesses identified in the previous fiscal year related to the failure of specific ITGCs for certain IT systems to operate effectively as well as the insufficient design and implementation of

controls and policies and procedures related to the goodwill impairment assessment. As a result, controls in the areas of user access and program-change management for associated IT systems that support our financial reporting processes have been remediated.
Revised procedures have been implemented related to the validation of completeness and accuracy of the data used in the goodwill impairment model together with additional procedures implemented to enhance the precision levels in evaluating certain assumptions utilized in this model. Even though the controls for the goodwill impairment process have been strengthened, it has not yet been fully remediated as model errors persisted.

The remediation plan with respect to the Material Weaknesses may be adjusted as is appropriate, as we continue to evaluate and enhance our internal control over financial reporting. Other than the design and implementation of the remediation plan, there have not been any changes in our internal control over financial reporting during the fiscal quarter ended September 30, 2024., that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Part II. Other Information

Item 1A. Risk Factors

See “Item 1A RISK FACTORS” in Part I of our Annual Report on Form 10-K for the fiscal year ended June 30, 2024, for a discussion of risk factors relating to (i) our business, (ii) operating in South Africa and other foreign markets, (iii) government regulation, and (iv) our common stock. Except as set forth below, there have been no material changes from the risk factors previously disclosed in our Annual Report on Form 10-K for the fiscal year ended June 30, 2024.

We may not be able to successfully integrate Adumo’s operations with our business.

On October 1, 2024, we announced the closing of our ZAR 1.67 billion ($96.2 million) investment to acquire a 100% interest in Adumo. Integrating these businesses into our company may require significant attention from our senior management which may divert their attention from our day-to-day business. The difficulties of integration may be increased by cultural differences between our two organizations and the necessity of retaining and integrating personnel, including Adumo’s key employees and management team. The services of some of these individuals will be important to the continued growth and success of Adumo’s business and to our ability to integrate the Adumo business with ours. If we were to lose the services of these key employees or fail to sufficiently integrate them, our ability to operate these businesses successfully would likely be materially and adversely impacted.

As such, if we are unable to successfully integrate Adumo’s operations into our business we could be required to record material impairments, and as a result, our financial condition, results of operations, cash flows and stock price could suffer.

We depend upon third-party suppliers, making us vulnerable to supply shortages and price fluctuations, which could harm

our business.

We obtain our smart cards, ATMs, electronic payment and POS devices, components for our safe assets, components to repair the ISV (independent software vendor) division’s POS hardware, and the other hardware we use in our business from a limited number

of suppliers, and do not manufacture this equipment ourselves. We generally do not have long-term agreements with our manufacturers or component suppliers. If our suppliers become unwilling or unable to provide us with adequate supplies of parts or products when we need them, or if they increase their prices, we may not be able to find alternative sources in a timely manner and could be faced with a critical shortage. This could harm our ability to meet customer demand and cause our revenues to decline. Even if we are able to secure alternative sources in a timely manner, our costs could increase as a result of supply or geopolitical shocks, which may lead to an increase in the prices of goods and services from third parties. A supply interruption, such as the recent global shortage of semiconductors, or an increase in demand beyond current suppliers’ capabilities could harm our ability to distribute our equipment and thus to acquire new customers who use our technology. Any interruption in the supply of the hardware necessary to operate our technology, or our inability to obtain substitute equipment at acceptable prices in a timely manner, could impair our ability to meet the demand of our customers, which would have an adverse effect on our business.

We do not have a South African banking license and, therefore, we provide our EPE solution through an arrangement with a third-party bank, which limits our control over this business and the economic benefit we derive from it. If this arrangement were to terminate, we would not be able to operate our EPE business without alternate means of access to a banking license. We are also required to comply with the requirements of payment schemes, including VISA and Mastercard. Furthermore, we provide certain of our services under partnerships with South African banks. We will be unable to provide our payments and card-acquiring businesses if we fail to comply with payment scheme rules, and/or fails to maintain certain regulatory licenses and registrations, and/ or if we were unable to continue to partner with South African banks to provide our payments and card acquiring services.

