LESAKA TECHNOLOGIES INC
For the period ended Dec 31, 2024. Filed Feb 5, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Dec 31, 2024 · Filed Feb 5, 2025
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-06.
0001562762-24-000261
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-12-31; filed 2025-02-05.
0001562762-25-000019
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 2970 previous paragraphs and 3263 current paragraphs.
1622 unchanged; 52 reworded; 1567 added; 1287 removed; 9 previous and 22 current paragraphs rearranged.
Tables are not compared: 0 previous and 0 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (1567)
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Item 2. Management’s Discussion and Analysis of
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measures.
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present these non-GAAP
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measures and the
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material risks and
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limitations of these
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measures, as well
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as a reconciliation
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of these non-
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Beginning in the
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second quarter of fiscal
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year 2025, Lesaka has
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commenced disclosing its
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financial results across
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three distinct
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operating divisions: Merchant, Consumer
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and Enterprise. We are building an
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integrated multiproduct platform that
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is organized around
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addressing a number of customer needs.
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The Consumer
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Division (“Consumer”)
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will remain
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substantially the
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same. We
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consumers a
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transactional account,
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and insurance. On 1 October the Adumo Payouts business officially
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became part of Consumer.
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The Merchant Division (“Merchant”) serves merchants
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and micro-merchants, combining existing Connect, Kazang and
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Insights (previously known
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as Touchsides) operations, as
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well as
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the bulk of
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Adumo, specifically its
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business and its GAAP hospitality platform. Combined the Lesaka
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offering will be amongst the most comprehensive
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in the market in
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present these non
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-GAAP measures and
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the material risks
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and limitations of
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these measures, as
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well as a
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reconciliation of these
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the year ended
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mission
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Lesaka
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is driven
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purpose
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Southern
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Africa’s
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underserviced
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consumers
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(B2C)
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merchants
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(B2B),
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improving
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people’s
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lives
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increasing
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inclusion
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markets
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operate. We offer a wide
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range of
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integrated payment solutions
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including transactional accounts
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(banking), lending, insurance,
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payouts,
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solutions,
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card
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acceptance,
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bill
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payments.
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providing
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full-service
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fintech platform in our connected ecosystem, we facilitate the digitization
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of commerce in our markets.
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solutions effectively “puts the bank” in approximately 4,480
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solutions effectively “puts the bank” in 4,664 merchants’
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provide robust cash vaults in the SME sector (Cash Connect) and are building a presence
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sector (Cash Connect) and are building a presence in the micro-
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their operational risks pertaining to cash management and security.
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pertaining to cash management and security.
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Throughput for the quarter (ZAR billions)
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Pre-paid solutions throughput for the quarter
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which is reflected in a healthy throughput growth and margin
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which is reflected in a healthy throughput growth.
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Total active EPE transactional account base at quarter
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Total active EPE transactional account base at
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the first quarter of fiscal 2024.
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2024, and 33 000 in the first quarter of fiscal 2025.
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Our total active EPE transactional account base stood at approximately 1.5 million at the end of September
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Our total active EPE transactional account base stood at approximately 1.6 million at the end of December 2024, of
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policies has grown 30% to approximately 466,000 policies as of September 30, 2024, compared to 359,000 policies
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policies has grown 29% to approximately 496,000 policies as of December 31, 2024,
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supplementally presented in ZAR, and our internal management information,
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measures which are supplementally presented in ZAR, and our internal management
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which is also presented in ZAR.
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information, which is also presented in ZAR.
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loss from equity-accounted investments to our reportable segments. Once-off items represents non-recurring expense items, including
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to our reportable segments. Once-off
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quarter of fiscal 2025 as compared with
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of fiscal 2025 as compared
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offset by fewer low margin prepaid airtime sales;
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to fewer low margin prepaid airtime sales and a
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Net loss before earnings (loss) from equity-accounted investments
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Net loss before earnings from equity-accounted investments
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claims and third-party transaction fees.
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revenue generated, and higher insurance-related claims and third-party
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the components of operating loss margin under “—Results of operations
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components of operating loss margin under “—Results of operations
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effective tax rate for fiscal 2025 was impacted
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Our effective tax rate for fiscal 2025 was impacted by deferred tax impact related to the fair value adjustment to our equity securities,
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regarding net operating losses incurred by these entities.
