Good day, ladies and gentlemen, and welcome to the Net1 First Quarter 2013 Results. [Operator Instructions] Please also note that this call is being recorded. I would now like to hand the conference over to Dhruv Chopra. Please go ahead, sir.

Thank you, Dylan. Good morning and good afternoon to our investors around the world. Thank you for joining us on our First Quarter Fiscal 2013 Earnings Call. With me today are Dr. Serge Belamant, our Chairman and CEO; and Herman Kotze, our CFO. Both our press release and Form 10-Q are available on our website, www.net1.com. As a reminder, during this call, we will be making forward-looking statements, and I request you to look at the cautionary language contained in our press release and Form 10-Q regarding the risks and uncertainties associated with forward-looking statements. In addition, during this call, we will be using certain non-GAAP financial measures, and we have provided a reconciliation of these non-GAAP measures to the most directly comparable GAAP measures. We will discuss our results in South African rand, which is a non-GAAP measure. We analyze our results of operations in our 10-Q and our press release in rand to assist investors in understanding the underlying trends of our business. As you know, the company's results can be significantly affected by currency fluctuations between the dollar and the rand. With that, let me turn it over to Serge.

Thank you, Dhruv. Good morning, good afternoon, good evening to all of our shareholders. During this call, I will focus primarily on 2 areas, the first being the implementation of our national SASSA contract; and the second, on our strategic vision for the group as we look to drive both profitability and value over the next 3 years. For quarter 1 2013, we reported revenues of $112 million, which is a year-over-year increase of 30% in constant currency. Fundamental EPS in the quarter was $0.25, down 33% in constant currency, largely due to the implementation cost incurred to roll out our new SASSA contract. Cash flow from operations was $26 million during the quarter. Our core established businesses, which includes CPS, KSNET and EasyPay, together in quarter 1 of 2013, accounted for approximately 82% of our revenue, while our growth businesses were collectively 6% of the revenue. As you know, our national SASSA contract commenced on April 1, 2012, and our Phase II implementation commenced in early July of 2012. During quarter 1 2013, we have paid approximately 9.5 million beneficiaries in excess of ZAR 8.7 billion per month, using 4 payment methodologies: Our own MasterCard-branded [indiscernible] card; our version 10 UEPS smart card as used in our old contract, bank-to-bank transfers using the national payment system; and more importantly, our world first EMB-compliant M/Chip 4 UEPS compliant smart card. We have also completed 7 months of registrations on behalf of SASSA and our technology core solutions and processing platforms have proved extremely reliable, effective and secure to the full extent anticipated. As it is known, our contract was challenging code [ph] by AllPay. AllPay used to be a previous contractor. The current status is that AllPay -- the AllPay appeal could be heard by the appeals court during the…

Thank you, Serge. I will discuss the key results and trends of our significant operating segments for the first quarter of 2013, compared to the first quarter of 2012. We'll also discuss, to the extent possible, the financial implications of the implementation progress made related to our new SASSA contract. My discussion will be based on our results in South African rand as this provides the base indicator of the group's actual operating performance. For Q1 of 2013, our average rand-dollar exchange rate was ZAR 8.26 compared to ZAR 7.09 a year ago and negatively impacted our U.S. dollar based results by approximately 16%. The year-over-year comparability of our results for the quarter was impacted by our new sets of contract in Q1 2013, the non-cash profits related to the liquidation of SmartSwitch Nigeria in Q1 2012. On a consolidated basis, for the first quarter of 2013, we reported revenue of $112 million, an increase of 30% in constant currency. Fundamental earnings per share was USD 0.25 compared to USD 0.44 a year ago, and Q1 2013 includes $14.1 million of direct implementation costs and $1.7 million related to the expensing of the UEPS/EMV smart cards issued to cardholder grant recipients. We measured the group's profitability by analyzing operating income and margin by segment. And within our segment, these transaction-based activities posted revenue of $61 million during Q1 2013, 53% higher in local currency, driven primarily by higher volume and revenue from our new SASSA contract and higher prepaid income [ph] sales offset by lower volumes at EasyPay and MediKredit. Our segment operating margin, excluding amortization of intangibles, declined to 13% from 43% last year primarily due to SASSA implementation costs, including COGS and higher low-margin prepaid income sales. As previously discussed, we expect our stability in this segment to…

[Operator Instructions] Our first question comes from David Koning of Robert W. Baird.

