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JOHANNESBURG, SOUTH AFRICA -- (Marketwired) -- 11/06/14 -- Net 1 UEPS Technologies Inc. (NASDAQ: UEPS)(JSE: NT1) today released results for the first quarter of fiscal 2015.

Summary Financial Metrics

                                        Three months ended September 30,
                                   -----------------------------------------
                                                         % change   % change
                                        2014      2013     in USD     in ZAR
                                   --------- --------- ---------- ----------
(All figures in USD '000s except
 per share data)
Revenue                              156,441   123,494        27%        36%

GAAP net income                       24,089    11,596       108%       123%

Fundamental net income (1)            28,155    16,823        67%        80%

GAAP earnings per share ($)             0.51      0.25       101%       116%

Fundamental earnings per share ($)
 (1)                                    0.60      0.37        62%        74%

Fully-diluted shares outstanding
 ('000's)                             47,335    45,801         4%

Average period USD/ ZAR exchange
 rate                                  10.76     10.00         8%

(1) Fundamental net income and earnings per share are non-GAAP measures and
are described below under "Use of Non-GAAP Measures-Fundamental net income
and fundamental earnings per share." See Attachment B for a reconciliation
of GAAP net income to fundamental net income and earnings per share.

Factors impacting comparability of our Q1 2015 and Q1 2014 results

--  Unfavorable impact from the strengthening of the US dollar against the
    ZAR: The US dollar appreciated by 7% against the ZAR during Q1 2015,
    which negatively impacted our reported results;
--  Increased contribution by KSNET: Our results were positively impacted by
    growth in our Korean operations;
--  Increase in the number SASSA grants paid: Our revenue and operating
    income has increased as a result of the higher number of SASSA UEPS/EMV
    cardholders paid during Q1 2015 compared with Q1 2014; and
--  Continued growth in financial inclusion services: We continued to grow
    our financial inclusion services offerings during Q1 2015, which has
    result in higher revenues and operating income from more sales of low-
    margin prepaid airtime and UEPS-based lending.

Comments and Outlook

"Our superb results for Q1 2015, once again reflect our continued focus on growing our existing businesses and implementing carefully selected new initiatives," said Dr. Serge Belamant, Chairman and CEO of Net1. "We achieved these results despite using significant management bandwidth to repel our detractors' attempts to disrupt our business, while at the same time preparing for the new SASSA tender," he concluded.

"We are pleased with the sustained momentum of our quarterly operating results, which underpins our fiscal 2015 targets," said Herman Kotze, Chief Financial Officer of Net1. "For fiscal 2015, we now expect fundamental earnings per share of at least $2.14, assuming a constant currency base of ZAR10.40/$1 and a share count of 46.5 million shares," he concluded.

SASSA issues Request for Proposal for five-year contract relating to the payment of social grants

As ordered by the South African Constitutional Court in its April 2014 ruling, SASSA has initiated a new tender process for a five-year contract relating to the payment of social grants. SASSA issued a request for proposals on October 22, 2014. Bidders are required to submit proposals by December 12, 2014. We cannot predict with certainty what the timing or ultimate outcome of the tender process will be, or if a new tender award will be made at all after the process is complete. We intend to participate in the new tender.

Results of Operations by Segment and Liquidity

Our operating metrics will be updated and posted on our website (www.net1.com).

South African transaction processing

The South African transaction processing segment consists mainly of pension and welfare benefit distribution services provided to the South African government, and transaction processing for retailers, utilities, medical-related claim service customers and banks.

Segment revenue was $60.3 million in Q1 2015, up 5% compared with Q1 2014 in USD and up 13% on a constant currency basis. In ZAR, the increase in segment revenues was primarily due to more low-margin transaction fees generated from beneficiaries using the South African National Payment System and more intersegment transaction processing activities. In addition, revenue from the distribution of social welfare grants grew modestly during the year and was in-line with the increase in unique welfare cardholder recipients, net of removal of invalid and fraudulent beneficiaries, partially offset by the loss of MediKredit revenue as a result of the sale of that business. Segment operating income margin in Q1 2015 and Q1 2014 was 23% and 11%, respectively, and has increased primarily due to more higher-margin intersegment transaction processing activities, the elimination of MediKredit losses and an increase in the number of beneficiaries paid in fiscal 2015.

