DStv owner Multichoice has warned shareholders that it expects to report a massive loss in the first half of the year, estimated at a loss of R1.84 billion.<\/p>\n\n\n\n
Multichoice said it is experiencing “the most challenging operating environment in the group’s history”, and has also entered the peak investment cycle of Showmax.<\/p>\n\n\n\n
Thus it expects losses and headline losses per share to increase due to the early life cycle of the Showmax business. <\/p>\n\n\n\n
The group expects reported trading profit to decline year-on-year and be close to flat on an organic basis. <\/p>\n\n\n\n
The group said its 1H FY25 financial performance had been negatively impacted by severe pressure in the macro-economic, foreign exchange rate and consumer environment in key markets, most notably Nigeria and Zambia.<\/p>\n\n\n\n
The group expects to report a further R2.1 billion in foreign exchange rate movements through its income statement on non-quasi equity inter-group loans in the current period.<\/p>\n\n\n\n
It said it is pursuing an “inflationary pricing strategy” and targeting R2.0 billion in cost savings in the group’s full-year results ending 31 March 2025 to offset weaker subscriber activity and foreign exchange pressures.<\/p>\n\n\n\n
Looking past the losses, it said the pricing strategy would deliver an “organic” growth in trading profit of 30%.<\/p>\n\n\n\n
“Adjusted core headline earnings per share” for the year is expected to decline year-on-year to close to breakeven.<\/p>\n\n\n\n
The group prefers trading profit and adjusted core headline earnings per share to be used as indicators of operating performance as they adjust for non-recurring and non-operational items. <\/p>\n\n\n\n
Organic trading profit and adjusted core headline earnings per share are considered to be non-IFRS measures.<\/p>\n\n\n\n
Organic trading profit is calculated by excluding foreign currency movements and changes in the composition of the group. <\/p>\n\n\n\n
Adjusted core headline earnings is calculated by adjusting headline earnings for the following items, net of tax and non-controlling interests.<\/p>\n\n\n\n<\/th> September 2023<\/th> Expected
September 2024<\/th>Expected change<\/th><\/tr><\/thead> Loss per share<\/td> (310)<\/td> (415) <\/mark>to (428)<\/mark><\/td> (34%)<\/mark> to (38%)<\/mark><\/td><\/tr> Headline loss per share<\/td> (289)<\/td> (413) <\/mark>to (431)<\/mark><\/td> (45%) <\/mark>to (49%)<\/mark><\/td><\/tr> Organic trading profit<\/td> R5.0bn<\/td> R4.85bn to R5.05bn<\/td> (3%)<\/mark> to 1%<\/td><\/tr> Adjusted core headline earnings per share<\/td> 356<\/td> 11 to (4)<\/mark><\/td> (97%) to (101%)<\/mark><\/td><\/tr><\/tbody><\/table><\/div><\/figure>\n\n\n\n