(Loss) Earnings Per Share

9 Months Ended

Mar. 31, 2022

(Loss) Earnings Per Share [Abstract]

(Loss) Earnings Per Share

13.(Loss) Earnings per share

The Company has issued redeemable common stock which is redeemable at an amount other than fair value. Redemption of a class of common stock at other than fair value increases or decreases the carrying amount of the redeemable common stock and is reflected in basic earnings per share using the two-class method. There were no redemptions of common stock, or adjustments to the carrying value of the redeemable common stock during the three months ended March 31, 2022 and 2021. Accordingly, the two-class method presented below does not include the impact of any redemption. The Company’s redeemable common stock is described in Note 13 to the Company’s audited consolidated financial statements included in its Annual Report on Form 10-K for the year ended June 30, 2021.

Basic (loss) earnings per share includes shares of restricted stock that meet the definition of a participating security because these shares are eligible to receive non-forfeitable dividend equivalents at the same rate as common stock. Basic (loss) earnings per share has been calculated using the two-class method and basic (loss) earnings per share for the three months ended March 31, 2022 and 2021, reflects only undistributed earnings. The computation below of basic (loss) earnings per share excludes the net loss attributable to shares of unvested restricted stock (participating non-vested restricted stock) from the numerator and excludes the dilutive impact of these unvested shares of restricted stock from the denominator.

Diluted (loss) earnings per share has been calculated to give effect to the number of shares of additional common stock that would have been outstanding if the potential dilutive instruments had been issued in each period. Stock options are included in the calculation of diluted (loss) earnings per share utilizing the treasury stock method and are not considered to be participating securities, as the stock options do not contain non-forfeitable dividend rights. The Company has excluded employee stock options to purchase 185,902 and 172,113 shares of common stock from the calculation of diluted loss per share during the three and nine months ended March 31, 2022, because the effect would be antidilutive.

The calculation of diluted (loss) earnings per share includes the dilutive effect of a portion of the restricted stock granted to employees in May 2018, September 2018, February 2020, May 2021, July 2021, August 2021, November 2021, December 2021, February 2022 and March 2022, as these shares of restricted stock are considered contingently returnable shares for the purposes of the diluted (loss) earnings per share calculation and the vesting conditions in respect of a portion of the restricted stock had been satisfied. The vesting conditions for all awards made are discussed in Note 16 to the Company’s audited consolidated financial statements included in its Annual Report on Form 10-K for the year ended June 30, 2021.

13.(Loss) Earnings per share (continued)

The following table presents net loss attributable to Net1 and the share data used in the basic and diluted (loss) earnings per share computations using the two-class method:

			Three months ended					Nine months ended
			March 31,					March 31,
			2022			2021		2022		2021
				(in thousands except					(in thousands except
				percent and					percent and
				per share data)					per share data)
Numerator:
	Net loss attributable to Net1		$	(3,327)		$	(6,204)	$	(28,727)	$	(39,696)
	Undistributed loss			(3,327)			(6,204)		(28,727)		(39,696)
	Percent allocated to common shareholders
	(Calculation 1)			98%			99%		99%		99%
	Numerator for loss per share: basic and diluted		$	(3,262)	$		(6,172)	$	(28,299)	$	(39,300)
Denominator
	Denominator for basic (loss) earnings per share:
	weighted-average common shares outstanding			56,660			56,352		56,467		56,236
	Effect of dilutive securities:
		Stock options		-			275		-		92
		Denominator for diluted (loss) earnings per share: adjusted weighted average common shares outstanding and assuming conversion		56,660			56,627		56,467		56,328
Loss per share:
	Basic		$	(0.06)		$	(0.11)	$	(0.50)	$	(0.70)
	Diluted		$	(0.06)		$	(0.11)	$	(0.50)	$	(0.70)
(Calculation 1)
	Basic weighted-average common shares outstanding (A)			56,660			56,352		56,467		56,236
	Basic weighted-average common shares outstanding and unvested restricted shares expected to vest (B)			57,791			56,646		57,322		56,803
	Percent allocated to common shareholders
	(A) / (B)			98%			99%		99%		99%

Options to purchase 408,252 shares of the Company’s common stock at prices ranging from $4.87 to $11.23 per share were outstanding during the three and nine months ended March 31, 2022, respectively, but were not included in the computation of diluted (loss) earnings per share because the options’ exercise price was greater than the average market price of the Company’s common stock. Options to purchase 425,784 shares of the Company’s common stock at prices ranging from $6.20 to $11.23 per share were outstanding during the three and nine months ended March 31, 2021, respectively, but were not included in the computation of diluted (loss) earnings per share because the options’ exercise price was greater than the average market price of the Company’s common stock. The options, which expire at various dates through February 3, 2032, were still outstanding as of March 31, 2022.