The South African retail banking market is highly regulated. Under current law and regulations, our EasyPay Everywhere (“EPE”) business activities require us to be registered as a bank in South Africa or to have access to an existing banking license. We are not currently so registered, but we have an agreement with African Bank Limited that enables us to implement our EPE program in compliance with the relevant laws and regulations. If this agreement were to be terminated, we would not be able to operate these services unless we were able to obtain access to a banking license through alternate means. Furthermore, we have to comply with the South African Financial Intelligence Centre Act, 2001 and money laundering and terrorist financing control regulations, when we open new bank accounts for our customers and when they transact. Failure to effectively implement and monitor responses to the legislation and regulations may result in significant fines or prosecution of African Bank Limited and ourselves.

We are required to comply with the requirements of payment schemes, including VISA and Mastercard. We have deployed a significant number of devices, and any mandatory compliance upgrades to our deployed POS devices would require significant capital expenditures and/or be disruptive to our customer base. Failure to comply with the payment schemes’ rules may result in significant fines and/or a loss of license to participate in the scheme(s).

We provide payment services to our customers by partnering with some of the largest banks in South Africa. If these agreements were to be terminated, we would not be able to provide these payment services unless we were able to conclude an agreement with an alternative bank. In addition, if we were to lose our PASA registrations or fail to have them renewed, we would not be permitted to provide payment services.

Compliance with the requirements under these various regulatory regimes may cause us to incur significant additional costs and failure to comply with such requirements could result in the shutdown of the non-complying facility, the imposition of liens, fines and/or civil or criminal liability.

In addition, the South African Financial Advisory and Intermediary Services Act, 2002, requires persons who act as intermediaries between financial product suppliers and consumers in South Africa to register as financial service providers. EasyPay Insurance was granted a Financial Service Provider, or FSP, license on June 9, 2015, and EasyPay Financial Services (Pty) Ltd was granted a FSP license on July 11, 2017. If our FSP licenses are withdrawn or suspended, we may be stopped from continuing our financial services businesses in South Africa unless we are able to enter into a representative arrangement with a third party FSP.

Furthermore, the proposed Conduct of Financial Institutions Bill will make significant changes to the current licensing regime however, the current proposal is that existing licences will be converted. The second draft of the Conduct of Financial Institutions Bill was published for public comment on September 29, 2020.

Proposed regulatory changes to the national payments system are expected to have a substantial impact on the South African payments industry. It may change the manner in which we conduct business and may lead to increased operating costs for our business as we work to ensure compliance with the new legislative and regulatory framework, which may have a material adverse

effect on our business.

On March 3, 2025, the South African Reserve Bank (“SARB”) published certain draft regulatory documents for commentary that are expected to have a substantial impact on how we conduct our business namely: (i) a draft directive entitled “Directive in

respect of specific payment activities within the national payment system” (the “Directive”); (ii) a draft exemption notice entitled “Designation by the Prudential Authority of specific activities conducted in the national payment system which shall be deemed not to constitute ‘the business of a bank’ under paragraph (cc) in section 1(1) of the Banks Act, 1990” (the “Exemption Notice”); and (iii) the National Payment System Bill (“NPS Bill”), which seeks to replace the existing National Payment System Act, 1998. The proposed regulations were made available for comment, and we submitted detailed comments to our industry body, Association of South African Payment Providers, on the proposed regulations.

The key objectives of the proposed regulations are to clarify the mandate and objectives of the SARB with respect to the national payment system (“NPS”); and establish a robust regulatory, oversight, and supervisory framework for the NPS. The proposed

regulations also aim to promote financial inclusion, competition, the prevention of financial crime, and the fair treatment and protection of customers, while introducing an activity-based licensing and authorization regime. In this regard, the Directive defines thirteen “payment activities” and provides that a person, which can be a bank or a non-bank, providing a “payment activity" must obtain authorisation from the SARB to undertake such activity. Under the Exemption Notice, certain payment activities are exempted from the definition of ‘the business of a bank’. Prior to the Exemption Notice, these activities could only be undertaken by a bank. Pursuant to the Exemption Notice, these activities can be undertaken by non-banks, subject to certain conditions. Certain of our businesses, including EasyPay Everywhere, Adumo and Kazang Pay, currently undertake activities which would qualify as “payment activities” under the Directive and the NPS Bill. Under the current regulatory framework, these activities are undertaken in partnership with a sponsoring bank and the sponsoring bank is subject to regulation by the SARB. In other words, the business undertaking the “payment activity” is not subject to direct regulation with respect to such payment activities.

