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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