Good afternoon and welcome to the Net1 results. (Operator Instructions) I would now like to turn the conference over to Dr. Serge Belamant; please go ahead sir.

Good morning to our investors in the US and good afternoon to our investors in Europe and of course in South Africa. Thank you for joining us for our fiscal 2008 fourth quarter and full year earnings call. As usual, Herman Kotze, our CFO is with me today. Both our press releases and 10-K are available on our website at www.net1ueps.com. During this call we will be making forward-looking statements and I call your attention to the cautionary language contained in our press release regarding the risks and uncertainties associated with forward-looking statements. In addition, during this call we will be using certain non-GAAP financial measures as defined under SEC rules, where required by these rules we have provided a reconciliation of the non-GAAP measures to the most directly comparable GAAP measures as exhibits in the press release dated yesterday. We will primarily discuss our results in South African rand, which is non-GAAP measure. We analyze our results of operations in our latest Form 10-K and in our press release in South African rand to assist investors in understanding the changes in underlying trends of our business. Company results can be significantly impacted by currency fluctuations between the US dollar and the South African rand. And therefore for clarification purposes I would like to reiterate that the use of South African rand is a non-GAAP measure and the appropriate GAAP presentation is included in our Annual Report on Form 10-K and press release and we advise our investors and analysts to review the company’s results in terms of US GAAP. During the fourth quarter of fiscal 2008 the South African rand as we all know was significantly weaker against the US dollar compared with quarter three 2008 and quarter four of 2007. As you are aware we also provide additional…

Thank you, Serge, and greetings to our investors around the world. I will discuss the key trends of the fourth quarter of fiscal 2008 compared to the fourth quarter of fiscal 2007 along with the key trends between the fourth and the third quarters of fiscal 2008. I will also discuss certain financial aspects of our acquisition of BGS and the proposed secondary listing on the Johannesburg Stock Exchange in South Africa. We have also updated the Frequently Asked Questions section in our press release to provide further clarity on the questions we are asked most often by our investors and the analysts. Again, for clarification purposes, I would like to mention that my following discussion will be based on our results in South African rand as this provides the best indicator of the group’s actual operational performance and this is a non-GAAP measure. In order to review our results in terms of US dollars and GAAP, please review our Annual filing on Form 10-K as well as our earnings press release filed yesterday evening. For Q4 2008 our average rand dollar exchange rate was significantly weaker at 7 rand 80 to the dollar compared to 7 rand 12 to the dollar for Q4 of fiscal 2007 and sequentially from Q3 we also saw a significant weakening for the 7 rand 41 to the dollar level. Looking at the current situation, the rand has remained relatively steady against the US dollar and is currently trading at around 7 rand 75 to the dollar. Any fluctuation of the rand obviously influences the dollar equivalent result of our South African operations which is why we provide you with constant currency information in our press release and on this call as the core operational drivers are clearly visible from these numbers. I am…

(Operator Instructions) Your first question comes from the line of Dave Koning - Robert W. Baird

As we look out in the core South African business how do you see grant growth in fiscal 2009 and then revenue per grant growth in fiscal 2009 just given all the dynamics with inflation etc. that are going on?

Obviously we’ll be influenced by a number of factors. The inflation rate in South Africa remains very high currently, 12.9% being the latest indicator and clearly also with us being in an election year the chances of the grant amounts being increased by anything less then inflation I personally think is fairly remote. So from that point of view, specifically in terms of the KwaZulu-Natal province where we get an automatic increase when the grant amounts go up, it certainly will grow the earnings in our biggest province quite significantly. So we will also obviously receive our price increases based on the current inflation rates in the other provinces as and when they become due and they are scattered during, throughout the year. But the key one will be KwaZulu-Natal and the increase from the budgets allocation will probably only become effective in the fourth quarter of fiscal 2009. From a higher volume point of view, I think that’s a bit more unclear to us. SASSA doesn’t provide us with any specific details and looking at the press release that we got from the Ministry they talk about a million people who will now qualify for grants simply because they’ve increased the minimum thresholds. Again the time taken to process those applications that will come in from the various provinces, and if we use the rule of thumb and they say a million people, we could probably expect us to have at least 400,000 of those in our provinces if not more because I think a high concentration of these guys that will now qualify are probably going to be more rural then urban based. But be that as it may, the application process, the evaluation process and until they really end up on the pay file for us to pay them, could be at least four to six months. So again I don’t think that we’ll see the numbers starting to tick up significantly as a result of this announcement at least until the end of the third quarter or the beginning of the fourth quarter of 2009. Overall we always say that we budget on a 6% growth rate in terms of the beneficiary numbers. I think if you look at the last year it’s slightly less then that, its 5%. Given all the developments within SASSA and the time they’ve spent on the tender and other processes and obviously also with the removal of quite a number of beneficiaries from the fraud eradication campaign, I think that that still is probably a fairly conservative guideline to use and in terms of price increases, given that our increases in most of the provinces are normally around 80% of the [CBI] rate, we probably look at a further 10% increase from a price increase point of view and that will obviously also be phased in during the months of the year when those increases become due in the various provinces.

