Listed media and Internet player, Naspers says it aims to to invest “quite heavily” in building out its mobile platforms in the year ahead.
“Our focus is on recruiting the best engineers and entrepreneurs, focus on innovation, move across from the PC to the mobile world,” CEO Koos Bekker said at the group’s results presentation for the year ended March 2013 on Tuesday (25 June).
In morning trade on the JSE, shares in Naspers gained R14.40, or 2.14%, to R686.50, valuing the company at R285.27 billion.
Naspers reported a 27% rise in consolidated revenues to R50.2 billion for the reporting period noting further that its consolidated trading profit for the year was flat at R5.7 billion. Operating profit advanced 19% to R3.82 billion.
Basil Sgourdos, CFO, MIH at Naspers told investors: “In the year ahead, we’re going to continue to invest in driving growth. As part of this, we’re also going to invest quite heavily in building out our mobile platforms.”
He said that the full impact of smartphones and tablets as well as the increased availability of wireless bandwidth means that consumers are rapidly migrating their Internet experience from a desktop one to primarily a mobile one.
“In fact, you will have seen research that shows that in India now, mobile traffic exceeds their desktop traffic on the Internet,” he said.
“We’re going to continue with this train of thought and we will continue to invest, building on our successes and also building out additional opportunities and markets. The investment primarily goes into marketing, into people, into products, into engineers and the software, and then obviously mobile development,” he said.
Naspers in SA
Bekker pointed out that Naspers was no longer a South African operation. “We used to be a South African company; we’re no longer so. Less than 40% of our revenues currently come from South Africa, and in the future it will decline further.”
He also stressed that for the first time, the Internet represented Naspers’ largest source of revenue, overtaking its pay television segment.
Speaking to Moneyweb, Bekker said: “South Africa is a bit of a laggard because of our poor broadband infrastructure, which is a function more of regulation than anything else. Kenya, for example, is moving ahead rapidly in broadband and so is Nigeria.”
He said that in Africa people tended to view the Internet as basically a PC activity. “You power up your Microsoft Outlook and you go on Chrome or Google – and increasingly it’s becoming a mobile activity. Last week for the first time our e-commerce business in Indonesia had more hits from mobile phones than from PCs.”
“And in Nigeria the trend is very sharp. So I think in future you’ll conceive the internet as something which is primarily on your mobile phone and secondarily on your desktop,” Bekker said.
Looking ahead, Bekker said that there may be some acquisitions in the year ahead, “but we will grow mostly organically, and our focus is on recruiting the best engineers and entrepreneurs, focus on innovation, move across from the PC to the mobile world”.
“Financially you’ll see, I think, a lively top line and less growth on the profit lines simply because we’re developing more organically.”