International transaction processing

The International transaction processing segment consists mainly of payment processing services for merchants and card issuers in South Korea. The segment also includes transaction processing of UEPS-enabled smartcards in Botswana and transaction processing of medical-related claims in the United States.

KSNET contributes the majority of our revenues and operating income in this segment. Segment revenue was $43.2 million in Q1 2015, up 15% compared with Q1 2014 in USD and 24% on a constant currency basis. Revenue and operating income increased primarily due to higher transaction volume at KSNET during Q1 2015. Segment operating income margin in Q1 2015 and Q1 2014 was 17% and 15%, respectively.

Financial inclusion and applied technologies

The Financial inclusion and applied technologies segment includes our smart card accounts, lending and life insurance businesses. This segment also includes the economics from merchants and card holders using our merchant acquiring system, the sale of prepaid products (electricity and airtime) and the sale of hardware and software.

Segment revenue was $65.2 million in Q1 2015, up 77% compared with Q1 2014 in USD and 91% on a constant currency basis. Revenue and operating income increased primarily due to higher prepaid airtime sales driven by the rollout of our prepaid airtime product, an increase in the number of UEPS-based loans as we rolled out our product nationally and an increase in intersegment revenues, offset by lower ad hoc terminal and smart card sales. Q1 2014 operating income includes expenses related to the national roll-out of our UEPS-based lending offering and the establishment of the allowance for doubtful finance loans in Q1 2014. Smart Life did not contribute to operating income in Q1 2015 and 2014 due to the FSB suspension of its license.

Notwithstanding the national roll-out expenses incurred in fiscal 2014, operating income margin for the Financial inclusion and applied technologies segment decreased to 27% from 35%, primarily as a result of more low-margin prepaid airtime and the sale of competitively priced financial inclusion products to address the needs of the broader market.

Corporate/eliminations

Corporate/eliminations generally includes acquisition-related intangible asset amortization; expenditure related to compliance with the Sarbanes-Oxley Act of 2002; non-employee directors' fees; employee and executive bonuses; stock-based compensation; legal fees; audit fees; directors and officers insurance premiums; telecommunications expenses; property-related expenditures including utilities, rental, security and maintenance; and elimination entries.

The decrease in our corporate expenses was primarily due to lower US government investigations-related and US lawsuit expenses, audit fees and other corporate head office-related expenses, which was partially offset by increases in acquisition-related intangible asset amortization.

Cash flow and liquidity

At September 30, 2014, we had cash and cash equivalents of $81.2 million, up from $58.7 million at June 30, 2014. The increase in our cash balances from June 30, 2014, was primarily due to the expansion of our all of our core businesses during the quarter, and to a lesser extent due to the cash conservation resulting from the sale of loss incurring businesses.

Excluding the impact of interest received, interest paid under our Korean debt and taxes presented in the table below, the increase in cash from operating activities resulted from improved trading activity during fiscal 2015. Capital expenditures for Q1 2015 and 2014 were $9.4 million and $5.6 million, respectively, and have increased primarily due to the acquisition of more payment processing terminals in South Korea.

Use of Non-GAAP Measures

US securities laws require that when we publish any non-GAAP measures, we disclose the reason for using the non-GAAP measure and provide reconciliation to the directly comparable GAAP measure. The presentation of fundamental net income and fundamental earnings per share and headline earnings per share are non-GAAP measures.

Fundamental net income and fundamental earnings per share

Fundamental net income and earnings per share is GAAP net income and earnings per share adjusted for (1) the amortization of acquisition-related intangible assets (net of deferred taxes), (2) stock-based compensation charges and (3) unusual non-recurring items, including the amortization of KSNET debt facility fees and US government investigations-related and US lawsuit expenses. Management believes that the fundamental net income and earnings per share metric enhances its own evaluation, as well as an investor's understanding, of our financial performance. Attachment B presents the reconciliation between GAAP and fundamental net income and earnings per share.

