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Media and internet giant Naspers on Friday announced its results for the half-year to September 2018, showing a 29% increase in revenue to $11 billion, driven by e-commerce ventures and its stake in Tencent.<\/p>\n
Trading profit grew 34% year on year to $2.0 billion, while core headline earnings grew 39% to US$1.7 billion.<\/p>\n
Diluted headline earnings per N ordinary share was up to 632 US cents, from 206 cents previously.<\/p>\n
Acquisitions in the period totalled over $700 million as Naspers said it continued to invest in existing and new businesses in classifieds, payments and food-delivery verticals.<\/p>\n
Naspers said its video-entertainment segment had a steady six months, growing subscriber numbers by a sizeable 400,000 households to 13.9 million households. Revenue increased 3% to $1.8 billion, but trading profit remained relatively flat at $211 million, it said.<\/p>\n
The South African video-entertainment business delivered solid trading profits and generated meaningful cash flows. Subscriber growth was strong in the middle- and mass-market segments, with some churn in premium subscribers as a\u00a0 number of households in this segment appear to be experiencing strains on their disposable income.<\/p>\n
The ongoing change\u00a0 in subscriber mix resulted in average revenue per user reducing from $27 last year to $25 this year. In September 2018, the group announced that it will list its video-entertainment business on the JSE as MultiChoice Group.<\/p>\n
Also in South Africa, Naspers said that Takealot, South Africa’s number one B2C platform, extended its market leadership and grew gross merchandise volume 58%. Its electronics, home and kitchen categories recorded the highest growth, while its food-delivery service, Mr D Food, increased market share and grew GMV by almost 200%.<\/p>\n
Takealot also announced the merger of its online fashion brand, Superbalist, with Spree, the online fashion brand owned by Media24.<\/p>\n
Media24 however, saw revenue down 7% due to pressure on advertising and circulation revenue.<\/p>\n
For the group, excluding equity-accounted investments (associates and joint ventures), consolidated revenue grew 8% to $3.3 billion. Ecommerce was the main driver of growth, with revenues increasing 32%.<\/p>\n
Revenues in the internet segment, which now contributes 82% of total group revenue compared to 77% a year ago, were up 31% to $9.0 billion, while trading profits rose 30% as ecommerce and Tencent continued to stimulate growth.<\/p>\n
E-commerce revenue increased 28% to US$2.0bn with meaningful contributions from classifieds, payments, food delivery and B2C.<\/p>\n
Tencent, meanwhile, grew total group revenue 39% year on year to RMB147.2 billion for its six months to 30 June 2018. Naspers’ share in Tencent amounts to 31%.<\/p>\n
Bob van Dijk, group chief executive, said: “In September, we took a significant step in our evolution into a global consumer internet company, announcing our intention to list our video entertainment business. We believe this will unlock value for Naspers shareholders while creating an empowered, top 40 JSE-listed African entertainment company.<\/p>\n
“It means in future, effectively 100% of our revenues and profits will come from online businesses. Throughout the period we continued to invest in growth, strengthening our online food-delivery, classifieds, and payments businesses.\u201d<\/p>\n
Koos Bekker, Naspers chairman, added: “The team made good progress in the first half of the year, building a focused consumer internet company that delivers long-term returns for shareholders. We also contribute meaningfully to the communities we serve, and hope to accelerate investing in early-stage technology companies in South Africa and abroad.”<\/p>\n
Shares in Naspers climbed on Friday, to R2,822, having endured a bumpy ride so far in 2018 as the group’s share price is heavily linked to Tencent.<\/p>\n