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# Lesaka is finally making money, and the division that brings in most of its revenue is the one shrinking
- URL: https://www.businessbagel.com/lesaka-khaole-africa-expansion-merchant-unit/
- Published: 2026-09-15T03:00:00.000Z
- Updated: 2026-09-15T02:59:59.000Z
- Description: Lesaka turned its first full-year profit since it was assembled in 2022, and its biggest division went backwards while it happened.
- Author: Christian Maidman
- Tags: Companies, Business Bagel News

Four companies went into Lesaka's merchant division and one is supposed to come out. Adumo, GAAP, Connect and Kazang were bought separately and ran separately, and they are now being welded into a single business with common systems and one billing platform. Lincoln Mali, who runs Lesaka in Southern Africa, told TechCentral that pulling them together is a mammoth task. The year-end numbers show what it costs.

Merchant revenue for the year to June fell 10%, to R8.61 billion. Net revenue, which is what is left once Lesaka has paid for the airtime vouchers and commissions it passes straight through, edged up slightly, to R3.1 billion. Divisional operating cash earnings went the other way and fell 6%, and in the fourth quarter alone they fell by a third. It is still the largest thing Lesaka owns, and the only part of the group going backwards.

## Where the merchant money went

The problem is mix, not demand. Mali told TechCentral the active merchant base grew 12% while average revenue per merchant fell, and that card acquiring, the division's most profitable line, lifted net revenue 21%, with software up 34%. What sank was everything prepaid. Airtime, data and similar products fell about a quarter after the mobile networks changed their commission structures, and the cash take rate dropped a tenth as bigger formal merchants moved off cash, leaving growth concentrated in spaza shops and wholesalers. Lending grew 3%, which Mali put down to deliberate caution.

The exposure is smaller than it sounds. Airtime is roughly 5% of merchant net revenue and under 3% of what the group makes in net revenue overall. About 30 people have been affected by the restructuring so far, and Lesaka will not rule out more.

## What the group made anyway

The rest of Lesaka had a good year. Net income attributable to the group came to R39.8 million, against a loss of R1.65 billion the year before, which is the first full-year profit since the company was effectively put together in 2022\. Group net revenue rose a fifth, to R6.32 billion. The consumer division grew revenue by well over a third, and the enterprise division, built around the prepaid-electricity business Recharger, lifted its own operating cash earnings more than fivefold off a small base.

Guidance for the year that started in July runs to between R7 billion and R7.7 billion of net revenue, and now includes the R1.1 billion Bank Zero acquisition that Lesaka had previously left out. Mali told TechCentral the merchant turn will not come in the first quarter and possibly not the second, and that he expects growth in the third and fourth.