Headline earnings per share ("HEPS")

The inclusion of HEPS in this press release is a requirement of our listing on the JSE. HEPS basic and diluted is calculated using net income which has been determined based on GAAP. Accordingly, this may differ to the headline earnings per share calculation of other companies listed on the JSE as these companies may report their financial results under a different financial reporting framework, including but not limited to, International Financial Reporting Standards.

HEPS basic and diluted is calculated as GAAP net income adjusted for the profit on sale of property, plant and equipment. Attachment C presents the reconciliation between our net income used to calculate earnings per share basic and diluted and HEPS basic and diluted and the calculation of the denominator for headline diluted earnings per share.

Conference Call

To participate in the call, dial 1-855-481-5362 (US and Canada), 0808-162-4061 (U.K. only) or 0-800-200-648 (South Africa only) ten minutes prior to the start of the call. Callers should request "Net1 call" upon dial-in. The call will also be webcast on the Net1 homepage, www.net1.com. Please click on the webcast link at least ten minutes prior to the call. A webcast of the call will be available for replay on the Net1 website through November 30, 2014.

About Net1 (www.net1.com)

Net1 is a leading provider of alternative payment systems that leverage its Universal Electronic Payment System ("UEPS"), to facilitate biometrically secure, real-time electronic transaction processing to unbanked and under-banked populations of developing economies around the world in an online or offline environment. Net1's UEPS/EMV solution is interoperable with global EMV standards that seamlessly permit access to all the UEPS functionality in a traditional EMV environment. In addition to payments, UEPS can be used for banking, healthcare management, payroll, remittances, voting and identification.

Net1 operates market-leading payment processors in South Africa and the Republic of Korea. In addition, Net1's proprietary MVC technology offers secure mobile payments and banking services in developed and emerging countries.

Net1 has a primary listing on NASDAQ and a secondary listing on the Johannesburg Stock Exchange.

Forward-Looking Statements

This announcement contains forward-looking statements that involve known and unknown risks and uncertainties. A discussion of various factors that cause our actual results, levels of activity, performance or achievements to differ materially from those expressed in such forward-looking statements are included in our filings with the Securities and Exchange Commission. We undertake no obligation to revise any of these statements to reflect future events.

                       NET 1 UEPS TECHNOLOGIES, INC.
         Unaudited Condensed Consolidated Statements of Operations

                                                   Three months ended
                                             ------------------------------
                                                       September 30,
                                               ----------------------------
                                                       2014            2013
                                               ------------    ------------
                                                  (In thousands, except
                                                     per share data)

REVENUE                                       $     156,441   $     123,494

EXPENSE

 Cost of goods sold, IT processing, servicing
  and support                                        74,406          56,559

 Selling, general and administration                 38,736          40,506

 Depreciation and amortization                       10,174          10,029

                                               ------------    ------------
OPERATING INCOME                                     33,125          16,400

INTEREST INCOME                                       4,090           3,319

INTEREST EXPENSE                                      1,312           1,752
                                               ------------    ------------

INCOME BEFORE INCOME TAX EXPENSE                     35,903          17,967

INCOME TAX EXPENSE                                   11,648           6,485
                                               ------------    ------------

NET INCOME BEFORE EARNINGS FROM EQUITY-
 ACCOUNTED INVESTMENTS                               24,255          11,482

EARNINGS FROM EQUITY-ACCOUNTED INVESTMENTS               92             103
                                               ------------    ------------

NET INCOME                                           24,347          11,585

LESS (ADD) NET (INCOME) LOSS ATTRIBUTABLE TO
 NON-CONTROLLING INTEREST                               258            (11)

                                               ------------    ------------
NET INCOME ATTRIBUTABLE TO NET1               $      24,089   $      11,596
                                               ------------    ------------
                                               ------------    ------------