Yes, I guess my first question is I know you talked to how the beneficiaries, the increase in beneficiaries don't really provide extra economics. It's really the 9.4 million that provides your economics. But is there anything extra to those beneficiaries can generate for you in terms of revenue over time, maybe not direct SASSA-based revenues? But are there other revenue streams that those beneficiaries can add for you over time?

It's Serge here. Obviously, that's an interesting question. It depends on the age of those particular beneficiaries. The one that obviously, baby is the in the 3 months and 6 months old and 9 months old babies are not likely to generate anything for -- in the near future. Certainly, the children that, let's say, on the border of adulthood, let's call it around the 18-year-old. There is no doubt that those beneficiaries will sooner or later or will hopefully become people that are going to have employment. And if they have employment, we are hoping that they will remain with our banking infrastructure and, therefore, will become banking customers in their own right, but within a short period of time. And there is a number of million of those particular people. So there's one thing that's more creating a bit of a net for the future. The next important issue is that everybody has been quite surprised in SASSA's decision to enroll 21.5 million or 22 million, in fact, of beneficiary and the number keeps on climbing. And obviously, we all understand that this is approximately twice as many people to be enrolled as was originally anticipated. Now we, obviously, contractually have obviously looked at that very seriously simply because it is required for us to double up on our infrastructure or at least registration infrastructure, both in terms of equipment but also in terms of people, which can at least -- far more expensive than the equipment over time. That is something that we're going to be discussing at length with our partner, in this case, SASSA. And also SASSA, you probably know from the disclosures, had intimated for quite a while now that their intention was over time to take over within the SASSA environment, the actual registration or enrollment of beneficiaries rather than to actually outsource it. As you know, that particular enrollment is included in our payment price. But it does not mean that, that infrastructure could not be either sold to SASSA for them to be able to continue to do the job themselves. So certainly, it's a negotiation simply because a deviation from 10 million to 22 million is obviously extreme, and there is no doubt that both parties will be talking around the table and arrive at a solution that at least fulfilled both parties or at least a portion of both parties at ease. I hope that gives a little bit of background.

Yes, that was great. That was great. I appreciate it. The second question, the $14 million or so of implementation costs this quarter plus the $1.7 million that originally was going to be capitalized but you expensed, does that eventually all go away other than the 1,200 or 1,500 of employees, the temporary employees now but the ones that will continue? I mean, other than that, that's probably $0.30 of EPS or something like that, that was specific to this quarter and the next couple of quarters, but that fully goes away at some point, 4 to 6 quarters out?

Yes, it does. It will largely fall away obviously in the phased approach. But if we analyze the majority of the costs that make up that specific number, they do relate as such that to the -- mainly to the staff component. Together with cost of the staff, of course, there is the quite substantial cost of transporting those temporary staff members around the country to do the enrollment. We also have to bring substantial amounts of tents and chairs to accommodate the beneficiaries while they wait to be enrolled. So from our perspective, looking forward, we will probably retain less than 20% of the temporary employee base that we currently have if we look out towards 3 or 4 quarters from now. And in terms of the other implementation costs as they relate to the transportation to rental of tents and chairs to the other incremental cost, I think they will largely fall away and cost should fall right down to the bottom line again.

Okay, great. And then 2 just quick ones. The -- I think you mentioned EPS should be down sequentially. But I think you said implementation costs should be at the high end of the $5 million to $10 million range. So in other words, if implementation costs next quarter are $10 million and we just had about $14 million in Q1, why would EPS be down sequentially?

We'll be issuing -- we are -- with Q2 sort of halfway done, we already know that the smart card costs and the amount of enrollments at the rate of 120,000 a day, obviously, that includes both the cardholders as well as their dependents. But just based on that metric, the cost of the cards themselves will be a lot higher than the 1.7 million that you saw in Q1.

Got you, okay. And then what was Eason revenue in Q1?

