While results from lead companies in the media counter of the JSE were robust in 2012, those companies representing the electronics sector had mixed results.<\/p>\n
“The media sector has been quite robust,” opined\u00a0investment analyst and partner at First Avenue Investment Management, Nadim Mohamed.<\/p>\n
In September, Kagiso Media reported that total revenue increased by 21.3% to R956.9 million for the year ended June 2012, \u201cthis growth being driven primarily by the broadcasting, content, information and other segments\u201d.<\/p>\n
Operating profit rose marginally to R258.6 million, from R252 million in 2011.<\/p>\n
“Kagiso Media is showing very strong cash generation ability from tier 1 radio assets.\u00a0 They are cautiously looking to invest in digital assets in order to prepare for a longer term migration in adspend towards digital medium,” said\u00a0Mohamed.<\/p>\n
Kagiso Media<\/a>\u00a0said its\u00a0MSN<\/a>\u00a0division had to recalibrate itself after the loss of the online gambling advertising spend, but was well positioned to grow in 2013.<\/p>\n Kagiso\u2019s MSN business was established in a partnership with Microsoft (MSN) in 2010 to manage and localise the www.howzit.msn.com portal in South Africa.<\/p>\n In November, media giant Naspers heralded a 22% rise in revenue for the six months ended September 2012, to R22.6 billion. This came on the back of organic growth in existing businesses, supplemented by a few acquisitions.<\/p>\n The group, with internet companies including Russia\u2019s Mail.Ru Group, kalahari.com and China\u2019s Tencent in its portfolio, reported an operating profit of R2.5 billion, from R1.95 billion in 2011.<\/p>\n Internet revenue improved 70% to R14.1 billion rand.<\/p>\n “Naspers is showing impressive growth in its internet business and the market has rewarded it with exceptional share price growth.\u00a0 Going forward, there will be more spend on development relative to acquisitions which may result in slower earnings growth in the near term,”\u00a0Mohamed said.<\/p>\n The analyst noted that whilst the group looks expensive at its P\/E multiples (38 times), “if you believe in Koos Bekker and his team, this is probably the best way to gain exposure to emerging market internet sector.\u00a0 Their focus going forward will be e-commerce which is not an easy journey.\u00a0 The GoTV offering in Africa for Multichoice is also looking very interesting,”\u00a0Mohamed said.<\/p>\n Stock return 1 Jan to 12 Dec, 2012<\/p>\nMedia<\/h3>\n