Naspers has announced its results for the twelve months ended March 2020, which reflects solid growth despite the uncertain macro-environment, exacerbated by the Covid-19 pandemic.
The internet and e-commerce group said it executed several significant strategic initiatives over the reporting period, which it said it believes will unlock value over time.
Operationally, Naspers said it ended the year in a position of strength with accelerating revenue growth in its e-commerce (online commerce) portfolio, improved profitability and a substantial net cash position with sufficient liquidity.
It said that the onset of a global pandemic has had a marked impact on the daily lives of people globally and the economy at large. And while the impact is likely to persist for some time, “we are confident to weather the storm”.
“The group’s focus is on safety, plus leveraging its financial flexibility to continue building a business that grows strongly, generates high rates of return and provides employment for thousands over the long term,” it said.
Group revenue, measured on an economic-interest basis, was $22.1 billion, reflecting growth of 17% from continuing operations.
Measured similarly, and including the stepped-up investment in food delivery, group trading profit grew 13% year on year to $3.7 billion.
Overall revenue growth in e-commerce, adjusted for acquisitions and disposals, grew 32% in local currency, a 6% acceleration year on year. This was led by the food delivery segment, which grew orders 102% and revenues by 99% (105%), and strong growth in classifieds, up 48% (37%), Naspers said.
It said it invested $1.3 to to expand its ecosystem and reach over the reporting period.
Notable investments were made in the following ventures:
- Wibmo ($66 million) to expand the group’s Indian footprint in payment security, mobile payment solutions and processing services;
- PaySense ($163 million) in India;
- Iyzico ($199 million), a payment service provider in Turkey; and
- Red Dot Payment ($48 million), providing payment solutions in Singapore and expanding across Southeast Asia.
In classifieds, Naspers said it acquired a controlling stake in Frontier Car Group for $320 million and the contribution of certain subsidiaries, expanding its transactions business.
It invested $81 million in Meesho, a social commerce online marketplace in India.
“We are also increasing our exposure to the edtech (educational technology) businesses by investing a further $25 million and $44 million in our education associates Brainly and Udemy respectively,” Naspers said.
In the food delivery business, the group invested a further $100 million in Swiggy.
Looking ahead, Naspers said the fundamentals of the group are strong, and the year ended with good momentum off the back of a solid performance.
“The group is focused on the long term and expects to benefit from a further acceleration of the underlying trend toward online e-commerce companies brought about by the Covid-19 pandemic.
“We face the challenging period from a position of relative financial strength and with sufficient liquidity to navigate the changing environment, to continue to invest in our businesses to position them well for future recovery, and to continue to seek out new opportunities,” it said.