It's Dhruv. I'll check up on that, and then I'll follow up with you.

Our next question comes from Thomas McCrohan of Janney.

In terms of getting the SASSA contract completely phased, I think you just said 3 or 4 quarters from now, but the current run rate, I think you said 3.5 million people being enrolled a month, if that's correct, and given how many, you said 5.8 million people on the system, it sounds like it's going to be closer to 3 quarters out by the time you get this will be phased. I'm just trying to understand the variability at the current run rates why it would be pushed out further beyond 3 quarters.

Sure. There's quite a bit of variability in terms of how the process works, and we appreciate that not all of this is under our control. I think the key aspect of this that we need to understand is that the beneficiaries or -- to the extent that they're not paid by us, either in terms of the old contract or in terms of the cash payments that we already took over during the initial stages of the contract. But if we look at those beneficiaries, we traditionally got paid directly into their bank accounts. They also need to be enrolled and re-registered and issued with COGS. Now, in order for those beneficiary to be enrolled, they have to be informed by SASSA regarding the time and the place of enrollment, they need to be made aware of the schedule. And so, all of the -- all of that information is disseminated by SASSA, and obviously, we then need to see how those beneficiaries react to these letters that they receive. And so, they may well be a case if a substantial percentage of those beneficiaries do not arrive at the initial set date for enrollment, we then have to perform what we would term as a MOPAC [ph] operation, to make sure that all of those beneficiaries that we didn't have before or failed to arrive for whatever reason when it was the set date to do so, we will then have to, obviously, make another ultimate arrangement to get those beneficiaries enrolled. And we simply don't know exactly how long that exercise will take. Obviously, there will be a time when those beneficiaries who have not been enrolled will simply be removed off the payment file, or they will be required to go to a government office to be enrolled, rather than for us to provide that specific service. Also I think it's important that you note that the way that we planned our implementation with SASSA and the way we've agreed it with SASSA is that we first focused on the rural areas and specifically the deep rural areas reduce the registrations, those are the areas that are very expensive to service in terms of taking out equipment and people into these areas to do their bulk registration. As we progress, we will probably end up in the third quarter, in Q3 of fiscal 2013, doing the urban areas and very urban areas where we require less staff members and where it's a lot less expensive for us to perform the enrollment service. And that's when the margin should start normalizing. So by Q4, we should be close to normal again.

Great. And the breakdown between urban and rural in terms of number of recipients, is it 50/50?

Strangely enough, not entirely. You're looking -- if you look again at recipient, you're looking at about probably after -- if we work out on big numbers, you're looking at about 40% is more urban, 60% is rural. And in terms of the 22 million people, it's slightly higher because the number of -- for lack of a better word, the number of children in the rural areas that been looked after by a single recipient is higher. So the number of registrations of recipients, 60/40. Total number in terms of people, it's probably closer to 70/30.

And I know it's still early innings with getting a feel for unit economics for urban versus rural, but is -- do you have any visibility on, given that the price you get for recipient is fixed regardless of where the recipient resides and given that you have to drive the truck and man with people at the rural location, the cost to deliver, a payment, obviously, is a lot higher in the rural areas. So can you give us any sense, are you breakeven at the SASSA-mandated price in the rural locations on the unit basis, but you make much more money in the urban, can you just kind of talk about that conceptually? That would be helpful.