One thing you didn’t mention on the call that was interesting out of the 10-K was in Botswana it looks like you’re starting a welfare beneficiary payment program sort of like in South Africa granted its only 100,000 or so beneficiaries, but what are the economics around that? Is it similar to the $3.00 or so per month that you get paid in South Africa and how big over time could Botswana be? Is that something that could be a million beneficiaries a couple of years from now?

No, Botswana is not likely to be a million beneficiaries, there’s not enough people in Botswana to give us that. We are looking at a country with around 1.8 million so the first 100,000 beneficiaries obviously we are going to be getting a price which is comparable to what we’re getting in South Africa. Obviously its in Pulas and not in rand, but remember we only own 50% of the switch which means obviously we will only be getting 50% of whatever the revenue is going to be, or the profit will be in that particular switch itself. Personally I think the potential for Botswana in terms of number of people is between 300,000 and 400,000 simply because we are in discussions with a number of organizations including their local savings bank which really was an offshoot of the government or used to be owned by government so it should, if we look at the number of people that could be [banked] namely for example the guys that are now receiving a grant, all the people that already bank which have got a savings account or the people that are banked through a bank, we probably looking at about 400,000 to 450,000 people. So I believe that our numbers will go up from 100,000 to maybe 250,000 to 300,000 but I think by the time it gets to that stage I think it will be saturated in terms of the number of people. That does not mean of course that those people can only generate the money that is currently being paid to us simply because we are paying them on behalf of government. Obviously by introducing financial services and all sorts of other products such as specifically bill payments and for example top up on cell phones and prepaid electricity and money transfers specifically, I think we can we can certainly [inaudible] with Africa, probably double the revenue that we are making, double to even 2.5x the revenue we’re making per person in Botswana. So it’s [the same as looking like you said] the potential is around 700,000 or 800,000 people if we take it purely by paying them a salary every month.

Within your guidance is BGS looked at as accretive or dilutive or neutral to fiscal 2009?

Obviously on a fundamental basis, if we exclude the material amortization of the intangibles that will obviously arise, and without the benefit of having completed the full US GAAP conversion, using a rule of thumb if we look at the interest that we will forego on the loan and obviously on the surplus cash that we will then use to repay the loan compared to the earnings that BGS reported last year adjusted for some of the growth prospects, I think the safest bet right now is to say it will probably be neutral and as soon as we’ve got the 8-KA out in November, I think we’ll be able to give you a bit more color around that.

Your next question comes from the line of Dhruv Chopra - Morgan Stanley

Could you help us understand how should we [inaudible] the contributions from Ghana, Iraq and which payments in fiscal 2009?

Well Ghana, it’s a little difficult to put them all in the same pot because as you know the models are completely different so from the Ghanaian point of view we’ve got to look at the fact that Ghana as you know has been very successful. You’re going to be going through there yourself so you’re going to see it. But more importantly it appears that Ghana is about to place substantial new orders certainly for terminals at this point in time and ATMs as well as cards. So there is no doubt that we still believe that over the next six months, the next two quarters, we will certainly get new orders coming out of Ghana. The next thing in Ghana that we’ve got to look at is that if we manage to launch which I know the Deputy Governor wants us to, the cellular phone technology by the last, well the last couple of months of this year, there is no doubt that I know that Brenda has negotiated a slightly different deal whereby we would be able to benefit by a transaction fee on all transactions that actually occur through the cell phone technology which is a little bit better then simply selling them a card and waiting to make a margin. So it’s a little bit early to say to you apart from the royalty that we are getting, apart from the maintenance that we are getting, apart from delivering the existing orders of equipment and we’ve got new orders of equipment, new orders for ATMs, point-of-sale and cards, there is also the potential of transaction fees as well. As well as one or two JVs that we are currently looking at in Ghana, namely for example the JV to set up with Central Bank in…

So just to be clear, you’ve already foregone how you’ve got existing orders out there, I think maybe 2.5 million or so of hardware and software rolled over for 2008, plus another 8 million of orders I think already placed, right? Other then that it sounds like you haven’t really factored in a lot of these other things in terms of quantification in your expectations for 2009?

You know that we never factor anything in that we don’t already have signed. We don’t work that way. We only tell our investors something that we are not percentage wise certain about, we only tell investors what we know we can deliver. So you are 100% right that at the end of the day, we haven’t looked at Iraq for example and you know yourself that the Iraqi model is based on transaction revenue kicking off at 10% of the top line. If what we are hearing from Iraq is obviously happens, namely we’re looking at 3 million cards to 4 million cards over the next two years and you’re looking at a 10% top line on a transaction fee of maybe $0.70 to $0.80 US that gives you a little feel that Iraq itself can deliver $0.50 million to $0.75 million a month for us which will be bottom line. That contract is in place that’s working and there is no reason why it should not happen but we tend to be I think a little maybe sometime too conservative but its difficult to change what you’ve been for 25 years. So you are right, we always look at what we know we have, what we know exists, and what we know will be delivered. Everything else as far as we’re concerned on top of that is just a bit of cream on the top.