Net income per share, in United States
 dollars
 Basic earnings attributable to Net1
  shareholders                                        $0.51           $0.25
 Diluted earnings attributable to Net1
  shareholders                                        $0.51           $0.25

                       NET 1 UEPS TECHNOLOGIES, INC.
              Unaudited Condensed Consolidated Balance Sheets

                                                  Unaudited             (A)
                                              September 30,        June 30,
                                                       2014            2014
                                             --------------   -------------
                                             --------------   -------------
                                                  (In thousands, except
                                                       share data)
                                   ASSETS
CURRENT ASSETS
 Cash and cash equivalents                    $      81,185   $      58,672
 Pre-funded social welfare grants receivable          4,863           4,809
 Accounts receivable, net of allowances of -
  September: $2,075; June: $1,313                   136,701         148,067
 Finance loans receivable, net of allowances
  of - September: $3,136; June: $3,083               53,884          53,124
 Inventory                                           12,200          10,785
 Deferred income taxes                                7,045           7,451
                                               ------------    ------------
  Total current assets before settlement
   assets                                           295,878         282,908
    Settlement assets                               724,279         725,987
                                               ------------    ------------
     Total current assets                         1,020,157       1,008,895
PROPERTY, PLANT AND EQUIPMENT, net of
 accumulated depreciation of - September:
 $92,753; June: $91,422                              48,739          47,797
EQUITY-ACCOUNTED INVESTMENTS                            934             878
GOODWILL                                            179,003         186,576
INTANGIBLE ASSETS, net of accumulated
 amortization of - September: $79,458; June:
 $78,781                                             62,148          68,514
OTHER LONG-TERM ASSETS, including reinsurance
 assets                                              36,533          38,285
                                               ------------    ------------
 TOTAL ASSETS                                     1,347,514       1,350,945
                                               ------------    ------------
                                               ------------    ------------
                                                     81,185
                                LIABILITIES
CURRENT LIABILITIES
 Accounts payable                                    14,941          17,101
 Other payables                                      43,346          42,257
 Current portion of long-term borrowings             14,276          14,789
 Income taxes payable                                13,581           7,676
                                               ------------    ------------
  Total current liabilities before settlement
   obligations                                       86,144          81,823
    Settlement obligations                          724,279         725,987
                                               ------------    ------------
     Total current liabilities                      810,423         807,810
DEFERRED INCOME TAXES                                14,078          15,522
LONG-TERM BORROWINGS                                 61,288          62,388
OTHER LONG-TERM LIABILITIES, including
 insurance policy liabilities                        22,396          23,477
                                               ------------    ------------
 TOTAL LIABILITIES                                  908,185         909,197
                                               ------------    ------------
COMMITMENTS AND CONTINGENCIES

                                   EQUITY
 COMMON STOCK
   Authorized: 200,000,000 with $0.001 par
    value;
   Issued and outstanding shares, net of
    treasury - September: 46,475,623; June:
    47,819,299                                           64              63
 PREFERRED STOCK
   Authorized shares: 50,000,000 with $0.001
    par value;
   Issued and outstanding shares, net of
    treasury: September: -; June: -                       -               -
 ADDITIONAL PAID-IN-CAPITAL                         210,708         202,401
 TREASURY SHARES, AT COST: September:
  18,057,228; June: 15,883,212                    (214,520)       (200,681)
 ACCUMULATED OTHER COMPREHENSIVE LOSS             (104,126)        (82,741)
 RETAINED EARNINGS                                  547,222         522,729
                                               ------------    ------------
  TOTAL NET1 EQUITY                                 439,348         441,771
  NON-CONTROLLING INTEREST                             (19)            (23)
                                               ------------    ------------
    TOTAL EQUITY                                    439,329         441,748
                                               ------------    ------------

                                               ------------    ------------
     TOTAL LIABILITIES AND SHAREHOLDERS'
      EQUITY                                  $   1,347,514   $   1,350,945
                                               ------------    ------------
                                               ------------    ------------

