| Leases |
The Company has entered into leasing arrangements classified as operating leases under accounting guidance. These leasing arrangements relate primarily to the lease of its corporate head office, administration offices, a manufacturing facility, and branch locations through which the Company operates its financial services business in South Africa. The Company’s operating leases have a remaining lease term of between one year ten years . The Company also operates parts of its financial services business from locations which it leases for a period of less than one year . The Company’s operating lease expense during the years ended June 30, 2026, 2025 and 2024, was $ 5.9 4.8 and $ 3.2 million, respectively. The Company does not have any significant leases that have not commenced as of June 30, 2026, except for a new regional office in Cape Town , Western Cape, South Africa (refer below). The Company has entered into short-term leasing arrangements, primarily for the lease of branch locations and other locations to operate its financial services business in South Africa. The Company’s short-term lease expense during the years ended June 30, 2026, 2025 and 2024, was $ 1.9 4.7 3.6 New corporate head office and other leases obtained In December 2025, the Company, through Lesaka SA, entered into a leasing arrangement for a new corporate head office in Dunkeld, Gauteng, South Africa with Oxford Parks Proprietary Limited, a limited liability private company incorporated in South Africa. The lease commenced on July 1, 2026 and is for a period of 10 years two five years secured beneficial occupation from April 1, 2026, and recorded a ROU asset and an operating lease liability related to this lease in April 2026 upon taking beneficial occupation. The Company was required to provide a bank guarantee or cash totaling $ 0.5 (ZAR 7.5 million, translated at exchange rates applicable as of June 30, 2026) to the lessor and on May 29, 2026, it procured and delivered a bank guarantee to the lessor. The Company expects to pay an annual basic lease expense of $ 1.5 25.1 translated at exchange rates applicable as of June 30, 2026), which increases by 6.25 % per annum. New corporate head office and other leases obtained (continued) In April 2026, the Company, through Lesaka SA, entered into a binding offer to lease for a new regional office in Cape Town, Western Cape, South Africa with Growthpoint Securitisation Warehouse Trust, a trust incorporated in South Africa. The lease commences on October 1, 2026 and is for a period of 10 years . The Company secured beneficial occupation from August 1, 2026, and recorded a ROU asset and an operating lease liability related to this lease in August 2026 upon taking beneficial occupation. The Company expects to pay an annual basic lease expense of $ 0.7 11.3 million, translated at exchange rates applicable as of June 30, 2026), which increases by 7.50 % per annum. Impairment of previous corporate head office lease and other leases In March 2026, the Company determined that its existing operating lease arrangements for its corporate head office and certain related leased facilities will no longer be utilized as originally intended as a result of the new lease arrangement and the planned transition of its corporate head office and other operating activities to the new premises. In June 2026, the Company determined that other existing operating lease arrangements, primarily in Cape Town, for leased facilities will no longer be utilized as originally intended as a result of the new lease arrangement concluded in April 2026. Accordingly, the Company identified indicators of impairment for these related ROU assets and certain items of property, plant and equipment during the year ended June 30, 2026. The Company evaluated the impacted ROU assets for impairment in March 2026 and again in June 2026. The asset groups consisted of operating lease ROU assets and related leasehold improvements associated with the affected locations as well as certain items of property, plant and equipment, including furniture and office equipment. The recoverability tests indicated that the carrying amounts of these asset groups were not recoverable, as the undiscounted future cash flows were insufficient to recover their carrying values. The Company initially measured these operating lease ROU assets and related leasehold improvements at fair value on a non-recurring basis during the nine months ended March 31, 2026, as a result of impairment. In June 2026, the Company reassessed the initial measurement of the fair value exercises performed in March 2026, and remeasured the fair value of these operating lease ROU assets and related leasehold improvements at fair value using updated information as of June 30, 2026. The Company updated its inputs for the remaining lease terms, expected sublease income and market rental rates with current information available as of June 30, 2026. The Company also measured other operating lease ROU assets and related leasehold improvements at fair value on a non-recurring basis during the three months ended June 30, 2026, as a result of impairment. These fair value measurements are classified within Level 3 of the fair value hierarchy. Fair value was estimated using a discounted cash flow methodology, which incorporates significant unobservable inputs, including assumptions related to remaining lease terms, expected sublease income and market rental rates. As a result, the Company recorded an impairment charge of $ 2.6 million during the year ended June 30, 2026, representing the excess of the carrying amount of the affected ROU assets and related leasehold improvements over their estimated fair value. The impairment charge is included in the caption impairment loss (refer to Note 10) in the consolidated statement of operations for the year ended June 30, 2026. The impairment did not impact the related operating lease liabilities. The following table presents supplemental balance sheet disclosure related to our right-of-use assets and our operating leases liabilities as of June 30, 2026 and 2025:
June 30, June 30, 2026 2025 Right-of-use assets obtained in exchange for lease obligations Weighted average remaining lease term (years) 6.59 2.84 Weighted average discount rate 10.1 % 9.8 % Maturities of operating lease liabilities 2027 $ 6,946 2028 5,413 2029 3,693 2030 3,252 2031 2,760 Thereafter 12,396 Total undiscounted operating lease liabilities 34,460 Less imputed interest 10,714 Total operating lease liabilities, included in 23,746 Operating lease liability - current 4,408 Operating lease liability - long-term $ 19,338 |