On SASSA have you got any feedback from the High Courts as you approach them?

We did approach the High Courts, the High Courts can [inaudible] because ours was an urgent application as you know and they told us that in fact the application as far as they were concerned should not be urgent and they rationale was is that when SASSA awards the tender if we are not happy with anything in the award of the tender the Judge gave us the latitude to then re approach him as an urgent application this time in order for them to suspend any negotiation of the SLAs until our queries have been resolved. So if SASSA actually awards the tender there is a possibility they might actually award a tender that we might like in which case there wouldn’t be any point in actually for us to go to Court to actually stop the tender from being actually implemented. If on the other hand the tender is awarded and we don’t like it, he has given us the latitude to go back as an urgent application to actually say, hey, you are right maybe something out there actually went wrong or should not have happened in this particular manner in which case he will then be able to actually look at the case and to suspend if necessary the implementation of the contract.

What was the fully diluted share count for the fourth quarter?

I think you could probably use 59 million shares as a fully diluted number that includes obviously all of the options, the outstanding options, that’s really the only additional factor. So the weighted average fully diluted number is 57,612 million and on an un-weighted basis it’s probably close to I would say 58,700, no 59.

Your final question comes from the line of Unspecified Analyst

The BGS acquisition on the partner [Spurbank] were they the existing shareholder?

Yes, the BGS had nine shareholders, of which [Spurbank] was an existing shareholder, they had 19.9% of the shares in BGS before. When we made the offer to the other shareholders in BGS we discussed this with [Spurbank] and we decided with their consent to leave them in as a shareholder and to make the offer only for the other 80.1% of the shares which is obviously what we’ve now acquired. So [Spurbank] remains as a very willing I hope and happy co-shareholder with us and for us that’s very important to have them remain a shareholder. They are the biggest customer of BGS by a long, long way. There are more then 5 million duet cards issued through [Spurbank] in the Russian federation and we believe that with them as partners in BGS and also being the largest client that there is significant opportunity for us to grow the cardholder base on the one hand and also to implement a variety of value-added services on top of the cards that are already there.

The wage payment system, how many employers and employees have signed up for that so far?

When we’re talking about the wage payment system like I explained in terms of being able to, you’re looking at for example number of employers we’ve been able to sign up in excess of about 20 farms now that are actually using the technology. But more important because of this problem we have had with the delay of MasterCard we have been more focusing of signing up in cardholders, in other words employees rather than employers simply because the card in terms of its interoperability cannot really currently be used everywhere. So what we plan to do is that we’ve said that if a person is already banked and let’s say he has a standard bank or an [SNB] account we actually keep that account open for him and we look for somebody that is prepaid to carry the cost of $3.00 a month to have, for lack of a better word, an intermediate account with us. And a lot of these people happen to be people that to take grants, short-term loans simply because they’re quite happy to carry the $3.00 a month if that $3.00 a month gives them the benefit of being able to do a deduction, a debit whereby they know that they will have a better chance to guarantee to be repaid so and fortunately we haven’t been able to strike at the employer level but we are certainly striking in a big way at the employee level. That base however happens to be a base that other open systems like a prison because those people don’t have to integrate with anybody, which is a lucky thing about that, they don’t even interoperate between prisons, the schools of course are great because these are closed systems which later on can be open because initially they…

I know it’s in the 10-K that the share buyback expired, are there any plans to renew that?

What we are doing now, I think Herman mentioned about the second relisting of, the inward listing in South Africa, in order for us to make, to be able to do a share buyback we need to have access to our rand in US dollar terms. Now right we cannot do it because of the exchange control. If of course we do, we manage to lift in South African and we manage to repatriate the money that Herman is talking about we will then also be in a position to payback dividends without the huge, or without needing approval which means then we will be in a position to actually have in place if we wish to have it a share buyback which is a tangible thing that we can really service. To everybody on the call we’d like to once again to thank you all for number one, listening. Number two reading over the information that we try to provide as concisely as we can and more importantly would like to thank our long-term shareholders for continually believing in the company. We know it’s been hard. We know that SASSA has thrown a lot of unfortunately question marks on our company. We of course being here, don’t believe that those question marks are necessarily justified but we can certainly understand why people will react they way they have. In conclusion I’m certainly convinced that I do not see any reason at all why our company will not continue to strive and at the rate that we are going. We really are striving and reaching a point where in fact SASSA over the next couple of years will no longer become part of these discussions. So thank you very much all of you for listening and we certainly look forward to talking to all of you very soon. Thank you.