Well, it's obviously logical to think that when you are going to pay someone in an urban area, specifically if you're paying them through an existing system, which happens to be the national payment system, that it's going to be fundamentally cheaper than to pay them -- than to pay people in deep rural areas where you got to basically drive a truck with ATMs, with a bunch of guys with shotgun, that is, to protect the money. So there's no doubt that it is, in our view, probably almost 3:1 cheaper. So there is a huge difference in the actual cost. So our fundamental vision beyond that tender, which was obviously accepted by government, was that it is important that we have provided a solution. We'd use one, for lack of a better word, to cross-fund the other. In other words, knowing that our costs, although that we might be paying -- we might begin paying $16 per transaction, we know that the $16 in urban areas, we'd might be able to be using a portion of that in order to fund what we are paying in the rural areas. So the ease of cross-finding dynamic here that we've got to understand. This is why, if we also look at our strategy, and I've tried to describe it, perhaps not as well is actually that's something one should do face-to-face with everybody present, is that the idea is to convert or to take this opportunity of utilizing our rule infrastructure, including our vehicles, for lack of a better word, into movable banks. And not only to bank obviously and service the beneficiaries, but to service everybody else that actually lives in rural areas as well, and therefore, making this infrastructure to render far more revenues than simply paying beneficiaries, and that's something that we've been thinking about for a long, long time, and it's certainly something that we are pushing now in a very, very strong way. Quite obvious at first. We wanted to show, we wanted to prove, we wanted to demonstrate to SASSA that we're capable of doing the job, which I think now everybody in the country certainly believes that, knows that. Now it's a question of utilizing and starting to utilize that infrastructure to do all of the other things that we wanted to do, which is probably to attempt to bank and to service at least, in our view, another 3 million or 4 million people in rural areas that are not beneficiaries, and then we're going to fund the debt infrastructure of ours. We will start actually becoming economically more lucrative in rural areas and what it is in urban areas, because in urban areas, we got to pay all of the other banks. But in rural areas, we are the bank.

Interesting. And my last question is on share count. Herman, how should we be thinking about that in the context of -- I guess, you still have some warrant issued to that organization. So how should we be thinking about share count as the year progresses?

Thomas, yes, I think for now the share count is roughly 45 million shares. The option is valid. We're probably halfway through that option period at the moment. We -- the share price at the moment is pretty close to the strike price of that option. And so from a fully diluted shakeout point of view, we have infected the exercise of the option, and I think we should only do so once the option is physically exercised.

And if that option was exercised, would you take the funds and buy back stock, or what would you do with the proceeds?

The uses of our cash will probably remain pretty much in line with what it's been in the past, so that would include a combination of considering stock buybacks, obviously, retiring some of the date way we believe it's expensive date and it's in our interest to do so, and to fund potential other strategic acquisition.

Our next question comes from Kevin Tracey on Oberon Asset Management.

I guess, I just wanted to follow-up on, Serge, you made some comments regarding the failure of 20%, I believe you said it was, of grant recipients to bring in their beneficiaries to be enrolled. And as a result of this problem, SASSA has required beneficiaries to be present for recipients to be enrolled. And I guess I'm just wondering, given this problem, I guess, what is the risk that it takes longer than 3 or 4 quarters to compete this phase in strategy? And you mentioned that if you're unable to induce grant recipients to be enrolled, you would execute a mop-up kind of strategy. But at the same time, you said there might be an understanding between you and SASSA that some of these people will be required to come in to government offices. So I guess I'm just trying to ask, what's the risk that the implementation costs go beyond 3 or 4 quarters and are more than we expect? Have you try to rein in stragglers to enroll them?

Well, your question, by the way, is an excellent question because there's absolutely no doubt because when you're doing your job over SASSA is what we're doing, my feelings are exactly the same as yours. I do not believe that we go into, have a cut-off point at the end of March whereby we're going to sell about 21.572 million beneficiaries in totality have been [indiscernible] it's not going to happen. There's absolutely no doubt that, in my view, you're going to be left with at least 10% to 15% of those that are going to come in bits and pieces. Some of them will only arrive when they have been categorically told that they're going to lose their grants if they do not register, and it would be the last resort, so you're going to have a little bit of a burst at the very last minute. What we're doing on our side, because we realized that that's something that's going to happen, is that SASSA's intention, even contractually, was that they want to take over the enrollment, they believe that should be done actually by SASSA, also shows which we tend to agree. And I'm hoping that by the time that we have done what we officially stated we would do mainly to enroll the first 10 million people, also which are the recipients, then SASSA would take over the registration role, and what I mean by that, they would also take over the cost of it, which means if we bet something that SASSA will continue to supply to provide of their own bet. For the foreseeable future, I don't see it stopping in March or stopping in April. I'm just hoping that our costs are going to stop in March or April. But certainly not registration.