(A) - Derived from audited financial
 statements

                       NET 1 UEPS TECHNOLOGIES, INC.
         Unaudited Condensed Consolidated Statements of Cash Flows

                                                  Three months ended
                                           -------------------------------
                                                     September 30,
                                             -----------------------------
                                                     2014             2013
                                             ------------     ------------
                                                    (In thousands)

Cash flows from operating activities
Net income                                  $      24,347    $      11,585
Depreciation and amortization                      10,174           10,029
Earnings from equity-accounted investments            (92)            (103)
Fair value adjustments                                413             (133)
Interest payable                                    1,159              972
Profit on disposal of plant and equipment            (122)              (1)
Stock-based compensation charge                       916              930
Facility fee amortized                                 82               69
Decrease (Increase) in accounts receivable,
 pre-funded social welfare grants
 receivable and finance loans receivable            9,470          (23,101)
(Increase) Decrease in inventory                   (2,123)           1,011
Decrease in accounts payable and other
 payables                                         (10,933)          (8,668)
Increase in taxes payable                           6,611            6,921
Decrease in deferred taxes                           (390)          (1,187)
                                             ------------     ------------
 Net cash provided by (used in) operating
  activities                                       39,512           (1,676)
                                             ------------     ------------

Cash flows from investing activities
Capital expenditures                               (9,378)          (5,616)
Proceeds from disposal of property, plant
 and equipment                                        241               48
Proceeds from sale of business                      1,895                -
Other investing activities, net                         -               (1)
Net change in settlement assets                   (43,054)          51,773
                                             ------------     ------------
 Net cash (used in) provided by investing
  activities                                      (50,296)          46,204
                                             ------------     ------------

Cash flows from financing activities
Acquisition of treasury stock                      (9,151)               -
Sale of equity to non-controlling interest          1,407                -
Long-term borrowings utilized                       1,097                -
Proceeds from issue of common stock                   989                -
Net change in settlement obligations               43,054          (51,773)
                                             ------------     ------------
 Net cash provided by (used in) financing
  activities                                       37,396          (51,773)
                                             ------------     ------------

Effect of exchange rate changes on cash            (4,099)           1,250
                                             ------------     ------------
Net increase (decrease) in cash and cash
 equivalents                                       22,513           (5,995)
Cash and cash equivalents - beginning of
 period                                            58,672           53,665
                                             ------------     ------------
Cash and cash equivalents - end of period   $      81,185    $      47,670
                                             ------------     ------------
                                             ------------     ------------

Net 1 UEPS Technologies Inc.

Attachment A

Operating segment revenue, operating income and operating margin:

Three months ended September 30, 2014 and 2013 and June 30, 2014

                                                                  Change -
                                                                  constant
                                                    Change -      exchange
                                                     actual       rate(1)
                                                -------------- -------------
Key segmental data,                              Q1 '15 Q1 '15 Q1 '15 Q1 '15
 in $ '000,                                          vs     vs     vs     vs
                        Q1 '15   Q1 '14   Q4 '14  Q1'14 Q4 '14  Q1'14 Q4 '14
                     --------- -------- -------- ------ ------ ------ ------
Revenue:
South African
 transaction
 processing            $60,252  $57,161  $88,265     5%  (32%)    13%  (30%)
International
 transaction
 processing             43,204   37,541   42,201    15%     2%    24%     6%
Financial inclusion
 and applied
 technologies           65,197   36,796   64,093    77%     2%    91%     5%
                     --------- -------- --------
 Subtotal: Operating
  segments             168,653  131,498  194,559    28%  (13%)    38%  (11%)
 Intersegment
  eliminations        (12,212)  (8,004) (11,806)    53%     3%    64%     7%
                     --------- -------- --------
  Consolidated
   revenue            $156,441 $123,494 $182,753    27%  (14%)    36%  (12%)
                     --------- -------- --------
                     --------- -------- --------