It is uncertain if and when the proposed regulations will enter into effect and whether a non-bank such as the relevant Lesaka subsidiary may elect whether to conduct an exempted payment activity by partnering with a bank to do so, or on its own, if it is authorised by the SARB - i.e. whether both options will be available to a non-bank. Should our businesses be subject to direct regulation under this new regime (i.e., if our current sponsorship model is no longer available), we expect that we will incur significant operating costs to comply with the new requirements, and to obtain authorization with respect thereto. Furthermore, while some requirements may already exist under other current regulatory frameworks for certain of our businesses, we will likely need to invest in additional resources, systems and processes to satisfy the regulatory requirements contemplated in the proposed regulations, which may also lead to increased operational costs, which may have a material adverse effect on our business. It is expected that the SARB will publish revised regulations later in 2025.

We identified material weaknesses in internal control over financial reporting, and determined that they resulted in our internal control over financial reporting and disclosure controls and procedures not being effective, during the quarter ended September 30, 2024. If we are not able to remediate these material weaknesses, or we identify additional deficiencies in the future or otherwise fail to maintain an effective system of internal controls, including disclosure controls and procedures, this could result in material misstatements of our financial statements or cause us to fail to meet our reporting obligations.

SEC rules define a material weakness as a deficiency, or a combination of control deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of a registrant’s financial statements will not be prevented or detected on a timely basis. We are required to annually provide management’s attestation on internal control over financial reporting. We are also required to disclose significant changes made to our internal control procedures on a quarterly basis and any material weaknesses identified by our management in our internal control over financial reporting during the course of related assessments.

Subsequent to the Original Filing, in connection with the restatement, management identified a material weakness in the Company’s internal control over financial reporting related to its controls over applying technical accounting guidance to nonrecurring events and transactions, specific to the evaluation of information that was known or knowable at the time of the transaction or event.
Refer to the section titled "Restatement” in Note 1 to the unaudited interim condensed consolidated financial statements as of and for the three months ended September 30, 2024 included in this Form 10-Q/A. Management determined that such material weakness resulted in the Company’s internal control over financial reporting and disclosure controls and procedures not being effective as of September 30, 2024.

Effective internal controls are necessary for us to provide reliable financial statements and prevent or detect fraud. The material weaknesses in internal control over financial reporting described above, any new deficiencies identified in the future or any deficiencies

in our disclosure controls and procedures, if not timely remediated, could limit our ability to prevent or detect a misstatement of our accounts or disclosures that could result in a material misstatement of our annual or interim financial statements. We are in the process of implementing a remediation plan to remediate the material weaknesses we identified, which is designed to improve our internal control over financial reporting. We can provide no assurance that the measures we have taken to-date and any actions that we may take in the future will be sufficient to remediate this control deficiency, or that such remediation measures will be effective at preventing or avoiding potential future significant deficiencies or material weaknesses in our internal controls.

If we identify any new deficiencies in the future or are not able to successfully remediate the material weaknesses we have identified and related deficiencies in our disclosure controls and procedures, the accuracy and timing of our financial reporting may

be adversely affected, investors may lose confidence in the accuracy and completeness of our financial reports, the market price of our common stock could decline, we could be subject to sanctions or investigations by the SEC, or other regulatory authorities, and we may not be able to source external financing for our capital needs on acceptable terms or at all. Each of the foregoing items could adversely affect our business, results of operations, financial condition, and the market price and volatility of our common stock. In addition, we have expended, and expect to continue to expend, significant resources, including accounting-related costs and significant management oversight, in order to assess, implement, maintain, remediate and improve the effectiveness of our internal control over financial reporting and our general control environment.

In addition, as a result of the material weaknesses described above and other matters raised or that may in the future be raised by the SEC, we face the potential for litigation or other disputes which may include, among others, claims invoking the federal and state securities laws, contractual claims or other claims arising from the deficiencies in our internal control over financial reporting described above, the preparation of our financial statements and the restatement described above. Any such litigation or dispute, whether successful or not, could have a material adverse effect on our business, results of operations, liquidity and financial condition.

The restatement of our prior quarterly financial statements may affect shareholder and investor confidence in us or harm our reputation, and may subject us to additional risks and uncertainties, including increased costs and the increased possibility of legal

proceedings and regulatory inquiries, sanctions or investigations.