Okay. Okay, I see. And then, I guess, with regard to your comments about your strategy of participating in tenders outside of South Africa or selling the UEPS volution to banks, I understand how the EMV technology makes you much more competitive in these tenders. But I guess I was just wondering who would you be competing with in these tenders? And I guess what problems would you be solved? I imagined the problem of fraud to be solved by your biometric capabilities. But I guess who would you be competing within these tenders? And I guess have you started looking at these tenders? Or what's the timeline for -- of starting to seeing some activity there?

Again, a very, very good question. I've tried to sort of -- I've given a couple of ideas away. We've already either entered into tenders in a number of countries, and some people sometimes look at us and say, "Why would you go there?" Like, for example, Afghanistan. Well, Afghanistan, it's no different to us than Iraq. So there is no doubt that there is a need for our solutions in those countries. Now one of the biggest barrier to entry with that, and that's something which is well known, is that UEPS has always been a perfect product for developing economies, with very little communication infrastructure, and that requires very, very adequate security, which is not based purely on the PIN number, and that's what we've always provided. But as you know, it doesn't matter what country you'll go in to, you do have the larger efforts. The MasterCards, the Visas. And you do have international banks, who follow the Visa and MasterCard rules and regulations. And these particular organizations are extremely powerful at all label in any country. So very often, all of that government would be very keen to implement our technology because they could see that this technology can be used to bank the unbanked, and to really also control exactly the money free flows in the country in totality. Those big organizations will always be very much against it as they believe that somehow, this was a market that was for them although that they have not penetrated it themselves. We believe the breakthrough we have made with the MasterCard EMV product will solve these problems, if not practically, certainly from a mental or philosophical point of view, simply because that barrier to entry, which was always a little bit, to be quite honest, an…

Okay, okay. That's very interesting. And then just lastly, because there's kind of a question related to your international segment. Now it looks like revenues grew very nicely. And then in your 10-Q, you've disclosed that margins were lower largely due to start-up costs related to some of your U.S. businesses. But I guess I just wanted to confirm that the margins of the cash net business were holding up. And I guess if you could comment maybe more broadly about the competitive environment with that business.

Sure. The margins of the KSNET business have been under pressure. Well, this quarter, we reported 25% EBITDA margins. Those margins do fluctuate during the course of the year. They are, in a way, I wouldn't use the word seasonal, but they do fluctuate depending on specific trends within the Korean market, and they've historically been between 25% and 28%. So right now, we're quite happy with the performance of the business. Revenue keeps on growing which, for us, is a very important indicator, the Korean market is highly competitive and obviously, an increase in revenue shows that we, at the very least, maintaining or probably growing our market share within the country itself. So from that perspective, we are very happy with what the KSNET management team is achieving at the moment. But having said that, we do believe that now that we've been the owners of this business for 18 months and we spent a lot of time understanding the business, understanding the market and getting to grips growth with all of those various elements, we are now finally in a position to capitalize on the real strength of this business, which is the significant markets shared that we've enjoyed in Korea. 200,000 merchant locations that it services, and with the current new product ideas that we have, we think that we can have -- that when implemented those, will have a major impact on the margins in the business. But for now the traditional historic business of that entity is safe, in our view, and it continues to trade well in very difficult conditions.

Our next question comes from Brian Steck of Mangrove Partners.

And I've got 2 questions, both of which have been touched on by Tom and Dave and others. First, with regard to the direct implementation cost of the SASSA contract which were $14.1 million this quarter, and the going forward guidance is at the high-end of your $5 million to $10 million range, what are the cost differences that we should expect in this quarter and the following quarter that would be substantially lower than what you experienced in Q1? What are drivers of that expected reduction?

The key driver will be the affect that during Q1, we were renting up really the employee base to end up effectively at the end of September with the approximately 5,000 -- 5,500 temporary staff members. So during July and August, we were still growing those numbers. So for Q2, we'll have the full staff complement fully occupied and over costs -- obviously, that there are some direct costs that one can ascribe to employing the additional people, so that will be a definite additional cost driver in both Q2 and Q3. In Q1, obviously, we had the rural implementation as our primary focus points, which means, obviously, that the distance is covered and the amount of money that we have to spend on transportation, accommodation, et cetera, was also quite high. We expect that to come down towards the end of Q2. So that will be something that I think will offset the increased staff costs that we will have over and above what we saw in Q1. And then, of course, again, the cost of our COGS specifically, which wasn't included in the $14 million, just to be clear, will also increase in Q2 and Q3. But the main driver really is going to be the staff cost, which wasn't fully in, in Q1.

