Net1 is not hung up on Cell C losses as it eyes the unbanked

Business

Net1 is not hung up on Cell C losses as it eyes the unbanked

Net1 took a R1.9bn hit on its Cell C stake, and revenue fell 41% as its controversial social grants deal expired

Ann Crotty

The Net1 share price (https://www.sharenet.co.za/v3/quickshare.php?scode=NT1) has held up reasonably well given the avalanche of bad news it has had to deal with over the past few months. At R51 it’s comfortably off the 12-month low of R38.60 the share touched in August. Presumably investors were swayed by the upbeat comment the board provided with the recently released quarterly results.

News that Net1’s SA business has been stabilised and management is now focused on returning to growth and profitability appears to have countered the grim developments on the Cell C front.

Net1 took a $125.4m (about R1.9bn ) hit on the valuation of its Cell C investment during the three months to the end of June but has not given up hope. It still reckons, with a bit more funding, it can “create a long-term sustainable business”...

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