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losses incurred by these entities.
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EBITDA for the first quarter of fiscal 2025.
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EBITDA for the
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three months ended September 30,
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for the three months ended December 31, 2023.
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re-presented to conform with current
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re-presented to conform with current period presentation.
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of pinned airtime sales decreasing, which results in a lower revenue
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decreasing, which results in a lower revenue and
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and related cost of sales, and an overall improved margin.
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related cost of sales, and an overall improved margin.
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during the first quarter of fiscal 2025
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computer software license costs, and the year-over-year impact of inflationary increases on certain expenses. As noted during the first
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First quarter of fiscal 2025 compared to first quarter
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First half of fiscal 2025 compared to first half of fiscal 2024
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as well as higher transaction, insurance and lending revenues in Consumer, which was partially
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value-added services activity in Merchant, as well as higher transaction, insurance and lending revenues in Consumer, which
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increase in depreciation expense related to additional POS devices deployed
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acquisition and an increase in depreciation expense related to additional
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for the first quarter of fiscal 2025 and 2024
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for the first half
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We did not record any changes in the fair value of equity interests in MobiKwik and Cell C
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adjustment loss related to MobiKwik. We did not record any changes in the fair value of equity interests in MobiKwik during the first
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continue to carry our investment in Cell
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carry our investment in Cell C at $0 (zero).
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higher overall average cash balances on deposit during the first quarter
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inclusion of Adumo and higher overall average cash balances on deposit during
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of fiscal 2025 compared with 2024.
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the first half of fiscal 2025 compared with 2024.
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on certain of our borrowing for which we were able
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for which we were able to negotiate lower rates of interest towards the end of
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below presents the relative (loss) earnings from our equity-accounted investments:
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the relative (loss) earnings from our equity-accounted investments:
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operating expenses incurred, especially employment-related expenditures, to expand
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is primarily due to the inclusion of Adumo, which was partially offset by higher operating expenses incurred, especially employment-
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offset by fewer low margin prepaid airtime sales. In ZAR, the modest decrease in Segment Adjusted EBITDA is primarily due higher
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In ZAR, the significant decrease in Segment Adjusted EBITDA is primarily due
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Our Segment Adjusted EBITDA margin for the
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Our Segment Adjusted EBITDA margin for the first half
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Presentation of Merchant and Consumer by segment for fiscal 2024 and 2023
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Presentation of Merchant, Consumer and Enterprise by segment for fiscal 2025 to date and fiscal 2024
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The tables below present Merchant and Consumer EBITDA for fiscal 2024
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The tables below present Merchant, Consumer and Enterprise revenue
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of cash. We provide robust cash vaults in the merchant
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Total active EPE transactional account base at
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items represent non-recurring expense items,
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with the same period in the prior year:
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activity in Merchant, as well as higher transaction, insurance and lending
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acquisition and an increase in depreciation expense related to
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calculation for MobiKwik and Cell C.
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The table below presents the relative earnings (loss) from our equity-accounted
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This discussion is based on the amounts prepared in accordance with U.S. GAAP.
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The following tables show the changes in the items comprising our statements of operations,
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both in U.S. dollars and in ZAR:
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Income (Loss) from equity-accounted investments
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Income (Loss) from equity-accounted investments
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components of operating loss margin under “—Results of operations
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deferred tax benefit related to acquisition-related intangible asset amortization, non-deductible expenses, the on-going losses incurred
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Results of operations by operating segment
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The composition of revenue and the contributions of our business activities to operating
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re-presented to conform with current period presentation.
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2025 increased compared with the prior
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during the second quarter of fiscal 2025 and 2024 were as follows:
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and our cash management business through Connect, and repaid
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$66.0 million of those facilities. We utilized $8.6 million of our long-
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Total active EPE transactional account base at quarter
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Earnings (Loss) from equity-accounted investments
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C at $0 (zero). Refer to Note
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for the first quarter of fiscal 2025.
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for the first quarter of fiscal 2025.
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(Earnings) loss from equity accounted investments
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Net loss before (earnings) loss from equity-accounted investments
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and restricted cash presented in our consolidated statement
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million of our long-term borrowings