Subsequent to the Original Filing, in connection with the restatement, management identified material weaknesses in the Company’s internal control over financial reporting, specific to the evaluation of information that was known or knowable at the time of the transaction or event. Refer to the section titled “Restatement” in Note 1 to the unaudited interim condensed consolidated financial statements as of and for the three months ended September 30, 2024 included in this Form 10-Q/A.

As a result of the restatement described above, we have incurred, and may continue to incur, unanticipated costs for accounting and legal fees in connection with, or related to, such restatement. In addition, such restatement could subject us to a number of

additional risks and uncertainties, including the increased possibility of legal proceedings and inquiries, sanctions or investigations by the SEC or other regulatory authorities. Any of the foregoing may adversely affect our reputation, the accuracy and timing of our financial reporting, or our business, results of operations, liquidity and financial condition, or cause shareholders, investors and customers to lose confidence in the accuracy and completeness of our financial reports or cause the market price of our common stock to decline.

Item 5. Other Information

Our Section 16 officers and directors, as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934 (the “Exchange Act”), may from time to time enter into plans for the purchase or sale of our common stock that are intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) of the Exchange Act. During the quarter ended September 30, 2024, no officers or directors, as defined in Rule 16a-1(f),adopted, modified, orterminateda “Rule 10b5-1 trading arrangement” or a “non-Rule10b5-1trading arrangement,” as defined in Item 408 of Regulation S-K.

Item 6. Exhibits

The following exhibits are filed as part of this Form 10-Q:

Incorporated by Reference Herein

ExhibitIncluded

No.Description of ExhibitHerewithFormExhibitFiling Date| 2.2 | First Addendum to Sale and Purchase Agreement, dated | | | |
| --- | --- | --- | --- | --- |
| | October 1, 2024, between Lesaka Technologies Proprietary | | | |
| | Limited; Lesaka Technologies, Inc. and the parties listed in | | | |
| | Annexure A | 8-K | 2.2 | October 1, 2024 |
| 10.39 | Facility Letter dated September 30, 2024 between Lesaka | | | |
| | Technologies (Proprietary) Limited and FirstRand Bank | | | |
| | Limited (acting through its Rand Merchant Bank division) | 8-K | 10.1 | October 1, 2024 |
| 10.40 | Sale of Shares Agreement dated October 1, 2024, between | | | |
| | Lesaka Technologies Proprietary Limited and Crossfin | | | |
| | Holdings Proprietary Limited | 8-K | 10.2 | October 1, 2024 |
| 10.41# | Third Addendum to Facility Letter no.: LM/CCMS/01/2021 | | | |

between FirstRand Bank Ltd, Cash Connect Management Solutions (Pty) Ltd, Main Street 1723 (Pty) Ltd, Cash Connect Rentals (Pty) Ltd; and K2020 Connect (Pty) Ltd dated October 29, 2024 31.1Certification of Principal Executive Officer pursuant to Rule 13a-14(a) under the Exchange ActX 31.2Certification of Principal Financial Officer pursuant to Rule 13a-14(a) under the Exchange ActX 32Certification pursuant to 18 USC Section 1350X 101.INSXBRL Instance DocumentX 101.SCHXBRL Taxonomy Extension SchemaX 101.CALXBRL Taxonomy Extension Calculation LinkbaseX 101.DEFXBRL Taxonomy Extension Definition LinkbaseX 101.LABXBRL Taxonomy Extension Label LinkbaseX 101.PREXBRL Taxonomy Extension Presentation LinkbaseX 104Cover page formatted as Inline XBRL and contained in Exhibit 101

Previously filed with the Quarterly Report on Form 10-Q for the period ended September 30, 2024 filed with the SEC on November 6, 2024.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on September 29, 2025.

LESAKA TECHNOLOGIES, INC.
By: /s/ Ali Mazanderani

Ali Mazanderani

Executive Chairman By: /s/ Dan L. Smith

Dan L. Smith

Group Chief Financial Officer, Treasurer and Secretary

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LESAKA TECHNOLOGIES INC

Previously filed with the Quarterly Report on Form 10-Q for the period ended September 30, 2024 filed with the SEC on November 6, 2024.

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