Here’s how much money MultiChoice makes per subscriber

The MultiChoice Group (MCG) has released its interim report for the period ended 30 September 2019.

The group said that it added 1.2 million 90-day active subscribers, representing 7% year-on-year (YoY) growth, taking the overall 90-day active subscriber base to 18.9 million households at 30 September 2019.

Revenue was up 4% (3% organic) to R25.7 billion, including subscription revenue of R21.2 billion, which grew at similar rates.

Core headline earnings were up 24% on the prior period at R1.9 billion, despite the impact of the additional 5% share in SA allocated to the group’s BEE scheme, Phuthuma Nathi in March 2019.

The group said that top-line momentum was affected by the group’s strategic decision not to increase Premium prices in South Africa.

It added that hardware sales and advertising revenues were lower due to the one-off prior year events, while macro-headwinds in certain markets affected disposable income and thus consumer demand.

The DStv Satellite Television service provider listed on the Johannesburg Stock Exchange (JSE) at the end of February, having been spun off from Naspers.

MultiChoice delivers local and international entertainment and sport content to around 14-million households in 50 African markets. It also includes the production of over 4,500 hours of local content in 10 studios across Africa.

Having opened trading at a price of R95 on the 27 February, shares in MultiChoice reached R131.81 in afternoon trade on the JSE.

South Africa

The South African business delivered solid results, reporting subscriber growth of 7% YoY or 600,000 subscribers on a 90-day active basis.

The group said that it now has 7,675,000 subscribers in the country – although this figure includes DStv, Showmax and other subscription services.

The Average Revenue Per User (ARPU) per month for South Africa was R292 in South Africa, compared to R111 in the Rest of Africa when looking at a 90-day active subscriber basis.

The group calculates ARPU by dividing average monthly subscription fee revenue for the period.

The subscription fee revenue includes BoxOffice rental income but excludes decoder insurance premiums and reconnection fees.

The results show that the ARPU for premium subscribers declined from  R597 to R581 – in line with a 3% decrease in Premium subscribers.

By comparison, the group showed growth in its mass (R88 per user) and mid-market (R301 users) accounts.

“We are pleased with our performance and our ability to navigate a very challenging economic climate,” said Group CEO Calvo Mawela

“The group’s cost-saving objectives for FY20 remain on track with R700 million in costs eliminated from the base during 1H FY20, mainly as a result of the continued shift in spend towards more cost-effective local content, innovation in customer care, contract renegotiations, hardware savings and the introduction of platform efficiencies.”

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Here’s how much money MultiChoice makes per subscriber