Naspers interim revenue climbs 24%, eyes acquisitions

South Africa’s largest company by value, Naspers has reported a 24% rise in revenue for the 6-months ended 30 September 2015, climbing to R74.3 billion, driven by growth in the e-commerce segment.

This number was taken on an economic interest basis, while consolidated revenues of R37.8 billion grew by 10%, it said.

Core headline earnings advanced 45% to R8.8 billion.

Operating profit declined substantially to R641 million, from R2.25 billion before.

The group said that an impairment loss of R1.9 billion has been recognised during the period for its investment in Latin American online comparison shopping (OCS) business, Buscapé.

The media giant said that internet revenues now account for 64% of group revenues, up from 60% a year ago. Businesses outside South Africa now contribute 75% of revenues, up from 71% a year ago.

Naspers said the internet segment delivered revenues of R47.7 billion, an increase of 33% year on year. Trading profit was R10.2 billion – a 57% year-on-year increase on the back of a strong Tencent performance.

Naspers has a 34% stake in China based e-commerce firm Tencent, which reported revenues of RMB45.8 billion for the period, up 20% year on year.

Over the review period, the e-commerce segment grew revenue by 26% to R15.3 billion.

Continued investments to drive growth and innovation, develop new markets and deliver superior customer experiences resulted in a trading loss of R3.8 billion, with development spend of R4.3 billion.

The video segment reported revenues of R22.6 billion – an increase of 12% over the prior year.

Trading profit was constant at R5.0 billion compared to the prior year due to the group’s investment in ShowMax, weakening economies and currencies, and sizeable foreign input costs in sub-Saharan Africa.

Development spend was R644 million, up marginally year on year, as the decrease in spend following the completion of the DTT rollout is offset by investments to scale ShowMax.

The DTT business recorded good growth, adding 172,600 customers. However, this growth was offset by a decline in the DTH business of 164 300 customers, largely in sub-Saharan Africa. The total customer base closed at 10.2 million at 30 September 2015, Naspers said.

Naspers said it aims to raise as much as $2.5 billion in cash to fund further acquisitions. It said the fund raising will “enhance financial flexibility over the next few years to invest in attractive growth opportunities”.

Shares in Naspers traded at R2,178 on the JSE in the afternoon session on Friday, wiving the group a market cap of R903 billion.

Shares in the group are up 540% over the past five years, and up 51% over the past year.

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Naspers interim revenue climbs 24%, eyes acquisitions