Operating income
 (loss):
South African
 transaction
 processing            $13,639   $6,461  $38,675   111%  (65%)   127%  (64%)
International
 transaction
 processing              7,349    5,524    6,647    33%    11%    43%    14%
Financial inclusion
 and applied
 technologies           17,607   12,835   18,126    37%   (3%)    48%     0%
                     --------- -------- --------
 Subtotal: Operating
  segments              38,595   24,820   63,448    55%  (39%)    67%  (37%)
 Corporate /
  Eliminations         (5,470)  (8,420) (20,801)  (35%)  (74%)  (30%)  (73%)
                     --------- -------- --------
  Consolidated
   operating income    $33,125  $16,400  $42,647   102%  (22%)   117%  (20%)
                     --------- -------- --------
                     --------- -------- --------

Operating income
 margin (%)
South African
 transaction
 processing                23%      11%      44%
International
 transaction
 processing                17%      15%      16%
Financial inclusion
 and applied
 technologies              27%      35%      28%
 Consolidated
  operating margin         21%      13%      23%

(1) - This information shows what the change in these items would have been
 if the USD/ ZAR exchange rate that prevailed during the first quarter of
 fiscal 2015 also prevailed during the first quarter of fiscal 2014 and the
 fourth quarter of fiscal 2014.

Net 1 UEPS Technologies Inc.

Attachment B

Reconciliation of GAAP net income and earnings per share, basic, to fundamental net income and earnings per share, basic:

Three months ended September 30, 2014 and 2013

                                      EPS,                          EPS,
                     Net income      basic        Net income        basic
                     (USD'000)       (USD)        (ZAR'000)        (ZAR)
                   ------------- ------------- --------------- -------------
                    2014   2013   2014   2013    2014    2013   2014   2013
                   ------ ------ ------ ------ ------- ------- ------ ------

GAAP               24,089 11,596   0.51   0.25 258,789 115,959   5.48   2.54

 Intangible asset
  amortization, net 2,941  2,832                31,601  28,317
 Stock-based
  compensation
  charge              916    930                 9,854   9,300
 Facility fees for
  KSNET debt           82     69                   882     690
 US government
  investigations-
  related and US
  lawsuit expenses    127  1,396                 1,366  13,960
                   -------------               ---------------
  Fundamental      28,155 16,823   0.60   0.37 302,492 168,226   6.41   3.69
                   -------------               ---------------
                   -------------               ---------------

Net 1 UEPS Technologies Inc.

Attachment C

Reconciliation of net income used to calculate earnings per share basic and diluted and headline earnings per share basic and diluted:

Three months ended September 30, 2014 and 2013

                                                       2014            2013
                                               ------------    ------------

Net income (USD'000)                                 24,089          11,596
Adjustments:
  Profit on sale of property, plant and
   equipment                                          (122)             (1)
  Tax effects on above                                   34               -

                                               ------------    ------------
Net income used to calculate headline earnings
 (USD'000)                                           24,001          11,595
                                               ------------    ------------
                                               ------------    ------------

Weighted average number of shares used to
 calculate net income per share basic earnings
 and headline earnings per share basic earnings
 ('000)                                              47,226          45,613

Weighted average number of shares used to
 calculate net income per share diluted
 earnings and headline earnings per share
 diluted earnings ('000)                             47,335          45,801

Headline earnings per share:
  Basic, in USD                                        0.51            0.25
  Diluted, in USD                                      0.51            0.25

Calculation of the denominator for headline diluted earnings per share

                                                   2014            2013
                                               ------------    ------------

Basic weighted-average common shares
 outstanding and unvested restricted shares
 expected to vest under GAAP                         47,226          45,613
Effect of dilutive securities under GAAP                109             188
                                               ------------    ------------
Denominator for headline diluted earnings per
 share                                               47,335          45,801
                                               ------------    ------------
                                               ------------    ------------

Weighted average number of shares used to calculate headline earnings per share diluted represent the denominator for basic weighted-average common shares outstanding and unvested restricted shares expected to vest plus the effect of dilutive securities under GAAP. We use this number of fully-diluted shares outstanding to calculate headline earnings per share diluted because we do not use the two-class method to calculate headline earnings per share diluted.