COMPANY COMMENT
New dawn can’t come soon enough for Net1
The company released a poor set of quarterly results that shocked the market
Net1 CEO Herman Kotzé sounded reasonably upbeat on the teleconference with analysts last week following the release of what one analyst described as a “shocking” set of quarterly results. Presumably the more shocking the results, the more upbeat you have to sound. Kotze referred to a “new dawn” for Net1 in South Africa since October 1 when the company was relieved of the Constitutional Court obligations to ensure the smooth payment of social grants to almost 11-million recipients monthly. The subsequent crash in the share price towards all-time lows indicates investors were not persuaded by his talk of strong post-SA Social Security Agency market growth. They may instead have focused on his warnings that the next few quarters could also be a bit tough. It is difficult to imagine that things might not improve from the extremely tough situation facing Net1 during the six months to end-September. Its Cash Paymaster Services (CPS) subsidiary was forced to continue distributing cash gran...
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