And then as we think about the fact that the number of beneficiaries has increased significantly since the original numbers were put forward, that's obviously having no significant impact on the cost of the initial implementation. But on an ongoing basis, once the start-up is taken care of, your cost should really be driven by the number of recipients and the number of additional beneficiaries that will come into the system should not have a significant impact on ongoing cost. Is that correct?

I think yes, that is correct. So the way that it will work going forward is once we've completed what we call bulk enrollment, whatever the -- whenever new beneficiaries, they join the system over the next 4 years, those beneficiaries will be enrolled and issued with cards at the SASSA offices, and those locations will be serviced and manned, obviously, by SASSA, not by us.

And then one other question on a separate issue. With regard to the BBB option -- the BBE option, that was issued earlier this year. From a funding perspective, the fact that, that option is denominated in U.S. dollars, I was curious as to whether that presented any issues to your partner that would not be there, if this was a more traditional BEE investment opportunity denominated in rand?

That's a very interesting question. Obviously, we chose to denominate the option in U.S. dollars simply because the South African market volume is very thin. And in calculating the option price, we looked at our volume weighted average price, which we could only really accurately measure using the U.S. sort of reference share price and data. So although the option is priced in dollars, we do have, in terms of our agreement with our BEE partner, they do have the right to exercise the option on the South African register. If they chose to do so failing, which obviously they would then have to obtain reserve banks, South African Reserve Bank, with exchange control approval if they wanted to pay for and keep the shares on the American register. So by doing it in dollars and in the U.S. currency, and that value is still obviously fixed and static and determine that $8.96 a share has given them the full flexibility to do it both in South Africa or internationally, depending on where the funding is available and what their intentions are.

And then with regard to the opportunities that you're pursuing with the UEPS platform outside of South Africa with MasterCard, are these opportunities, in which you're pursuing the tender in MasterCard, is riding Shotgun [ph]? Are they playing lead on these opportunities? Are you both in side-by-side? How does that partnership work in terms of securing new business opportunities? And the opportunity to tender, are those requests being sent primarily to you, primarily to MasterCard? Are you both receiving them? I'm interested in how that new business generation is working between the 2 companies.

Again, it's a very good question. At the moment, I'm not going to give you an answer which is better than if they lose the capital basically network, namely MasterCard, I think is obviously seen the opportunity in South Africa, whereby they will now issue 10 billion MasterCard and is absolutely no doubted for them that is something that to probably make them the largest issuer from a branding point of view in the country, which they were not before. Now they've also realized our technology works obviously, and more importantly, does actually provide the solution to many countries in which they operate where they did not have the solution before. So in all of those countries, I think they are promoting the solution we've implemented in South Africa but talking obviously to the banks, the banks that issue MasterCard. And obviously, very often, as you know MasterCard in terms of government, will certainly talk to the different financial departments and to the different ministers, and certainly, do mention to them that there is a solution that can fulfill the requirements, for example, of welfare system and at the same time, a payment instrument. We already know that they are doing this because there's 1 or 2 other tenders that have been mentioned to us which have come through directly MasterCard, whereby, in fact, they would like us to actually respond to this particular tenders in association with them or with them to become the brand through, of course, a local bank which they, themselves, would identify. In other words, we seeing this thing playing out is that in any country where they are, there will be a number of banks that might talk to them and say to them, this is an opportunity for you to tackle different market space. You're welcome to do it. We have looked at this thing. This thing is MasterCard-certified. It works. We know the company, we know the guys, but what they are doing, we suggest that you go ahead and actually work with them directly. And I don't think that we're going to be doing. It's not something whereby we're sharing their revenue, they're sharing ours. They're sharing theirs, and we take ours, but we certainly can do local deals. But instead of fighting MasterCard in the particular country, they are now going to be the one that are going to open a few doors rather than perhaps to be fooled when they may be the one that are closing them.

That's excellent. They did a wonderful job of highlighting your technology at their Investor Day earlier this year, to the extent that they're acting as a marketing department for you is very encouraging. So congratulations.

Our final question comes from Marc Heilweil of Spectrum.

This is Marc Heilweil from Spectrum Advisory Services. I have a balance sheet question. With regard to the risk of the cash which you'd park over night, are there any insurance or security collateral that is provided for you or to South African Bank in which you have money sales? Would you lose that cash?

No. The cash that we have, which is obviously held by one of the South African registered banks, fully registered banks, is not insured. You will appreciate that the quantum of the grant money alone that we hold on behalf of SASSA, sometimes exceed $1 billion on an overnight basis. So not easy to ensure that kind of money, but we believe that stability of the South African banking system, obviously, and the oversight that is performed by our regulators on these banks, is particularly rigorous. And so, we're quite comfortable that there is very little risk in terms of the overnight cash holdings that we have.

So it's not collateralized by any security?

Not at all, no.

And is there anything you can tell us about -- I think you have 2 large venture [ph] funds. Did these funds have deadlines for distribution which will require them to distribute their shares to their investors? Or can you give us any color at all on those arrangement?

Marc, this is Dhruv Chopra here. The 2 funds you're talking about is international Value Advisers that owned about 25% of the company, and they've built their position over the last 2 or 3 years now. As far as we understand, they have taken a long-term view on the company. They still remain incredibly supportive. And based on their track record, they tend to be long-term holders. But for an actual response, you would probably have to talk to them. As far as...

In general though, is that in one fund of theirs?

No, I think, I believe, it's spread across several funds. Now they have been in for 7 years now since the IPO. Logic would tell you, any private equity investment -- investor has a finite time period. But as far as we understand, they have not specifically expressed any interest, and nor do they have any specific time pressure where they have to pull the trigger.

Okay. I have one more in the credit risk category for Herman or the like. When -- could you just give us a more general view of -- I'm a little confused from reading the documents, as to what credit risk you take in your banking business? Because there's some talks that you've eliminated that credit risk through insurance. Is that right?

Well, it depends what part of the business you're referring to. On the pension and welfare side of the business, there is no credit risk. Before, many years ago, we -- on their old contracts in some of our provinces, we actually pre-funded the social grant, and obviously, there was some credit risk which was really equivalent to sovereign risk that we had to take on the South African government at that period in time. Under the new contract, there is no pre-funding of grants at all, so we do not disclose the grants until we actually get paid by SASSA and until our accounts are funded with the grant money, so there's no credit risk as far as that's concerned. The only credit risk that we assume on that side of the business is that we pre-fund sometimes some of the merchants who performed grant pals [ph] or who performed cash back at the point-of-sale. And obviously, you can appreciate that some of these merchants are relatively small. The volume of money that flows through that system and specifically during the first or the second day of payment can be quite significant. And so, when those merchants approach us and ask us to assist them with some pre-funding, we evaluate the creditworthiness of that specific merchant. And if we believe that the risk is acceptable, we then provide a line of pre-funding to make it possible for that merchant to perform cash back at the point-of-sale for our grant recipients. So that's --- those are really -- and then in terms of our micro finance book, they, obviously, is a credit risk purely from the point of view that when we provide our beneficiaries with these microloans, what we used to do before is we used to ensure the credit risk of these loans through a simple credit life product. Now that we have the experience of having done this for the last 5 years and we know what the loss ratio is on our microlending book, and bear in mind that the only time that there really is a default event on any one of these microloans is when the beneficiary passes away or is removed from the SASSA payment file, and that very rarely happens. So our only risk really is the risk of death. We know what that loss ratio is, and at the moment, we self-insure our credit book, our microlending book, because the loss ratio that we've seen over the last 5 years is acceptable to us and is obviously priced into the product.

Well, I'm glad to hear good trends in longevity in South Africa, and I will give some thought to relocating there. But more seriously, I want to commend everybody for a very intelligent discussion of the business.

Thank you.

Thank you.

Thank you, Mark.

Thank you very much. On behalf of Net1, that concludes this conference. Thank you for joining us. You may now disconnect your lines.